Академический Документы
Профессиональный Документы
Культура Документы
TOPICS
NO
01 Hotel industry –an overview
02 Contribution to Indian economy
03 SWOT analysis
04 Trends in hospitality sector
05 Challenges for hospitality industry
06 Use of IT in hospitality industry
07 Importance of human resource in
hospitality sector
08 Future of hospitality sector
09 The hotel industry
10 Related cases
11 Customer analysation
12 Bibliography
HOSPITALITY INDUSTRY – AN OVERVIEW
Hospitality is all about offering warmth to someone who looks for help at a
strange or unfriendly place. It refers to the process of receiving and
entertaining a guest with goodwill. Hospitality in the commercial context
refers to the activity of hotels, restaurants, catering, inn, resorts or clubs who
make a vocation of treating tourists.
With unlimited tourism and untapped business prospects, in the coming years
Indian hospitality is seeing green pastures of growth. Availability of qualified
human resources and untapped geographical resources give great prospects
to the hospitality industry. The number of tourists coming to India is growing
year after year. Likewise, internal tourism is another area with great
potentials.
The hospitality industry is a 3.5 trillion dollar service sector within the global
economy. It is an umbrella term for a broad variety of service industries
including, but not limited to, hotels, food service, casinos, and tourism. The
hospitality industry is very diverse and global. The industry is cyclical;
dictated by the fluctuations that occur with an economy every year. Today
hospitality sector is one of the fastest growing sectors in India. It is expected
to grow at the rate of 8% between 2007 and 2016. Many international hotels
including Sheraton, Hyatt, Radisson, Meridien, Four Seasons Regent, and
Marriott International are already established in the Indian markets and are
still expanding. Nowadays the travel and tourism industry is also included in
hospitality sector. The boom in travel and tourism has led to the further
development of hospitality industry.
Capital
GDP Employment Visitor Export Personal T&T
Investment
Govt.
Expenditure
Outlook
7.80% 1.40% 10.90% 6.90 % 8.30% 7.70%
for 2006
Outlook
for 2007- 6.60% 1.00% 7.80% 6.70% 7.80% 6.60%
2016
ATITHI DEVO BHAVO (guest is God)- we have all heard this phrase many
times during our childhood from our parents and grand-parents. We can also
find its presence in the earliest Vedas and religious epics. Hospitality is deep-
rooted in our traditions and comes as an integral part of our heritage. In very
simple terms, hospitality is the art of being warm to strangers and has been
derived from the Latin word hospitalitem, which means "friendliness to
guests".
The hospitality industry covers a diverse range of establishments in the form
of accommodation, food and drinks. It includes hotels, motels, restaurants,
bars, ships, airlines and railways. The concept of hospitality business started
when people started traveling away on business and they needed a place
away from home which could cater to all their needs.
Today hospitality has evolved from the basic food and accommodation
industry and taken a very important position in almost all businesses. In fact,
it has become a huge industry and drives economies across the globe. The
scope of hospitality/ service industry today is far more than one could have
ever imagined a few years back. Earlier people who graduated from a Hotel
School could get employed either in Hotels, Cruises or Airlines.
But service is the BUZZ word for all businesses today. Be it the Retail
Sector, Banking Industry, BPO, Telecom world, Real Estate or any other
sector having direct customer contact, a person with hospitality background
has an edge above the rest, because of their sheer capability of understanding
the needs of a customer better and handling difficult customers/ situations
efficiently.
Hotel industry depends largely upon the foreign tourist arrivals further
classified into business travelers (around 65% of the total foreign tourists)
and leisure travelers. The following figures show that business as well as the
leisure travelers (both domestic and international) formed major clientele for
hotels in 2004.
Over the last two years, the hotel industry has seen higher growth rates due
to greater number of tourist arrivals, higher occupancy rate (being around
75% in FY'06) and significant increase in average room rate (ARR). The
major factors contributing to this growth include stable economic and
political conditions, booming service industry, FDI inflow, infrastructure
development, emphasis on tourism by the central as well as state
governments and tax rationalization initiatives to bring down the tax rates in
line with the international levels.
Accommodation
• Hotels,
Residential
Public houses
• Motels
• Resorts
• Sanatorium
• Nightclubs
• Public houses
• Restaurants
• Travel Agents
• Airline Cabin Staff
• Travel technology
• Accountancy
• Occupational Health and Spa
South Asia is and will remain a must-visit destination and India is looking
more and more lucrative. Within the nation, major contribution as
destinations will be from the growing tier I and II cities with a special
emphasis on business hotels across categories as well as the prime leisure
destinations like Goa, Rajasthan, etc, which will remain on the growth path,
creating the aura for India as a leisure destination. Accordingly, the needs of
the traveller, will be nothing less than perfection. Jain says, "They will be
more discerning and more value conscious." With an increase in choices
available, they will be less forgiving of service deficiencies. Guests will
require higher levels of service in the full-service segments, which will
warrant greater training requirements for hotel staff. The limited service
hotels will require a complete shift in the perception of customer service.
Nevertheless, this is directly related to the travellers' travel persona. "The
same person will have different standards when he/she is on a business trip,
versus an escape with his partner versus a leisure trip with the family," he
explains.
Future-wise
Hotels as a product will witness evolution, says Jain. According to him, "As
the market becomes more segmented, especially in the mid-market and select
service categories, more product types will appear." The driving force behind
these will be global brand standards and therefore they will have standard
specifications creating a degree of uniformity and standardisation in certain
limited and mid-market hotel segments. Differentiations in product type will
evolve more at the higher end of the market with boutique hotels, resorts,
convention centres, etc. The need to differentiate design will play an
important role. Various brands and operators will play a larger role in driving
design standards, getting involved at early project planning stages. "As hotel
segments cater to specific demand segments, design typologies will be more
customised to suit traveller's lifestyle," says Jain. Equal importance will also
be given to green-building concepts in terms of development and operations,
which will go beyond cost-saving, placating the demands from both investors
and customers. "From the investment side, there will be enough
environmentally-conscious investors, who will only invest in green buildings
and will also pay a premium for such properties relative to other properties,"
predicts Jain. In addition, 'green-conscious' business and corporate groups
will patronise hotels and brands that support green concepts," he further
adds.
Besides all this, the reliance on technology will move beyond Wi-Fi and
internet requirements to tools to support sales and marketing as well as yield
management. Even basic interiors will be upgraded with the use of
technology like self check-in and information kiosks. This will also revamp
sales and marketing as international brands will leverage their central
reservation systems and will initiate networks with third party reservation
agencies. In addition, systems will become more sophisticated and targeted,
customising sales and marketing efforts for each targeted traveller.
Being part of a real estate money management and services company, Jain
discusses the various driving factors for growth opportunities, quoting
research done by Jones Lang LaSalle Hotels. He believes that if the country
is able to sustain its economic growth specially in the service sector, it will
have a direct influence on the hotel industry. This is directly related to the
incoming foreign investments, not just in the hotels but the economy as a
whole. Also equally important is the fact that India has now discovered the
power of marketing and with campaigns like Incredible India, there are also
the various large scale regional and global events like the upcoming
Commonwealth Games, Asian Games and the recent Indian Premiere League
that builds interest about the nation. "These are just external factors. The
policies and incentives that will be provided over the next decade could
further act as a catalyst to this industry," says Jain. Apart from these external
factors there are other factors where the industry can be given a great boost.
For instance if land prices became more realistic, the process of getting
approvals and licences to build and operate hotels are streamlined, together
with strong infrastructure development and investment and more tax/levy
incentives being provided to build hotels, it would prove very fruitful for the
industry. "Also, moving to a more 'international' FSI guideline will stimulate
development. Today, FSI's for hotels in India are only a fraction of those that
exist in other mature markets," says Jain. He believes that there would be no
stopping the growth in the industry if these measures were undertaken. But
the fact remains that half of these changes will only occur if the government
begins to take some proactive measures and provide the much needed stimuli
to further accelerate development.
SWOT ANALYSIS
STRENGTHS
1. Natural and cultural diversity : India has a rich cultural heritage. The
"unity in diversity" tag attracts most tourists. The coastlines, sunny beaches,
backwaters of Kerala, snow capped Himalayas and the quiescent lakes are
incredible.
WEAKNESSES
OPPORTUNITIES
1.Rising income: Owing to the rise in income levels, Indians have more
spare money to spend, which is expected to enhance leisure tourism.
2.Open sky benefits: With the open sky policy, the travel and tourism
industry has seen an increase in business. Increased airline activity has
stimulated demand and has helped improve the infrastructure. It has
benefited both international and domestic travels.
THREATS
1. Low cost carriers: Travelers in general are more price sensitive to airfare
than they are to hotel room rates. Often a low airfare will stimulate demand
for travel even if hotel prices are increasing. LCCs are a good option for
business travelers, as they have advantages like low costs, more options and
connectivity.
The popularity and growth of the Internet has changed the way many
businesses and services are marketed. With the potentially unrestricted
access to millions of people, hotel, resorts, and lodges have capitalized on
Internet advertising and promotion as a means of adding value to the services
they are able to offer; thus, enabling them to cater to a niche market.
Having a solid understanding of the value that online directories offer to both
visitors and business owners alike, the directory was created to provide a
wealth of area information that is complied into assorted categories for easy
access. Featured on the directory are a wide range of area vacation and resort
properties, as well as area attractions and activities; thus, making it easy for
visitors to find what they are looking for in a vacation, while providing the
business owners with an affordable way to market their business. This
service has shaped the way that the Almaguin Highlands tourist industry
functions and will continue to offer many benefits to this region.
Comparing this total with the need for 20,000 additional personnel each year,
it is clear that further analysis is required. A survey being conducted to
identify the requirements for trained manpower at each level of employment
would focus on general management trainees, trainees in kitchen
management, housekeeping management, operational trainees, front office
and accounting management, chefs, butlers, captains, bakery, confectionery
and other specialized cooking.
The committee should review the present situation and suggest the steps to
be taken to reduce the gap between the demand and supply of human
resources in the industry .
Some of the main features of the Indian hotel industry include the following:
The hotel industry can be further categorized into three segments: hotels,
restaurants and contract caterers.
A. HOTELS
The hotels in India can be broadly classified into the following segments:
1.Star rated hotels
2.Heritage hotels
3.Budget hotels
4.Unclassified hotels
Star rated hotels: They form 30% of the industry size. These are mainly
situated in the business districts of metro cities and cater to business travelers
and foreign tourists. These are considered to be very expensive. They are
built over an area of up to 18000 sq. meters
1 Five star deluxe
2 Five star
3 Four star
4 Three star
5 Two star
6 One star
The first 2 types are usually located in business areas of metro cities and
cater to foreign tourists, business travelers, top government officials and
political brass, offering luxury at a high price.
You’ll find the next 2 types in tier II cities and tourist destinations, preferred
by mid-level executives and leisure tourists.
The last 2 types are found in smaller cities and around tourist spots, preferred
by domestic tourists.
Reputed Indian veterans include ITC, Indian Hotels Company (Taj group),
East India Hotels (Oberoi group), Hotel Leela Venture and ITDC
hotels. Foreign hospitality players include Marriott, Radisson, Sheraton,
Meridien, Hyatt, Four Seasons Regent, Carlson group, Jumeirah and
Mandarin Oriental and Dubai’s Istithmar luxury hotels,
Heritage Classic: These include hotels built between 1920 and 1935.
Heritage Grand: These include hotels built prior to 1920.
Heritage: These include hotels built between 1935 and 1950.
Unclassified hotels: They’re motels spread across the country. They form
19% of the industry size. Low price is their only USP.
B. RESTAURANTS
These typically include fast food chains, ethnic restaurants, fine dining and
coffee bars. The major players include Barista, Mc Donalds, Ruby Tuesday,
Bercos, etc.
CONTRACT CATERING
This includes any catering business unit that is formally not a part of the
hotel industry but is closely allied to it. Some of the major players in this
category include Sodexho, Compass Group, etc.
RELATED CASES
"We achieved cash break-even last year and we hope our real profits will
start here-on," McDonald's India Franchisee (Northern and Eastern)
Managing Director Vikram Bakshi said.
The company, which currently runs 126 restaurants in the country, has so far
committed an investment of Rs 1,200 crore in India for setting up cold chains
and other infrastructure.
"We will set up 40 outlets by the end of the current year at an investment of
about Rs 100 crore," Bakshi said.
The company aims at doubling its turnover every three years, Bakshi said
without disclosing details.
"Our aim is to now push for numbers wherever it is possible. We are talking
of doubling our turnover every three years for at least six years.
Automatically, the number of outlets should also double," Bakshi said.
The award by Britain's widely read magazine, Theme, celebrates the best in
the industry bringing together excellence in modern drinks, design and
hospitality in different categories.
The restaurant was last year awarded 'The Best Wine List in London' by 'The
Independent' newspaper and 'The Best Pan-Fusion Food in London' by the
'Evening Standard'.
Among the list of firms that have ventured into this segment are Puducherry-
based leather accessories maker Hidesign and Bangalore-headquartered
liquor firms Khoday Group of Industries and John Distilleries. According to
experts, many people who own land are cashing in on the demand for hotel
rooms.
“We decided to get into the hospitality business because we believe we could
offer something different to the customer, a combination of fashion and
design. We are also getting international recognition for our niche offering,”
says Dilip Kapur, president, Hidesign. Their third property, located between
Chennai and Puducherry, is expected to open by mid-2009. The 70-room
hotel will see an investment of Rs 40 crore.
CUSTOMER ANALYSATION
QI] Maximum amount you will prefer to pay in a hotel for a one
night stay?
The answer to this one wasn’t uniform. As it changed depending from person
to person. Again it depends on a person’s spending behavior and his
priorities. If he prefers comfort more than price he tends to spend more for a
one night stay but the situation gets reversed if he considers price as his
priority. The purpose for which he rents the hotel room also plays an
important role in determining his budget. But on an average this is what we
could infer:
That depends on the purpose for which one rents a room along with
his budget. On a vacation with friends and family and a medium
budget resort is preferable. Premium class might go in for a club or
five or seven star hotels.