The Case Study of Club Med - Essay Example

This cultural concept was picked up during the initial inception of Club Mediterranee whereby both Blitz and Trigano opted to create a vacation camp under the sun that could provide a relaxing experience to guests after the Second World War. Secondly, before the year 2000 it could be argued that the business was largely managed through a paternal approach of which Gilbert Trigano was cited saying that Gerard Blitz and her wife Claudine Blitz were the tutelary parents of the club. Moreover, Philippe Bourguignon who spearheaded major reforms before 2000 in the company, and enabled it to start generating massive profits was disowned by the company’s staffs because of his autocratic management style as they preferred Trigano’s paternalism approach.

In regards to the force of competition, it can well be stated that before the year 2000 Club Med had managed to create a monopoly within a unsaturated market niche, which had low level of competition and to a greater extent it could be argued that Club Med was the among the first pioneers in the village-camp vacation resorts. According to Magretta (2011), the low threat of competition provided Club Med within an opportunity to expand faster and even diversify to other related businesses. Before the year 2000, Club Med faced low threats of competition since the village –camp vacation resorts had not yet gained wide fame and most players in the hospitality industry only focused on providing customers with high quality experience within high-class tourism facilities.

In the studies by Saloner et al. (2001), the low threat of new entrants could further be attributed to the limited knowledge that potential competitors had about the operations of village camp vacation resort and the high amount of capital that was required since constructing a village required a huge pieces of land situated at strategic locations. Before the year 2000, the threat of substitutes was very eminent since there were many excellent hotels and resorts that had been established. Moreover, substitutes presented a major competition more so for the high-end clients who preferred high-end hotels and luxurious resorts instead of the village-camps where tourist resided in camps.

In regards to the buyers’ power, it was stated that because of the availability of numerous substitutes buyers wielded a lot of bargaining power and hence why Club Med offered it services at an affordable range. As for suppliers bargaining power, Magretta (2011) stated that a business organization would be able to wield more power against the suppliers if for instance the business organization buys supplies in large volumes, the switching cost of firms in the industry is low, and there is presence of substitute inputs.

As for Club Med before 2000, it is correct to state that it had a stronger bargaining power because of the fact that it had a wide branch network and therefore, it bought its supplies in bulk, which means it was capable of negotiating for better prices. Reasons for Club Med’s success between 1950s and 1990s In the writings by McLimore (1996), he attributed the success of any venture to the leadership of the venture. In regards to the case study of Club Med its success between 1950s and 1990s can largely be attributed to the exceptional leadership by Gerard Blitz and Gilbert Trigano, who