CASE STUDY

SOLBERRI HOTEL
OVERVIEW:
Solberri was established in the mid 1980’s by its founder, Richard Berriman. It is a group of
mainly resort hotels, all in Europe. It was The first two Solberri hotels were located in two
different countries around the coast of the Mediterranean Sea. By the late 1980’s the two
Solberri hotels were regarded by many other international hotel chains as the benchmark for
the standards to aspire to. The success of these first two hotels helped to finance the expansion
of the Solberri hotel group. This success financed the expansion of new purpose built resort
hotels, which included a wider range of facilities on site, including golf facilities, water sports,
spas and beauty treatments. To enable the group to expand further, it needed additional
finance, rather then relying solely on loan finance. In 1998 the company became listed on a
European stock exchange. By the end of 2000 the Solberri group had 10 resort hotels and the
original 2 hotels, which have a smaller range of facilities.
PROBLEMS FACED BY SOLBERRI HOTEL:
 Needs improvement in IT
 Poor training of employees
 Issues in human resource management
 Poor customer service and quality management programme
 Fall revenue in spa’s

FACTS:

 This most critical indicator is known as the proportion of rooms accessible during the
time occupied.

 Solberri describes this KPI in the same way as it is usually for the sector that is separated
by non-current assets at the end of last financial year as operating income created by
the company overhead.

 It is described as the total revenue produced by room bookings for the peaking season,
divided by the total available rooms in the peak season, represented as a regular
number, after the discounts provided to travel agencies and retail businesses and before
additional revenue from extras such as spas.

 The amount of reservations of the clients staying at every hotel in Solberri in the last 5
years is the proportion of the overall number of reservations. That indicates the number
of reservations.

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ALTERNATIVES:

 Solberri works on sustainability programs, emphasizes on climate policies, tracking and

raising consumptions, and improving strategies to minimize costs and raise revenue.

 Solberri plans to reduce its use by awareness programs and by designing new buildings
and equipment and better working practices for water and materials

 Solberri is dedicated to work with local governments, to improve links with local
companies and business and to promote collaborations

 All staff and consumers need to be committed to strict health and safety requirements.
The organization is dedicated to maintaining a healthy atmosphere.

FINANCIAL IMPLEMENTATIONS:
Current ratio= Current assets = 26 =0.49%
Current liabilities 53
Cash availability = Non current assets = 136 =4.85 %
Trade payables 28

Net profit margin= Net Income = 5 = 0.03%

Revenue 159

Operating profit margin= Operating profit = 11 = 0.07%

Revenue 159

Fixed assets turn over= Sales revenue = 159 = 1.17 Times

Non current 136

Equity analysis = Operating profit = 11 = 0.125

Equities 88
ROCE = Operating profit = 11 = 0.08
Non-current assets 136

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RECOMMENDATIONS:

 Improving client satisfaction and efficiency by hiring and educating new staff.
 Invest in spa’s because of the strong demand from consumers for them.
 Investing in additional IT solutions to improve business efficiency and profitability.
 IT-software innovation to give potential travelers a view of hotel facilities.

Once the required steps are taken to hire new workers and inspire them with success based
goals, Solberri is in a position to reach its expected profitability and produce higher shareholder
value.

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