Please see the top 11 risks Marriott will face as below,
a) General macro economic risk 1) – 3)
1) General economic uncertainty and weak demand in the lodging and timeshare industries could continue to impact Marriott’s financial results and growth.
2) The hospitality industries are highly competitive, which may impact Marriot’s ability to compete successfully with other hotel and timeshare properties for customers.
3) Currency exchange fluctuation might make Marriot very vulnerable to foreign markets.
b) Business risk 4) – 7)
4) Trademark or intellectual property infringement
5) Circumstances, such as the bankruptcy of its branch hotel owner or franchisee, or a failure under some agreements to meet will impact Marriot for sure.
6) Business segments risk -----unbalance gain between managing and franchising
Marriott follows the business model wherein it emphasizes on managing and franchising hotels, rather than owning them. The company operated 46% of its hotel rooms under management agreements, 52% under franchise agreements. But, as compared to this, only 33.6% of the revenue in FY2009 were earned through franchising while 66.4% from own operation. The emphasis on management contracts and franchising although tends to provide more stable earnings in periods of economic softness, however does not provide much scope for revenue growth.
c) Risk from emerging markets :
7) The economic and political instability in the developing country lead to the risk of Marriots operation including customer loyalty and reputation. In 2008, a massive bomb blast has hit the Marriott Hotel in Pakistan's capital, Islamabad, killing at least 40 people. These incidents could result in lower check-ins at Marriott hotels which will affect the company’s business and reputation in the long run
d) Capital Structure Risk 8)-8)
8) Even through it’s a feature for the hotel