QUESTION $1[25$ MARKS$]$

Carefully read the case study below and answer the question that follows.

Peaceful Sleep is a small business in the suburban area of a resort town in Restland. The business

is located just by the beach, shops and other attractions. The owner, Ms$.$ King, strongly believes

that her low$-$cost homely accommodation surrounded by luxury and beauty of the area is still

relevant. Her rooms are large although they lack luxurious accessories. The business has plenty

of room for future expansion and the grounds are generally simple and mostly covered with grass.

Miss King serves breakfast to the room occupants and provides tea$-$making facilities. There are

now many new entrants in the market, with a lot of good restaurants and take$-$aways in the area.

Miss King$$s prices are less than half of what similar motels charge and only a fraction of what

the big five$-$star facilities are charging.

The problem is occupancy. She has some regulars who come every holiday period $($and have

been doing so for the four years she has owned the property$).$ Overall, occupancy is about $50\%$

year round and she knows from the local tourist office that the other properties average around

$68\%$ occupancy year round. New developments could mean trouble. This lack of occupancy

can be quite frustrating for Miss King. Cars pull in$,$ drive around the parking areas, and then

drive away.

Currently Miss King does very little advertising in local district guides and the holiday papers,

mainly because she really thinks word$-$of$-$mouth is the best form of advertising. She is a member

of the local tourist committee, but too busy to go to meetings. However, she does receive the

local statistics and knows the average stay in the area is $3\mathrm{.}8$ nights, and that local families and

couples and increasingly overseas visitors are her potential customers.

While she is not desperate yet, she is getting worried and disillusioned. She thought she would

be overrun with guests, but that has not happened.

Required:

Conduct a SWOT analysis that could assist the business to identify risks it faces. $(25$ marks$)$