SWOT analysis of Premier Inn (Premier Inn SWOT)

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SWOT analysis of Premier Inn (Premier Inn SWOT)

This is a detailed SWOT analysis of Premier Inn (Premier Inn SWOT). It aims to examine the strengths and the weaknesses of Premier Inn. It also aims to explore some of the opportunities that the hotel should take into consideration for further growth, and the threats that it should pay attention to devise suitable strategies. Premier Inn is a British hotel chain and is the largest hotel and restaurant group in the UK. It is a Whitbread owned brand.

Strengths of Premier Inn

Occupancy rate

With an occupancy rate of more than 76.3%, Premier Inn is in a very good position in its industry (Lock, 2020). Many guests like its pillows, cosy duvet, and blackout curtains.

Strong presence in the UK

Premier Inn has over 800 hotels in the UK containing over 78,5000 rooms. It serves over five million customers every month (Whitbread, 2021). It has a good number of hotels in Germany as well.

Locations

Many of the Premier Inn hotels are located near airports and great tourist attractions. Some of the hotels are near universities as well. This allows different customer segments to stay near the places where they need to be.

Brand Image

Premier Inn has established a very good brand image over the years. Kid-friendly and bike-friendly image coupled with free Wi-Fi 24/7 has been a great selling point for the hotel. It was voted the ‘Best UK economy hotel brand’ at the British Travel Awards 2017 for the 7th consecutive year. It was named the Best Budget Hotel Brand at the Business Travel Awards 2020 and won TripAdvisor Travellers’ Choice Awards 2019 (Premier Inn, 2021). Indeed, it has won several accolades awarded by some of the prestigious organisations in the UK.

Weaknesses of Premier Inn

Limited global presence

Limited global presence is a weakness of Premier Inn. Compared to some other market giants, Premier Inn operates in a very limited number of countries.

Refund Issues

Premier Inn has been accused of refusing to refund some customers who booked to stay in parts of Wales which came under strict local lockdowns. This has made many customers unhappy.

Big issues with hygiene

An undercover filming by channel 4 reporters in February 2018 found housekeeping staff (agency workers) hired by Premier Inn using the same guest towels to clean the entire bathrooms, including the toilets (Newton, 2018). In the same programme, the trade union Unite expressed concerns for Premier Inn’s exploitative work practices.

Opportunities for Premier Inn 

New markets

The first opportunity to discuss in the SWOT analysis of Premier Inn (Premier Inn SWOT) is the exploration of new markets. After a successful entry in Germany, Premier Inn has finally got into the Republic of Ireland as well. Exploring more countries and regions is worth the effort.

Further growth in Germany

Premier Inn has 28 hotels in Germany. The country offers further growth opportunities for the hotel as it is one of the most visited countries in Europe, and in fact in the world.

New décor

Some properties have been trialling an upmarket room design and décor which is a nice surprise to guests in the budget hotel segment. In 2018, a contract was given to a firm of contractors for complete renewal of floor and wall tiling, as well as sorting out the issue of inflammable cladding on some of the properties.

Threats to Premier Inn

Competitors

While the main competitors of Premier Inn are Holiday inn, Easyhotel, and Ibis within the same category of budget hotel segment, there is strong competition from Marriott as well as many other small and independent hotels.

Legal threats

Due to some of the issues mentioned in the weaknesses section above, there is a risk of legal actions against Premier Inn if it does not take actions when required, arguably from trade unions and from health and safety executives.

Lockdowns

Lockdowns have decimated many businesses around the world in the last few years. Premier Inn was affected badly as well. Similar situations in the future may turn out to be extremely challenging.

Concluding statement

From the research conducted, it can be argued that Premier Inn is going to remain the leader in budget hotel segment in the UK. The competition pressure is mainly price-based, with some of the competitors going as low as £19 per night and breakfast as low as £2.95. However, as the hotel, restaurants and coffee shops complement each other, Premier Inn has a competitive model which is hard to emulate by others.

We hope the article on the ‘SWOT analysis of Premier Inn (Premier Inn SWOT)’ has been useful. You may also like reading SWOT analysis of Hilton Worldwide. Other relevant articles for you are:

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Last update: 08 September 2021

References:

Lock, S. (2020) Premier Inn hotel room occupancy rates in the UK 2011-2020, available at: https://www.statista.com/statistics/739831/premier-inn-hotel-occupancy-rates/ (accessed 06 September 2021)

Newton, J. (2018) “Housekeepers ‘use the same guest towel to clean the entire bathroom, including the TOILET, and work unpaid extra hours’ at Premier Inn” http://www.dailymail.co.uk/travel/travel_news/article-5380489/Premier-Inn-cleaners-use-towel-clean-bathroom.html (accessed 07 September 2021)

Premier Inn (2021) Our awards, available at: https://www.premierinn.com/gb/en/why/awards.html

Whitbread (2021) About us, available at: https://www.whitbread.co.uk/about-us/ (accessed 08 September 2021)

Photo credit: Premier Inn

Author: Veeren Gowrea

Veeren Gowrea is a lecturer in Tourism & Hospitality management. He holds an MBA in Strategic Management and MSc in Human Resource Management from the University of Wales, UK. He also holds a Postgraduate Certificate in Higher Education (PgceHE) from Birkbeck, the University of London. He works as a visiting lecturer at a number of institutes in London.