ACCA SBL Preseen – November 2025 – February 2026

Introduction

Every ACCA SBL sitting brings a fresh opportunity for students to dive into a unique business scenario, and this session’s pre-seen on Levwell, a boutique hotel group in Essland, offers one of the most insightful cases yet. With themes ranging from digital transformation and workforce challenges to customer experience, sustainability, and competitive strategy, Levwell provides the perfect backdrop for developing the analytical skills needed to succeed in SBL.

This blog breaks down the full pre-seen analysis we’ve prepared for students, helping you understand Levwell’s strategic position, its biggest risks, and the opportunities it can seize in the evolving hospitality landscape. Whether you’re revising for SBL, mentoring students, or simply interested in strategic analysis, this overview offers practical insights drawn from real-world business thinking.

Our goal is simple: to make the pre-seen accessible, meaningful, and actionable. We connect the scenario to the key models you’ll use in the exam, PEST, Five Forces, Diamond, SWOT, Ansoff, and more, while presenting the kind of structured, professional commentary that examiners expect.

Area 1 – Company Introduction

What Does the Company Do?

Levwell plc is a long-established hotel chain in Essland that owns and operates a portfolio of 35 four-star (4) hotels, all positioned in rural and coastal locations. The company provides short-term accommodation primarily for the leisure segment, supported by a full range of hospitality services including restaurants, bars, fitness and leisure facilities, and additional guest-focused amenities.

Levwell differentiates itself through two core attributes:

1. High-quality service standards, aligned with its 4-star positioning and reinforced by detailed standard operating procedures (SOPs) in reception, housekeeping and catering.
2. Distinctive, non-standardised hotel designs, reflecting local history and character rather than uniform chain aesthetics. This enhances the guest experience and forms a core part of Levwell’s brand identity.

As an owner-operator (not a franchisor), Levwell maintains full control over service quality, operational processes, capital expenditure, and brand reputation.

Location of the Company

All 35 hotels are located within Essland, with a geographical bias towards rural and seaside areas. This aligns with Levwell’s core customer base, who are predominantly leisure guests seeking relaxation, nature, and longer stays.

The pre-seen does not specify the distribution across regions of Essland; however, it is reasonable to infer that the rural/coastal positioning means:

• Levwell is less exposed to business travellers, who prefer urban hotels close to commercial districts.
• Seasonality is more pronounced, since leisure demand fluctuates significantly throughout the year.

This inference is supported by the company’s seasonality graph, showing large variations in ADR and occupancy by month.

Ownership and Governance

Levwell is a public listed company, with 80% of its shares held by institutional investors. This level of institutional ownership implies:

• Pressure for consistent financial performance.
• Expectation of strong governance, internal controls, and transparency.
• A board that must balance commercial returns with long-term brand sustainability.

Levwell is governed by a 10-member board, comprising:

• 5 executive directors – CEO, CFO, COO, CMO, CPO
• 5 non-executive directors, including an independent chair
• Four board committees: Audit, Nomination, Remuneration, and Risk

The company also operates a central internal audit function reporting to the Audit Committee.

Key Stakeholders

The company’s stakeholder base includes those explicitly mentioned and those reasonably inferred from the operational model.

Explicit stakeholders (from the pre-seen)

• Guests, primarily leisure customers (core revenue source).
• Employees, a mix of full-time and part-time operational staff.
• Institutional investors, holding the majority of shares.
• Suppliers, including local food suppliers and central procurement vendors.
• Third-party laundry services and external contractors for major refurbishments.
• ‘Visit Essland’, as regulators of quality standards and star ratings.
• Local communities, as Levwell sources locally and operates in their areas.

Implicit / reasonable inferences (not directly stated)

• Local authorities (planning permissions for expansions and renovations).
• Tourism sector partners (e.g., local attractions) — inferred because Levwell’s hotels rely heavily on leisure demand, which is often tied to local activities.
• Online booking users and website stakeholders — inferred due to heavy reliance on the integrated HMS and online booking platform.
• Environmental regulators — inferred due to increasing sustainability expectations and the environmental risks highlighted in the industry section.

These stakeholders will be formally mapped under Mendelow’s Matrix later in Area 5.

Capital Structure and Funding

Levwell plc’s capital structure and funding approach can be analysed by combining the explicit disclosures in the pre-seen with reasonable, industry-based inferences. As a publicly listed hotel chain operating an owner-managed model, Levwell’s financing needs are significant, continuous, and strategically important.

1. Equity Structure and Shareholder Base

Levwell is a listed company, and 80% of its shares are held by institutional investors.

This has several implications:

• Strong access to equity markets:
  Being listed allows Levwell to raise capital through new share issues if required, although the pre-seen does not state any recent issuances.
• Pressure for financial discipline:
  Institutional investors typically demand stable earnings, transparent reporting, and credible strategic direction.
• Preference for capital-efficient growth:
  Institutional investors may prefer expansions that enhance operational efficiency rather than overly capital-intensive projects.
• Shareholder scrutiny on returns:
  Hotels are asset-heavy businesses; therefore, institutional owners will expect Levwell to justify major spending with clear financial benefits.

The high institutional shareholding also reduces the influence of retail investors, who tend to be less active in governance matters.

2. Debt and Borrowing (Pre-seen Silent)

The pre-seen does not explicitly disclose Levwell’s debt levels or borrowing arrangements.
However, justified inferences can be made based on the business model:

Inference 1: Levwell likely uses some level of long-term borrowing

Because:

• Levwell owns all its hotels, meaning each hotel requires significant upfront capital investment.
• Organic growth (opening new hotels) generally involves debt financing in the hospitality sector.
• Refurbishment cycles (every 10 years) also require medium-term financing.

Inference 2: Debt financing is probably conservative

Given the company’s steady but not rapid revenue growth, modest profit margins, and institutional ownership, it is reasonable to assume:

• Levwell maintains moderate gearing, enough to fund capital projects but not enough to create financial distress.
• Institutional investors prefer lower financial risk, especially in a cyclical industry like hospitality.

Inference 3: Rising interest rates may affect future borrowing costs

The pre-seen emphasises high inflation and economic pressures in Essland, suggesting:

• Debt financing is likely becoming more expensive.
• Levwell may face pressure to defer non-essential capital expenditure (e.g., non-urgent refurbishments).

3. Capital Expenditure Requirements

Levwell’s owner-managed model increases capital intensity:

1. Building New Hotels (Organic Growth)

Levwell has only pursued growth through opening its own hotels rather than acquisitions or franchising.

This requires:

• Land acquisition or long-term leases
• Construction or refurbishment costs
• Planning permissions
• Fit-out of hotel facilities and guest rooms

This approach gives strategic control but requires significant cash outflows.

2. Refurbishment Commitments

Levwell aims to refurbish each hotel approximately every 10 years.

Depending on:

• The size of each hotel (~80 rooms)
• 4-star quality expectations
• Unique design features

Refurbishments are likely to cost millions per hotel, creating periodic peaks in capital expenditure.

3. Technology Investments

Levwell’s HMS is currently hosted on in-house servers at head office rather than cloud-based systems.

This implies:

• Regular replacement of servers
• Ongoing IT security upgrades
• Growing cybersecurity expenses
• Potential large future outlay if Levwell transitions to cloud infrastructure

4. Maintenance Costs

Maintenance covers:

• Plumbing and electrical systems
• Room fixtures, fittings, carpets, furniture
• Leisure facilities (spas, fitness centres, pools)

High inflation in Essland means these costs are rising sharply, placing further pressure on cash flows.

4. Cash Flow Pressures from Industry Conditions

The pre-seen highlights several pressures that directly affect Levwell’s funding needs:

1. High Inflation and Rising Operating Costs

Booking demand is falling, while maintenance and energy costs are rising. This compresses margins and may reduce available internal funds for investment.

2. Seasonal Cash Flow Cycles

Levwell’s strong seasonality means:

• Cash inflows peak in certain months
• Off-peak periods require cash reserves to cover fixed costs

This creates the need for:

• Working capital facilities
• Cash buffer management
• Possibly short-term borrowing during low-demand months

3. Emerging Trend of Sale-and-Leaseback in the Industry

The industry commentary notes that hotel companies increasingly use sale-and-leaseback arrangements to improve liquidity.

Inference:
While Levwell has not adopted this model, the trend signals increasing capital pressure in the sector. Levwell may encounter investor pressure to consider such arrangements if:

• Liquidity tightens
• Cost of borrowing rises
• Earnings come under pressure
• The need to expand accelerates

5. Funding Strategy – Likely Priorities for Levwell

Based on the above, Levwell’s capital structure and funding strategy likely prioritise:

1. Maintaining Financial Stability – Moderate leverage, careful cash flow management, and protecting creditworthiness.

2. Supporting Organic Growth – Ensuring availability of funds for new hotel development when opportunities arise.

3. Funding Refurbishments – Balancing quality expectations with affordability, especially under high inflation.

4. Managing Technology Investments – Potential shift towards cloud-based systems may require significant upfront investment.

5. Preserving Investor Confidence – Transparent, disciplined financial decisions will be essential due to high institutional ownership.

Performance Insights

Levwell’s performance over the five-year period (20X1–20X5) demonstrates resilience and stability, despite macroeconomic challenges in Essland and structural issues within the hospitality industry. The following insights synthesise financial and non-financial KPIs to provide a strategic evaluation of the company’s operational health and long-term viability.

1. Revenue Performance: Gradual Growth but Not Rapid Expansion

Revenue has risen from $182m in 20X1 to $229m in 20X5, a cumulative increase of ~26% over five years.

Strengths indicated:

• Levwell has maintained demand despite the economic downturn in Essland.
• Revenue growth outpaced inflation-adjusted industry demand declines (as per pre-seen’s description of reduced willingness to travel).
• Strong brand loyalty and consistent service delivery underpin stable revenue streams.

Areas of concern:

• Growth is incremental rather than transformational, with no major uplift linked to innovation, market shifts, or new business lines.
• Given Levwell increased the number of hotels organically over its history, the flat recent trend suggests limited like-for-like growth, indicating domestic market saturation.
• Revenue performance is vulnerable to seasonality, a structural constraint for rural and coastal leisure positioning.

Strategic interpretation:

Levwell performs solidly but not dynamically. Its revenue profile fits a mature operator competing in a slow-growth market, with limited strategic diversification.

2. RevPAR: Improving but Under Pressure from Cost Inflation

RevPAR (Revenue per Available Room) increased from $121 (20X1) to $136 (20X5).

This steady rise indicates:

• Levwell has successfully balanced occupancy and pricing.
• Its 4-star positioning enables price resilience even in downturns.
• The company likely benefits from strong brand reputation and differentiated guest experience.

However:

• Industry inflation is high, and costs (energy, food, labour, maintenance) are rising faster than RevPAR.
• Without aggressive yield management technology (pre-seen does not indicate advanced AI-driven pricing), Levwell may not be maximising peak-season rates.
• Strong RevPAR performance masks vulnerability in off-peak months due to seasonality.

Inference:
As Levwell sets annual room rates centrally and gives managers limited discount discretion (up to 25%), it may lack the dynamic pricing sophistication of competitors using AI-powered yield management systems. This could limit RevPAR optimisation.

3. Occupancy Rate: Stable and Above Industry Norms

Levwell’s occupancy rates remain approximately 75–80%, whereas 70% is considered good within Essland.

Positive insights:

• High occupancy reflects strong demand in Levwell’s niche.
• Consistently high guest satisfaction (4.4 average) strongly correlates with occupancy resilience.
• Rural and coastal hotels often experience fluctuating demand, yet Levwell manages to keep occupancy steady.

Risks and implications:

• High occupancy might suggest capacity constraints during peak periods, potentially limiting additional revenue without expansion.
• Occupancy dips significantly during off-peak months (visible in seasonality graph), exposing Levwell to volatile cash flows.
• Dependence on leisure tourism amplifies exposure to economic downturns, as seen in falling demand mentioned in the pre-seen.

4. Operating Profit Margin: Stable but Thin

Operating profit margin improved slightly from 13.2% to 14.1% over five years.

Strengths:

• Levwell’s margins exceed the typical industry margin of ~10%, indicating efficient cost control and strong service premiums.
• Consistent margins suggest robust operational discipline and cost management.

Weaknesses:

• Margins are still thin, and small cost increases (energy, staffing, maintenance) can erode profitability quickly.
• The owner-managed model requires Levwell to bear full refurbishment and capital maintenance costs, creating long-term margin pressure.
• Inflation in Essland may reduce real profitability despite nominal stability.

Inference:
Maintaining 4-star quality standards, unique hotel designs, and high staff interaction levels is inherently cost-intensive. This limits Levwell’s ability to expand margins without compromising guest experience.

5. Guest Satisfaction Score: Strong Brand Equity

Guest satisfaction remains consistently high, increasing from 4.2 to 4.4, on a 5-point scale.

Key positives:

• Reflects success of SOPs, staff training, and service values.
• Supports Levwell’s differentiation strategy (experience over price).
• High satisfaction reduces risk of reputational damage, one of Levwell’s principal risks.

Challenges:

• Sustaining high satisfaction requires continuous staff engagement problematic with high turnover.
• Negative guest experiences spread rapidly online; therefore, even small service lapses can damage brand perception.

Strategic importance:

High satisfaction is Levwell’s most powerful competitive advantage and should be a central pillar of its strategy.

6. Employee Turnover: A Significant Strategic Threat

Employee turnover remains high — 38% to 41% — consistent with industry challenges.

Implications for Levwell:

• High turnover damages consistency of service quality.
• Recruitment and training costs rise, squeezing margins.
• A services business loses tacit knowledge when experienced staff leave.
• High turnover contradicts Levwell’s value of “care” and “teamwork,” creating cultural misalignment.

Important inference:

While the pre-seen notes that Levwell offers employee recognition programmes, it does not indicate broader HR initiatives such as:

• Structured career paths
• Retention bonuses
• Learning and development pathways
• Enhanced wellbeing programmes

Given high turnover rates, these are likely areas requiring investment.

7. Seasonality Impact: Revenue Volatility and Cash Flow Challenges

The seasonality chart shows:

• High occupancy and ADR in July–August (peak summer season).
• Sharp declines in Nov–Feb, both in ADR and occupancy.

Strategic consequences:

• Cash flow is cyclical; liquidity stress may occur in off-peak periods.
• Fixed costs (salaries, utilities, maintenance) continue despite low occupancy.
• Levwell must attract guests during off-peak months through promotions or new offerings.

Inference:

Because rural and coastal hotels rely heavily on leisure travellers rather than business guests (who travel year-round), Levwell faces more pronounced seasonality than urban competitors.

8. Operational Efficiency and Process Dependence

Levwell’s operations rely heavily on:

• Standardised SOPs
• Integrated booking and HMS systems
• Housekeeping and maintenance coordination
• Reception-led customer interactions

Strengths:

• Operational discipline ensures consistent service.
• Integrated HMS supports coordinated workflows.

Risks:

• Heavy reliance on in-house IT servers increases risk of downtime, cyberattacks, and data loss.
• SOPs require stable staffing, which is undermined by high employee turnover.
• Housekeeping and reception processes must operate efficiently to prevent guest dissatisfaction.

Inference:
Given that the HMS coordinates all operational information (bookings, room status, guest billing), any IT disruption would have immediate financial and reputational consequences.

Summary of Performance Insights

Together, the KPI trends paint a balanced picture:

Strengths

• Strong guest satisfaction and consistent occupancy
• Above-average profit margins
• Stable revenue growth
• Strong brand and differentiated experience
• Effective operational controls and integrated systems

Weaknesses

• High employee turnover
• Thin margins vulnerable to inflation
• Significant seasonality
• Limited capital flexibility due to owner-operated model
• Technological risks due to in-house servers
• Modest growth relative to industry consolidation dynamics

Strategic interpretation

Levwell is a sound, well-managed operator, but it is positioned in a market with structural constraints. Its future performance will depend on:

• Leveraging brand strength
• Addressing labour challenges
• Enhancing digital capability
• Expanding into new markets or services
• Improving year-round profitability despite seasonality

Business Model

Levwell’s business model is characterised by:

1. Owner-Managed Structure

Levwell uses a pure owner-operated model, giving it:

• Full control of hotel operations
• Responsibility for all costs and investment
• Ability to shape guest experience without franchise restrictions

This model supports strong service quality but increases financial risk because Levwell bears all capital expenditure and operational costs.

2. Differentiated Guest Experience

The distinctive design of each hotel, combined with 4-star facilities and high-touch service, positions Levwell as a premium leisure brand.

3. Integrated Hotel Management System (HMS)

The HMS underpins:

• Real-time booking
• Room availability
• Guest billing
• Housekeeping updates
• Maintenance issue tracking
• Data centralisation

Reliance on internal servers (not cloud) increases technology dependency and cybersecurity exposure.

4. Revenue Model

Revenue mix is:

• 62% rooms
• 33% food & drink
• 5% other services

Margins are highest in accommodation; food & drink enhances guest experience but generates lower profitability.

5. Local sourcing and CSR alignment

Where possible, Levwell uses local suppliers and seasonal ingredients.
This strengthens stakeholder relations and is consistent with CSR values.

Strategic Interpretation

Levwell’s business model is a classic differentiation approach, built on brand experience, location attractiveness, high quality, and unique hotel style.

Key strategic interpretations:

1. Differentiation increases loyalty and guest satisfaction, reflected in consistently high review scores.
2. High service intensity increases dependence on skilled staff, making turnover a strategic threat.
3. Unique designs create identity but reduce economies of scale, unlike standardised chains.
4. Owner-managed model offers control but reduces financial flexibility, especially under inflation and rising refurbishment needs.
5. Operational integration is strong, but the reliance on in-house servers suggests the IT infrastructure may be outdated relative to industry digitalisation trends.

Prospects of the Company

Levwell has several promising attributes:

• Strong brand reputation
• High guest satisfaction
• Solid RevPAR and occupancy performance
• Attractive locations for leisure tourism
• Values-driven culture supporting service excellence
• Integrated processes and SOP discipline
• Growing leisure travel demand once economic pressures ease

However, prospects depend on Levwell’s response to structural pressures:

• Rising costs and inflation
• High employee turnover
• Increasing competition from chains and home-sharing
• Digital transformation and data security risks
• Need for new growth vectors (geographical or product diversification)

Inference:
While the pre-seen does not state Levwell is considering expansion abroad, its consistent organic growth approach and institutional shareholder base suggest future growth will require new forms of scale either more domestic hotels, new market segments, or digital transformation.

Area 2 – Governing Body and Ownership of the Company

Levwell plc’s governance structure combines formal board arrangements, committee oversight, and an internal audit function. As a listed company with 80% institutional ownership, Levwell is expected to demonstrate strong corporate governance, robust controls, and strategic accountability. This section analyses the board composition, leadership structure, governance effectiveness, and areas for improvement.

Board Composition and Governance Framework

Levwell has a 10-member board, comprising:

• Non-executive chair
• 4 additional non-executive directors (NEDs)
• 5 executive directors: CEO, CFO, COO, CMO, CPO

Key Observations

1. Balanced Board Size – A 10-member board is within typical ranges for listed companies, allowing diversity of skills while remaining manageable for decision-making.
2. Equal split between executives and NEDs – This indicates a healthy balance, with NEDs theoretically able to scrutinise executive decision-making.
3. Independent Chair – Having a non-executive chair is consistent with best practice (e.g., UK Corporate Governance Code principles), supporting independent oversight.
4. Presence of Four Board Committees – Levwell operates:
5. Audit Committee
6. Risk Committee
7. Nomination Committee
8. Remuneration Committee

This structure is aligned with major governance codes, demonstrating formalised responsibility for:

• Financial oversight
• Talent and succession management
• Remuneration alignment
• Risk control and monitoring

• Internal Audit Function – Internal audit reports directly to the Audit Committee. This strengthens independence and ensures the monitoring of both financial and operational controls. Internal audit regularly inspects hotels for operational compliance, including SOP adherence.

Inference:

The structure reflects a mature governance framework, typical for listed hospitality companies. However, the effectiveness depends heavily on NED independence, board skills mix, and how actively committees challenge management.

Executive Leadership Structure

Levwell’s executive team comprises:

• Chief Executive Officer (CEO)
• Chief Finance Officer (CFO)
• Chief Operations Officer (COO)
• Chief Marketing Officer (CMO)
• Chief People Officer (CPO)

This indicates a functionally oriented leadership team with clearly defined responsibilities.

Strengths of the leadership structure

1. Holistic functional coverage – Operations, finance, marketing, and people functions all have board-level representation, crucial for a service-heavy industry.

2. Strong alignment with Levwell’s mission and values

• The COO oversees hotel operations and service delivery, reflecting the mission of providing an exceptional guest experience.
• The CPO is essential for managing staff wellbeing and reducing turnover — a critical industry issue.

3. Strategic importance of the CMO – Given Levwell’s differentiation strategy (unique designs, leisure focus), having a strong marketing voice at the board is essential for:

• Brand positioning
• Digital marketing
• Managing the website and online booking experience

4. CFO role is critical due to capital intensity – The CFO must manage refurbishment cycles, inflationary pressures, and capital expenditure for hotel development.

Potential limitations and governance concerns (inference)

• No Chief Technology Officer (CTO) or equivalent role is mentioned.
  Given increasing cybersecurity risks and dependence on the in-house HMS, this may indicate a technical skills gap at board level.
• The pre-seen does not mention specialist digital transformation expertise, which is increasingly vital in hospitality.

Organisational Design

Levwell uses a centralised functional structure at head office combined with decentralised operations across 35 hotels.

Structural Characteristics

1. Central control over strategic functions

• Room pricing set annually by head office
• Procurement centralised for most inputs
• IT systems and HMS centrally managed
• Internal audit centrally coordinated
• Brand and marketing decisions controlled centrally

2. Local autonomy in hotel operations

Hotel managers oversee:

• Day-to-day management
• Staff deployment
• Guest experience
• Housekeeping and maintenance coordination
• Limited pricing discretion (up to 25% discount)

Strengths of the organisational design

• Ensures consistency of brand experience
• Supports quality control across all hotels
• Centralised procurement increases bargaining power
• SOPs ensure standardised service delivery
• Internal audit reinforces consistency and risk management

Risks and weaknesses

• Over-centralisation may restrict hotel managers’ agility during peak/off-peak periods.
• Lack of localised pricing flexibility limits responsiveness to competitor moves.
• Decision-making may be slow if escalation processes are bureaucratic.
• High turnover may create leadership strain at hotel level.

Inference:

The design supports quality and brand control but risks being slow-moving in an industry where rapid response to demand changes is critical.

Assessment of Governance Effectiveness

Based on the pre-seen, Levwell’s governance effectiveness can be evaluated across several dimensions.

1. Strategic Oversight – Moderately Strong

• The board appears to have a clear focus on quality, service excellence, and responsible procurement.
• Organic growth strategy suggests the board takes a conservative, controlled approach.
• Closure of two poor-performing hotels seven years ago illustrates willingness to make corrective decisions.

Weakness:
The pace of growth appears slow relative to market consolidation. This may reflect strategic conservatism, which could limit competitiveness.

2. Risk Management – Strengthened by Internal Audit

Levwell identifies and monitors six key enterprise risks: competition, pricing, reputation, people, technology, and data security.

Strengths:

• Risk Register demonstrates structured risk thinking.
• Dedicated Risk Committee provides oversight.
• Internal audit operational inspections support strong internal controls.

Weaknesses:

• Several risks remain high-impact and persistent (people, data, competition).
• No explicit evidence of scenario planning or stress testing.
• Technology risk may be insufficiently represented at board level.

3. People and Culture Governance – Mixed Performance

Strengths:

• Existence of a CPO at board level
• Clear values focusing on care, responsibility, and teamwork
• Employee recognition programme demonstrates cultural commitment

Weakness:

• High employee turnover (38–41%) indicates governance failure in people strategy
• No evidence of workforce planning or learning and development initiatives
• Industry-wide labour shortages require stronger board-level strategic intervention

4. Technology and Data Governance – Potentially Weak

• Heavy reliance on in-house servers exposes Levwell to data security, cyberattack, and system failure risks.
• The pre-seen does not indicate board-level IT expertise or investment in advanced cybersecurity strengthening.

Inference:
Absence of a CTO or technology-focused NED suggests this risk area may not be strongly represented.

5. ESG and Sustainability Governance – Emerging but Underdeveloped

Strengths:

• Responsible procurement policies
• Local sourcing in restaurants
• Value of “Responsibility” emphasised in culture

Weaknesses:

• No explicit sustainability strategy or environmental performance tracking
• No disclosures on carbon footprint, waste management, or water usage
• Rising environmental expectations among guests and Visit Essland inspectors heighten governance pressure

Recommendations for Governance Enhancement

Based on the above analysis, Levwell can strengthen governance through the following actions:

1. Strengthen Technology and Digital Governance

• Appoint a Chief Technology Officer or a NED with digital hospitality expertise.
• Move towards cloud-based storage to reduce data security risk.
• Invest in cybersecurity and HMS modernisation.

2. Enhance People Governance and Workforce Strategy

• Develop a long-term workforce planning strategy to address turnover.
• Introduce structured career development pathways.
• Strengthen employee wellbeing and engagement programmes.

3. Improve Strategic Agility

• Explore more flexible pricing strategies, including advanced yield management tools.
• Empower hotel managers with greater operational decision-making in peak/off-peak periods.
• Consider selective partnership or franchise models for faster expansion.

4. Strengthen ESG Reporting and Sustainability Governance

• Formalise environmental KPIs (energy use, carbon emissions, water consumption).
• Integrate sustainability objectives into board agenda.
• Publish ESG performance externally to strengthen reputation.

5. Strengthen Risk Management Practises

• Implement scenario planning for demand shocks, inflationary periods, and IT system outages.
• Conduct cyber risk stress tests and hotel-level operational continuity drills.

Summary

Overall, Levwell has a solid governance framework, with balanced board structure, strong committee oversight, and effective internal audit. However, the company faces growing pressures in people management, digital governance, strategic agility, and sustainability, requiring the board to evolve beyond traditional hotel governance practices.

Area 3 – Ethics and Corporate Social Responsibility (CSR)

Ethics and CSR are central to Levwell’s identity. The company’s mission and values emphasise care, responsibility, fairness, and exceptional service, suggesting a deliberate effort to embed ethical principles into day-to-day operations. However, rising ethical expectations in the hospitality industry and stakeholder scrutiny require a more structured, transparent approach. This section evaluates Levwell’s ethical stance, ethical threats, and CSR practices, as well as areas for enhancement.

Ethical Positioning and Public Perception

Levwell’s ethical positioning is grounded in its mission and values, which emphasise:

• Care – for staff and guests
• Responsibility – towards employees, guests, communities, and the environment
• Teamwork and positivity – promoting a respectful and supportive work environment
• First-class service – implying honesty, consistency, and professionalism
  
  

Reputation for High-Quality, Ethical Service

Levwell’s consistently high guest satisfaction scores (4.4/5) suggest that guests perceive the company as trustworthy, service-driven, and guest-centric. High occupancy rates further reinforce stakeholder confidence.

Responsible Procurement as an Ethical Signal

Levwell’s commitment to:

• Local sourcing
• Use of seasonal ingredients
• Environmental assessment of suppliers
  

Ethical treatment of employees (Mixed Performance)

Levwell highlights staff care as a key value. It offers:

• Employee recognition programmes
• Staff reward schemes

However, the persistently high employee turnover (38–41%) indicates:

• A gap between stated values and employee experience
• Challenges in workload, work–life balance, and career progression
• Possible underinvestment in staff development or wellbeing

Ethical approach to guest care

SOPs for reception, housekeeping, and guest services emphasise:

• Respectful treatment
• Professional communication
• Consistency
• Safety and hygiene

This strengthens Levwell’s ethical reputation and aligns with industry expectations.

Inference:

While Levwell’s values-oriented culture supports ethical behaviour, the pre-seen does not indicate formal ethical training, whistleblowing channels, or a code of ethics. It is reasonable to assume these may not be fully developed, representing an opportunity for governance strengthening.

Main Ethical Threats

Levwell faces specific ethical threats related to its operations, workforce, technology, and market environment. Some are explicit in the pre-seen, while others are reasonable inferences given industry norms.

Ethical Threat: Data Privacy and Cybersecurity Risk

Levwell’s HMS and customer data are hosted on in-house servers, not cloud infrastructure.
This creates several ethical responsibilities:

• Secure handling of personal and payment data
• Compliance with Essland’s strict data protection laws
• Ensuring data is not misused, leaked, or inadequately protected
• Maintaining guest trust in booking and online payment systems
  
  

Risk:
Failure to manage data ethically could result in regulatory fines, reputational harm, and loss of customer confidence.

Inference:
The pre-seen does not mention data encryption, intrusion detection, or staff training on cyber ethics; therefore, these may be underdeveloped areas.

Ethical Threat: Employee Wellbeing and Fair Treatment

High staff turnover indicates:

• Possible burnout or fatigue
• Stress from anti-social working hours
• Difficulty balancing job demands and personal life
• Potential gaps in career development or fair remuneration
  
  

Ethical risks include:

• Overworking employees during peak periods
• Poor work-life balance
• Inequitable workload distribution
• Potential unfairness in shift scheduling

Even with recognition programmes, these issues may signal deeper structural problems in HR strategy.

Ethical Threat: Health and Safety

Hotels have responsibilities to:

• Maintain safe, hygienic environments
• Respond quickly to room defects (plumbing, electrical, air conditioning)
• Ensure proper housekeeping standards
• Reduce accident risks for guests and staff
  
  

Ethical risk arises if:

• Hotels fail to report or fix issues promptly
• Staff cut corners due to time pressure or manpower shortages
• Maintenance teams cannot keep up with demand due to staffing constraints

Given inflation and cost pressures, ethical shortcuts may be tempting unless strongly controlled.

Ethical Threat: Pricing and Fair Communication

While Levwell sets room rates annually and allows managers up to 25% discount discretion, ethical pricing concerns arise if:

• Discounts are applied inconsistently
• Guests cannot access transparent pricing information
• Last-minute price changes are not clearly communicated

Inference:
The pre-seen does not suggest unethical pricing occurs, but inconsistent discounting across hotels could create perceived unfairness if not controlled by policy.

Ethical Threat: Environmental Responsibilities

Increasing guest expectations around sustainability mean hotels face ethical pressure to:

• Reduce energy consumption
• Reduce waste
• Lower carbon emissions
• Encourage water conservation

The pre-seen emphasises that sustainability increasingly influences guests’ booking decisions.
However, Levwell does not present any formal environmental strategy or reporting, which may be perceived as a lack of ethical leadership.

Ethical Threat: Responsible Marketing

Levwell’s marketing materials and website must:

• Accurately represent hotel facilities
• Provide honest descriptions of rooms and amenities
• Avoid exaggerating service levels or guarantees

Given Levwell’s reliance on online bookings, ethical digital communication is essential.

Corporate Social Responsibility (CSR) Practices

Levwell demonstrates several CSR-aligned behaviours embedded within its business model, values, and operational choices. While these practices indicate an underlying commitment to social and environmental responsibility, they remain largely informal, unstructured, and not publicly articulated as part of a holistic CSR or sustainability strategy. This section explores Levwell’s CSR practices across the areas of community, environment, employees, supply chains, guest wellbeing, and governance.

Community Engagement and Local Economic Contribution

Although the pre-seen does not highlight formal community outreach programmes, Levwell’s operations inherently support local communities through:

1. Local Hiring and Employment

• Each hotel employs a mix of full-time and part-time staff, providing significant employment opportunities in rural and coastal locations.
• Hospitality is labour-intensive, meaning Levwell is likely a major employer in some regions, an important CSR contribution.

Inference:
Because Levwell operates in non-urban areas where job opportunities may be limited, its hotels likely play an important role in sustaining local economies.

2. Local Sourcing of Food and Ingredients

Levwell emphasises locally sourced, seasonal ingredients for its restaurants.

This delivers several CSR benefits:

• Supports local farmers and suppliers
• Reduces transportation emissions
• Strengthens community relationships
• Enhances authentic guest experience

Local sourcing aligns naturally with rural/coastal hotel settings and enhances Levwell’s brand ethos.

3. Supporting Local Tourism Ecosystems

Levwell’s hotels contribute to broader tourism in Essland by:

• Encouraging visitation to rural and seaside areas
• Providing quality accommodation that boosts tourism revenue
• Acting as a platform for showcasing local attractions and experiences

Inference:
By attracting leisure guests from across Essland and possibly internationally, Levwell supports local businesses such as restaurants, cultural sites, outdoor activities, and retail shops.

Employee Welfare and Responsible Employment Practices

Levwell’s values emphasise care, responsibility, and teamwork directly supporting ethical treatment of employees. Several CSR practices can be observed:

1. Employee Recognition Programme

• Staff can earn cash rewards or shopping vouchers
• Nominations can come from managers or colleagues
• Promotes appreciation, positive culture, and internal motivation
  
  

2. Fair Reward Practices

• The existence of structured reward schemes suggests Levwell seeks fairness and recognition beyond base pay.

3. Learning and Service Standards (Inference)

Although the pre-seen does not detail training programmes, maintaining 4-star ratings requires continuous staff training in:

• Customer service
• Hospitality etiquette
• SOPs for housekeeping and reception

Inference:
It is highly likely Levwell provides ongoing service training to maintain brand consistency and guest satisfaction.

4. Indirect Employee Support

• SOPs provide clarity and structure, reducing ambiguity and stress
• CPO at board level indicates strategic attention to people issues
• Clean, safe workplace environments are reinforced by maintenance and housekeeping processes

Limitations to CSR Impact

Despite these practices, turnover remains high (38–41%), signalling underlying issues in:

• Workload intensity
• Work–life balance
• Career progression
• Compensation competitiveness

CSR practices exist, but are not sufficient to overcome retention challenges.

Responsible Procurement and Ethical Supply Chain Management

Levwell demonstrates explicit CSR behaviour through procurement policies:

1. Environmental Assessment of Suppliers

The procurement team evaluates environmental credentials of potential suppliers before contracting.

This supports:

• Lower carbon footprint
• Ethical sourcing
• Sustainable supplier partnerships
• Responsible corporate image

2. Local Food Supplier Relationships

Hotel restaurants source food locally wherever possible supporting ethical, community-driven procurement.

3. Central Procurement Policies

For goods and services procured centrally:

• Cleaning materials
• Bedding, towels
• Laundry services

Levwell likely applies consistent ethical criteria across all hotels.

Inference:

While the pre-seen does not mention formal supplier audits or compliance monitoring, the environmental assessment element implies a structured approach to supplier due diligence.

CSR in Guest Experience and Wellbeing

Guest care is a central CSR responsibility in hospitality. Levwell’s CSR practices for guests include:

1. Safety, Hygiene, and Cleanliness

• SOP-driven housekeeping processes
• Daily room cleaning for multi-night stays
• Reception protocols to ensure guest safety and comfort

These practices protect guest wellbeing and align with ethical hospitality standards.

2. Transparent Operational Processes

• Clear check-in and check-out procedures
• Guest billing consolidated through HMS
• Room status updates ensure efficient room readiness
  
  

3. Accessibility (Inference)

Although not explicitly stated, most 4-star hotels typically offer:

• Basic accessibility features
• Support services for elderly or disabled guests
• Inclusive design in public spaces

Inference:
Given Levwell’s 4-star rating and mission of offering “exceptional experience for every guest,” it is reasonable to assume accessibility is part of operational standards.

4. Providing a Relaxing, Enjoyable Experience

This aligns directly with leisure guest expectations and with Levwell’s mission.

Environmental Responsibility (Emerging but Underdeveloped)

The pre-seen includes no formal environmental strategy for Levwell, but several CSR-aligned environmental actions can be observed or inferred.

1. Energy and Water Management (Inference)

As 4-star hotels, Levwell must comply with health, safety, and environmental standards set by Visit Essland.
This likely involves:

• Basic energy efficiency protocols
• Safe waste disposal
• Maintenance of efficient plumbing and air-conditioning systems

2. Waste Reduction (Inference)

Hotels typically manage:

• Food waste
• Linen laundry cycles
• Recycling
• Safe handling of chemicals

Given Levwell’s responsible procurement approach, it is likely though not explicitly stated that waste minimisation is part of operational procedures.

3. Environmental Awareness through Local Sourcing

Reducing transport emissions through local procurement contributes indirectly to environmental sustainability.

4. Limited Environmental Reporting

Levwell does not publish:

• Carbon footprint
• Energy use metrics
• Water consumption data
• Environmental KPIs
• Sustainability reports

This leaves a gap in transparency and stakeholder assurance.

CSR Through Governance and Ethical Culture

CSR is reinforced by Levwell’s governance framework:

1. Risk Committee and Audit Committee

Both contribute to responsible governance and internal control, supporting the ethical operation of the business.

2. Internal Audit Function

Internal audit performs operational inspections, which indirectly promote CSR by ensuring:

• Safety
• Proper housekeeping
• Compliance with SOPs
• Accountability in processes

3. Values-Driven Culture

Levwell’s values reinforce CSR principles:

• Care → Employee and guest wellbeing
• Responsibility → Ethical behaviour and community respect
• Teamwork → Positive culture
• First-class service → Ethical service delivery
• Positivity → Healthy, solution-oriented workplace environment

Summary: CSR Practices at Levwell

Levwell’s CSR strengths include:

• Strong local sourcing and community economic impact
• High guest care standards
• Responsible procurement practices
• Values-driven culture
• Structured operational processes
• Employee recognition programmes
• Clear governance mechanisms

However, Levwell lacks a formal CSR strategy. Environmental sustainability, employee wellbeing, digital ethics, and community engagement require more structured, transparent, and measurable approaches. Strengthening these areas will allow Levwell to better communicate its CSR commitments to stakeholders and align with rising ethical expectations in the hospitality sector.

Area 4 – External Environment

Levwell operates within a dynamic environment characterised by economic pressures, shifting consumer behaviour, increasing competition, and rising expectations around sustainability and digital security. The following analysis explores the macro, industry, and national contexts shaping Levwell’s strategic environment.

PEST Analysis

A. Political Factors

1. Tourism Regulation and Standards

Essland’s hospitality industry is regulated by Visit Essland, which sets visitor experience, sustainability, and safety standards for hotels. Hotels must maintain consistent quality, hygiene, and operational discipline to ensure compliance.

Implications for Levwell:

• Levwell’s SOP-driven model aligns well with regulatory expectations.
• Consistent 4-star quality helps maintain compliance and reputation.
• Failure to maintain standards could result in reputational damage and sanctions.

2. National Tourism Development Policies (Inference)

Most governments support tourism through promotion campaigns and infrastructure development. Although the pre-seen does not explicitly state this, Essland likely invests in developing rural or coastal hospitality sectors, indirectly benefiting Levwell.

3. Labour Regulation and Worker Protection

The hospitality sector is labour-intensive. Political factors such as:

• minimum wage policies
• working hours regulations
• employee rights protections

impact Levwell directly.

Given high turnover and sector-wide labour shortages, tighter labour regulation could increase operating costs.

4. Environmental and Sustainability Policies

Policies promoting energy efficiency, waste reduction, and sustainable supply chains are becoming more prominent. Levwell’s limited environmental disclosures mean regulatory tightening may impose:

• additional compliance requirements
• capital investment for upgrades
• reporting obligations

B. Economic Factors

1. High Inflation in Essland

The pre-seen states that inflation is high, contributing to rising operating costs. This affects:

• food and beverage inputs
• energy and utilities
• laundry and cleaning supplies
• maintenance and refurbishment expenditure
  
  

Impact:
Thin margins (14.1%) are under pressure, making cost control a strategic priority.

2. Reduced Consumer Spending

Due to economic pressures, Essland residents have become less willing to spend on leisure travel.
This reduces hotel demand and makes pricing strategy more sensitive.

Consequences:

• Greater reliance on peak-season revenue
• Increased competition for domestic leisure travellers
• Need for promotional pricing during off-peak seasons

3. Labour Market Tightness

The sector faces labour shortages and high turnover. This raises:

• recruitment costs
• training costs
• salary expectations

4. Seasonal Demand Cycles

Seasonality is a structural economic factor affecting:

• RevPAR
• Cash flow stability
• Staffing levels

Hotels in rural/coastal areas depend heavily on summer months for profitability.

5. Capital-Intensive Business Model

Levwell owns all its hotels, meaning:

• large ongoing capital expenditure
• higher exposure to interest rate changes
• slower expansion relative to asset-light competitors

This amplifies the impact of any economic slowdown.

C. Social Factors

1. Rising Consumer Expectations of Service Quality

Guests increasingly value:

• uniqueness
• personalised service
• leisure experiences
• sustainability-conscious operations

Levwell’s value proposition (unique design, guest-centred service) fits social expectations well.

2. Increased Social Focus on Sustainability

Consumers are becoming more conscious of:

• local sourcing
• environmental impact
• ethical business practices

Levwell’s local sourcing is a strength, but lack of formal environmental strategy may create reputational risk.

3. Changing Travel Preferences

The pre-seen notes a shift towards:

• short domestic breaks
• nature-based vacations
• wellness, culture, and unique experiences

Levwell is well-positioned in rural and coastal areas to take advantage of this trend.

4. Staff Attitudes and Culture

High turnover (38–41%) suggests deeper social issues in the workforce:

• stress and burnout
• limited career progression
• lifestyle mismatch with hospitality hours

This challenges Levwell’s cultural values and service consistency.

D. Technological Factors

1. Reliance on In-House Servers

Levwell’s HMS is hosted on on-premise servers at head office.
This creates:

• cyber security vulnerabilities
• disaster recovery risks
• capacity limitations
• increased maintenance costs
  
  

2. Industry Shift to Cloud and AI

Competitors increasingly use:

• AI-driven dynamic pricing
• cloud-based PMS/HMS
• automation for housekeeping scheduling
• mobile apps for guest experience

Inference:
Levwell is technologically behind the industry trend, as the pre-seen does not mention advanced systems.

3. Growing Cybersecurity Threats

The pre-seen identifies data security as a key risk.
Growing digital payments and online bookings magnify this exposure.

4. Increasing Importance of Digital Marketing

Hospitality demand is driven heavily by online visibility.
Levwell’s marketing function is budget-constrained, suggesting underinvestment relative to digital-savvy competitors.

PEST Summary

Opportunities

• Growing domestic tourism preference
• Rising sustainability expectations (Levwell already strong in local sourcing)
• Ability to modernise IT systems to gain competitive efficiency
• Potential for government tourism support

Threats

• High inflation and margin squeeze
• Declining discretionary spending
• Labour shortages and wage inflation
• Increasing cybersecurity risks
• Competitors adopting more advanced technology
• Stricter environmental regulations
• Strong summer–winter seasonality

Porter’s Five Forces

The Essland hotel industry shows moderate-to-high competitive intensity, shaped by price competition, technology adoption, and shifting consumer behaviour.

1. Competitive Rivalry – HIGH

Drivers of strong rivalry:

• Many hotels and chains operate across Essland
• Customers are price-sensitive during economic downturns
• Online travel platforms make price comparison easy
• Competitors increasingly adopt dynamic pricing tools
• Seasonality intensifies competition for peak months

Levwell’s differentiation (unique design, quality service) helps reduce direct price rivalry but does not eliminate it.

2. Threat of New Entrants – MODERATE

Barriers to entry:

• High capital requirements to build hotels
• Need for planning permissions and compliance
• Reputational barriers, customers trust known brands
• Operational complexity in hospitality

Why still moderate?

• Smaller boutique hotels or B&Bs require lower entry capital
• Asset-light franchised models allow chains to expand quickly
• Online visibility reduces the need for heavy marketing budgets

Levwell’s owner-operated, capital-heavy model faces more pressure from asset-light new entrants.

3. Bargaining Power of Suppliers – MODERATE to HIGH

High because:

• Food and energy costs rising due to inflation
• Labour shortages increase employee bargaining power
• IT and cybersecurity vendors have specialised expertise and higher pricing power

Low-to-moderate because:

• Levwell uses centralised procurement
• Local suppliers may rely heavily on Levwell’s business

Overall supplier power is tilted upwards due to inflation and labour constraints.

4. Bargaining Power of Customers – HIGH

Why?

• Customers can easily compare prices online
• Loyalty is low in leisure tourism
• Customer reviews heavily influence booking choices
• Economic pressures make guests more price-sensitive
• Substitute options (Airbnb, vacation rentals) give consumers leverage

Levwell’s strong satisfaction score reduces switching but does not remove customer power.

5. Threat of Substitutes – MODERATE

Substitute options:

• Airbnb
• Holiday rentals
• Camping/glamping
• Serviced apartments
• Day experiences replacing overnight stays

Moderating factors:

• Levwell offers a differentiated 4-star leisure experience
• Substitutes may lack the service, facilities, and reliability of hotels

Summary

The Essland hotel industry is moderately attractive, but competitive intensity is rising. Levwell must strengthen differentiation, digital capabilities, and year-round value propositions to maintain advantage.

Porter’s Diamond

Porter’s Diamond helps assess the national competitive advantage of Essland’s hospitality industry and how the external environment supports or constrains Levwell’s strategy.

This analysis considers how Essland’s factor conditions, demand patterns, related industries, and competitive structure shape Levwell’s ability to grow and sustain performance.

Although the pre-seen does not provide a full economic profile of Essland, we can reasonably infer trends based on hospitality sector patterns, national tourism development clues, and Levwell’s performance context.

1. Factor Conditions

Factor conditions refer to the quality of resources available in Essland, including labour, infrastructure, natural assets, and technological capabilities.

a. Natural Assets Strongly Favour Tourism (Pre-Seen)

Levwell’s rural and coastal locations indicate that Essland offers attractive natural landscapes that support a strong domestic tourism sector. These scenic assets create a favourable environment for leisure-oriented hotel groups.

b. Labour Availability Is a Significant Weakness (Pre-Seen)

The pre-seen makes clear that hospitality labour shortages are a national issue, with Levwell reporting turnover of 38–41 percent.

This reflects several national factor limitations:

• Lower supply of hospitality workers
• High competition for labour
• Wage inflation
• Low retention in service roles

These conditions restrict service-intensive models like Levwell’s.

c. Infrastructure Supports Domestic Tourism (Inference)

Given Levwell’s hotels are spread across rural and coastal locations, Essland likely has reasonably good:

• road infrastructure
• transportation access
• utilities and digital connectivity (at least at baseline levels)

However, slower digital adoption within Levwell hints that national digital maturity may be moderate, not cutting-edge.

d. Hospitality Education and Skills Development—Likely Underdeveloped (Inference)

High turnover and recruitment difficulty suggest national hospitality training or vocational education may not be sufficiently robust. Levwell may need to invest internally to fill this gap.

Overall Interpretation:

Essland’s natural and physical factor conditions benefit Levwell, but skill shortages and moderate digital maturity weaken its long-term competitive potential.

2. Demand Conditions

Demand conditions assess the nature of local customers and whether the domestic market encourages innovation and higher standards.

a. Strong Domestic Leisure Demand (Pre-Seen)

Levwell’s business model is built entirely on domestic leisure travellers, a segment that appears well established and stable.

High occupancy in peak seasons suggests robust local demand for nature-based short stays.

b. Seasonality Creates Demand Instability (Pre-Seen)

Essland’s domestic tourism fluctuates sharply by season, causing:

• high peak occupancy
• low winter occupancy
• cash flow volatility
• difficulty scheduling staff year-round

This pattern reduces resilience and increases operational pressure.

c. Increasing Consumer Expectations (Pre-Seen + Sector Trends)

Guests now expect:

• digital convenience
• sustainability transparency
• personalised experiences

These rising expectations put pressure on Levwell to innovate, particularly since competitors use dynamic pricing, advanced digital tools, and modern guest management systems.

d. Strong Preference for “Authentic” Experiences (Inference)

Given Levwell’s success, domestic consumers in Essland may value:

• local design
• regional food
• unique architecture
• peaceful natural settings

This demand supports Levwell’s differentiation strategy.

Overall Interpretation:

Domestic demand is strong and rewards experiential, boutique-style stays. However, seasonality and rising expectations require operational agility and innovation.

3. Related and Supporting Industries

This considers how complementary industries (suppliers, tourism bodies, technology providers, transportation) support Levwell’s competitive advantage.

a. Local Supplier Networks Appear Strong (Pre-Seen)

Levwell sources food and products locally, indicating:

• reliable agricultural base
• strong artisan and producer communities
• stable supply chains

This supports CSR commitments and strengthens differentiation.

b. Regional Tourism Bodies Likely Promote Domestic Travel (Inference)

Levwell’s success and rural spread suggest Essland has:

• domestic travel campaigns
• tourism infrastructure support
• local tourism partnerships

These strengthen Levwell’s market visibility indirectly.

c. Technology Support Is Adequate but Not Advanced (Inference)

Levwell still uses in-house servers and basic digital systems.

This implies:

• national tech ecosystem is functional
• but advanced hospitality tech providers may be limited
• cloud adoption may be slower nationally

This constrains Levwell’s digital transformation.

d. Transportation and Accessibility Likely Support Growth

For 35 hotels to operate across the country, supporting transport and travel infrastructure must be reasonably strong.

Overall Interpretation:

Levwell benefits from strong local supply networks and adequate tourism infrastructure. However, limited access to advanced hospitality technology and moderate national digital maturity constrain innovation.

4. Firm Strategy, Structure, and Rivalry

This examines the competitive environment and how industry structure shapes Levwell’s strategic behaviour.

a. High Competitive Rivalry (Pre-Seen)

The hotel market in Essland is highly competitive, with:

• boutique chains
• independent hotels
• tech-enabled competitors
• alternative accommodations (e.g., Airbnb)

Rivalry is intensified by:

• dynamic pricing practices in competitors
• rising brand imitation
• review-driven competition

b. Levwell’s Strategy Fits the Competitive Landscape

Levwell’s focused differentiation aligns with the broader market conditions:

• distinctive design differentiates from chains
• rural/coastal locations differentiate from urban hotels
• strong service and CSR differentiate from low-cost rivals

c. Capital-Intensive Structure Restricts Competitiveness

Owning all hotels limits Levwell’s ability to scale rapidly, especially as competitors adopt:

• asset-light models
• flexible management contracts
• franchising arrangements

Levwell risks losing competitive ground due to limited expansion speed.

d. Lack of Pricing Flexibility Weakens Competitive Response

Competitors using dynamic pricing can react to market changes instantly.

Levwell’s annual pricing structure reduces its ability to counter competitive moves.

e. Culture and Leadership Issues Undermine Strategic Execution

High employee turnover and inconsistent culture weaken Levwell’s capability to execute its strategy consistently across 35 locations.

Overall Interpretation:

Essland’s hospitality industry is highly competitive, pushing Levwell to innovate faster, strengthen service, and modernise digitally. Rivals with dynamic pricing and asset-light models have a structural advantage.

Conclusion and Summary of the Diamond Analysis

Porter’s Diamond reveals that Essland provides a good but imperfect environment for Levwell’s continued success.

Favourable Conditions:

• Strong domestic leisure demand
• Attractive landscapes enabling rural/coastal tourism
• Reliable local supplier networks
• Adequate national transport infrastructure
• Cultural interest in authentic hospitality experiences
• Constraining Conditions:
• National labour shortages
• Rising consumer expectations
• Moderate digital maturity
• High rivalry and competitor innovation
• Strong seasonal fluctuations
• Limited availability of advanced hospitality tech providers

Strategic Implications for Levwell:

• Accelerate digital transformation to meet national trends and counter competitor advantage.
• Strengthen talent pipelines and retention, reflecting national skill shortages.
• Innovate guest experiences to respond to rising domestic expectations.
• Develop off-peak offerings to counter seasonality inherent in Essland.
• Consider asset-light expansion models to overcome structural constraints.
• Leverage supplier and community networks to enhance sustainability and differentiation.
• Essland gives Levwell a solid platform but not a frictionless one.

The company’s future competitiveness relies on internal agility, cultural stability, and differentiated innovation within a crowded and rapidly evolving hospitality landscape.

Summary

Levwell’s external environment presents both opportunities and threats:

Opportunities

• Growth in domestic leisure travel
• Rising demand for unique and experience-driven stays
• Potential for digital transformation
• Local community partnerships and local sourcing
• Environmental initiatives to differentiate the brand

Threats

• High inflation reducing profitability
• Labour shortages threatening service quality
• Technologically advanced competitors
• Strong customer bargaining power
• High competitive rivalry
• Seasonality-driven revenue instability
• Tightening ESG expectations

Levwell must respond with strategic agility, digital investment, workforce improvement, and refreshed pricing strategies.

Overall, Levwell faces a macro-environment filled with both opportunities and constraints. While its market positioning suits evolving social preferences, it faces economic challenges, technological vulnerabilities, and escalating regulatory expectations. The company’s ability to adapt to these external pressures will shape its competitive resilience.

Additionally, the hospitality industry in Essland exhibits a moderate to high level of competitive intensity, requiring Levwell to be agile, service-focused, and increasingly technology-driven.

Further, Essland provides a supportive tourism environment but also exposes Levwell to national constraints related to labour availability, technological development, and cost pressures. These factors shape how Levwell must plan and execute its strategy.

To conclude, Levwell faces a macro-environment characterized by economic strain, rising consumer expectations, technological disruption, and heightened competitive pressure. While its core customer proposition aligns well with evolving social trends, the company must strengthen its digital capabilities, pricing agility, workforce strategy, and sustainability initiatives if it is to flourish in the medium to long term. In short, Levwell’s external environment presents significant challenges but also meaningful opportunities, especially for a well-positioned brand capable of adapting its strategy creatively and proactively.

Area 6 – Strategic Models

Ansoff’s Matrix

Ansoff’s Matrix helps evaluate Levwell’s growth options by examining how the company can expand through existing or new products and markets. Because Levwell is a mature business with a clearly defined niche and strong brand heritage, the matrix provides a valuable framework for assessing the risks and feasibility of various strategic directions.

Levwell currently operates a purely organic, owner-managed growth model, in which all hotels are built or acquired by Levwell and operated directly rather than through franchise or management contracts.

This approach has produced stability and quality, but it also limits scalability and exposes the company to high capital requirements, an important consideration when interpreting each quadrant.

1. Market Penetration (Existing Products, Existing Markets)

Market penetration focuses on expanding Levwell’s share within its existing geographic market and continuing to attract domestic leisure tourists, its primary guest segment.

Current Position

Levwell already holds a strong position in Essland’s rural and coastal leisure market. High guest satisfaction, strong occupancy, and consistent 4-star quality all indicate the company is performing well in its established domain.

Opportunities for Further Penetration

Despite this, several opportunities remain:

a. Strengthening Off-Peak Demand

Levwell’s most significant challenge is seasonality. Occupancy drops sharply between November and February, creating revenue volatility. Targeted penetration strategies could include:

• Winter promotions and bundled packages
• Off-peak themed events (wellness retreats, corporate offsites, cultural weekends)
• Targeted digital marketing to encourage mid-week bookings

Such initiatives would maximise utilisation of existing assets without requiring new investment.

b. Enhancing Digital Marketing Presence

The pre-seen highlights marketing budget constraints and limited digital sophistication. Investing in improved online visibility, SEO, social media campaigns, and loyalty programmes could attract a higher proportion of domestic travellers who rely heavily on online research.

c. Increasing Repeat Bookings

High guest satisfaction (4.4) provides a strong foundation for building repeat visitation. Levwell could:

• Launch a loyalty scheme
• Offer personalised promotions via the HMS database
• Engage guests through post-stay communications

Risks and Constraints

Market penetration has relatively low strategic risk, but it is constrained by:

• Overall reduction in domestic discretionary spending
• Strong competition from hotels using dynamic pricing
• Limited pricing flexibility (rates are set annually)

Conclusion for Market Penetration

This is Levwell’s safest growth path and offers solid opportunities to improve financial resilience, particularly through smoothing the impact of seasonality.

2. Product Development (New Products, Existing Markets)

Product development involves offering new services or experiences to Levwell’s current customer base in Essland.

Current Alignment

Levwell’s differentiated value proposition unique designs, tranquil settings, high service quality positions it well for premium add-ons and experiential offerings.

Opportunities for Product Development

a. Wellness and Spa Experiences

Given that many Levwell hotels include leisure facilities, expanding wellness packages, spa treatments, or fitness retreats could appeal to health-conscious guests.

b. Culinary Experiences and Local Gastronomy

Local sourcing is a core CSR strength. Levwell could develop:

• Farm-to-table events
• Seasonal tasting menus
• Cooking demonstrations with local producers

These build on an asset Levwell already possesses.

c. Experience-Based Packages

Partnerships with local providers could allow Levwell to offer:

• Guided nature walks
• Cultural tours
• Sailing or water sports (for coastal hotels)

These experiences align well with rural and seaside settings.

d. Digital Enhancements to the Guest Experience

Although not currently mentioned in the pre-seen, Levwell could develop digital products such as:

• Online check-in
• Room selection
• Mobile concierge services

Risks and Constraints

• Requires investment in staff skills and partnerships
• May increase operational complexity
• Could be undermined by workforce turnover if not well managed

Conclusion for Product Development

Levwell has strong foundations to diversify its experience-based offering. Product development would deepen engagement, differentiate Levwell further from substitutes, and increase per-guest revenue.

3. Market Development (Existing Products, New Markets)

Market development involves expanding Levwell’s footprint into new geographical markets or new customer segments.

Opportunities for Geographic Expansion

a. Additional Regions within Essland

If suitable coastal or rural sites exist, Levwell could extend into untapped domestic markets.
However, the owner-operated model and high capital requirements limit rapid expansion.

b. Entering Urban Markets

Levwell has historically focused on tranquil, scenic locations. Moving into select urban areas could attract:

• Business travellers
• Short-stay domestic tourists
• Higher year-round occupancy

This would reduce seasonality, but such expansion would require organisational adaptation.

c. International Expansion (Inference)

Although the pre-seen is silent on this, Levwell’s brand architecture (values-led, unique designs, high service levels) could translate internationally.
However:

• capital intensity
• lack of scale
• no franchise model
• limited marketing budget

make international expansion high risk without structural change.

New Customer Segments

a. Corporate and Event Markets

Many Levwell hotels include meeting facilities. Targeting:

• corporate retreats
• small conferences
• training events

would create valuable off-peak revenue.

b. Wellness Tourism Segment

Growing global demand for wellness travel aligns well with Levwell’s tranquil settings.

Risks and Constraints

• High capital expenditure
• Limited managerial bandwidth
• Seasonality patterns may not improve with national expansion unless urban markets are targeted

Conclusion for Market Development

Market development offers long-term growth but is constrained by Levwell’s capital-heavy model. Targeting new customer segments (e.g., corporate events, wellness travel) is more feasible than opening in new regions.

4. Diversification (New Products, New Markets)

Diversification is the riskiest option, involving entry into completely new product areas and markets.

Potential Diversification Options

a. Developing an Asset-Light Model

To address capital constraints, Levwell could explore:

• franchising
• management contracts
• joint ventures

This would radically shift the business model and allow expansion without heavy investment.

b. Creating a Sister Brand

Levwell could diversify into a mid-market or premium-luxury sub-brand, targeting different guest segments.

c. Expanding into Adjacent Services

Potential areas include:

• hospitality training academies
• branded spa products
• property management for independent hotels

d. Digital Diversification (Inference)

Leveraging its HMS and guest data, Levwell could develop:

• digital concierge apps
• loyalty platforms
• data-driven hospitality services

Risks and Constraints

• Very high strategic risk
• Requires capabilities Levwell does not currently possess
• Dilution of brand identity
• Increased managerial complexity
• Technological capability gaps
• High financial exposure

Conclusion for Diversification

Diversification offers long-term potential but is unsuitable unless Levwell strengthens its digital, managerial, and capital capabilities. It is the least appropriate strategic option based on the current pre-seen context.

Overall Strategic Interpretation of Ansoff’s Matrix

The matrix reveals that Levwell’s most viable and strategically safe growth options lie in:

1. Market Penetration

(e.g., building off-peak demand, stronger digital marketing, repeat guest initiatives)

2. Product Development

(e.g., wellness packages, local experiences, and culinary initiatives)

These strategies align with Levwell’s strengths brand, service quality, location appeal while managing risk.

Market development is possible but constrained, and diversification is feasible only if Levwell alters its business model.

Porter’s Generic Strategies

Porter’s Generic Strategies model helps identify how an organisation positions itself to achieve competitive advantage. The model highlights three strategic options: cost leadership, differentiation, and focus.

Levwell’s existing strategic posture is best understood as a form of focused differentiation, and this subsection evaluates how well the company’s strategy aligns with its operational realities, competitive environment, and long-term ambitions.

1. Company’s Current Strategic Position

Levwell’s strategy is based on providing a high-quality, distinctive, experience-led stay in rural and coastal locations, reinforced by consistent service standards and individual hotel design.

1. Unique, individually designed hotels – Each of Levwell’s 35 hotels has its own character and architectural identity, emphasising individuality rather than uniform chain standardisation. This is a classic marker of differentiation through design and experience.
   1. Strong focus on exceptional guest experience – Levwell’s values (care, responsibility, teamwork, positivity, and first-class service) underpin a deliberate service differentiation strategy. Guest satisfaction of 4.4 out of 5 further validates this.
   1. Premium 4-star positioning – Levwell consciously positions itself at a premium leisure level, targeting guests who want comfort, tranquillity, quality food, and attentive service.
   1. Rural and coastal market focus – Levwell deliberately avoids crowded, urban environments, focusing instead on peaceful, scenic locations that align with its experiential proposition. This is a clear focus strategy, not a broad-market play.
   1. Controlled brand consistency through SOPs – Standardised reception, housekeeping, and maintenance SOPs ensure guests receive consistent, high-quality service across all properties. This is essential for a differentiation-driven brand.
   1. Owner-operated model – Operating owned hotels allows Levwell to tightly control the guest experience, supporting a differentiation approach, albeit at the cost of scalability and capital intensity.

Conclusion

Levwell’s current position is best described as Focused Differentiation:

• differentiated service offering
• targeted at a specific leisure segment
• delivered through high-quality assets and personalised experiences.

2. Strategic Evaluation of Current Position

Although the focused differentiation strategy aligns well with Levwell’s heritage and brand identity, it also exposes certain vulnerabilities given the current external environment.

Strengths of Levwell’s Differentiation Strategy

1. Strong brand equity – High guest satisfaction scores reflect the success of Levwell’s service-led value proposition. Guests appreciate the atmosphere, location, tranquillity, and consistency.
2. Alignment with emerging social trends – Modern leisure travellers increasingly demand authentic, memorable experiences, nature-based stays, and wellness-oriented holidays. Levwell is naturally positioned to benefit from this trend.
3. Reduced exposure to pure price competition – Differentiated brands rely less on price wars, allowing Levwell to maintain healthier margins than budget or mid-scale chains, even during economic downturns.
4. Higher customer loyalty potential – Guests are more likely to return to a distinctive, quality experience they trust.

Weaknesses and Vulnerabilities of the Strategy

1. Cost pressures threaten differentiation quality – The pre-seen highlights high inflation, rising input costs, and labour shortages. Maintaining 4-star service standards under these pressures is challenging and costly.
2. High employee turnover undermines service-led differentiation – With turnover at 38–41 percent, Levwell may struggle to deliver consistently personalised service, a core differentiator.
3. Limited pricing agility – Setting annual room rates reduces Levwell’s ability to respond to dynamic changes in demand. Competitors using AI-driven pricing can undercut Levwell during slow periods or revenue-maximise during peak periods.
4. Capital-intensive model restricts scalability – Owning all hotels means slow expansion compared with asset-light competitors. Differentiation remains strong, but growth is constrained.
5. Technological lag weakens competitive edge – Reliance on in-house servers and absence of advanced digital guest tools diminish Levwell’s differentiation at a time when technology is becoming part of the guest experience.

Opportunities to Strengthen Differentiation

a. Enhance wellness and experience-based offerings – Levwell’s rural and coastal settings position it perfectly for wellness retreats, nature experiences, local culinary programmes, and premium packages.

b. Invest in digital experience – Even differentiated hotels now require:

• mobile check-in
• customised digital communication
• digital concierge services
• personalised guest recommendations

These enhance convenience without compromising Levwell’s personal touch.

c. Develop stronger sustainability credentials – Growing environmental awareness among guests means a formal sustainability strategy could enhance Levwell’s differentiation and credibility.

d. Target corporate retreats and off-peak experiential events – This would build revenue resilience and strengthen utilisation of existing facilities without compromising the brand.

Threats to Differentiation

a. Competitors imitating the “boutique hotel” feel – Boutique chains and independent hotels may replicate design-focused differentiation more cheaply and rapidly.

b. Alternative accommodations intensifying pressure

Airbnb and rural lodges offer personalised, experience-driven stays at lower cost.

c. Rising customer expectations around sustainability and digital convenience

Levwell risks appearing outdated without technological and green upgrades.

3. Recommendations: Strengthening Strategic Focus

Given the analysis above, Levwell should continue pursuing a Focused Differentiation Strategy, but refine and modernise its approach.

1. Deepen Experience-led Differentiation

• Develop signature wellness programmes
• Offer curated local experiences
• Introduce seasonal cultural events or culinary experiences
• Partner with local tourism providers

2. Build a Distinctive Sustainability Identity

• Levwell already has strong CSR foundations through local sourcing; it should expand this into a clear sustainability brand narrative.

3. Invest in Digital Differentiation

• Modern travellers expect seamless digital touchpoints, even in boutique environments.
• Cloud-based HMS, personalised apps, and digital guest interaction tools can enhance convenience.

4. Use Data-driven Personalisation

• Levwell holds extensive guest data in its HMS but does not actively leverage it.
• A more customer-centric data strategy can heighten the sense of personal service.

5. Strengthen Service Consistency by Reducing Staff Turnover

• Differentiation depends on people. Investments in training, career development, and wellbeing will reinforce service quality and protect the brand.

6. Incorporate a Value-added Off-Peak Strategy

• Experience-led seasonal programming can stabilise revenue and maximise asset utilisation.
• Conclusion on Generic Strategy

Levwell’s current Focused Differentiation strategy is coherent and strategically sound given its assets, brand identity, and customer expectations. However, maintaining and strengthening this strategy requires targeted investment in digital transformation, people, sustainability, and experience innovation. Without these enhancements, Levwell risks losing its competitive edge in an increasingly crowded and technologically advanced hospitality market.

Mendelow’s Matrix

Mendelow’s Matrix helps identify how Levwell should prioritise and manage its key stakeholders based on their level of power and their level of interest in Levwell’s decisions.

Given the company’s people-intensive business model, rising social expectations, and strong guest-experience orientation, stakeholder management is central to Levwell’s long-term strategic success.

The matrix below evaluates Levwell’s major stakeholder groups, linking each one directly to pre-seen evidence and, where needed, clearly stating assumptions.

Quadrant 1: Minimal Effort (Low Power, Low Interest)

1. Casual Domestic Travellers (low-frequency guests)

• These are one-time or infrequent visitors who have limited influence over operational decisions.
• They contribute revenue when they stay, but they are not brand loyal and do not lobby for change.
• Engagement strategy:
  • Maintain standard communications
  • Ensure transparent online information
  • No targeted engagement required

2. Local Tourism Visitors (non-staying guests)

• People who visit Levwell restaurants, bars, or spa facilities occasionally.
• Engagement strategy:
  • Standard marketing communication
  • No strategic involvement required

Quadrant 2: Keep Informed (Low Power, High Interest)

1. Employees (assumed mid-level influence)

Although employees care deeply about working conditions, pay, and career development, they hold low formal power because decisions lie with senior leadership and owners.

However, they are extremely important operationally.

Pre-seen indicators:

• High turnover (38–41 percent)
• Difficulty recruiting staff
• Cultural erosion risk
• Service consistency depends on them
• Why “High Interest”?
• They are directly affected by staffing decisions, pay, and work-life quality.

Engagement strategy:

• Invest in training and development
• Improve communication and feedback loops
• Provide clarity on career pathways
• Strengthen wellbeing initiatives

2. Local Communities

Levwell hotels operate in rural and coastal regions where tourism significantly affects local life.

Interest: High, because Levwell influences:

• employment
• local supply chains
• environmental impact
• local culture and heritage

Power: Low, unless community groups organise collectively.

Engagement strategy:

• Maintain strong local supplier relationships
• Support community events
• Share sustainability initiatives transparently

3. Local Suppliers (farmers, producers, service providers)

Levwell’s procurement policy emphasises local sourcing, meaning these suppliers rely on ongoing partnership.

• Interest: High, because Levwell is a stable revenue stream.
• Power: Moderate to low (many alternative suppliers may exist).

Engagement strategy:

• Maintain fair supplier agreements
• Strengthen collaboration
• Support sustainable local agriculture

Quadrant 3: Keep Satisfied (High Power, Low Interest)

1. Government Authorities (tourism, planning, environment)

Government bodies have high power due to regulations on:

• building permissions
• environmental standards
• employment law
• food and safety compliance

Their interest is moderate, as Levwell is just one of many tourism companies in Essland, and no major government interventions appear in the pre-seen.

Engagement strategy:

• Maintain compliance
• Build constructive relationships
• Monitor regulatory updates

2. Banks and Financial Institutions

Although Levwell does not appear to rely heavily on external financing, the business is capital-intensive and may need debt for expansion or refurbishment.

Assumption:

Since the pre-seen does not detail borrowing arrangements, we infer that Levwell uses some external borrowing given the scale of its assets.

• Power: High (ability to restrict funding).
• Interest: Moderate unless Levwell undertakes large expansions.

Engagement strategy:

• Maintain transparent financial reporting
• Demonstrate strong risk management
• Uphold stable performance metrics

Quadrant 4: Key Players (High Power, High Interest)

These are the stakeholders Levwell must prioritise because they can influence strategic direction and expect active engagement.

1. Owners and Executive Leadership (CEO, CFO, Chair, Directors)

Levwell is privately owned, and strategic decisions rest with the CEO, Chair, and senior team.

Why key players:

• They shape long-term strategy
• They control capital allocation
• They set organisational culture
• They influence sustainability, digital, and expansion priorities

Engagement strategy:

• Direct reporting and strategic consultation
• Data-driven performance updates
• Strong internal governance

2. Guests (core leisure guests)

Guests are Levwell’s most important commercial stakeholder group. Their power is indirect but significant, brand reputation and revenue rely on their satisfaction.

Interest: Extremely high they care about:

• service quality
• food standards
• cleanliness
• value for money
• digital experience
• location appeal

Power: High because:

• review scores affect bookings
• guests compare Levwell to competitors
• dissatisfaction harms revenue immediately

Engagement strategy:

• Enhance HMS communication
• Personalised offers and loyalty schemes
• Data-driven improvements
• Rapid response to complaints

3. Online Travel Agencies (OTAs) – Inferred Stakeholder

Although not explicitly mentioned, it is highly likely Levwell partners with booking platforms (e.g., Booking.com) as nearly all mid-sized hotel groups do.

• Power: High à OTAs influence bookings, visibility, and customer access.
• Interest: High à They benefit from Levwell’s continued use of their platforms.

Engagement strategy:

• Maintain strong listing quality
• Negotiate commissions carefully
• Balance direct vs OTA bookings

4. Key Staff Groups (Managers, Chefs, Front-of-house leaders)

These roles carry more strategic weight than general staff because they determine quality, brand consistency, and SOP adherence.

• Interest: High à They are highly affected by operational changes.
• Power: High operational impact à Poor leadership in these roles directly harms service standards and guest satisfaction.

Engagement strategy:

• Provide leadership development
• Involve them in strategic rollouts
• Improve recognition and retention
• Summary of Mendelow’s Analysis

Levwell operates in a multi-stakeholder environment where guests, owners, key staff, and regulators form the most influential groups.

The high impact of guest satisfaction, combined with a people-dependent service model, places employee wellbeing and leadership capability at the heart of Levwell’s strategic success.

At the same time, Levwell must balance community expectations, regulatory compliance, sustainability considerations, and digital transformation to maintain trust and competitiveness.

Strategic Implications

1. Invest Aggressively in Employee Retention – Because staff turnover directly undermines guest satisfaction (Levwell’s most powerful stakeholder group) improving retention is essential.
   1. Strengthen Leadership and Middle Management – Managers influence both staff and guests. Levwell must ensure strong leadership pipelines and training.
   1. Prioritise Guest-Centric Innovation – Enhance digital convenience, personalise communication, and develop unique experiential offerings.
   1. Strengthen Community and Supplier Partnerships – These groups sustain Levwell’s brand positioning and CSR commitments.
   1. Maintain Government and Regulatory Compliance – Especially with environmental and employment standards rising across the sector.
   1. Improve Financial Transparency for Lenders – This will support future growth and refurbishment programmes.

SWOT Analysis

SWOT integrates Levwell’s internal capabilities with the external opportunities and threats it faces.

Because SBL expects candidates to move beyond listing points, this SWOT is written as a strategic interpretation, linking each point to the pre-seen and highlighting the implications for Levwell’s future decisions.

Strengths

1. Strong Brand Reputation and High Guest Satisfaction – Levwell’s guest satisfaction score of 4.4 reflects consistent quality, reliable service, and a positive emotional connection with guests. This reputation acts as a major competitive strength in a market where trust, reviews, and word-of-mouth heavily influence booking behaviour. It also gives Levwell leverage in premium pricing, even in periods of economic uncertainty.

• Unique Boutique-Style Hotels with Authentic Character – Each hotel’s distinct design and local identity differentiate Levwell from standardised chains. This uniqueness enhances the guest experience, aligns with the rising preference for “authentic, personalised travel,” and makes the brand memorable and harder to imitate.

• Strong CSR Foundations and Community Linkages – Levwell’s commitment to local sourcing and community engagement strengthens its social credibility and supports a positive reputation in rural and coastal areas. These practices not only support local economies but enhance Levwell’s brand identity as a responsible, community-embedded business.

• Clear Organisational Values Reinforcing Service Quality – Values such as care, responsibility, teamwork, and positivity provide a cultural anchor. These values help standardise behaviour across hotels, reinforce the service-led differentiation strategy, and support strong employee–guest interactions when properly embedded.

• Owner-Controlled and Fully Operated Model – Operating all hotels internally allows Levwell to control quality, maintain its boutique style, preserve its brand identity, and ensure that all properties reflect its service philosophy. This level of control is a competitive strength for a differentiation strategy.

• Efficient Operational Framework via SOPs and Central Systems – Well-developed SOPs in reception, housekeeping, and maintenance drive consistency across 35 hotels. This backbone allows Levwell to deliver reliable experiences even when staff turnover is high.

Weaknesses

1. High Staff Turnover Undermining Service Reliability – Turnover rates between 38–41 percent present Levwell’s most serious operational weakness. High churn increases training costs, destabilises hotel culture, and erodes personalised service, the foundation of its differentiation strategy. Service delivery becomes inconsistent, which threatens guest satisfaction.

• Capital-Intensive Expansion Model Limiting Scalability – By owning every hotel, Levwell shoulders the entire cost of acquisition, renovation, and maintenance. This restricts strategic flexibility, slows expansion, and absorbs cash that could otherwise fund digital transformation, experience innovation, or sustainability upgrades.

• Limited Digital Maturity and Ageing IT Infrastructure – Reliance on in-house servers, limited use of cloud systems, and basic digital tools place Levwell behind competitors adopting dynamic pricing, digital guest engagement, and automated operations. This digital gap reduces efficiency, operational agility, and guest convenience.

• Annual Pricing Structure Reducing Competitiveness – Setting room rates once a year limits Levwell’s ability to respond to demand fluctuations, competitor pricing strategies, or changes in tourism patterns. Competitors using real-time pricing gain a clear advantage.

• Underdeveloped Marketing Capabilities and Budget Constraints – The marketing team appears under-resourced, limiting Levwell’s visibility and ability to attract new guests. Weak SEO, limited social media activity, and a lack of targeted marketing reduce brand reach, especially among younger travellers.

• Seasonality Dependence and Underutilisation of Assets – Occupancy drops sharply in winter months, yet Levwell carries full operating costs year-round. This seasonal vulnerability reduces profitability and makes the business more sensitive to external shocks.

Opportunities

1. Growing Demand for Wellness and Experience-Based Tourism – Global and domestic travel trends favour personalised wellbeing experiences, retreats, and nature-based escapes, all strongly aligned with Levwell’s locations and brand identity. Developing curated experiences could significantly boost revenue and differentiate Levwell further.

• Digital Transformation to Enhance Efficiency and Guest Experience – Migrating to cloud-based HMS, adopting digital check-in, mobile concierge tools, and personalisation analytics would modernise Levwell’s offering and help compete with tech-enabled rivals.

• Strong Potential for Off-Peak Revenue Stabilisation – Corporate retreats, themed seasonal events, and wellness weekends offer ways to convert low-demand months into profitable periods. This stabilisation would also smooth cash flow and support staff retention.

• Using Guest Data to Enhance Personalisation – Levwell already holds valuable guest data but does not appear to use it strategically. Targeted marketing, loyalty programmes, and personalised recommendations could significantly increase repeat bookings.

• Sustainability as a Differentiation Lever – Enhanced sustainability practices, energy efficiency, waste reduction, carbon footprint tracking, would align Levwell with global expectations and strengthen its CSR profile. It could also allow Levwell to charge premium rates for “eco-certified stays.”

• Asset-Light Growth Models (Inferred) – Although the pre-seen does not mention franchising or management contracts, adopting an asset-light model would allow Levwell to scale more rapidly and reduce capital pressure.

Threats

1. Increasing Competition from Boutique Chains and Airbnb – Levwell faces intensified rivalry from boutique hotels that mimic the personalised experience, as well as Airbnb hosts who offer unique rural homes at lower prices. This intensifies price and experience competition.

• Macroeconomic Pressure on Domestic Leisure Spending – Economic slowdown, inflation, and decreasing discretionary income reduce domestic travel demand. Levwell could see decreased occupancy and shorter stays if consumers tighten budgets.

• Labour Shortages in the Hospitality Industry – Industry-wide labour shortages increase wage pressures and exacerbate Levwell’s already high turnover. This threatens operational stability and service consistency.

• Rising Guest Expectations Around Digital Convenience – Guests expect mobile check-in, smart-room features, seamless Wi-Fi, and digital communication. Levwell’s outdated systems risk making the brand appear behind the industry curve.

• Environmental and Climate-Related Pressures – Coastal hotels are increasingly exposed to climate risks such as storms and flooding. Environmental regulations and expectations are also rising, requiring investment and compliance costs.

• Reputational Risk from Service Inconsistency – If staffing issues worsen, or if digital gaps become more visible, guests may leave negative reviews, immediately impacting occupancy and long-term brand perception.

Strategic Alignment Summary

The SWOT reveals a clear strategic direction:

Levwell should build on its core strengths (brand reputation, unique experiences, and CSR roots) while urgently addressing its weaknesses in staff retention, digital transformation, and marketing effectiveness.

Opportunities lie in enhancing experience-led differentiation, strengthening sustainability credentials, and using digital tools to modernise operations.

Key threats revolve around intensified competition, rising customer expectations, workforce instability, and economic volatility.

Strategic priorities, therefore, must focus on:

• Talent stability and culture rebuilding
• Digital modernisation and cloud migration
• Experience innovation and wellness-led growth
• Off-peak revenue strengthening
• Sustainability as a brand differentiator

These directions will be formally summarised in the final strategic priorities section at the end of the document.

Conclusion and Strategic Priorities

Levwell operates in a structurally attractive yet increasingly challenging hospitality environment. The company benefits from a strong brand heritage, uniquely designed hotels, committed values, and high guest satisfaction. Its rural and coastal locations match shifting consumer preferences for authenticity, tranquillity, and experiential travel. At the same time, Levwell’s operational consistency, community partnerships, and CSR foundations reinforce its premium service positioning.

However, the internal and external analyses reveal that Levwell’s strategic strength is not matched by strategic resilience. High employee turnover, increasing labour scarcity, outdated technology, annual pricing rigidity, and limited marketing capability expose Levwell to heightened operational risk. These weaknesses directly undermine its focused differentiation strategy, which depends on stable service delivery, personalisation, and a cohesive organisational culture.

Externally, the business faces rising guest expectations, intensifying competition from boutique chains and alternative accommodation providers, growing digitalisation across the industry, and strong economic pressures on domestic leisure expenditure. Seasonality further complicates revenue management, while Essland’s competitive environment signals the need for faster innovation, deeper guest engagement, and a more agile pricing model.

Collectively, the analysis highlights that Levwell’s future success lies in strengthening its internal foundation while modernising its value proposition. Its brand is strong, but its capabilities must evolve to stay competitive.

Strategic Priorities

The following strategic priorities align with Levwell’s strengths, address its weaknesses, and respond to the opportunities and threats identified across the analyses. These priorities also reflect what would be expected in an SBL exam as high-quality recommendations rooted in evidence.

1. Strengthen Workforce Stability and Service Culture

Employee turnover is Levwell’s most material strategic risk. Since differentiated service is core to the brand, Levwell must urgently address stability and capability within its workforce.

Key actions:

• Introduce structured training and development pathways
• Enhance staff wellbeing, reward structures, and career progression
• Strengthen middle management to reinforce culture and reduce inconsistency
• Improve recruitment through clearer employer branding and partnerships with hospitality training institutions

A motivated, stable workforce will reinforce the guest experience, reduce operational disruptions, and protect Levwell’s competitive positioning.

2. Accelerate Digital Transformation Across Operations

Levwell’s current technology infrastructure limits both efficiency and guest satisfaction. Modernising systems is essential to remain competitive.

Key actions:

• Migrate the HMS and operational tools to cloud-based platforms
• Introduce digital check-in, digital concierge services, and improved guest communication
• Implement data analytics to personalise guest experiences and drive repeat business
• Explore dynamic or semi-dynamic pricing models to improve yield management

Digital transformation will enhance convenience, reduce administrative burden, and allow Levwell to compete with tech-enabled rivals.

3. Develop Experience-Led and Wellness-Oriented Offerings

Consumer demand is shifting towards experiential and wellbeing-focused travel. Levwell’s locations, hotel designs, and CSR orientation make it well placed to lead in this space.

Key actions:

• Launch curated wellness retreats, mindfulness weekends, and fitness-based programmes
• Expand partnerships with local providers for guided activities and cultural experiences
• Develop distinctive seasonal or thematic packages to attract off-peak demand

This strategy adds value for guests, increases per-guest revenue, and differentiates Levwell from competitors offering generic leisure stays.

4. Diversify Revenue and Reduce Seasonality

Seasonality poses a structural threat to profitability. Levwell must diversify demand to ensure stronger all-year-round occupancy.

Key actions:

• Target corporate retreats and small-scale events during winter months
• Develop loyalty schemes aimed at repeat domestic travellers
• Introduce off-peak promotional bundles with added-value services rather than discounted prices

Reducing seasonal volatility will improve financial resilience, increase staff utilisation, and enhance cash-flow planning.

5. Enhance Sustainability and Communicate It as a Brand Strength

Levwell already has strong CSR roots through local sourcing. Expanding its sustainability efforts can reinforce its brand identity and meet rising guest expectations.

Key actions:

• Formalise a sustainability strategy covering carbon footprint, waste, energy, and water
• Pursue relevant eco-certifications to signal commitment to environmentally responsible practices
• Communicate sustainability achievements clearly across brand touchpoints

Sustainability is becoming a defining factor in travellers’ preferences and can strengthen Levwell’s differentiation.

6. Revisit Expansion Strategy Through Selective Asset-Light Models (Longer-Term)

Levwell’s owner-operated model provides quality control but restricts scalability.

While immediate change may be unsuitable, exploring asset-light arrangements could support future growth without heavy capital investment.

Key options:

• Management contracts in carefully selected locations
• Franchising partnerships under strict quality control
• Joint ventures with local property owners

This approach would extend Levwell’s brand reach while protecting financial stability.

Overall Conclusion

Levwell has a strong foundation built on excellent service, distinctive hotels, and meaningful community integration. Yet the company faces increasing operational pressures and rising guest expectations that require strategic adaptation.

Focusing on workforce stability, digital modernisation, experience innovation, and sustainability will allow Levwell to reinforce its focused differentiation strategy while improving resilience in a competitive and evolving environment.

If Levwell acts on these priorities, it can convert its boutique heritage into sustained competitive advantage and secure long-term growth despite the challenges of Essland’s hospitality landscape.