Case Study #1 The Sleep Well Motel In April 1990, Will Shelton was evaluating information received from the owner of a motel that was for sale in Fort Morgan, Colorado. Will had answered an ad in the Wall Street Journal under the heading “Business for Sale. ” To Will’s surprise, he received a call directly from Hank Bennington, the owner of the Sleep Well Motel of Fort Morgan, Colorado. During the conversation, Mr. Bennington described his motel and his reason for wanting to sell. He also described the many advantages of living in Colorado and promised to send Will more information on his company.
The next day an overnight package of information arrived at Will’s home. Background on Will Shelton At 44 years of age, Will felt that he had climbed the corporate ladder about as high as he was likely to go. He also had doubts about remaining in a large corporation for the rest of his working life. The present position Will held was director of marketing research for a large electronics corporation located in Houston, Texas. Despite the title, Will felt his position was not satisfying. “Marketing research in an industrial company just isn’t very exciting or personally rewarding; in fact, it’s downright dull. This statement pretty well summarized Will’s feelings. Although Will had been trained as an engineer, he discovered that engineering wasn’t his primary interest and began to move into marketing. When the position of marketing research director opened in his company, Will applied and was elated when he learned he had received the position. In reviewing this move, Will stated that he believed the fact that he had recently completed an MBA during part-time studies had helped him to obtain the position. Will had recently gone through a divorce and his former wife had been awarded custody of the two boys.
Because the laws of Texas called for a division of shared property and child support, Will had suffered a financial setback and was faced with large ongoing payments to his former wife other than for child support. Despite his recent financial problems, Will felt he could raise sufficient money to purchase the motel with a bank mortgage. In his earlier years, Will had studied and worked in New Mexico. He had learned to ski and also enjoyed hunting and fishing in that state. Will felt the people in that part of the United States were somehow more genuine and that life was better in many ways than his present life in Houston.
As a result, when he read about a motel for sale in Colorado, Will had an automatic interest. Background on the Sleep Well Motel As Will began to pull his thoughts together, he reviewed what he had already learned about the Sleep Well Motel. This information had been gained through the telephone conversation with Mr. Bennington plus sales literature and a brief historical sketch that had been included with data sent by Mr. Bennington. The motel had 80 rooms. It was affiliated with a chain several years ago, but was no longer associated with that company. The property was located off U. S.
Highway 76, which carried traffic between Denver and Nebraska. Mr. Bennington did not have data concerning the profile characteristics of his customers, but told Will that his customers were commercial travelers such as repair crews, independent sales reps, middle-aged retired couples and young budget-minded travelers. The motel did not have an attached restaurant, but there was a cafe about two blocks away. There was also a laundromat nearby that was frequently used by the guests. The property was 17 years old and was described as clean and comfortable, but in need of “cosmetics” and new carpeting.
Mr. Bennington said he had a dependable night clerk, but served as the manager/front-desk clerk himself during the day. He said that dependable maid service was a problem for all of the motels in the area, and his was no exception. Reasons for Selling In the telephone conversation, Mr. Bennington stated he had recently lost his wife in a tragic car accident. Since that time he had been unable to concentrate on the business and now wanted to return to his home state of Illinois to be near his son’s family. In addition, Mr. Bennington said he wanted to be perfectly candid.
He said that after the car accident he failed to keep as close a watch on the business as he should have. Mr. Bennington admitted that he felt ill at ease in the field of marketing and felt the company would need strong direction in that area. He went on to say that Will should be a “natural” to manage this type of business. After skimming the material, Will became increasingly enthused about the possibility of owning and managing this motel. He knew there were many additional questions he would need to ask in his next phone conversation. At the moment, the most exciting part was the possibility of living in Colorado and being his own boss.
Will knew he would have to develop a list of penetrating questions to ask Mr. Bennington and also knew he needed to study the financial sheets in detail. That could come later. For the moment, Will was picturing himself on the slopes of Colorado’s beautiful mountains gracefully skimming down the snow. Questions: 1. Discuss the pros and cons of Will Shelton owning and operating the Sleep Well Motel. ????? 2. Do you believe that Will’s marketing/marketing research background will be of great assistance to him in running this motel? Why or why not? ????? 3. Why do you suppose Mr.
Bennington said that Will’s marketing background would be a real benefit? ????? 4. What kinds of marketing/sales tactics are best suited for a motel such as the Sleep Well Motel? ????? This tool is designed to help you achieve the grade you want. Names: ????? Total Marks: ????? / 50????? |Section |Outstanding (A) |Excellent (B) |Good (C) |Needs Work (D) | |Q1: Discussion of Pro’s and|A minimum of five valid pros |A minimum of five valid pros |A minimum of five valid pros and |Incomplete listing of pros and | |Con’s and five cons are presented in|and five cons presented in |five cons presented. |cons. | |/10 |sentence format. |sentence format. |Little or no discussion of each |Little or no discussion of each | | |Each pro and con is discussed |Limited discussion of each pro |pro and con. |pro and con. | | |in some detail. |and con. |Little evidence of extra research |No research efforts are evident. | | |External research is used |Some external research is used |efforts. | | |extensively to support pros |to support pros and cons. | | | | |and cons. | | | | |Q2: Will’s Marketing/ |Good, direct answer to the |Good, direct answer to the |Good, direct answer to the |Direct answer to the question. | |Marketing research |question. question. |question. |Answer is not well supported by | |background? |Answer is fully supported by |Answer is supported by facts |Answer is complete, but not well |facts from case, nor is the | |/ 10 |facts from case. |from case. |supported by fact. |opinion of the student | | |Student “opinions” are |Student “opinions” are |Opinions are unsubstantiated. |substantiated. | | |substantiated with outside |substantiated. | | | |research. | | | | |Q3: Bennington’s comments. |Good, direct answer to the |Good, direct answer to the |Good, direct answer to the |Direct answer to the question. | |/ 10 |question. |question. |question. |Answer is not well supported by | | |Answer is fully upported by |Answer is supported by facts |Answer is complete, but not well |facts from case, nor is the | | |facts from case. |from case. |supported by fact. |opinion of the student | | |Student “opinions” are |Student “opinions” are |Opinions are unsubstantiated. |substantiated | | |substantiated with outside |substantiated | | | | |research. | | | |Q4: Marketing and Sales |Detailed discussion of various|Discussion of various tactics |Some discussion of various tactics|Limited discussion of relevant | |Tactics |tactics relevant to this |relevant to this property. |relevant to this property. |tactics. | |/ 15 |property. |Some new marketing ideas. |Few marketing ideas. |Limited ideas to market property. | | |Innovative marketing ideas. Shows understanding of the |Shows some knowledge of the |Shows little understanding of the| | |Shows solid comprehen-sion of |marketing mix as it applies to |marketing mix as it applies to |marketing mix as it applies to | | |the marketing mix as it |this property. |this property. |this property. | | |applies to this property. |Some research has been done. |Little outside research is |No research effort has been made. | | |Extra research effort is | |evident. | | |evident. | | | | |Presentation of Report |No spelling, grammar or |Minor spelling, grammar or |Some spelling, grammar or |Unacceptable amount of spelling, | |/ 5 |formatting errors. |formatting errors. |formatting errors. |grammar or formatting errors. | | |Accurate utilization of |Use of references appropriate. |References naccurate or difficult|References missing or inaccurate | | |references; easy to follow. |Few difficulties in the |to follow. |and difficult to follow. | | |The structure and layout of |structure and layout of the |Some difficulties in the |Report layout and design | | |the case is logical and easily|case. |structure and layout of the case, |(packaging, materials and print | | |followed. | |making it difficult to follow. |quality) poor quality. |