The political relationship between the UK and these countries act as a major determinant of the company’s success in attracting overseas customers. The improved international relationship with the UK is being reflected in the increased number of visitors from across the world (case study).
Economic influence: The economic structure of the UK has significantly influenced the business operations of AG Hotel. The weak recovery from the European economic crisis has influenced certain financial decisions of the company (BBC, 2012). The company initially decided to invest £500,000 to buy an additional 40 hectares of land adjacent to the plot of AG hotels. However, on closer inspections, it has been revealed that the poor economic condition may not be favorable for such investments. Moreover, it has also put pressure on the internal operations of the company. Due to the slow growth of the company’s profitability, the CEO has decided to increase the occupancy level to 90% for both high and low seasons. The occupancy level of AG hotel is directly proportional to the GDP of the country. It can be seen that with the rise in GDP from January to September, the occupancy level has also increased proportionately from 80% to 100% (case study).
Social influence: The AG hotel essentially targets the niche customers with extremely high disposable income. The increased trend of arranging a business meeting and conferences in the high-end hotels and resorts has eventually increased the consumer preference for AG hotel. According to BBC (2011), the increasing number of upper elite class of the society is also responsible for the increased popularity of the boutique hotels and heritage homes. AG hotel targets the extremely rich business owners, entrepreneurs, celebrities, etc. The hotel acts as a holiday destination for tourists as well as a business site for conferences and meetings.