Investigating Business: Alton Towers in Qatar - Case Study Example

Investigating Business Alton Towers in Qatar Institute Alton Towers in Qatar Alton Towers Resort, or simply Alton Towers, is a hotel complex, theme park and a water park located in Staffordshire United Kingdom. Merlin entertainments of UK call it their flagship attraction. Initially, it was established only as a place for flower shows and garden tours in 1860. Proper theme park was built in 1980. Its major attractions are Oblivion, Runaway Mine Train, Congo, Hex-The Legend of The Towers, The Smiler, River Happens, Nemesis and Th13een (Alton Towers, 2014). Quite recently (early 2014) the theme park opened a brand-new family area the CBeebies land, featuring several rides and modified themes from old McDonald farmyard area (Alton Towers, 2014). The primary focus of the theme park is on live entertainment. This report includes a SWOT analysis and a PESTLE analysis based on the assumption that Alton Towers will expand its business into Qatar. PESTLE analysis will reveal the position of Qatar as a host for such a business. A SWOT analysis gives an overall perspective of the challenges that the company might face when venturing out into another territory. PESTLE Analysis Political Qatar runs under an emirate type government. Although, there are claims from the government that it is trying to move into the constitutional monarchy, but there are no active opposition political parties in the country neither regular elections are being held. The people of Qatar and the government take their nationality and citizenship very seriously. It is for this reason the expatriates cannot own property. Also, there is a vast number of residents who cannot even apply for the citizenship. The emirate has ten municipalities or provinces; Economic The country is a powerhouse of economic activity. Since the oil was discovered in 1940, the country has seen rapid progress. It transformed the states economy and now it enjoys a high standard of living. The country does not have any income tax and is considered among the countries with the lowest tax rates in the world. This low tax rate is helpful for new businesses. The unemployment rate is less than 1%, according to June 2013. According to a report issued by CIA World Fact Book, Qatar has the ninth highest GDP per capita in the world (Central Intelligence Agency, 2014). According to an estimation 40% of the households are dollar millionaires (The Economist, 2013). The country has a high dependence of foreign labor to grow its economy. The migrant workers comprise of 94% of its workforce. However, Qatar is considered one of the worst places in the world for workers according to the international trade Union Confederation (Tuttle, 2014). The country is the leading exporter of liquefied natural gas. In short, the Qatari economy is doing well and offers an excellent business environment to Alton Towers. Social From a social perspective Alton Towers can changes when they set their business up in Qatar. Qatar is an Islamic country that holds its culture, religion and values very dearly. Alton Towers is in the entertainment industry, and the general perception is that the a religion like Islam and entertainment are contradicting notions. Alton Towers already experimented on this issue back in their home country where they made an alliance with Islamic Leisure. The terms of the partnership stated that there will be a Muslim Day celebrated in the park with no smoking, gambling and drinking and only Halal meat was served. This experiment was to encourage Muslims to go to fun places and events. This test gives a lot of insights into what can be expected if a theme park opens up in Qatar. The people of Qatar are known as Qatari(s). According to 2013 reports, Qatar has a population of 1.8 million. Interestingly 1.5 million expatriates live in this country where only 278,000 have Qatari citizens, which makes them only 13% of the entire population (Snoj, 2013). Non-expatriates make up the majority of its population. Indians are the largest expat community, with over half a million people (Snoj, 2013). Similarly a huge population from Nepal, Philippines, Bangladesh, Sri Lanka and Pakistan resides in Qatar (Snoj, 2013). Out of the total population almost 1.4 million are male and about half a million are females (Snoj, 2013). This is due to the influx of the male laborers that has skewed the gender balance. Women are only one-quarter of the whole population. Islam is the official religion of the country. Officially Qatars official Wahhabi Islam is its state religion. Arabic is the official language, and the citizens speak Qatari dialect. English is widely spoken and is very popular among the expatriate community. This is something that the Alton Towers need to consider when they are setting up this business within Qatar. They have to convert and advertise almost everything in Arabic. They have to hone their company message according to the target audience. The need to easternize their business to make loyal customers. Technological The oil and gas revenues forms the backbone in the Qatari economy. By exporting liquefied natural gas, the country has made a fortune and is now considered among the wealthiest countries in the world. The government owns the major interest in several economic sectors. Petrochemicals, steel and fertilizer industries are mostly owned by the government. From a technological perspective, Qatar won the 2022 FIFA bid mainly because of its technological innovation. IT services will probably be the fastest growing segment of the Qatari IT market. The IT services market will outperform the hardware and software industries. Its IT services spending are estimated to grow to US$151 million by the end of 2014. And from the next year onwards there is expected growth in financial services sector, education, health and medication. Nanotechnology in the fields is expected to make better quality products with a small investment. Alton Towers can take advantage of this rapid technological innovation and improve their park facilities. Environmental The ministry of environment was established to protect the Qatari environment and to help develop and sustain the countrys living and nonliving entities (Hukoomi, 2014). The goal is to provide environmental health and quality by creating awareness through campaigns (Hukoomi, 2014). Environmental legislations and policies form the core driving force for the ministry and they support and run it through community partnerships. The Ministry of Industry and Agriculture is responsible for environmental issues. In 1984, the Environmental Protection Committee was created for monitoring the environmental problems (Hukoomi, 2014). It occupies a small Qatar Peninsula on the north eastern coast of the Arabian Peninsula. As with the majority of the Middle Eastern countries Qatar harbors an average hot climate. The average temperatures in July and August reach 45°C or 113° F. January is the coldest month which sees a minimum average low temperature of 9°C or 48°F. Considering this fact, a water-based theme park by the Alton Towers will be an enormous success. Legal Qatar has a strict law enforcement mechanism which even trots upon the infringement of discretionary system. Islamic law is the sovereign governing rule. In comparison with Saudi Arabia, Qatar has comparatively liberal laws, but still it is less liberal than Bahrain or the UAE. Islamic law also governs the aspects of the family law inheritance and other criminal acts. Women have the permission to drive as opposed to Saudi Arabia. SWOT The SWOT matrix stands for strengths, weaknesses, opportunities and threats. Strengths The greatest strength of Alton Towers is there long streak of success and fame that they enjoyed in UK. They are quite famous and there is hardly any theme park that famous in Qatar. They will face relatively petite competition. Weaknesses Their greatest weakness is that they do not have that experience of operating in Middle Eastern countries. The challenge is to adapt to an environment where people from Western countries come and enjoy their leisure time. The demographics are not the same everywhere in the world. When Alton goes to the Middle East, they will have to face drastic changes. They wont openly offer alcohol, gamble or other forms of entertainment that contradict the Islamic ideology. Second, they will have to abide by the rules where they cannot create an environment where male-female interaction is as open as the ones they have created in the Western countries. Hence, they will have to do market research on the forms of entertainment that the people in Qatar enjoy and would like to see in Alton Tower theme park. Opportunities Alton Towers need to focus on the opportunities that Qatar offers. An example is the 350 mile coastline surrounding Qatar. After considering this fact, it is hard to believe that scuba diving and underwater exploration is not included in the top ten list of the tourist activities (Walker, 2014). Altons business move of expanding to Qatar also offers opportunities for the business because Qatar has not seen a theme park of such magnitude. Moreover, there is not much competition that can directly threaten the profitability for the business. Qatar is a sovereign Arab country in the Middle East. Threats Competition for Alton Towers awaits them in Qatar. The Aqua Park Qatar has been providing entertainment to the citizens. It is the oldest theme park in Qatar, inaugurated in 2010 by HE the Prime Minister of Qatar Sheikh Hamad Bin Jassim Bin Jabor Al Thani (Aqua Park, 2014). More competition is on its way; Resort Developers in Qatar are looking to build an Atlantis styled in Doha (Walker, 2014). The Gondolania Theme Park is another competing entity that offers rides and activities like water coasters, trampolines, carousel, laser wars and many other popular activities (Villaggio Qatar, 2014). The Entertainment City (the Kingdom of Aladdin) is among minor competition. It is an outdoor entertainment park located in West Bay area (Online Qatar, 2014). More competition is expected from Circus Land, Doha. It is located in Landmark Shopping Mall, Doha (Landmark Shopping Mall, 2014). Even though these individual competitors might not seem much when it comes to posing a direct threat but when the combined effect of these theme parks is considered, they will be taking away a significant chunk of the market share. In conclusion Qatar offers a unique mix of opportunities and threats which complements both the strengths and weaknesses of Alton Towers. Moreover considering the political, economic and other aspects of the country Alton Towers has a lucrative opportunity to establish their footprint in the Middle East. References 1. Aqua Park Qatar. 2014. About us. [online] available at http://www.aquaparkqatar.com/en/about/ [Accessed 20 November 2014] 2. Alton Towers. 2014. Alton Towers Rides and Attractions. [online] available at http://www.altontowers.com/rides-and-attractions/ [Accessed 21 November 2014] 3. BQ Doha. 2013. Population of Qatar. [online] available at http://www.bqdoha.com/2013/12/population-qatar [Accessed 21 November 2014] 4. Central Intelligence Agency. 2014. The World Factbook. [online] available at https://www.cia.gov/library/publications/the-world-factbook/rankorder/2004rank.html [Accessed 21 November 2014] 5. Hukoomi. 2014. Ministry of Environment. [online] available at http://portal.www.gov.qa/wps/portal/directory/agency/ministry%20of%20environment/!ut/p/a0/04_Sj9CPykssy0xPLMnMz0vMAfGjzOI93Z2d3YNNzDwNAl2NDDydTc0Mgr0MDd19zPQLsh0VAeOPyTs!/ [Accessed 21 November 2014] 6. Landmark Shopping Mall. 2014. Entertainment: Circus Land. [online] available at http://www.landmarkdoha.com/en/entertainment [Accessed 20 November 2014] 7. The Economist. 2013. The haves and the have-nots. [online] available at http://www.economist.com/news/special-report/21580630-even-rich-arab-countries-cannot-squander-their-resources-indefinitely-haves-and [Accessed 20 November 2014] 8. Online Qatar. 2014. Attractions in Doha Qatar. Available at http://www.onlineqatar.com/attractions/kids-attractions.aspx [Accessed 20 November 2014] 9. Snoj, J. 2013. Population of Qatar. [online] available at http://www.bqdoha.com/2013/12/population-qatar [Accessed 20 November 2014] 10. Tuttle, R. 2014. World Cup Host Qatar Ranked among Worst Places to Work by Unions. [online] available at http://www.bloomberg.com/news/2014-05-22/world-cup-host-qatar-ranked-among-worst-places-to-work-by-unions.html [Accessed 20 November 2014] 11. Villaggio Qatar. 2014. Gondolania theme park. [online] available at http://www.villaggioqatar.com/index.php/entertainment/gondolania [Accessed 20 November 2014] 12. Walker, L. 2014. Qatar considers building underwater ‘Atlantis-style’ theme park. [online] available at http://dohanews.co/qatar-eyes-underwater-atlantis-style-theme-park/ [Accessed 20 November, 2014] Read More