Airbnb is a company that provides various types of accommodation services. Belize is a country that is located close to the Caribbean Sea, and it serves up an excellent location for Airbnb to setup their operations. While Airbnb is a relatively successful company, expanding into new markets requires an informed approach to realize the goals of the company. Setting up a company such as Airbnb to provide accommodation services would require the implementation of various key economic concepts. These economic principles and concepts have been crucial towards the success of various companies all through the years (Levitt & Dubner, 2011).
In order to be successful setting up a company like Airbnb in a place like Belize, one would need to think through a series of important questions. Economic theory can help to guide that particular inquiry, allowing one to best understand what needs to be done in order to provide maximum value to the citizens of Belize while also returning some value to shareholders of such a company. In particular, the theories of decision-making theory, consumer behavior theory, and supply and demand are critical to consider for any person who wants to be successful at moving an established business into a new market.
One of the most important theories to consider would be the decision-making theory, which is a dynamic approach to determine how specific decisions are made. These decisions are made even when there are various unknown variables and vague decision-making environments as well. Also, this theory would be important since it leverages various disciplines such as philosophy, mathematics, psychology and more. Decision-making theory suggests that in order to be successful, one has to have the proper inputs. This will, in turn, produce appropriate outputs that might include a company being successful in a new, emerging market like Belize. Some of those inputs, which might be suggested according to decision-making theory, would be considerations on the labor force in the country, considerations revolving around the political environment there, and considerations on whether consumers there are willing to adhere to the kind of company that parrots American values of tourism (Schwartz, 2016). Airbnb is very much based in the idea of the sharing economy that has become so popular and important in the United States. Any good decision-making matrix will need to consider whether there is enough cultural overlap for this to work in Belize just the same.
The consumer theory is also another important aspect of implementing setting up Airbnb to help the Belizeans. In particular, this theory will help the company to better understand how people spend money in relation to accommodation preferences and budget limitations. Consumer theory also demonstrates how customers make choices, especially when restraints such as income and prices of accommodations services are present (Levit & Dubner, 2011). These specific restraints play a major role in the buying and spending habits of clients. Consumer theory focuses some of its attention on the important differences among consumers in different countries (Zeugner-Roth et al., 2015). In order to be successful in setting up a company like this in a country like Belize, one could not just go in there and try to apply the same model being used in San Francisco. One would have to figure out whether there is something in particular that consumers in this country like and want (Cross et al., 2018). From there, it will be much easier to gear not only one’s services to the people, but also one’s marketing so that the company can tell its story in a way that is compelling enough to connect with these individuals.
Also, another economic theory that will be important in setting up Airbnb to help the Belizeans would be the supply and demand theory. The theory will be beneficial in that it allows the company to calibrate their services to suit the demands from customers. More so, this theory also helps to show the relationship in between the supply and demand of the company. This theory is one of the most basic and important approaches that any successful businesses venture should consider. In looking at the particular situation in Belize, one would need to consider just how much demand there is for places to stay. On one hand, Belize is becoming a more popular place to visit, especially among young American travelers. On the other hand, tourism there is already cheap, so there may not be a need for people to save money by choosing an Airbnb over a hotel. Considering the supply of housing in the country, as well as the specific supply of vacation housing, will allow one to figure out what kind of market might be there for the service.
This will help the Belizeans in that it will help them gain access to cheap and high-quality accommodation resources. Airbnb is one of the leading companies in the world when it comes to providing accommodation resources. More so, the presence of the company in the country will also help in setting high standards for other Belizean companies that operate in the accommodation market niche. Belize is a country that is located along the Caribbean Sea. As a result, it often experiences high amounts of tourist activities all throughout the year. More so, the country is the recuperation stages of years of political instability. As a result, this makes a great destination to start an accommodation business. Still, unless one is willing to apply appropriate theory, it will be very difficult to set up a successful business there.