Scandic Faces Competition From New Operators in Key Destinations

Scandinavia’s largest hotel group Scandic is
facing some stiff local competition in some key destinations and
cities. We find out how they are planning on tackling this new
scenario.

An unexpected end to 2018

Nordic hotel group Scandic did
not see 2018 ending the way it looks to be going. The company
surely thought it was going to finish the year without much to
worry about, given their domination of the Scandinavian market and
some recent acquisitions that have cemented their position as the
leading hotel company in the region. However, third quarter results
indicate an increase in competition from other hotels and operators
in Copenhagen, Oslo and Stockholm, which would be important
destinations for Scandic.
This competition has been reflected in a slowing of growth for
Scandic in
the third quarter, something that they would have expected to see
coming towards the end of the year.

Cost cutting

One of the strategies that Scandic
might employ to curb this unexpected onslaught of competition in
these vital locations is to implement some cost cutting measures,
although CEO was vague about what form these could possibly take,
saying that there is no one strategy in terms of cost cutting that
they are currently putting in to practice. Although the competition
has affected Scandic’s
growth, Frydenberg says that this may not be apparent from the
analysis on room rates, but is reflected in occupancy, explaining,
“When you have more supply, it doesn’t necessarily have a
direct impact on the average rate in the near-term, but it does
have an impact on the occupancies.”

Restel acquisition

Scandic
acquired Finnish hotel group
Restel
in December of 2017, and the group was delighted with
how well the new brand was integrating into their portfolio.
Revenue was boosted significantly by Restel’s
presence under the Scandic
umbrella, with profits increasing by 22.6% to bring the total
figure to $535m in the third quarter of this year. So it will no
doubt be a disappointment for Scandic
that the overall growth and profit will be hit by this new wave of
competition. For further information, click
here
.

Let’s take a look at a few other projects currently underway
by Scandic:

Scandic Aarhus
Library Park

The Aarhus waterfront will become home
to a new landmark conference hotel. The complex will include a
29,000 m2 hotel.  …[READ
MORE]
Scandic
Spectrum

Scandic Spectrum will be an obvious hub
for social gatherings and spending the night and will provide a
great view of the city and the harbor.  …[READ
MORE]
Scandic Hotel –
Heksinki Central Railway Station

The new hotel,
will be located next to the Ateneum Art Museum and the Finnish
National Theater  …[READ
MORE]

More information on hotel projects by Scandic can be found in
the 
TOPHOTELPROJECTS
database
.
 TOPHOTELPROJECTS is the specialized service
provider of cutting-edge information of the hospitality
industry.

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Scandic Faces Competition From New Operators in Key
Destinations
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Source: FS – All-Hotels-Blogs
Scandic Faces Competition From New Operators in Key Destinations