Magnetic Water Treatment

Introduction to Hospitality Industry
UNIT 1
1.1 Meaning and definition

1.2 Historical evolution and development
1.3 Hospitality as an Industry
1.1 Meaning and definition
Introduction
Tourism is not just about the facilities and attractions provided for visitors. It is about people
and especially about the relationship between the customer and the individual providing
service. Everybody employed in tourism needs to have the knowledge, skills and attitudes to
provide the standard of product and service that customers expect. Knowing about the
tourism industry, its component parts and especially where you fit in is an important starting
point to a successful career in tourism.
What Is Tourism?
Tourism may be described as the activities of tourists and those who cater for them. It is a
highly diversified business with many component parts ranging from airlines to hotels.
Tourism is concerned with providing:
 Travel and transport facilities
 Accommodation
 Food and drink
 Entertainment/recreation
 Information and assistance
 Souvenirs
Above all, tourism is a hospitality industry providing a service to visitors in a warm and
welcoming way.
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Who Are Tourists?

Tourists are people who for a variety of reasons travel to destinations, where they stay at least
one night. Excursionists are also visitors that do not make an over-night stop, such as day-
trippers or people on cruises.
There are several basic types of tourists:

 People who travel to another country simply for pleasure/leisure.
 People who travel to pursue specialist activities, e.g. cultural tourism, visit to
historical sites.
 People who travel for business purposes.
 People who attend international conferences and meetings.
 People who travel to another country to pursue specific courses of study.
 People who visit their friends and relatives in another country.
 People in search of their ancestral roots.
 People who travel for religious reasons, e.g. pilgrimages to Mecca.
 Retired people who have time to spare and money to travel.
1.2 Historical evolution and development
Origins of Hospitality Industry

Early travelers were either warriors or traders or people in search of knowledge and there
were no hotels. Warriors and conquerors pitched their tents for accommodation while traders
and persons traveling for knowledge placed a high value on hospitality and sometimes traded
their merchandise for lodging.
Inn keeping can be said to be the first commercial enterprise and hospitality one of the first
service for which money was exchanged. Inns of the Biblical times offered only a cot or a
bench in the comer. Guests stayed in large communal rooms with no sanitation and privacy.
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The rates were, of course, reasonable. The company was rough. Travelers shared the same
quarters with their horses and animals.
King James Version of Bible mentions that a Bethlehem innkeeper turned Mary and Joseph
away, because there was "no room at the inn". According to Biblical scholars the innkeeper
may have meant that the room was unsuitable for a woman about to give birth to a child. At
that time, and probably for several centuries after that, men and women shared the same
accommodation accompanied by their horses and livestock. The stable where Mary and
Joseph spent the night was probably almost as comfortable as an inn and at the same time
certainly more private than the inn itself.
In the 3rd century AD, the Roman Empire, developed an extensive network of brick paved
roads throughout Europe and Asia Minor, and a chain of roadside lodges was constructed
along the major thoroughfare from Spain to Turkey.
Till the Industrial Revolution of the 1700s, no significant improvement was made in the inns,
and taverns and they were not very suitable for aristocrats. To accommodate wealthy
travelers, luxurious structures were constructed with private rooms, individual sanitation and
comforts of a European castle. These elegant new establishments adopted the French word for
mansion-'Hotel'. Their rates were beyond the reach of an ordinary person.
In America early inns were-modeled after European taverns with sleeping quarters shared by
two or more guests.
Herman Melville in his novel Moby Dick has mentioned about a seaman who checked into a
room of a nineteenth century inn and next morning woke up to find out that he was sharing
the bed with a cannibal. Sharing beds was a very common practice in early American and
European inns. Throughout the 1800s American innkeepers improved their services and
continued to build larger and more amply equipped properties and most of these properties
were located near seaport towns.
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The tendency of Americans to travel more provided an inspiration to lodging operators. The
nation's democratic spirit also led to the development of comfortable and sanitary lodging
within the reach of an ordinary person.
Nature Of The Hospitality Industry
Basically for all those who are away from their home, hospitality industry provides services.
Hospitality industry consists of those businesses and institutions and (provide food, and
lodging-such as hotels, motels, lodges) inns, cruise ships and restaurants etc. To some extent
it also inc1udes the air lines industry. In a broad sense, any group engaged in tourism,
entertainment, transportation and lodging are covered under hospitality.
Hospitality industry is a part of travel and tourism industry. Early travelers were mostly
warriors, businessmen, and scholars in search of knowledge or people in search of
occupation. Mostly warriors would pitch their tents for accommodation while businessmen
would look for a comfortable and safe place; and would often pay through their merchandise
or cash to people providing them accommodation and food. The poor people traveling to far off
places in search of job or occupation were provided the facilities of food and accommodation
free of charges. As per some authentic sources, to facilitate travel throughout Western Europe
a highway was constructed in 312 BC. Travel could be done on this highway by chariots.
Later in 117 AD this roadway was reconstructed and covered a distance of nearly 50,000
miles.
Hospitality business now is both profits making as well as non-profit making. For example,
commercial hotels are profit making while canteens, cafeterias and religious catering outlets
such as langars and bhandaras are non-profit making.
Hospitality industry provides services, which are need oriented, and the services vary with the
needs. For example, the needs of a business executive shall be a business hotel while the
needs of a student is generally a youth hostel.
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Traditional ways of providing hospitality in our country varies from place to place. In Jammu
and Kashmir, Kashmiri Pandits, who are very God-fearing people, consider guests as epitome
of God almighty Himself and welcome the-guest by a rangoli called Vyog patterned on their
door-steps out of flowers and leaves. When the guests come, the host takes a glass of water
and touches it on their forehead, so as to drive all evil spirits away from them. A special herb
called Isbandh is also touched on the forehead and then burnt in the Kangri. The head of the
Dogri family, another community of Jammu, goes to the door of the house to welcome the
guest. The head female member of the family performs aarti of the guest and puts up a tilak
on the forehead of the guest. Every day in the southern part of the country, ladies make
rangoli of rice, flowers and flour etc. It is believed that by doing so they are inviting guests
and giving a message that the house is open to welcome guests. Greeting guests with folded
hands, touching their feet in respect, aarti, puja, garlanding, applying tilak and ringing of
bells, are numerous other ways of providing warm reception and welcome-and hence
hospitality-in various parts of our country. Beating of drums, dhols, blowing of trumpets,
exotic dances and shows such as puppetry etc. are all different ways of expressing warm
hospitality in our country.
In different parts of the world, traditional style hospitality is provided. For example, ladies
decorated with flowers greet the guests in Honolulu. In some countries, local people gather to
welcome visitors -at airports. Providing shoeshine service for every guest in the morning in a
hotel in Bangkok is a part of welcome to the guests. In one of the hotels in Mauritius, after
the dinner service is over the staff collects in the dining area and sings local songs in the
honor of the guests. Memorizing the names of the guests and addressing them by their names
is another way of providing
Traditional Style Hospitality for Visitors

Hospitality in one of the hotels in France is shown by Singing melodious songs at the time of
departure of a guest is done in one of the resorts in Fiji.
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All the above-mentioned examples along with many others reflect the concept of hospitality
provided by highly trained and experienced staff. Through their sincere efforts every guest
feels like a VIP and a welcome syndrome is generated.
The past, present and future of the hospi1ality industry are linked together. Comfortable and
sanitary lodging was once considered the exclusive privilege of the wealthy only, but with the
rise of industry and democracy, hospitality has now become available to common men also.
Hospitality has both influenced and is being influenced by cultural, social and economical
changes in society. Hospitality business tends to satisfy human needs and also play an
important role in the satisfaction of social needs such as belongingness, longing ness, love,
esteem and status.
1.3 Hospitality as an Industry
Hospitality Market
Hospitality has a very vast market. All those who have stayed in hotels or have plans to stay
in hotels or any other lodging establishment can be put under hospitality market. Hence all
travelers including tourists, visitors, businessmen, leisure travelers, pilgrims and company
executive‘s etc- can be the hospitality market. Depending upon the purpose of travel people
can be classified under either commercial hospitality market or leisure hospitality market.
Hotel
Common Law states that a "Hote1 is a place where all who conduct themselves properly, and
who being able to pay and ready to pay for their entertainment, are received, if there be
accommodation for them, and who without any stipulated engagement as to the duration of
their, stay or as to the rate of compensation, are while there, supplied at a reasonable cost
with their meals, lodging and other services and attention as are necessarily incident to the
use as a temporary home."
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A hotel may be called as an establishment where primary business is to provide to the general
public lodging facilities and which may also furnish one or more of the various services such
as food: beverage, laundry, uniformed services etc. Hence, hotel can also be called as home
multiplied by commercial activities.
As per the Reader's Digest Dictionary the term 'Hotel' refers to 'a house of entertainment of
travelers'.
According to the Encyclopedia Britannica the word 'Hotel' is of ancient origin, but its use in
English for a house offering lodging and food for travelers is recent. The Hostlers of London
took the name of Inn keeping in 1473. The world Hostler' or 'Ostler' having come to mean an
inn servant.
The term 'Hotel' was used in England in about 1760. British law as a ―place where a bonafide
traveler can receive food and shelter, provided he is in a position to pay for and is in a fit
condition to be received‖ defines hotel or inn.
In legal terminology a: hotel is an inn and is required under common law to offer to its visitors
lodging, food and protection, 10 their baggage. Hotel service is generally based on these three
fundamental necessities of life. In addition to these a modem hotel provides its visitors many
luxuries of modem urban city living, all under one roof.
1. Inns Public houses in early times in England were called inns. Normally the term 'Inn'
was meant for the finer establishments catering to nobilities and clergy: In France these were
ca1led 'HOTELLERIES‘.
2. Taverns. The house frequented by common man were known as taverns. The less
important establishment in France were called ‗CABARETS‘.
3. Hostel Derived from the word' Host' and was used very late. The head of the hostel was
called" 'HOSTELER' in French, while in England he was called 'Inn-Keeper'.
History Of Hotels And Accommodation Industry And Their Development
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Early history of accommodation for travelers can be traced back to the Greek word 'Xenia',
which not only meant hospitality but also the protection given to a traveler from discomforts.
The city was bound to offer hospitality. In Sparta city, although due to rigorous customs
visitors were not encouraged, yet goddess Athena was considered as protector of strangers
and hence her name was 'Xenia Athena'.
In this period travelers were mainly diplomats, philosophers; intellectuals arid researchers.
Guests were invited to stay with noblemen. In ancient Olympia, buildings constructed with
the aim to accommodate strangers can be seen. They were called 'Leonidio' and were, built in
4th century B.C. The concept of hospitality can also be drawn back to ancient times. Homer
finds mention of it in ‗Iliad‘ and ‗The Odyssey‘.
Hotel keeping can also be traced back to many centuries and its evolution through the, ages
has been brought about by Britain‘s economical and industrial changes and developments.
During the seventh and eighth centuries, it was thee monasteries that applied hospitality to
strangers and, as no charge was made for the accommodation, a travelers were expected to
contribute according to their means to the Abeey funds. As more people began to travel they
grouped themselves together not only for company but for mutual protection from highway
and robbers. Consequently travelers arrived in groups at a monastery and it was often
difficult to accommodate them all. To overcome this, separate lodging houses, called 'Inns' (a
Saxon word) were built. The word 'inn' came to mean a 'Lodging House' and until the passing
of the Hotel proprietors Act in 1956, it was the legal term for 'Hotel' and hotel proprietors were
legally referred to as 'Common innkeepers'. 'Common' in this sense referred to Common Law.
In the thirteenth and fourteenth centuries, manor houses, being hospitable 'places; willingly
gave accommodation to travelers. As no payment was expected, travelers tipped the servants
as a 'thank you' for the generous hospitality received-thus the practice of tipping was born.
When high taxes crippled the generosity and hospitality of the owners of the manor houses,
many became commercial inns. During Elizabeth the First's reign, posting houses were
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established and travelers, in addition to getting refreshment were able to change horses
before continuing their journey.
The turn of the century saw an era that was called the 'Belle Epoch‘ when the grand and
luxurious hotels flourished. A few hotels are still operating today. In London and some other
cites attempts have been made to recapture some of the grandeur of the past era in the
making of modem hotels, and bring back the memories the grand hotels of olden days.
The next stage in the cycle of evolution of the hotel industry was the coming of the motorcar.
It enabled people to visit those parts of the country not reached by railways. This gave birth to
inland resorts and the hotel Industry began to flourish.
International air, travel has helped create the modem 'stop-over' hotel. With the increase in
this form of travel, the number of hotels built close to airports has multiplied.
Another trend in hotel keeping is the motel, which is the twentieth-century version of the old
'Coach Inn'. People traveling the country by car, stopping overnight here and there, require
not only refreshment for themselves, but also safe parking for their cars. Post Houses,
developed by the Trust House Forte Group are in fact the modern version of the old coaching
inns.
B.Sc. (HOSPITALITY AND CATERING MANAGEMENT)

INTRODUCTION TO HOSPITALITY INDUSTRY
UNIT II
2.1 Complementary roles with other industry
2.2 Contribution to Indian and global economy
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2.1 Complementary roles with other industry
Hotel industry in India

India‘s hospitality industry is all set to roll with big players entering the budget hotel
segment. Due to a huge demand- supply gap, this segment holds enormous business
potential.
India is one of the world‘s most dynamic economies today. So with the rapidly growing trade
the number of inbound, outbound & domestic tourist has also increased. India is on track to
capture 01% of the global trade in the near future. In fact the world‘s GDP of India is expected
to rise from 6% to 11% by 2025 & as such India may emerge as the ―3rd Pole‖ in the global
economy.
So, with a growing number of wealthy Indians as well as an expanding middle class, the
number of Indians traveling within the country has nearly doubled in the past decades to
about 450 million. It means that there is a huge domestic tourist market in India itself,
including business & leisure travelers.
An estimated 300 millions tourist trips annually are there, on average, which may also
include those traveling for social & religious purpose. The industry expects a boom in tourism
in the domestic sector in India, & a growth of 10% to 15% over the next few years. A growth in
tourism will certainly mean a boom in hotel & restaurants & in turn focus on its service
sector &the human resource manning those services.
The hospitality industry has grown at 23.7% in 2005-2006 & now the focus is shifting
towards domestic travel, which is the real driver of hotel business in the country in past,
Foreign tourist arrivals in our country has been hovering around 2.5 million but in 2003, with
2.72 millions tourist, growing was at 14.3%. in calendar year2004, foreign tourist arrivals
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reached the figure of 3.37 million, showing a growth of 23.5% & India crossed the magic
figure of 03 million foreign tourist for the 1st time.
And in an effort to encourage foreign investment in the real estate sector for hospitality
industry, the Indian government has changed its restrictive laws in February 2005, to allow
100% foreign direct investment to develop new housing, commercial properties, hotels &
hospitals. The international tourist arrival in Delhi for the year 2010 is forecasted at 18 lakh
& of domestic tourist being 35.8 lakhs in the same year.
Career in hospitality
Demand of manpower in hospitality industry

Encompassing all components of Hotel & Tourism consumption, investment, government
spending & exports is expected to grow 5.4% & total S 6.2 trillion in 2005. the ten year
annualized growth(2006-2014) forecast is 4.6% per annum illustrating the outlook for strong
long term growth.
Hotel industries GDP contribution in an Indian economy.

Tourism & hotel industry contribute to world economy is illustrated by the direct industry
impact of 3.8% of total GDP & the combined direct & indirect impact of Hotel & Tourism
economy expected to total 10.6% in 2005.
Role of Hotel management Courses in Hospitality Sector
Introduction to Hotel Management

India has great caliber for growth & development in the tourism sector. The growth of the
hotel management is linked closely to this sector. Manpower requirement for hotels is on the
rise. Star hotels require specialized trained staff for their various departments like Food &
Beverage, Food Production, Housekeeping & Front office, Public relation, Account section &
other services. These jobs have become increasingly challenging & sophisticated in recent
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times. The employment opportunity in hotels varies within the industry & is largely
dependent on the size of the hotel. Human resource required by the hotel industry by 2001 is
predicted to match the extension of room space, likely to be almost an additional 124,000
rooms. Each room in a 5 star hotels needs 03 person & jobs with direct responsibilities, while
many more persons indirectly assist the core group.
Nature of work
In all hotels, hotel managers & assistant managers works to ensure that guests‘ visits are
pleasant comfortable. 05 star hotels may employ hundreds of workers & under the manager
there may be many assistant managers assigned among departments responsible for various
aspects of operations.
Employee in most of the hotel operational areas enjoys pleasant & comfortable working
conditions. The office staff works with automated electronic office system, which provides the
best job conditions. Hotels works on a 24 hour & so the employees work on shift system.
Communicating with the various kinds of people would make the work quite interesting but
housekeepers & their assistant staff performs physically strenuous duties.
The job demand a consistent personal appeal, which may be difficult customers may be
challenging. This dynamic sector offers jobs for young men & women with a pleasant
personality & a flair for creativity. Hoteliering seems to be glamorous but at the same time it
is tough. A gregarious, extrovert person can find this job pleasurable.
Revenues of Hotel and Restaurant (H&R) industry in India during the financial year 2006-07
was INR604.32 billion , a growth of 21.27% over the previous year, primarily driven by foreign
tourist arrivals ,which increased by 14.17%. Currently there are some 1,980 hotels approved
and classified by the Ministry of Tourism, Government of India, with a total capacity of about
110,000 hotel rooms.
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The hospitality industry, is poised to grow at a faster rate and reach INR826.76 billion by
2010. It is estimated that over the next two years 70,000-80,000 rooms will be added across
different categories throughout the country.
In the Indian scenario, the report covers the current trends in the Hotel industry (increase in
foreign tourist arrivals, MNC's foraying into India, demand supply mismatch getting closer,
rise in Occupancy rates and RevPAR and strong recovery of the Indian economy),its structure
(composition of hotels), key consumer segments (business traveller, leisure traveller, & airline
cabin crew) and value chain. As a part of the derisking model the companies in the Indian
hotel industry are also moving up the value chain to management contracts and co-branding.
2.2 Contribution to Indian and global economy
Dynamics of the Lodging Industry

If there is one constant in the lodging industry, it is that everything changes. For example,
changes in transportation technology brought about an increase in both hotel supply
(number of rooms available to rent) and demand (people who want to rent rooms on use
services). More people began traveling more frequently than ever before. With the rise in
demand came an influx of new supply - hotels judiciously located and designed to service
guests.
The Influence Of Economic Fluctuations

Generally throughout history, when economies expand, so do supply and demand. The
healthy economy at the beginning of the twentieth century ushered in the Golden Age of
hotels, during which time a number of large hotels were constructed in the United States. On
its heels came the Great Depression, a time when banks failed, unemployment skyrocketed,
and travel sharply decreased. Many of the hotels that survived the depression are nowhighly
familier – Statler, Ritz-Carlton, and Hilton, to name a few. Another major economic boom
occurred in the 1980s. Tax incentives to investors, expectations of higher demand, and a
growing economy helped fuel extensive hotel development. In the late 1980s and early 1990s,
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however, further development was curtailed and the industry was seriously hurt by excessive
room supply, economic recession, and elimination of tax incentives.
In recent years, there have been more hotel rooms available than guests to fill them. The
lodging industry is steadily emerging from this crisis situation. An economy recovery, an
increase in domestic demand and international travel, and a slight but significant upturn in
occupancy rates are all expected to help return the lodging component of the hospitality
industry to profitability.
The report on Indian Hotel Industry provides an in-depth view of the sector in general and
important aspects of the sector. The report starts with the global hotel industry to give a
perspective of the Indian hotel industry in the global context. The report covers the hotels
industry structure, major players, regulations, growth drivers, issues and challenges, critical
success factors and foreign direct investment trends. An analysis of the industry performance
was made on critical business parameters like Occupancy rates, Revenue Per Available Room
(RevPAR) and Average Room Rates (ARR) and compared with global trends. The report also
analyses the performance of the industry across major markets, and profiles the major
players in the industry.
Contribution to Indian and global economy

Revenues of Hotel and Restaurant (H&R) industry in India during the financial year 2006-07
was INR604.32 billion , a growth of 21.27% over the previous year, primarily driven by foreign
tourist arrivals ,which increased by 14.17%. Currently there are some 1,980 hotels approved
and classified by the Ministry of Tourism, Government of India, with a total capacity of about
110,000 hotel rooms.
The hospitality industry, is poised to grow at a faster rate and reach INR826.76 billion by
2010. It is estimated that over the next two years 70,000-80,000 rooms will be added across
different categories throughout the country.
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In the Indian scenario, the report covers the current trends in the Hotel industry (increase in
foreign tourist arrivals, MNC's foraying into India, demand supply mismatch getting closer,
rise in Occupancy rates and RevPAR and strong recovery of the Indian economy),its structure
(composition of hotels), key consumer segments (business traveller, leisure traveller, & airline
cabin crew) and value chain. As a part of the derisking model the companies in the Indian
hotel industry are also moving up the value chain to management contracts and co-branding.
The report on Indian Hotel Industry provides an in-depth view of the sector in general and
important aspects of the sector. The report starts with the global hotel industry to give a
perspective of the Indian hotel industry in the global context. The report covers the hotels
industry structure, major players, regulations, growth drivers, issues and challenges, critical
success factors and foreign direct investment trends. An analysis of the industry performance
was made on critical business parameters like Occupancy rates, Revenue Per Available Room
(RevPAR) and Average Room Rates (ARR) and compared with global trends.. The report also
analyses the performance of the industry across major markets, and profiles the major
players in the industry.
Role of multinational chains/groups of Hotels in the Indian hospitality industry and

their contribution to the Indian Economy
The role of the multinational companies are significant with their increasing contribution to
the Economy. Basically Services are intangible deeds, processes and performances that
cannot be touched, seen or felt but can be experienced. The Service sector is characterized by
its diversity. Global opportunities are growing due to accelerated growth of the service
economy.
In the hospitality industry, Average room rate (ARR) and occupancy are the two most critical
factors that determine the profitability, since most of the marginal revenue gets added to the
bottom-line. ARR in turn depends upon location, brand image, star rating, quality of facilities,
pricing of value added services, complementary services offered and the seasonal factor. The
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hotels to manage and invest their fund in India adopt many business strategies to establish
their place of business and create innovative service packages to their custom. In a long-term
perspective, these measures bring significant financial returns.
CURRENT SCENARIO:
The hotel industry in India has a latent potential for growth. This is because India is an ideal
destination for tourists as it is the only country with the most diverse topography and relative
political stability. At present India attracts approximately 2.5 Million tourists every year,
which is just 0.4% of the world tourist arrivals.
Normally the Multi national hotels operated In India can be owned, leased or acquired under
management contract basis. Hotel operators want the leverage on their management expertise
and brand equity without making enormous capital investment. In management contract
agreements a fee calculated as a percentage of revenue and/or operating profit is charged.
Typically, the management fee is to the tune of 3% of the total revenue and 7% of gross
operating profits.
Most players, with the exemption of IHCL and EIH, have entered into a marketing tie-up with
major international hotel chains. Thus we have Hyatt Regency a renowned international hotel
chain having tied up with AHL, Leela having tied up with Kempinski and ITCH having a
franchisee agreement with ITT Sheraton to use the latter's brand name.
For the Indian hotel owners and the international hotel chains the benefit is mutual, tie-up
with an international hotel chain puts the hotel on the global map with access to chain's
reservation network worldwide. For the international hotel chain they can ride on the boom of
the industry without making enormous capital investments on infrastructure and facilities.
Associations with international brand also play a major role in image building and attracting
foreign tourists. However the value of the international brand gets diluted if a foreign entity
enters an agreement with several Indian companies.
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SOME FINANCIAL ISSUES :

Luxury hotels operate under single tariff structure whereby the foreign tourists are charged in
dollar terms whereas the domestic guest is charged the equivalent amount in rupees. The
luxury hotels earn about two-thirds of their revenue from foreign tourists. Leisure travelers
constitute approximately 76.5% of the total tourist arrivals whereas business travelers
constitute 21% of the total arrivals. The remainder is accounted by students. The hotel
industry is the second largest foreign exchange earner and between 1991 and 1998 there has
been a 100% growth in foreign tourists.
Hotels benefit from rupee depreciation as over 60% of revenues in the luxury hotel segment
are in foreign currencies. Thus any depreciation of the rupee goes directly to the bottom line
(FOREX income is also fully tax exempt), as none of the costs are directly linked to the
exchange rate.
The hotel debt environment is also improving. While many countries are hampered by a still
sluggish economy, those with a low interest rate environment with relatively stable-banking
conditions will provide opportunities for hotel investors to raise capital. For hotel lenders,
from a risk/return basis, there has never been a better time to provide new capital to this
industry in India.
Currently, guest retention and repeat clientele is the name of the game. Hotels those are able
to provide guests a product where the service is consistent and of a level required by the
target market, will only survive. The Hotel industry, always ready with innovative ambitious
business plans and the spirited management plotting the right strategies, is contributing its
might to improve the position of the Economy. So the role of multinational chains/groups of
Hotels in the Indian hospitality industry and their contribution to the Indian Economy is
significant. There have not been many exploratory researches in this area. But there is every
need to work on the economics for a proper planned growth at a macro level. Also the WORLD
definitely looks better and happy with ALL the hospitality it can muster.
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Tourism & Hospitality
India boasts of the world's highest mountains, miles of coastline with excellent beaches,
tropical forests and wildlife, adventure tourism, desert safari, lagoon backwaters, ancient
monuments and World Heritage Sites, forts and palaces, and of course, the Taj Mahal. The
Indian tourism and hospitality industry has thus emerged as one of the key sectors driving
the country's growth. The tourism sector is thriving, owing to a huge surge in both business
and leisure travel by foreign and domestic tourists.
According to the latest Tourism Satellite Accounting (TSA) research, released by the World
Travel and Tourism Council (WTTC) and its strategic partner Accenture, India's travel and
tourism industry is expected to generate approximately US$ 100 billion in 2008 and almost
US$ 275.5 billion by 2018, growing at an average of 9.4 per cent over the next ten years.
Moreover, according to the TSA research, travel and tourism is expected to contribute 6.1 per
cent to India's national gross domestic product (GDP) and provide almost 40 million jobs by
2018. Also, a country brand index (CBI) 2008 survey, conducted by FutureBrand—a leading
global brand consultancy—in collaboration with public relations firm Weber Shandwick's
Global Travel & Lifestyle Practice, has ranked India second in the value-for-money index.
The rapid growth of India's tourism industry has been instrumental in South Asia being the
preferred tourist destination as noted by the UN World Tourism Organisation (UNWTO).
Foreign tourist arrivals during the period January–October 2008 increased by 370,000 to
4.32 million as compared to 3.95 million during the corresponding period of 2007. Number of
foreigners visiting India as tourists in October 2008 was 453,000 as compared to 331,000 in
September 2008. Consequently, foreign exchange earnings from tourism in India rose from
US$ 8.293 billion during January to October 2007 to US$ 9.696 billion during January to
October 2008. Earlier, in 2007, total number of foreign tourists visiting India was 5.08 million
- an increase of 14.3 per cent over 2006.
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Outbound Tourists
A booming economy and increase in disposable income has led to a massive growth in the
number of Indians travelling abroad. In 2007, 9.78 million Indians went abroad for tourism,
an increase of 17.3 per cent over 2006.
Indian outbound tourist flow is expected to increase at a compounded annual growth rate
(CAGR) of 13.30 per cent during 2008–2012, according to a new report titled, "Indian Tourism
Industry Analysis", by RNCOS, a leading market research and information analysis company.
Along with the rise in the number of Indians travelling abroad, both the total and per capita
expenditure spent abroad has been increasing. For example, according to the European
Travel Commission, average spend per trip of Indian outbound tourists has increased from
US$ 611 in 2000 to US$ 822 in 2006. Similarly, Euromonitor International estimates the
outgoing tourism expenditure from India to grow to US$ 21 million by 2011, representing a
growth rate of over 25.7 per cent between 2006 and 2011.
Medical Tourism
"First World treatment' at Third World prices" is how industry sources define medical tourism
in India. Although India is a recent entrant into medical tourism, it is fast catching up.
According to a study by McKinsey and the Confederation of Indian Industry (CII), medical
tourism in India could become a US$ 2 billion industry by 2012 (from US$ 350 million in
2006). Credit Suisse estimates medical tourism to be growing at about 25–30 per cent
annually. Indian hospitals are fast becoming the first choice for an increasing number of
foreign touristsand as per a Credit Suisse estimate, nearly 180,000 medical tourists were
treated in India in 2004.
The key selling points of the medical tourism industry are its cost effectiveness and its
combination with the attractions of tourism. Many travel agents are now selling combined
packages of treatment and vacation. India has some of the best hospitals and treatment
centres that are equipped with infrastructure and technology, which are at par with those in
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the US, UK and Europe at a fraction of the costs –only a tenth and sometimes even a
sixteenth of the cost in the West.
In fact, according to the World Travel and Trade Council, Indian tourism demand will
continue to grow at a rapid pace. It estimates the demand to grow at an average of 8.8 per
cent between 2004 and 2013, making India the world's third fastest growing tourist market.
The boom in the Indian tourism industry has cascaded to the rural areas as well. India
continues to attract tourists owing to its splendid historical architecture and rich culture
along with beautiful beaches, rural tourism or what now is called 'responsible tourism' is also
fast gaining popularity with travellers flocking to discover the best in rural arts and heritage.
Hospitality
The boom in India's tourism industry and the surge in tourist inflow to the country have
percolated to other associated sectors like hospitality. The revenues for the Indian hotel and
restaurant industry in the year 2006-07 exceeded US$ 118.85 million, an increase of nearly
22 per cent over the previous year. The industry is poised for rapid growth and is projected to
be well worth over US$ 158.49 million by the year 2010.
And with the continuing surge in tourist inflow, this sector is likely to offer tremendous
opportunity for investors. For example, while the estimated number of required hotel rooms is
around 240,000, the current availability is just 90,000 rooms - leaving a shortfall of 150,000
rooms to be provided.
India's hospitality sector is expected to see an estimated US$ 11.41 billion in the next two
years, and around 40 international hotel brands by 2011, according to a report by Ma Foi
Management Consultants. Moreover, the sector is expected to provide over 400,000 jobs.
Along with these large-scale expansion plans, international hotel asset management
companies are also likely to enter India. Several global hotel chains see immense investment
opportunities in the sector with global chains like Hilton, Marriott International, Berggruen
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Hotels, Cabana Hotels, Premier Travel Inn (PTI), InterContinental Hotels group and
Hampshire amongst others have announced major investment plans in India with others
likely to follow suit.
Latest Trends
Hotels are no longer satisfied with the plain-vanilla room concept but are now getting ready
for alternate hospitality formats such as residential hotels, destination resorts, condo hotels,
vacation ownership and private residents' club.
Four Seasons is developing a destination resort in Puthenkayal, Kerala, which will have 75
villas and also 20 branded, luxury private residences. The resort will be operational by 2012.
Nearly 11 per cent of the hotel demand in the country is from long stay guests. The Leela
Group is looking at tapping this market. Its property in Gurgaon will have 90 apartments
called 'The Residence' aimed at the long stay guests.
India's largest real estate player, DLF, is building India's first residential hotel in Goa with the
Hilton Group. DLF plans to invest US$ 2 billion to have six hotels on a similar format in the
next five years.
Expansion Plans
With India being on the global tourist map and more and more people coming to India for
tourism or business, hotels are looking at expansion in a major way.
The Taj Hotels Resorts and Palaces — in a joint venture with CC Africa, a leading safari
operator and ecotourism company from Africa is opening two safari lodges in Madhya Pradesh
at Panna and Kanha National Parks. It already has a safari lodge each at Bandhavgarh and
Pench National Parks.
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Marriott, which manages six hotels in India at present, is looking at a steady growth in the
number in the next four years. It expects to have 25 hotels by 2011 with room strength of
8,000–10,000.
EIH, which owns the Oberoi and Trident group of hotels, is looking at opening 10 hotels in
India and abroad in the next three years. These include a luxury Oberoi Hotel in Gurgaon to
be opened in 2009, a 320-room Trident hotel at the Bangalore International Airport to be
opened in 2010, and two hotels to be opened in Hyderabad in 2010.
Hotels in Hyderabad are on an expansion spree and a whooping 4,000 rooms will be added in
the next couple of years. Around 20 major properties including that of Park Hyatt, Trident,
Marriott, Leela and Taj among others will effectively double the current capacity of 4,000
rooms across all types of hotels.
International Recognition
India's booming tourism sector has not only witnessed international investments but also
achieved international accolades with its increasing appeal as the leading global tourist
destination. The government has been instrumental in making tourism a priority sector. Its
efforts have borne fruits with a series of international recognition and awards.
India has been elected to head the UN World Tourism Organisation (UNWTO), the highest
policy making world tourism body represented by 150 countries.
The world's leading travel and tourism journal, Conde Nast Traveller, has ranked India as the
'numero uno' travel destination in the world.
India was adjudged Asia's leading destination at the regional World Travel Awards (WTA).
India's Taj Mahal continues to figure in the Seven Wonders of the World.
Bangalore-based Leela Palace Kempinski was voted the favourite business hotel in the world
in a Readers' Choice Awards by Conde Nast Traveller in 2007.
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India bagged the World's leading Destination Marketing Award for the Incredible India
campaign.
Government Initiatives
 To unlock the huge potential in this sector, the government has taken various initiatives
for the development of this sector.
 Launch of Incredible India campaign to promote tourism both in domestic and
international markets.
 Recognition of spare rooms available with various house owners by classifying these
facilities as "Incredible India Bed and Breakfast Establishments"', under 'Gold' or 'Silver'
category.
 A new category of visa, "Medical Visa" ('M'-Visa), has been introduced which can be given
to foreign tourists coming into India for medical tourism.
 Ministry of Tourism has tied up with United Nations Development Programme (UNDP) to
promote rural tourism.
Over the last decade and half the mad rush to India for business opportunities has intensified
and elevated room rates and occupancy levels in India. Even budget hotels are charging USD
250 per day. The successful growth story of 'Hotel Industry in India' seconds only to China
in Asia Pacific.
'Hotels in India' have supply of 110,000 rooms. According to the tourism ministry, 4.4
million tourists visited India last year and at current trend, demand will soar to 10 million in
2010 – to accommodate 350 million domestic travelers. 'Hotels in India' has a shortage of
150,000 rooms fueling hotel room rates across India. With tremendous pull of opportunity,
India is a destination for hotel chains looking for growth. The World Travel and Tourism
Council, India, data says, India ranks 18th in business travel and will be among the top 5 in
this decade. Sources estimate, demand is going to exceed supply by at least 100% over the
next 2 years. Five-star hotels in metro cities allot same room, more than once a day to
different guests, receiving almost 24-hour rates from both guests against 6-8 hours usage.
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With demand-supply disparity, 'Hotel India' room rates are most likely to rise 25% annually
and occupancy to rise by 80%, over the next two years. 'Hotel Industry in India' is eroding its
competitiveness as a cost effective destination. However, the rating on the 'Indian Hotels' is
bullish. 'India Hotel Industry' is adding about 60,000 quality rooms, currently in different
stages of planning and development and should be ready by 2012. MNC Hotel Industry giants
are flocking India and forging Joint Ventures to earn their share of pie in the race.
Government has approved 300 hotel projects, nearly half of which are in the luxury range.
Sources said, the manpower requirements of the hotel industry will increase from 7 million in
2002 to 15 million by 2010.
With the USD 23 billion software services sector pushing the Indian economy skywards, more
and more IT professionals are flocking to Indian metro cities. 'Hotel Industry in India' is set
to grow at 15% a year. This figure will skyrocket in 2010, when Delhi hosts the
Commonwealth Games. Already, more than 50 international budget hotel chains are moving
into India to stake their turf. Therefore, with opportunities galore the future 'Scenario of
Indian Hotel Industry' looks rosy.
For further information on ''Hotel Industry in India‖ please go through the following links.
Hotel Industry in India has witnessed tremendous boom in recent years. Hotel Industry is
inextricably linked to the tourism industry and the growth in the Indian tourism industry has
fuelled the growth of Indian hotel industry. The thriving economy and increased business
opportunities in India have acted as a boon for Indian hotel industry. The arrival of low cost
airlines and the associated price wars have given domestic tourists a host of options. The
'Incredible India' destination campaign and the recently launched 'Atithi Devo Bhavah' (ADB)
campaign have also helped in the growth of domestic and international tourism and
consequently the hotel industry.
In recent years government has taken several steps to boost travel & tourism which have
benefited hotel industry in India. These include the abolishment of the inland air travel tax of
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15%; reduction in excise duty on aviation turbine fuel to 8%; and removal of a number of
restrictions on outbound chartered flights, including those relating to frequency and size of
aircraft. The government's recent decision to treat convention centres as part of core
infrastructure, allowing the government to provide critical funding for the large capital
investment that may be required has also fuelled the demand for hotel rooms.
The opening up of the aviation industry in India has exciting opportunities for hotel industry
as it relies on airlines to transport 80% of international arrivals. The government's decision to
substantially upgrade 28 regional airports in smaller towns and privatization & expansion of
Delhi and Mumbai airport will improve the business prospects of hotel industry in India.
Substantial investments in tourism infrastructure are essential for Indian hotel industry to
achieve its potential. The upgrading of national highways connecting various parts of India
has opened new avenues for the development of budget hotels in India. Taking advantage of
this opportunity Tata group and another hotel chain called 'Homotel' have entered this
business segment.
According to a report, Hotel Industry in India currently has supply of 110,000 rooms and
there is a shortage of 150,000 rooms fueling hotel room rates across India. According to
estimates demand is going to exceed supply by at least 100% over the next 2 years. Five-star
hotels in metro cities allot same room, more than once a day to different guests, receiving
almost 24-hour rates from both guests against 6-8 hours usage. With demand-supply
disparity, hotel rates in India are likely to rise by 25% annually and occupancy by 80%, over
the next two years. This will affect the competitiveness of India as a cost-effective tourist
destination.
To overcome, this shortage Indian hotel industry is adding about 60,000 quality rooms,
currently in different stages of planning and development, which should be ready by 2012.
Hotel Industry in India is also set to get a fillip with Delhi hosting 2010 Commonwealth
Games. Government has approved 300 hotel projects, nearly half of which are in the luxury
range. The future scenario of Indian hotel industry looks extremely rosy. It is expected that
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the budget and mid-market hotel segment will witness huge growth and expansion while the
luxury segment will continue to perform extremely well over the next few years.
Classifying Lodging Properties

Because of constant changes, staying current just with who is offering what and where can be
difficult for the guest. The necessity for classifying hotels came about when hotels began to
differ from one another enough to appeal to different group of people. Long gone are the days
when the guest had two choices – luxury hotels or budget hotels. Hotel entrepreneurs such as
Kemmons Wilson created a third option when they built facilities intended to serve middle-
class families. These property classes had clear-cut boundaries in the beginning. Potential
guests knew they could expect more services at a luxury hotel than a budget motel, and
something in between at a midpriced hotel.
As the economy in general boomed and room supply increased, hoteliers focused on setting
themselves apart from the crowd by offering specialized accommodations. No longer just a
place to sleep, hotels were appealing to conventioneers, business groups, and special-interest
groups. Descriptive hotel classifications helped potential guests locate suitable lodgings, and
as such, became a valuable marketing tool.
As this diversity flourished, so did competition for customers and brand loyalty. As properties
continually upgraded their services, boundaries between the descriptive labels blended into
one another. Old systems of classification were not as clear. For instance, the Marriott brand,
once recognizable as a midpriced hotel, began to include hotels classified as economy
(Fairfeilds Inns), business (Courtyard), extended-stay (Residence Inns), all suite (Marriott
Suites), and upscale (Marriott Hotels and Resorts). Other chains also began to cater to a
myriad of guests – from business to pleasure travelers and from individuals to groups.
Consequently, lodging classification became more complex. Facilities were then grouped
according to size, amenities offered, price, type of guest (business or pleasure), or type of hotel
(luxury, full-service, or economy, extended stay to name a few). Many facilities fit two or more
categories, and did so in order to attract different types of guests.
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Descriptive Labels
Motels and hotels are the most widely recognized forms of lodging. They can be found almost
anywhere – from the center of a huge metropolis to the streets of a small town. For the most
part, hotels and motels attract transient guests who need a place to stay for a night or two
while traveling for business or pleasure. Hotels that specialize in residence or extended-stay
accommodations serve guests looking for more permanent lodging.
Hotels.
From the age of grand hotels to the troubled 1990s, the hotels has been the most fabled type
of lodging. Varying greatly in style and service, most hotels share a similar structure. They
generally have more than two stories with guest rooms located along common hallways.
Guests rooms usually have a bed, bath, telephone, and television. In addition to
housekeeping, services may include luggage assistance, access to a business center for use of
a photocopier or fax machine, and availability of recreation facilities, restaurants, or bars.
Hotels are most often located in or near business districts, travel destinations, and airports.
Motels.
Motels offered fewer amenities and were less expensive to build and operate than downtown
hotels. The lower rates, basic accommodations, roadway locations, and lack of a central lobby
were well-suited for the new overnight automobile traveler.
Motels are generally less formal than hotels. Guests usually carry their own luggage, and free
parking is available, often adjacent to the guest‘s room. Many motels provide swimming pools
and restaurant service. Guests who prefer to save money may opt for a budget motel that has
smaller rooms, no pool, and fewer amenities.
All-Suite Hotels.
Unlike regular hotels, all-suite hotels rent only suites, often combing living space with kitchen
facilities, or a bedroom section with an attached parlor. To keep rates competitive with other
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hotels, many all-suite hotels have small lobbies and no public meeting rooms. Some do not
offer restaurant or bar facilities. As the market has expanded, through, some all-suite hotel
hotels have reintroduced public areas and limited foodservice. Amenities such as free
breakfast, cocktail hour, and access to an on-premise health club keep Summerfield Suites
Hotel in San Jose, California, at a 98 percent average occupancy rate.
Convention Hotels. Convention hotels provide meeting and banquet facilities for large
groups (usually five hundred or more) booked in their guest rooms. Because they target
groups, these hotels need large lobbies to accommodate group arrivals. They also have a high
percentage of double-occupancy rooms and emphasize food and beverage services.
Convention hotels may also offer concierge floors to cater to individual guests‘ needs.
Levels Of Service
At one time, hotels differed distinctly by the services they offered. Recognizing that all guests
do not expect the same services nor have the same amount to spend on lodging, the hotel
industry offered a variety of services at different prices aimed at particular markets (groups
whose members have similar expectations and budgets). Familiarity with these labels is
helpful in understanding guest perception as the transition is made from one system to
another. Also, classification‘s short history shows how dynamic the industry is and how
important service is at all levels. Classifying hotels by service contains four broad categories:
luxury, full-service, limited-service, and economy.
Luxury Hotels And Resorts.

Traditionally, independent hotels offer the finest accommodations money can buy. Luxury
properties are descendants of the grand hotels, featuring expensive, lavishly decorated public
areas and the high levels of customer service. They offer the finest cuisine and the full range
of amenities from shampoos and hair dryers to private Jacuzzis and fireplaces. Whether
parking your car, carrying your luggage, or delivering room service, staff members – including
concierges, bell persons, front desk attendants, and wait staff – are well-trained and efficient.
Luxury resorts offer the finest entertainment and recreational facilities available. A part of
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luxury properties‘ attraction is their ability to perpetuate an exclusive image by charging high
rates. Hotels in the category include Four Seasons and Ritz-Carlton properties, the Waldorf-
Astoria, and the Trump Plaza in New York.
Royal Sonesta, a deluxe hotel in New Orleans, Louisiana, spends an estimated $1.5 million
annually on guest service. Their guests must find such service pleasing – with an average
occupancy of 75 percent in 1992, the hotel grossed $25 million in sales.
Full-Service Properties.
Featuring properties operated by Hilton, Hyatt, Westin, and Marriott, this category of hotels
attempts to offer a wide range of services at lower rates than luxury hotels. Full-service hotels
generally offer clean, well-decorated hotels with meeting and restaurant facilities, a limited
room-service menu, and a variety of recreational activities. Although not as extravagant as the
luxury properties, full-service hotels generally have large, attractive public areas. The ratio of
service of the concierge or other staff may be limited to designated VIP floors.
Some all-suite and extended-stay hotels with good-sized public areas also fit into the full
service category, with amenities like in-room coffeemakers, microwave ovens, and
refrigerators.
Limited-Service Properties.
Lodging establishments like Days Inn, Hampton Inn, and Quality Suites & Inns were once
considered limited-service facilities. Usual offerings included simple, clean rooms with a
telephone, free cable television, swimming
but some offered a few extra amenities such as complimentary shampoo and lotion to
distinguish themselves from the economy properties. The remaining all-suite hotels fit into
this category because of their limited services and amenities, and small public areas. The
Days Inn in Fort Pierce, Florida, has a guest mix of 50 percent business and 50 percent
leisure. As the second most successful highway facility in 1992, its management renovated its
public spaces – including two meeting rooms.
Economy Properties.
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Once offering only the basic bed and bath facilities, economy properties focus on ―more values
for the dollar‖ with clean and low-priced lodging. Economy properties generally did not offer
meeting and recreational facilities or food and beverage services, with the possible expectation
of a vending area featuring prepackaged snacks and video games. Staff was limited to only
those required to provide basic front office services, security, and housekeeping services.
Generally, the smaller guest rooms of the economy hotels offered one or two double beds and
a separate bathroom equipped with no more than towel and soap. Properties in this category
include Econo Lodge, Motel 6, and Daystop. Economy Lodging Systems management
company has positioned Knights Inns as ―the lodging choice of Middle America.‖ According to
President Gregory P. Terrel, ―The target is traveling salesmen, senior citizens, and people with
a family income of $30,000 a year.‖
How Important Is Tourism To The Economy?
A healthy vibrant industry is important for the national economy and job creation. Tourism
makes an important contribution to employment. By its nature, tourism is a highly labor
intensive activity as it relies so much on personal service. It is probably the sector of the
economy, which is least vulnerable to substitution of labor by technology. Tourism has also
an important role to play in the bringing of prosperity to those under-developed parts of the
country, which for various reasons, are relatively unsuited to industrial development or
agriculture. In this context, tourism's expressed natural effects complement Government's
policies to achieve a balanced growth throughout the whole economy.
The hotel sector represents a vital part of these earnings, since the provision of
accommodation, food and beverage is essential for anyone spending time away from home,
whether it is for business or pleasure.
As the nature of the traveler will vary, so the category of hotel available to them will differ
accordingly.
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The star rating system is based upon the facilities, which the hotel offers, and the service they
provide. This may be as basic as a room with breakfast, or as sophisticated as the service
offered in a luxury five-star operation.
The decision to stay in a particular hotel may be influenced by various factors. One will
certainly be the price. The guest will, however, be influenced by other variables such as the
facilities on offer, or the location, or the size, or the standard of service. Many guests are loyal
to a particular group or chain of hotels. They always seek out an establishment in which they
feel the surroundings to be familiar.
Hospitality is treating people like you would want to be treated when you are traveling. In
other words, it means making a tourist feel totally welcome as not only your guest, but also
the guest of the complete family of the Hotel. Hospitality is genuine smiling face.
Hospitality can be termed as deliberate, planned and sustained effort to establish and
maintain mutual understanding between an organization and public i.e. business of making
and keeping friends, and promoting an atmosphere of better understanding.
Very frequently we hear phrases like "He is always hospitable to visitors", "We are grateful to
friends for their hospitality in putting us up while we were on holiday", "She is so inhospitable
that she grudges giving us anything to eat or drink when we visit her" etc. All such
statements are suggesting the positive or negative attitude of welcome towards visitors,
friends or strangers. Hospitality activity covers everything i.e. providing attentive and
courteous services, facilities and amenities to a traveler, meeting and greeting him at the
door, providing efficient and caring service of food and beverage to him in the room i.e.
providing "A Home away from Home; and making his visit a memorable and pleasant
experience.
Reception, welcome and, in general, the treatment of a guest pr a stranger in most friendly
manner is Hospitality. In most of the countries all over the world a guest is received with a
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great amount of courtesy and warmth and is provided with entertainment. The basic concept
of Hospitality is to make the guest feel that he has come amongst friends and that GUESTS
ARE ALWAYS WELCOME. Although the basic concept of hospitality has remained the same,
yet with the passage of time and development of technology and science, the needs and wants
of travelers have changed greatly thus providing numerous services and facilities in terms of
accommodation, and other basic needs such as food and beverages. In olden days kings,
lords, maharajas, landlords and sometimes the panchayats etc. used to provide food and
shelter to travelers and their animals free of charges and it used to be a benevolent activity.
But with the passage of time it has not only remained a benevolent activity but has become a
flourishing business too.
A part of hospitality activity is being attentive, alert, and cordial with the guest without
forcing yourself and your ideas on to him; at the same time being very polite and cooperative.
All those working in hospitality industry have one common objective-"Creating an image of
friendly reception and treatment" for guests and visitors.
As front office personnel, the hotel staff, in order to provide hospitality should make his
guests feel at home and use pleasant tone of voice smilingly, offers his assistance wherever
possibly can be provided. Don't ignore the guest, and don't be abrupt no matter how busy you
are: anticipate his needs and wants and provide the same without his asking them.
As an hotelier, keep on checking the hospitality attitude of your organization. Make a

checklist and be sure that you and your-staff are fulfilling each and every point of the
checklist. The checklist may include areas such as front desk arid lobby, etc. Make sure that
the front desk is always kept clean, orderly and well lighted. Even the stationery used is so
designed that it does not create confusion and clearly indicates how it is to be filled in, and. is
inviting. The lobby is kept clean and furniture kept at proper _place. Lighting system is soft
and appealing. The welcome spirit that the guest is looking for is there. Floor covering,
pictures, furnishing etc. are appealing, attractive and aesthetically designed.
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Further, the check list should include the intangibles such as training of the staff and
willingness and positive attitude of the staff., The arriving guest is always greeted with a smile
and proper salutation to show interest in his trip and his well being.
REVIEW QUESTIONS
1. What is the meaning and definition of hospitality industry?
2. Write a note on historical evolution and development of hospitality industry
3. Give an overview on hospitality as an Industry
4. Discuss on role of hospitality industry in complement with other industry
5. Write a note on contribution of hospitality industry to Indian and global economy
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UNIT 3
3.1 Hospitality accommodation

3.2 Food and beverage facility
3.3 Ancillary service, Support service
3.4 Hospitality organization
To efficiently run their hotels, hotel managers organize them into various functional areas and
then delegate responsibility and authority. The functional areas are divided into revenue and
cost (or support) centers. Divisions such as rooms and food and beverage are revenue centers;
others, like engineering and accounting, are cost centers. The number of such centers (or
divisions) depends on the size of the hotel.
3.1 Hospitality accommodation
Service Departments
To provide lodging to guests, all hotels are organized around four basic functions:
(1) front desk operation
(2) housekeeping
(3) building maintenance/engineering, and
(4) security.
Beyond these common services, hotels and their departments can vary tremendously. For
example, most luxury hotels include a restaurant and beverage department, while most
budget facilities do not. The performance of these functions can also vary widely among
different types of hotels. Business guests of a convention center may expect hi-tech front desk
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operations, and guests at a resort may prefer a more personal approach. At any rate, all
hotels carry out these functions both behind the scenes and at the front of the house.
Functional Areas:
• There are two approaches to classify departments in typical hotels:

1. Revenue Generating versus Cost Centers: The first approach is trying to differentiate
between departments revenue-wise. In fact, this approach entitles that if a department
generates revenue to the hotel (ex. Rooms Division Department, F&B Department…), it is
called a revenue generator. On the other hands, if a department incurs costs without directly
contributing to hotel profitability, it is called a cost or support center (ex. Accounting
Department, Maintenance and Engineering Department…).
2. Front of the House versus Back of House: This approach classifies departments
according to department staff's frequency of communication with guests. If communication
between staff and guest is frequent (ex. Front Office Department), then the department is said
to be a front of the house department. On the other hand, if the communication between
department staff and guests in nonexistent or on occasions, then the department is said to be
back of the house department.
Different Departments:
Rooms Division:
In a statistics conducted by the U.S. Lodging Industry in 1995, it has been shown that the
majority of hotels revenues (60.2 %) are generated from Rooms Division Department under
the form of room sales. This very department provides the services guests expect during their
stay in the Hotel. Lastly, the Rooms Division Department is typically composed of five
different departments:
 Front Office
 Reservation
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 Housekeeping
 Uniformed Services
 Telephone
Beneath is a brief description of the different departments decomposing the Rooms Division
Department, along with their related main responsibilities:
Front Office:
 Sell guestrooms; register guests and design guestrooms
 Coordinate guest services
 Provide information
 Maintain accurate room statistics, and room key inventories
 Maintain guest account statements and complete proper financial settlements
Front office is also known as the face of the hotel. It is the first guest contact area and also
the nerve center of the hotel. All the activities and areas of the front office are geared towards
supporting guest transaction and services
• The major functions that is performed as a part of the Rooms Division Department are:
a) Reservation, registration, room & rate assignment
b) Fulfills guest services and updates room status
c) Maintains & settles guest accounts
d) Creates guest history records
e) Develops & maintains a comprehensive database of guest information
f) Coordinates Guest Services
• The sole priority of the Rooms Division Department is ensuring Guest Satisfaction, which
happens when, guest expectations match what the hotel provides.
• In order to achieve Guest Satisfaction, front office department should prepare:
a) Careful designed front office organization chart
b) Comprehensive goals, strategies and tactics
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c) Planned work shifts

d) Well designed job descriptions
e) Well designed job specifications
Reservation:
 Receive and process reservation requests for future overnight accommodations.
 With technology development, the Reservation Department can, on real time, access the
number and types of rooms available, various room rates, and furnishings, along with the
various facilities existing in the hotel
 There should be close relation-ships with Sales and Marketing Division concerning Large
Group Reservations
Rooms Division: Concierge

The Concierge department is there to answer the guest's inquiries about the city and its
surroundings, make reservations at restaurants, theaters, sightseeing tours and many other
services
Rooms Division: Transportation / Garage

The Transportation department oversees the parking garage and also any special
transportation needs that a guest might have.
Rooms Division: Guest Relations

This department is responsible for engineering surprises and anticipating our guests' needs,
by pre-calling all guests prior to their arrival to help garner preferences, identify special
occasions and offer additional hotel services.
Housekeeping:
. Inspects rooms before they are available for sale
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. Cleans occupied and vacant rooms

. Communicates the status of guestrooms to the Front Office Department
. Cleans and presses the property‘s linens, towels, and guest clothing (if equipped to do so,
free of charge or for a pre-determined fee)
. Maintains recycled and non-recycled inventory items
One of the most integral departments within the hotel, the housekeeping department is
responsible for the immaculate care and upkeep of all the guest rooms and public spaces.
Individuals who excel in the housekeeping departments have an eye for detail and a
commitment to the training, development and motivation of a diverse group of talented
employees. In a competitive hotel market, it is service and cleanliness that really make an
impact on guests and determine whether they will return.
An efficiently managed housekeeping department ensures the cleanliness, maintenance and

the aesthetic appeal of the hotel. The housekeeping department not only prepares clean
rooms for the arriving guests on a timely basis, but also cleans and maintains everything in
the hotel so that the property is as fresh and attractive as the day it opened for business.
The task performed by the housekeeping department is critical for the smooth daily operation
of any hotel. The concept of housekeeping is very simple but considering the size of the
establishment the task is gigantic. The rooms division constitutes 50% or more of the total
revenue. The hotel management ensures optimal room sales for maximum profit. The sale of
rooms is dependant on the quality of the décor, facilities, cleanliness and safety of the room.
Housekeeping has to ensure that the basic human needs of comfort and security are catered
to. Thus the efforts of the housekeeping department in giving a guest a desirable room has a
direct bearing on the room and the guest‘s experience in the hotel.
In any residential or commercial establishment, whether a hotel, hostel or hospital, the basic
requirement s are food, beverages and accommodation.
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On arrival a guest gauges the quality of the hotel from the entrance and the foyer and the
behaviour of the staff.
On reaching the room the guest has more time to take a closer look at the décor, the furniture
and fixtures, the furnishings, especially the bed, cleanliness and comfort of the surrounding
and can judge the standard of the establishment. This impression is formed before a guest
has had any meals or beverages in the hotel.
The basic services provided should be a clean, comfortable and safe room.
In a hotel, accommodation is the biggest major revenue generator and thus the satisfaction of
the guest is of prime importance. In any establishment there are three departments that are
concerned with accommodation:
 Reception/Front office - Sell rooms
 Housekeeping - Clean and maintain rooms
 Maintenance - Maintain a/c, light, water
Management of the accommodation or housekeeping department will be influenced by factors

like size, type and location of the establishment. However regardless of the size of the
department, it should be run with the highest degree of efficiency at the lowest cost.
d) Uniformed Services:
. Bell Attendants: Ensure baggage service between the lobby area and guestrooms
. Door Attendants: Ensure baggage service and traffic control at hotel entrance(s)
. Valet Parking Attendants: Ensure parking services for guest‘s automobiles
. Transportation Personnel: Ensure transportation services for guests from and to the hotel
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. Concierge: Assists guests by making restaurant reservations, arranging for transportation,

and getting tickets for theater, sporting, or any other special events
Telephone Department:
. Answers and distributes calls to the appropriate extensions, whether guest, employee, or
management extensions
. Places wake-up calls
. Monitors automated systems
. Coordinates emergency communications
. Protects Guest Privacy‗
3.2 Food and beverage facility
Food & Beverage: Restaurants/Bars/Lounges
This includes all the restaurants, bars and lounges that are located throughout the hotel.
Food & Beverage: Banquets
This department sets up the rooms where small and large meetings and events including
weddings and receptions are held. They take place in the various conference rooms and
ballroom of the hotel. They also provide the service of food and drink to the guests at these
events. The Banquet Department coordinates the details of an event as it is happening,
executing the requests the guests have made prior to their arrival and responding to any
unexpected needs of each guest.
Food & Beverage: Culinary
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This department includes all the kitchens of the hotel. Typically, a hotel will have a Main
Kitchen, a satellite Fine Dining Restaurant Kitchen, a Banquet Kitchen, a Cold Kitchen, a
Pastry Kitchen and sometimes, a Pool Kitchen. These various kitchens order, receive, store
and prepare all the meals in the Hotel. They also prepare the beautiful buffets and the guest
room food amenities.
Food & Beverage Night Cleaners
Since the food and beverage areas are all very busy from morning to night, much of the
cleaning activity must take place overnight to ensure that the highest levels of cleanliness and
hygiene are maintained in all food preparation and service areas.
Food & Beverage: Room Service
Also known as In-Room Dining, this department provides meal and beverage service to the
guest in his/her room. The meal is always beautifully presented, as if the guest were at a
table in one of our restaurants. This department operates 24 hours of the day.
Food & Beverage: Stewarding
This department stores, cleans and distributes all the equipment (glassware, silverware,
chinaware) that is needed in food and beverage service for our guests. This Stewarding
department supports the entire food and beverage operation, providing important equipment
supply and cleaning services to the kitchen and to every food and beverage outlet.
Food & Beverage: Storeroom

This is the storeroom where all fresh produce, meat, dairy and preserved foods as well as
beverages are stored at the correct temperatures and in an orderly way until they are needed
for preparation in the kitchens.
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Food & Beverage Service Department:

• According to U.S. Lodging 1995 statistics, F&B Department constitutes the second largest
revenue generator of a typical hotel with an average of 23.1 for Food sales, and 8.6 % for
Beverage sales. In a five-star hotel, Food and Beverage outlets might have the following forms:
. Quick Service
. Table Service
. Specialty Restaurants
. Coffee Shops
. Bars
. Lounges
. Clubs
. Banquets
. Catering Functions . Wedding, Birthdays…
3.3 Ancillary service, Support service
Sales & Marketing Division:

This department sells the hotel and all its services and brings in the guests. Sales people have
targets to meet and their goal is to keep the hotel busy all year.
• A typical hotel should usually have Sales & Marketing division. However, if the staff size,
volume business, hotel size, expected group arrivals is low enough, the hotel might have
marketing staff placed under the reservation department (i.e. No need for a Sales & Marketing
Division).
• A typical Sales & Marketing Division is composed of four different departments:

a) Sales
b) Convention Services
c) Advertising
d) Public Relations
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The following are the sections coming under sales and marketing
Public Relations
The Public Relations department ensures that the image of the hotel and the company in the
local community is always maintained at the very highest level. They also make press releases
whenever there is something important to announce and maintain excellent media relations.
Sales Reservations & Revenue Management
The Reservations department takes calls, emails and faxes from guests and makes their room
reservations for arrival at a future date. The Revenue Management department establishes
the optimal room rate at any given time, based on demand and other market variables.
Sales & Marketing: Catering Sales
The Catering Sales Department sells, plans, and coordinates all social and local corporate
catering events such as weddings, bar/bat mitzvahs, retirement parties, society events, local
functions and meetings. After booking the event, the catering sales department works with
event planners to understand, record and coordinate the details of what the guest is looking
for and communicate these to the relevant departments. The team works to ensure the
guest's utmost satisfaction at the event. Each catering sales manager is also responsible for
individual booking goals and for achieving departmental budget requirements.
Sales & Marketing: Conference Sales

This department sells the space that guests need to hold their meetings and social events in
our hotels. They also take care of recording and sharing with the appropriate departments all
the details (other than food and beverage needs, which are handled by the catering
department) related to the function such as flowers, audio-visual needs, table layout etc.
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Finance/Accounting Division:
All transactions involving cash, billing, purchasing and other numerical data processing and
reporting are done in this department. This department also assists with the preparation of
the annual budgets and the profit and loss statements and other accounting reports.
• The Accounting Division monitors the financial activities of the property. Some of the
activities that are undertaken in the Accounting Division are listed below:
a) Pays outstanding invoices
b) Distributes unpaid statements
c) Collects amounts owed
d) Processes payroll
e) Accumulates operating data
f) Compiles financial reports
g) Makes bank deposits
h) Secures cash loans
i) Performs other control and processing functions
Finance Purchasing/Receiving
This department ensures that all the products, food and beverage, equipment and other
operating supplies required to run the hotel are ordered in a timely manner, received, checked
and stored until they are needed by the operating departments.
Engineering and Maintenance Division:

• This very department maintains the property's structure and grounds as well as electrical
and mechanical equipment. Some hotels might have this very division under different names,
such as maintenance division, property operation and maintenance department…
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The maintenance department takes care of all repairs such as electrical, air-conditioning,
plumbing, carpentry, painting and polishing and masonry. A list of the items required for
maintenance, is given to the desk housekeeper by the floor supervisor. The latter maintains
order slips and informs the maintenance department, which can attend to the complaints.
Once the repairs have been carried out the room is double checked by the floor supervisor
and cleared to the front office for sale.
Security Division:
• Security division personnel are usually screened from in-house personnel, security officers
or retired police officers, across certain physical skills, and prior experience.
• Some of the functions of the security division are listed below:
a) Patrols the property
b) Monitors supervision equipment
c) Ensures safety and security of guests, visitors, and employees
Human Resources Division:

• Some of the duties of the human resources division are listed below:
a) Responsible for external & internal recruitment
b) Calculates employees' salaries, compensation, and tax withholding…
c) Administrates employees' paperwork, monitors attendance…
d) Maintains good relations with Labor Unions
e) Ensures employees' safety and working conditions
Other Divisions:
• All the above mentioned departments and/or divisions should exist in a typical five-star
hotel, however there might be some revenue generators that are specific to certain hotels but
not existing in others. Below is a list of some possible extra or other divisions that might exist
in a hotel:
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Retail Outlets (i.e.: Shops rented to outsiders or managed by the hotel) The revenue earned
from this is called a Rental
Recreation Facilities (ex: Fitness Center, Tennis Courts, and Cinema Saloons…) These
facilities may be operated by an independent operator who would pay either a flat fee, a
minimum fee and a percentage of the gross receipts or simply a percentage of gross sales. The
revenue earned from this is called a Concessions
Conference Centers
Casinos
Hotels may be paid a fee by suppliers that are located outside the hotel but provide a service
to hotel guests e.g. car rentals and photographers. The revenue earned from this is
Commission
Fitness/Recreation
This department includes services and facilities to enhance the well-being and health of our
guests by offering Tennis, Golf, Massage, Swimming and a Fitness Center among other
activities
Golf
Some of our hotels offer golf facilities to our guests. This department ensures that all the
guests' needs with regard to playing golf are met. This includes the management of the
landscaping, irrigation, golf buggies, golf retail store etc.
Information Systems / Technology
This department ensures that all the computers and computer systems in the hotel are
installed correctly and run properly at all times. This department also ensures the efficient
functioning of the telephone switchboard equipment.
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Meetings & Special Events
The Meetings/Special Events Department coordinates all details involved with group
bookings, working closely with meeting planners to arrange all rooming, food and beverage
details, meeting facility specifications, and any additional requirements of the group. The
Meetings & Special Events Managers partner with company event planners prior to their
arrival to understand, manage, record and coordinate the details of each event and to
communicate these to the relevant departments. The role of the Meetings & Special Events
manager is to be the liaison between the planner and the hotel operational departments. The
team works to ensure the guest's utmost satisfaction with the event. The Meetings & Special
Events department is responsible for accurate forecasting of group rooms, banquet food and
beverage and for achieving overall hotel budgeted revenue.
Quality
The Quality department makes sure that the quality sciences are known and energized by all
employees and that all decisions are made using quality tools.
Spa
The Spa department operates almost like a hotel with a hotel. It offers separate services such
as reservations, housekeeping, front desk and concierge. It may be joined to a fitness center
or a Golf Club or a Resort Hotel, and will operate as a profitable business unit. In addition to
the services mentioned above, the Spa department employs certified massage therapists,
nutrition consultants, wellness coordinators, nail technicians, and hair stylists.
Audio Visual
The Audio Visual department supports the Food & Beverage and Meetings/Special Events
departments by providing audio (sound), light, projection and other services to guests who
hold meetings and events at our hotels.
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Control Systems
An important part of managing is to measure performance levels and take corrective action if
they do not meet the goals of the enterprise. In order to maintain control over all aspects of an
organization, managers and owners must first establish goals against which results can be
measured. For example, an organization may establish a payroll goal of 30 percent of
revenues-that is, the operating plan is to spend 30 percent or less of sales on salaries and
other payroll expenses. The plan may also provide that a variance of 2 percent is acceptable,
but that anything above that is not. If payroll expenses exceed 32 percent, management must
take action. The ideal control system allows managers to quickly recognize and correct
deviations from the operating budget (or some other management standard) before they
become major problems.
One way hotel managers accomplish this is to have accurate forecasting systems. In too many
cases, corrections are made long after the problem starts. The longer the period between the
variation from property goals and the correction, the weaker the control system and the
greater the potential for lost revenue and increased costs. Training plays a key role in control
systems. A certain number of errors by front desk personnel and food servers is inevitable-no
human system is perfect. But careful training can minimize errors and bring performance
levels up to standard. Many of management's goals can be quantified. The more specific the
goal and the easier it is to quantify, the more likely it is that the goal will be met. Guest room
occupancy levels, guest counts in restaurants, and revenue and expense targets are examples
of quantifiable goals. Not all goals are easy to measure.
For example, an operating plan might have a goal of increasing guest satisfaction or employee
morale. However, even there it is possible to be
more specific and measure the results accordingly. Two of the most important types of
controls for hotel managers are financial controls and quality controls.
Financial Controls
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Among the most useful financial control tools are financial statements. Investors use them
to monitor profitability. Lenders view them as measures of financial stability. Managers base
their planning on them and monitor the success of their planning with them. In order to
understand a hotel financial statement, it is necessary to be familiar with the hotel industry's
financial terminology and to understand the manner in which
revenues and expenses are grouped by hotel division.
Uniform System of Accounts. In March 1926 the American Hotel & Lodging Association (at
that time it was called the American Hotel Association of the United States and Canada)
adopted a manual called the Uniform System of Accounts for Hotels. The system was
formulated by a committee of accountants and hoteliers in New York City. The ninth
edition bore a new title to better encompass all segments of the industry:
The Uniform System of Accounts for the Lodging Industry classifies the different types of hotel
revenues and expenses, and groups them in the statement of income by division or
department. The statement of income is one of management's major control tools. It shows
the total sales by product or service category (rooms, food, beverage, and so on) for a stated
period of time, the expenses incurred in generating those sales, and the profit earned or the
loss incurred as a result of those activities (see Exhibit
11).
There are three types of hotel expenses: divisional expenses, overhead expenses, and fixed
charges or capital costs. Divisional expenses include a wide range of items, such as rooms
division payroll expenses, restaurant laundry, and telephone supplies like message pads and
pencils. Overhead expenses are costs such as marketing and energy--costs that relate to the
entire hotel and not to one specific division. Fixed charges or capital costs are expenses
related to the investment, such as insurance on the building and contents, and interest on
the mortgage loan. The uniform system also classifies assets (something of value that is
owned) and liabilities (what is owed to creditors). Examples of assets might be the hotel
building itself, furniture and equipment, and courtesy vans to transport guests to and from
airports. Liabilities include items such as the mortgage loan and food purchases for which
payment is due. All of these items are grouped
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together in the financial statement known as the balance sheet (see Ex
A balance sheet reports the financial position of a business by presenting its assets, liabilities,
and owner's or shareholders' equity on a given date.
Quality Controls
It is a relatively simple task to standardize the quality and cost of a manufactured product.
This is because products, whether they be toasters or skis, are produced in a factory under
strictly controlled 'conditions. Some assembly lines are computerized, and many use robots to
perform some functions. Moreover, quality control inspectors not, only monitor all operations
but can inspect each finished item before it leaves the plant and a consumer purchases it.
Service businesses such as hotels operate under an entirely different set of circumstances.
The ―product‖ that a hotel produces-the experience of staying there is manufactured in the
hotel "factory" right in front of the consumer. For example, a guest enters a hotel, goes into
the lounge, sits down at a table, and orders a strawberry daiquiri. The product in this case is
not simply the daiquiri-it also includes the lounge, the server, and the bartender who mixes
the drink. It is this total experience that the guest pays for. If the guest had just wanted a
strawberry daiquiri, he or she could have made one at home or bought a bottled one at the
corner liquor store. Because of the nature of a service business, it is extremely difficult to
standardize or even control the service that guests receive. There are too many variables that
can interfere with the process-including the guests, who, for example, may be rude 'and
provoke employees to be rude in return.
Opportunities for dissatisfaction abound. Take our guest who ordered the strawberry daiquiri.
Possibly the guest had to wait for a table because none was available or the host was out of
the room temporarily. Maybe the seating was prompt, but the guest had to wait longer than
expected for the order because the ice machine or the drink mixer was broken. Perhaps the
bartender was preoccupied with a personal problem instead of concentrating on fixing a
perfect strawberry daiquiri. Even if everything else goes well, it can all be spoiled if the guest,
has to wait too long for the check or if there is a mistake on it. All of these possibilities exist
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whenever a guest enters the lounge. Any of them can affect the quality of the experience (the
product) and thus the guest's perception of the lounge and the hotel. This one transaction is a
single example of the many kinds of things that can go wrong in a hotel that is open 24 hours
a day, seven days a week, where guests interact regularly with, and receive service from, front
desk agents, food servers, room attendants, bell persons, concierges, valets, maintenance
people, and gift shop employees.
Product and service consistency is of primary importance and can only be achieved through
quality controls such as:
• Setting standards that answer the needs and expectations of guests
• Selecting employees who are capable of achieving those standards and who are motivated to
do so
• Conducting continual training and certification programs for all employees at every level
• Involving employees in structuring job descriptions, setting performance, standards, and
solving work problems
• Having a feedback system so that all managers and employees know they are achieving
what they have set out to do-satisfy the guest
• Rewarding managers and employees for achieving quality goals
Quality programs at hotels go by various names: "quality assurance" (QA) and "total quality
management" (TQM) are two examples. Although their names vary, the goal of all such
programs is to provide quality service to guests.
3.4 Hospitality organization
Hotel Organization:
• In order to carry out its mission, global and departmental goals and objectives, every
company shall build a formal structure depicting different hierarchy of management,
supervision, and employee (staff) levels. This very structure is refereed to as organization
chart. Moreover, the organization chart shows reporting relationships span of management,
and staff/line functions.
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Usually in the hotel industry, where the sole aim is to satisfy guests, positions, whatsoever
level in the hierarchy they occupy, shall coordinate jointly their efforts so as to provide
quality, standard product to their customers. Therefore, examples of dotted lines are
numerous in hotel organization charts.
• Every organization chart shall be flexible, to reflect the ever-changing environmental

dynamics and, hence be able to survive. In accordance, organization charts shall be reviewed
periodically in order to determine whether the actual organization still match the environment
needs (i.e. guests, employees, technology, competitor's needs…) or not.A SWOT analysis (i.e.:
Strengths, Weaknesses, Opportunities, and Threats) shall be a good start to initiate a change
in the organization chart or not. Last but not least, it is of extreme importance that there are
no 2 hotels having exactly the same organization chart, and that a hotel might have an
organization chart change over time. For, organization charts shall be tailored to fit the needs
of each individual property.
REVIEW QUESTIONS
1. What do you mean by hospitality accommodation?
2. What are the Food and beverage facility in the hotels?
3. Write a note on Support service in hotels
4. Comment on hospitality organization

UNIT 4
4.1 Hospitality distribution channels- meaning and definition, function and

level of distribution
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4.1 Hospitality distribution channels- meaning and definition, function and level of
distribution
MARKETING MIX
Introduction
Marketing mix allows you to combine all the marketing tools in order to sell your product.
Marketing mix is also said to be the marketing tool that the hotel uses to purchase its
marketing objectives in the target market. The various marketing tools are
1. Product
2. Place
3. Price
4. Promotion
SALES
PROMOTION
PRODUCT
ADVERTISI
HOTEL NG CHANNEL CUSTOMER
PRICE
SALES
FORCE
PUBLIC
RELATION
DIRECTIONAL
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ING
Definition: Marketing mix is the combination of elements that we use to market our product.
There are four elements: Product, Place, Price and Promotion. They are called the four Ps of
the marketing mix.
Some people think that the four Ps are old fashionable and propose a new paradigm: The four
Cs! Product becomes customer needs; Place becomes convenience, price is replaced by cost to
the user, promotion becomes communication. It looks like a joke but the Cs is more
customer-oriented.
Product
A good product makes its marketing by itself because it gives benefits to the customer. You
should have a clear idea about the benefits your product can offer.
Suppose now that the competitors products offer the same benefits, same quality, same price.
You have then to differentiate your product with design, features, packaging, services,
warranties, return and so on. In general, differentiation is mainly related to:
 The design: it can be a decisive advantage but it changes with fads. For example, a fun
board must offer a good and fashionable design adapted to young people.
 The packaging: It must provides a better appearance and a convenient use. In food
business, products often differ only by packaging.
 The safety: It does not concern fun board but it matters very much for products used by
kids.
 The "green": A friendly product to environment gets an advantage among some segments.
In business to business and for expensive items, the best mean of differentiation are
warranties, return policy, maintenance service, time payments and financial and insurance
services linked to the product.
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Place-Distribution
A crucial decision in any marketing mix is to correctly identify the distribution channels. The
question ―how to reach the customer" must always be in our mind.
Definition: The place is where you can expect to find your customer and consequently, where
the sale is realized. Knowing this place, you have to look for a distribution channel in order to
reach your customer.
Important
The place is not where is located your business but where your customers are. For a retailer it
is the same but for a boat producer located in Philippines the real place is the entire world.
Do not confuse positioning and place. Here place means the real physical position of the
customer in a geographic area or along a distribution channel.
Channels
It exists today, with the internet, more channels than in the past but basically, you have to
consider three main distribution channels:
-Selling to the customers: Whether you sell by yourself ( as retailer) whether you employ a
sales force, you are in these cases in front of the final customer. There are not intermediaries
between you and him. Unfortunately, except for the retailer business, this situation is far to
be the general case.
 Selling to the retailers: For example, you manufacture the fun boards and you sell them
to the retailers. This practice could be a bit complicated.
 Selling to the wholesalers: There are maybe four or five sport articles wholesalers . You
sell your fun boards to these big men. On turn the wholesalers sell the fun boards to the
retailers which finally sell to their customers.
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As you can see, the choice of your distribution channel heavily depends on your product and
place in the productive process. If you are in coal mining, do not expect to sell some coal
buckets to the final consumer.
PRICE
Price means the pricing strategy you will use. You have already fixed, as an hypothesis a
customer price fitted to your customer profile but you will have now to bargain it with the
wholesalers and retailers.
Pricing strategies
There are three pricing strategies:
 Competitive pricing: If your product is sold at the lowest price regarding all your
competitors, you are practicing competitive pricing. Sometimes, competitive pricing is
essential. For instance, when the products are basically the same, this strategy will usually
succeed.
The success of competitive pricing strategy depends on achieving high volume and low costs.
If your prices are lower than your costs, you are going straight to bankruptcy! To avoid such a
mistake, you have to take notice of the break even ratio.
 Cost-plus-profit: It means that you add the profit you need to your cost. It is also called
cost-orientated strategy and is mainly used by the big contractor of public works. The
authority may have access to the costing data and should like to check if the profit added to
the cost is not too high.
In fact, this strategy is only good for a business whom the customers are public collectivities
or government agencies.
 Value pricing: It means that you base your prices on the value you deliver to customers.
For example, when a new technology has a very large success, you can charge high prices to
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the customer. This practice is also called skimming. It is easy when you are in the
introductory phase of the product life cycle.
Value pricing is also common in luxury items. Sometimes, the higher the price, the more you
sell: Fashionable clothing or restaurants for
Promotion
Advertising, public relations and so on are included in promotion and consequently in the
4Ps. Sometimes, packaging becomes a fifth P. As promotion is closely linked to the sales, here
are the most common features about the sale strategy.
Definition: The function of promotion is to affect the customer behavior in order to close a
sale. Of course, it must be consistent with the buying process described in the consumer
analysis.Promotion includes mainly three topics: advertisement, public relations, and sales
promotions.
Advertisement:
It takes many forms: TV, radio, internet, newspapers, yellow pages, and so on. You have to
take notice about three important notions:
Reach is the percentage of the target market which is affected by your advertisement. For
example, if you advertise on radio you must know how many people belonging to your
segment can be affected.
Frequency is the number of time a person is exposed to your message. It is said that a person
must be exposed seven times to the message before to be aware of it. Reach*frequency gives
the gross rating point. You have to evaluate it before any advertisement campaign.
Message: Sometimes, it is called a creative. Anyway, the message must: get attraction,
capture interest, create desire and finally require action that is to say close the sale.
Public relations:
Public relations are more subtle and rely mainly on your own personality. For example, you
can deliver public speeches on subjects such as economics, geo-economics, futurology to
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several organizations (civic groups, political groups, fraternal organizations, professional

associations)
These speeches will enable you to develop new relationships and their cost is nil.
Sales promotion:
It includes fair trades, coupons, discounts and are linked to the sales strategy.
Sales Strategy
Sales bring in the money. Salesmen are directly exposed to the pressure of finding prospects,
making deals, beating competition and bringing money.
Definitions:
A lead is a person who has been identified as a prospect.
A prospect is a potential customer.
An account is a customer that often buys from the company.
A national account is a very big customer
An order taking: the customer asks for a product and the vendor sells it. It's usual way to
sell candy, soda or to sell tickets for theater. On the contrary, active selling involves locating
customers and persuading them to buy.
Inside sales refers to selling done mainly by phone or by internet.
Outside sales involves getting appointment to meet customers at their home.
Home cold calling means to phone people you do not know.
Hard sell means to use of high pressures upon the prospect.
We have then to distinguish the sale process and the sale organization.
The sales process:

It depends heavily on the buying process. It includes prospecting and persuading.
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Prospecting involves finding the leads and presenting the product. After making contact, the
salesman must show that the product solves a customer's problem. He must also answer two
questions :
 Has the prospect a need or an interest in the product ?
 Does the prospect have the money to buy the product ?
If the prospect does not meet these criteria, you have better to move on to the next prospect !
Persuading and authority are often necessary to close a sale. The salesman's approach is
often to rise questions in order to lead the prospect to a logical conclusion : I must buy now.
The sale organization:

The two major issues are to recruit salesmen or to organize a franchising or multi-level
market
If you recruit the salesmen:
 You should determine the size of the sales force: It must cover the customer segment. A
poor coverage is an invitation to competitors. Remember the production possibility frontier to
determine your maximum sales force.
 You should also determine the alignment of the sales force:
o Alignment by territory divides the market into geographical areas such as counties or
cities and specializes each salesman in an area.
o Alignment by product specializes each salesman in a product
o Alignment by customer specializes each salesman in a customer (it means that the
customer must be a national account).
o You can also combine the three alignments.
 You should finally determinate how to motivate the sale force: Sales people can be
compensated by commissions, salary or salary plus commission. For a starting business it's
more convenient to pay only commissions
If you organize a multi level marketing: Salesmen becomes independent distributors. They
operate as contractors. They are encouraged by your company to recruit other distributors. In
return, they receive a percentage commission on the sales of their recruits.
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There are two benefits from multi-level marketing :You get a large sale force without the
expense of full time employees and the distributors work very hard to improve their income.
Global connections
Time is coming to emphasize on the logical connections between all these elements.
Low involvement products such as soda, with high price elasticity can afford a competitive
pricing and a mass market strategy.
But you have to take notice that competitive pricing implies low costs and a lot of technical
progress, that require big investments and big money.
What is more, mass market strategy implies very important budgets in advertising and once
again big money.
It is easy to view all the implications. It shows that this strategy fit to important companies.
On the contrary, high involvement product with low price elasticity do not always implies big
investments or important expenses in advertising: Value is subjective to the consumer and is
not related to the real cost ( fashionable clothing, luxurious perfumes)
But how to convert any product in a high involvement product?
1) The best way is to create a value expressive message about the product. You have to link
the product to very high involvement issues. For example : health, social status, youth,
success, and so on. This link must be seen by the consumers as a very important
characteristic (in fact, this characteristic is only subjective. It just exists in the consumer's
mind).
2) A product provides different benefits : For example, a single garment brings you three
benefits : it is warm, it is fashionable and it is easy to clean.
Hospitality Distribution channels

Distribution (or "Place") is the fourth traditional element of the marketing mix. The other three
are Product, Price and Promotion.
The Nature of Distribution Channels
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Most businesses use third parties or intermediaries to bring their products to market. They
try to forge a "distribution channel" which can be defined as
"all the organisations through which a product must pass between its point of production and
consumption"
Why does a business give the job of selling its products to intermediaries? After all, using
intermediaries means giving up some control over how products are sold and who they are
sold to.
The answer lies in efficiency of distribution costs. Intermediaries are specialists in selling.
They have the contacts, experience and scale of operation which means that greater sales can
be achieved than if the producing business tried run a sales operation itself.
Functions of a Distribution Channel

The main function of a distribution channel is to provide a link between production and
consumption. Organisations that form any particular distribution channel perform many key
functions:
Gathering and distributing market research and intelligence - important

Information
for marketing planning
Promotion Developing and spreading communications about offers
Contact Finding and communicating with prospective buyers
Adjusting the offer to fit a buyer's needs, including grading, assembling
Matching
and packaging
Negotiation Reaching agreement on price and other terms of the offer
Physical distributionTransporting and storing goods
Financing Acquiring and using funds to cover the costs of the distribution ch
Assuming some commercial risks by operating the channel (e.g. holding
Risk taking
stock)
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All of the above functions need to be undertaken in any market. The question is - who
performs them and how many levels there need to be in the distribution channel in order to
make it cost effective.
Numbers of Distribution Channel Levels
Each layer of marketing intermediaries that performs some work in bringing the product to its
final buyer is a "channel level". The figure below shows some examples of channel levels for
consumer marketing channels:
In the figure above, Channel 1 is called a "direct-marketing" channel, since it has no

intermediary levels. In this case the manufacturer sells directly to customers. An example of a
direct marketing channel would be a factory outlet store. Many holiday companies also
market direct to consumers, bypassing a traditional retail intermediary - the travel agent.
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The remaining channels are "indirect-marketing channels".

Channel 2 contains one intermediary. In consumer markets, this is typically a retailer. The
consumer electrical goods market in the UK is typical of this arrangement whereby producers
such as Sony, Panasonic, Canon etc. sell their goods directly to large retailers such as Comet,
Dixons and Currys which then sell the goods to the final consumers.
Channel 3 contains two intermediary levels - a wholesaler and a retailer. A wholesaler

typically buys and stores large quantities of several producers goods and then breaks into the
bulk deliveries to supply retailers with smaller quantities. For small retailers with limited
order quantities, the use of wholesalers makes economic sense. This arrangement tends to
work best where the retail channel is fragmented - i.e. not dominated by a small number of
large, powerful retailers who have an incentive to cut out the wholesaler. A good example of
this channel arrangement in the UK is the distribution of drugs.
Distribution - channel strategy

The following describes the factors that influence the choice of distribution channel by a
business:
Market factors An important market factor is "buyer behaviour"; how do buyer's want to
purchase the product? Do they prefer to buy from retailers, locally, via mail order or perhaps
over the Internet? Another important factor is buyer needs for product information,
installation and servicing. Which channels are best served to provide the customer with the
information they need before buying? Does the product need specific technical assistance
either to install or service a product? Intermediaries are often best placed to provide servicing
rather than the original producer - for example in the case of motor cars.
The willingness of channel intermediaries to market product is also a factor. Retailers in

particular invest heavily in properties, shop fitting etc. They may decide not to support a
particular product if it requires too much investment (e.g. training, display equipment,
warehousing).
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Another important factor is intermediary cost. Intermediaries typically charge a "mark-up" or

"commission" for participating in the channel. This might be deemed unacceptably high for
the ultimate producer business.
Producer factors A key question is whether the producer have the resources to perform the
functions of the channel? For example a producer may not have the resources to recruit, train
and equip a sales team. If so, the only option may be to use agents and/or other distributors.
Producers may also feel that they do not possess the customer-based skills to distribute their
products. Many channel intermediaries focus heavily on the customer interface as a way of
creating competitive advantage and cementing the relationship with their supplying
producers.
Another factor is the extent to which producers want to maintain control over how, to whom
and at what price a product is sold. If a manufacturer sells via a retailer, they effective lose
control over the final consumer price, since the retailer sets the price and any relevant
discounts or promotional offers. Similarly, there is no guarantee for a producer that their
product/(s) are actually been stocked by the retailer. Direct distribution gives a producer
much more control over these issues.
Product factors Large complex products are often supplied direct to customers (e.g. complex
medical equipment sold to hospitals). By contrast perishable products (such as frozen food,
meat, bread) require relatively short distribution channels - ideally suited to using
intermediaries such as retailers.
Distribution Intensity
There are three broad options - intensive, selective and exclusive distribution:
Intensive distribution aims to provide saturation coverage of the market by using all
available outlets. For many products, total sales are directly linked to the number of outlets
used (e.g. cigarettes, beer). Intensive distribution is usually required where customers have a
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range of acceptable brands to chose from. In other words, if one brand is not available, a
customer will simply choose another.
Selective distribution involves a producer using a limited number of outlets in a

geographical area to sell products. An advantage of this approach is that the producer can
choose the most appropriate or best-performing outlets and focus effort (e.g. training) on
them. Selective distribution works best when consumers are prepared to "shop around" - in
other words - they have a preference for a particular brand or price and will search out the
outlets that supply.
Exclusive distribution is an extreme form of selective distribution in which only one

wholesaler, retailer or distributor is used in a specific geographical area.
Distribution - types of distribution intermediary

Introduction
There is a variety of intermediaries that may get involved before a product gets from the
original producer to the final user. These are described briefly below:
Retailers
Retailers operate outlets that trade directly with household customers. Retailers can be
classified in several ways:
 Type of goods being sold( e.g. clothes, grocery, furniture)
 Type of service (e.g. self-service, counter-service)
 Size (e.g. corner shop; superstore)
 Ownership (e.g. privately-owned independent; public-quoted retail group
 Location (e.g. rural, city-centre, out-of-town)
 Brand (e.g. nationwide retail brands; local one-shop name)
Wholesalers
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Wholesalers stock a range of products from several producers. The role of the wholesaler is to
sell onto retailers. Wholesalers usually specialise in particular products.
Distributors and dealers

Distributors or dealers have a similar role to wholesalers – that of taking products from
producers and selling them on. However, they often sell onto the end customer rather than a
retailer. They also usually have a much narrower product range. Distributors and dealers are
often involved in providing after-sales service.
Franchises
Franchises are independent businesses that operate a branded product (usually a service) in
exchange for a licence fee and a share of sales.
Agents
Agents sell the products and services of producers in return for a commission (a percentage of
the sales revenues)
Direct selling
Introduction
A key decision a business has to make about distribution is whether to sell ―direct‖.
This method of distribution is usually called ―direct marketing‖.
Direct marketing means selling products by dealing directly with consumers rather than
through intermediaries.
Traditional methods include mail order, direct-mail selling, cold calling, telephone selling, and
door-to-door calling. More recently telemarketing, direct radio selling, magazine and TV
advertising, and on-line computer shopping have been developed.
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The main advantages of selling direct are that there is no need to share profit margins and the
producer has complete control over the sales process. Products are not sold alongside those of
competitors either.
There may also be specific market factors that encourage direct selling:
 There may be a need for an expert sales force, to demonstrate products, provide detailed
pre-sale information and after-sales service
 Retailers, distributors, dealers and other intermediaries may be unwilling to sell the
product
 Existing distribution channels may be owned by, or linked to, competing producers
(making it hard to obtain distribution by any other means than direct)
However, there are significant costs associated with selling direct which may be higher than
the costs associated with using an intermediary to generate the same level of sales.
There are several potential advantages of using an intermediary:
 More efficient distribution logistics
 Overall costs (even taking into account the intermediaries‘ margin or commission) may be
lower
 Consumers may expect choice (i.e. the products and brands of many producers) at the
point of sale.
UNIT V
5.1 Major Hospitality distribution channels – travel agents, tour operators,
consortia, and reservation system, GDS, Internet
A travel agency is a retail business, that sells travel related products and services to
customers, on behalf of suppliers, such as airlines, car rentals, cruise lines, hotels, railways,
sightseeing tours and package holidays that combine several products. In addition to dealing
with ordinary tourists, most travel agencies have a separate department devoted to making
travel arrangements for business travelers and some travel agencies specialize in commercial
and business travel only. There are also travel agencies that serve as general sales agents for
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foreign travel companies, allowing them to have offices in countries other than where their
headquarters are located
Origins
The British company, Kings, is sometimes said to be the oldest travel agency in the world, but
this rests upon the services that the original bank, established in 1758, supplied to its
wealthy clients. The modern travel agency first appeared in the second half of the 19th
century. Thomas Cook, in addition to developing the package tour, established a chain of
agencies in the last quarter of the 19th century, in association with the Midland Railway.
They not only sold their own tours to the public, but in addition, represented other tour
companies. Other British pioneer travel agencies were Dean and Dawson, the Polytechnic
Touring Association and the Co-operative Wholesale Society.
Travel agencies became more commonplace with the development of commercial aviation,
starting in the 1920s. Originally, travel agencies largely catered to middle and upper class
customers, but the post-war boom in mass-market package holidays resulted in travel
agencies on the main streets of most British towns, catering to a working class clientèle,
looking for a convenient way to book overseas beach holidays.
Operations
As the name implies, a travel agency's main function is to act as an agent, that is to say,
selling travel products and services on behalf of a supplier. Consequently, unlike other retail
businesses, they do not keep a stock in hand. A package holiday or a ticket is not purchased
from a supplier unless a customer requests that purchase. The holiday or ticket is supplied to
them at a discount. The profit is therefore the difference between the advertised price which
the customer pays and the discounted price at which it is supplied to the agent. This is
known as the commission. A British travel agent would consider a 10-12% commission as a
good arrangement.
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In some countries, airlines have stopped giving commission to travel agencies. Therefore,
travel agencies are now forced to charge a percentage premium or a standard flat fee, per sale.
However, some companies still give them a set percentage for selling their product. Major tour
companies can afford to do this, because if they were to sell a thousand trips at a cheaper
rate, they still come out better than if they sell a hundred trips at a higher rate. This process
benefits both parties.
Other commercial operations are undertaken, especially by the larger chains. These can
include the sale of in-house insurance, travel guide books and timetables, car rentals, and
the services of an on-site Bureau de change, dealing in the most popular holiday currencies.
The majority of travel agents have felt the need to protect themselves and their clients against
the possibilities of commercial failure, either their own or a supplier's. They will advertise the
fact that they are surety bonded, meaning in the case of a failure, the customers are
guaranteed either an equivalent holiday to that which they have lost or if they prefer, a
refund. Many British and American agencies and tour operators are bonded with the
International Air Transport Association (IATA), for those who issue air tickets, Air Travel
Organisers' Licensing (ATOL) for those who order tickets in, the Association of British Travel
Agents (ABTA) or the American Society of Travel Agents (ASTA), for those who sell package
holidays on behalf of a tour company.
A travel agent is supposed to offer impartial travel advice to the customer. However, this
function almost disappeared with the mass-market package holiday and some agency chains
seemed to develop a 'holiday supermarket' concept, in which customers choose their holiday
from brochures on racks and then book it from a counter. Again, a variety of social and
economic changes have now contrived to bring this aspect to the fore once more, particularly
with the advent of multiple no-frills airlines.
Commissions
Most travel agencies operate on a commission-basis, meaning that the compensation from the
airlines, car rentals, cruise lines, hotels, railways, sightseeing tours and tour operators is
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expected in form of a commission from their bookings. Most often, the commission consists of
a set percentage of the sale.
In the United States, most airlines pay no commission at all to travel agencies. In this case,
an agency usually adds a service fee to the net price.
Types of agencies
There are three different types of agencies in the UK: Multiples, Miniples and Independent
Agencies. The former comprises of a number of national chains, often owned by international
conglomerates, like Thomson Holidays, now a subsidiary of TUI AG, the German
multinational.[1] It is now quite common for the large mass-market tour companies to
purchase a controlling interest in a chain of travel agencies, in order to control the
distribution of their product. (This is an example of vertical integration.) The smaller chains
are often based in particular regions or districts.
In the United States, there are four different types of agencies: Mega, Regional, Consortium
and Independent Agencies. American Express and the American Automobile Association (AAA)
are examples of mega travel agencies.
Independent Agencies usually cater to a special or niche market, such as the needs of
residents in an upmarket commuter town or suburb or a particular group interested in a
similar activity, such as sporting events, like football, golf or tennis.
There are two approaches of travel agencies. One is the traditional, multi-destination, out-
bound travel agency, based in the originating location of the traveler and the other is the
destination focused, in-bound travel agency, that is based in the destination and delivers an
expertise on that location. At present, the former is usually a larger operator like Thomas
Cook, while the latter is often a smaller, independent operator.
Consolidators
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Travel consolidators or wholesalers are high volume sales companies that specialize in selling
to niche markets. They may or may not offer various types of services, at a single point of
access. These can be hotel reservations, flights or car-rentals, for example. Sometimes the
services are combined into vacation packages, that include transfers to the location and
lodging. These companies do not usually sell directly to the public, but act as wholesalers to
retail travel agencies. Commonly, the sole purpose of consolidators is to sell to ethnic niches
in the travel industry. Usually, no consolidator offers everything, they may only have
contracted rates to specific destinations. Today, there are no domestic consolidators, with
some exceptions for business class contracts.
Criticism and controversy

"Racking"
Travel agencies have been accused of employing a number of restrictive practices, the chief of
which is known as 'racking'. This is the practice of displaying only the brochures of those
travel companies whose holidays they wish to sell, the ones that pay them the most
commission. Of course, the average customer tends to think that these are the only holidays
on offer and is unaware of the possible alternatives.
Conversely, by limiting the number of companies that a travel agency represents, this can
bring a better and more profitable, working relationship between the agency and its suppliers.
Travel agencies can then obtain special benefits for their customers, from a supplier, by
concentrating their bookings with that supplier. Some examples of these special benefits
would be room upgrades or the waiver of change and cancellation fees.
("Racking" is a British expression, not used in the United States.)
The Internet threat

With general public access to the internet, many airlines and other travel companies began to
sell directly to passengers. As a consequence, airlines no longer needed to pay the
commissions to travel agents on each ticket sold. Since 1997, travel agencies have gradually
been disintermediated, by the reduction in costs caused by removing layers from the package
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holiday distribution network.[2][3] However, travel agents remain dominate in some areas such
as cruise vacations where they represent 77% of bookings and 73% of packaged travel.
Many travel agencies have developed an internet presence of their own by posting a website,
with detailed travel information. Full travel booking sites are often complex and require the
assistance of outside travel technology solutions providers such as Travelocity and OTRAMS.
These companies use travel service distribution companies who operate Global Distribution
Systems (GDS), such as Sabre Holdings, Amadeus IT Group, Galileo CRS and Worldspan
(now Travelport GDS), to provide up to the minute, detailed information on tens of thousands
of flights, hotels and car rentals.
Some online travel sites allow visitors to compare hotel and flight rates with multiple
companies for free. They often allow visitors to sort the travel packages by amenities, price,
and proximity to a city or landmark.
Travel agents have applied dynamic packaging tools to provide fully bonded (full financial
protection) travel at prices equal to or lower than a member of the public can book online. As
such, the agencies' financial assets are protected in addition to professional travel agency
advice.
All travel sites that sell hotels online work together with GDS, suppliers and hotels directly to
search for room inventory. Once the travel site sells a hotel, the site will try to get a
confirmation for this hotel. Once confirmed or not, the customer is contacted with the result.
This means that booking a hotel on a travel website will not necessarily result in an instant
answer. Only some hotels on a travel website can be confirmed instantly (which is normally
marked as such on each site). As different travel websites work with different suppliers
together, each site has different hotels that it can confirm instantly. Some examples of such
online travel websites that sell hotel rooms are Expedia and Orbitz.
The comparison sites, such as Kayak.com, TripAdvisor, and SideStep search the resellers site
all at once to save time searching. None of these sites actually sell hotel rooms.
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Often tour operators have hotel contracts, allottments and free sell agreements which allow
for the immediate confirmation of hotel rooms for vacation bookings.
Mainline service providers are those that actually produce the direct service, like various
hotels chains or airlines that have a website for online bookings. Portals will serve a
consolidator of various airlines and hotels on the internet. They work on a commission from
these hotels and airlines. Often, they provide cheaper rates than the mainline service
providers as these sites get bulk deals from the service providers. A meta search engine on
the other hand, simply culls data from the internet on real time rates for various search
queries and diverts traffic to the mainline service providers for an online booking. These
websites usually do not have their own booking engine.
Careers
With the many people switching to self-service internet websites, the number of available jobs
as travel agents is decreasing. Most jobs that become available are from older travel agents
retiring. Counteracting the decrease in jobs due to internet services is the increase in the
number of people travelling. Since 1995, many travel agents have exited the industry, and
relatively few young people have entered the field due to less competitive salaries.[6] However,
others have abandoned the 'brick and mortar' agency for a home-based business to reduce
overheads and those who remain have managed to survive by promoting other travel products
such as cruise lines and train excursions or by promoting their ability to aggressively
research and assemble complex travel packages on a moment's notice, essentially acting as a
very advanced concierge.
Cargo
A small number of companies work with cargo airlines and cargo ships.
A history of Thomas Cook: From Leicester upwards
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Thomas Cook started organising leisure trips in the summer of 1841 when its founder, who
gave his name to the company, organised a successful one-day rail excursion at a shilling a
head from Leicester to Loughborough.
During the next three summers Mr Cook arranged a succession of trips, taking passengers on
trips to the midland towns of Leicester, Nottingham, Derby and Birmingham. Four years later,
he organised his first trip abroad, taking a group from Leicester to Calais to coincide with the
Paris exhibition.
From its humble beginnings Thomas Cook steadily grew, adding more destinations and
holidays and today is the second largest European travel group. It now has 33 tour operating
brands, 2,400 travel agencies, 66 aircraft and employs 19,775 full time staff.
Thomas Cook was nationalised shortly after World War Two when it became part of the state-
owned British Railways. It was privatised in the 1970‘s with Midland Bank becoming its sole
owner in 1977. It was then sold by Midland in 1992 to a German bank and charter airline.
Mark Twain, Europe and Elsewhere - 1923 (An article on the historic trip)
The people boarding the train at Leicester station thought that they were only going on a good
day out. As far as the majority of the 570 people it was a day to relax. Little did they know
that they were taking part in history, as part of Thomas Cook's first excursion in 1841.
Nothing had happened like it before. Rail travel was still relatively new and Cook was the first
person to organize a group round fare- something even the rail companys had not thought of
yet at the time-excursion rate for 'the enormous distance of eleven miles and back a shilling,
children half price.'
Thomas Cook not only brought excursions into the real of reality, he also bought travel for
common, ordinary citizens into scope. Until that first excursion in 1841, most travellers for
pleasure were the wealthy and the aristocracy who travelled independently: less privileged
people travelled only through necessity.
Thomas Cook's entrepreneurial spirit, enthusiastic vision, and social conscience changed all
that. 'God's green earth in all it's fullness is for the people' he proclaimed, and set about making
it possible.
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Today we take organized travel for granted but Cook's approach was revolutionary. He went to
Liverpool before the trip and checked hotel accommodatoins and resturants to ensure that his
350 excursionists had the best possible service. He then wrote A Handbook of the Trip to
Liverpool in which he gave every detail of the excursion. It was probably the first guidebook of
its kind.
Other trips followed, Cook's pioneering excursionists to Scotland were greeted with crowd
lined streets, brass bands and cannon fire because the tourist was still unusual enough to be
an entertaining curiousity.
Cook was also an opportunist. He was quick to see the possibilities for travel which the newly
invented railways presented, and he reacted speedily when the S S Great Britain ran aground
in Dundrum Bay by organizing an exursion to view the stranded ship in 1847. The Great
Exhibition of 1851 brought him an excellent opportunity to expand his business and he
seized it with relish. He did NOT make money, but he did make his name by persuading a
great many people to visit the Exhibition with Cooks.
Despite the many setbacks of the railroad trying to undermine him by undercutting his
prices, he was forced to find more passengers than he had at first calculated. He brought his
son John Mason, 17, into the business to help and together they paraded though the streets
of Sheffield, Leeds, Derby and Bradford with a band, making speeches about their trips to the
Great Exhibition. They had also set up clubs so working men could pay in small sums a week
toward the total cost which included accommodatoin at the Ranclagh Club-bed and a hearty
Victorian breakfast- for two shillings, the fare was five shillings. Through their direct selling
methods, he was able to take 165,000 people to the Exhibition.
Other Victorian Entrepreneurs did not miss the opportunity to copy Cook and had many
rivals who gave him keen competition. Over the years he took tourists to such varied places
as: the Paris Exhibition, A Grand Circular Tour of Antwerp, Brussels, Waterlo, Cologne,
Frankfurt, Heidelberg, Baden Baden and Paris. In 1863 he lead a tour to Paris and
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Switzerland, and in 1864 to Italy. In that year Cook claimed that he had one million clients
and the business was stable enough for him to settle clients' bills, but he was not actually
running inclusive tours yet. The following year Coook opened an office at 98 Fleet Street,
which was run by his son, John Mason.
In 1865, Cook finally crossed the Atlantic. During the American Civil War Cook watched the
North American continent, which was then virgin territory untrampled by the feet of British
tourists. That year the very first group of European tourists set foot in America. Led by his
son, they visited among other places, New York, Washington, Niagara, Chicago, The
Mammouth Caves of Kentucky and the rather gruesome deserted battlefields of Virginia
where they say, 'skulls, arms, and legs all bleaching in the sun.' The party travelled 10,500
miles in nine weeks.
During the famous Nile Tours, there were no hotels so in 1868 they travelled as a vast
caravan, accompanied by 65 horses, 87 pack mules, tents, beds anf field kitchens to prepare
Victorian breakfasts of boiled eggs, followed by chicken and cutlets, and dinners of seven
courses including wild boar and mutton. However, it was not all fun and games. When one of
the party, a Mrs. Samuels, died on the trip, Cook diplomatically disguised the fact from the
Arabs and, pretending that she was ill, packed up her body and had it carried in a palanquin
until a suitable burial could be arranged.
No matter the circumstances, Cook had a bevy of admirers. Oscar Wilde said of Cook 'They
wire money like angels.' Kipling and H. Rider Haggard found words of praise. Even the
American writer, Mark Twain gave Cook a mention in his writings. Cook's tours not only were
for the middle classes, they also attracted the likes of the British Royal Family, The Kaiser,
the Czar, many European aristocrats, politicians, bishops, archibishops and more.
The inclusive tour, in which everything is paid for in advance was also a creation of Cook as
well as the Circular Note, the forerunner of the trveller cheque which he created in 1873.
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Travel agents
Travel benefits, such as reduced rates for transportation and lodging, attract people to this
occupation.
Training at a postsecondary vocational school, college, or university is increasingly important.
Travel agents increasingly specialize in specific destinations or by type of travel or traveler.
Nature of the Work

Travel agents help travelers sort through vast amounts of information to help them make the
best possible travel arrangements. They offer advice on destinations and make arrangements
for transportation, hotel accommodations, car rentals, and tours for their clients. They are
also the primary source of bookings for most of the major cruise lines. In addition, resorts
and specialty travel groups use travel agents to promote travel packages to their clients.
Travel agents are also increasingly expected to know about and be able to advise travelers
about their destinations, such as the weather conditions, local ordinances and customs,
attractions, and exhibitions. For those traveling internationally, agents also provide
information on customs regulations, required papers (passports, visas, and certificates of
vaccination), travel advisories, and currency exchange rates. In the event of changes in
itinerary in the middle of a trip, travel agents intercede on the traveler‘s behalf to make
alternate booking arrangements.
Travel agents use a variety of published and computer-based sources for information on
departure and arrival times, fares, quality of hotel accommodations, and group discounts.
They may also visit hotels, resorts, and restaurants themselves to evaluate the comfort,
cleanliness, and the quality of specific hotels and restaurants so that they can base
recommendations on their own experiences or those of colleagues or clients.
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Travel agents who primarily work for tour operators and other travel arrangers may help
develop, arrange, and sell the company‘s own package tours and travel services. They may
promote these services, using telemarketing, direct mail, and the Internet. They make
presentations to social and special-interest groups, arrange advertising displays, and suggest
company-sponsored trips to business managers.
Agents face increasing competition from travel and airline websites for low-cost fares, but
travelers still prefer using travel agents who can provide customized service and planning for
complex itineraries to remote or multiple destinations. To attract these travelers, many travel
agents specialize in specific interest destinations, travel to certain regions, or in selling to
particular demographic groups.
Work environment. Travel agents spend most of their time behind a desk conferring with
clients, completing paperwork, contacting airlines and hotels to make travel arrangements,
and promoting tours. Most of their time is spent either on the telephone or on the computer
researching travel itineraries or updating reservations and travel documents. Agents may be
under a great deal of pressure during travel emergencies or when they need to reschedule
missed reservations. Peak vacation times, such as summer and holiday travel periods, also
tend to be hectic.
Many agents, especially those who are self-employed, frequently work long hours. Advanced
computer systems and telecommunications networks make it possible for a growing number
of travel agents to work at home; however, some agents feel a need to have an office presence
to attract walk-in business.
Travel agents organize and schedule business, educational, or recreational travel or activities.
Other workers with similar responsibilities include tour guides and escorts, travel guides,
reservation and transportation ticket agents and travel clerks, retail salespersons, and hotel,
motel, and resort desk clerks.
Tour operator
A tour operator typically combines tour and travel components to create a holiday. The most
common example of a tour operator's product would be a flight on a charter airline plus a
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transfer from the airport to a hotel and the services of a local representative, all for one price.
Niche tour operators may specialise in destinations e.g. Italy, activities and experiences e.g.
skiing, or a combination thereof. The original raison d'etre of tour operating was the difficulty
of making arrangements in far-flung places, with problems of language, currency and
communication.
The advent of the internet has led to a rapid increase in self-packaging of holidays. However,
tour operators still have their competence in arranging tours for those who do not have time
to do DIY holidays, and specialize in large group events and meetings such as conferences or
seminars. Also, tour operators still exercise contracting power with suppliers (airlines, hotels,
other land arrangements, cruises, etc.) and influence over other entities (tourism boards and
other government authorities) in order to create packages and special departures for
destinations otherwise difficult and expensive to visit.
The two major tour operator associations in the US are the National Tour Association (NTA)
and the United States Tour Operator's Association (USTOA), in Europe it is the European
Tour Operators Association - ETOA and in the UK it is AITO .
Travel technology
Travel technology is a term used to describe applications of Information Technology (IT), or
Information and Communications Technology (ICT), in travel, tourism and hospitality
industry. Travel technology may also be referred to as tourism technology or even hospitality
automation
Definition of Travel Technology

Since travel implies locomotion, travel technology was originally associated with the computer
reservations system (CRS) of the airlines industry, but now is used more inclusively,
incorporating the broader tourism sector as well as its subset the hospitality industry. While
travel technology includes the computer reservations system, it also represents a much
broader range of applications, in fact increasingly so. Travel technology includes virtual
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tourism in the form of virtual tour technologies. Travel technology may also be referred to as
e-travel / etravel or e-tourism / etourism (eTourism), in reference to "electronic travel" or
"electronic tourism".
In other contexts, the term "travel technology" can refer to technology intended for use by
travelers, such as light-weight laptop computers with universal power supplies or satellite
Internet connections. That is not the sense in which it is used here.
Applications of Travel Technology

Travel technology includes many processes such as dynamic packaging which provide useful
new options for consumers. Today the tour guide can be a GPS tour guide, and the guidebook
could be an audioguide, podguide or I-Tours, such as City audio guides. The biometric
passport may also be included as travel technology in the broad sense.
History of Travel Technology

Certainly travel technology was born on the coat-tails of the airline industry's use of
automation and their need to extend this out to the travel agency partners. It should be kept
in mind that there was an online world before the advent of the world wide web in the form of
private and commercial online services, via packet switched network using X.25. Travel
technology played a significant role in the so-called dot-com boom and bust, circa 1997-2001.
GDS
Worldwide computerized reservation network used as a single point of access for reserving
airline seats, hotel rooms, rental cars, and other travel related items by travel agents, online
reservation sites, and large corporations. The premier GDS are Amadeus, Galileo, Sabre, and
Worldspan owned and operated as joint ventures by major airlines, car rental firms, and hotel
groups. Also called automated reservation system (ARS) or computerized reservation system
(CRS).
A computer reservations system (CRS) is a computerized system used to store and retrieve
information and conduct transactions related to air travel. Originally designed and operated
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by airlines, CRSes were later extended for the use of travel agents; major CRS operations that
book and sell tickets for multiple airlines are known as global distribution systems (GDS).
Airlines have divested most of their direct holdings to dedicated GDS companies, who make
their systems accessible to consumers through Internet gateways. Modern GDSes typically
allow users to book hotel rooms and rental cars as well as airline tickets.
History
In the early days of American commercial aviation, passengers were relatively few, and each
airline's routes and fares were tightly regulated by the Civil Aeronautics Board. These were
published in a volume entitled The Official Airline Guide, from which travel agents or
consumers could construct an itinerary, then call or telex airline staff, who would mark the
reservation on a card and file it. As demand for air travel increased and schedules grew more
complex, this process became impractical.
In 1946, American Airlines installed the first automated booking system, the experimental
electromechanical Reservisor. A newer machine with temporary storage based on a magnetic
drum, the Magnetronic Reservisor, soon followed. This system proved successful, and was
soon being used by several airlines, as well as Sheraton Hotels and Goodyear for inventory
control. It was seriously hampered by the need for local human operators to do the actual
lookups; ticketing agents would have to call a booking office, whose operators would direct a
small team operating the Reservisor and then read the results over the telephone. There was
no way for agents to directly query the system.
In 1953, Trans-Canada Airlines (TCA) started investigating a computer-based system with

remote terminals, testing one design on the University of Toronto's Manchester Mark 1
machine that summer. Though successful, the researchers found that input and output was
a major problem. Ferranti Canada became involved in the project and suggested a new
system using punch cards and a transistorized computer in place of the unreliable tube-
based Mark I. The resulting system, ReserVec, started operation in 1962, and took over all
booking operations in January 1963. Terminals were placed in all of TCA's ticketing offices,
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allowing all queries and bookings to complete in about one second with no remote operators
needed.
In 1953, American Airlines CEO C. R. Smith chanced to sit next to R. Blair Smith, a senior
IBM sales representative. C.R. invited Blair to visit their Reservisor system and look for ways
that IBM could improve the system. Blair alerted Thomas Watson Jr. that American was
interested in a major collaboration, and a series of low-level studies started. Their idea of an
automated Airline Reservation System (ARS) resulted in a 1959 venture known as the Semi-
Automatic Business Research Environment (SABRE), launched the following year. By the time
the network was completed in December 1964, it was the largest civil data processing system
in the world.
Other airlines soon established their own systems. Delta Air Lines launched the Delta
Automated Travel Account System (DATAS) in 1968. United Airlines and Trans World Airlines
followed in 1971 with the Apollo Reservation System and Programmed Airline Reservation
System (PARS), respectively. Soon, travel agents began pushing for a system that could
automate their side of the process by accessing the various ARSes directly to make
reservations. Fearful this would place too much power in the hands of agents, American
Airlines executive Robert Crandall proposed creating an industry-wide Computer Reservation
System to be a central clearinghouse for U.S. travel; other airlines demurred, citing fear of
antitrust prosecution.
In 1976, United began offering its Apollo system to travel agents; while it would allow the
agents to book tickets on United's competitors, the marketing value of the convenient
terminal proved indispensable. SABRE, PARS, and DATAS were soon released to travel agents
as well. Following airline deregulation in 1978, an efficient CRS proved particularly important;
by some counts, Texas Air executive Frank Lorenzo purchased money-losing Eastern Air
Lines specifically to gain control of its SystemOne CRS.
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European airlines also began to invest in the field in the 1980s, propelled by growth in
demand for travel as well as technological advances which allowed GDSes to offer ever-
increasing services and searching power. In 1987, a consortium led by Air France and West
Germany's Lufthansa developed Amadeus, modeled on SystemOne. In 1990, Delta, Northwest
Airlines, and Trans World Airlines formed Worldspan, and in 1993, another consortium
(including British Airways, KLM, and United Airlines, among others) formed the competing
company Galileo International based on Apollo. Numerous smaller companies have also
formed, aimed at niche markets the four largest networks do not cater to.
Major systems
Name Created by Also used by

Amadeus Air France Online travel agencies including
Iberia ebookers
Lufthansa Expedia
SAS Opodo
Flights
Anyfares
Over 500 individual airlines
Over 120 individual airline websites
Over 90,000 travel agencies
Over 76,000 hotels
SABRE American Airlines Expedia
All Nippon Airways Travelocity
Cathay Pacific Airways Anyfares
China Airlines Kayak
Singapore Airlines Over 20 individual airlines
Galileo Aer Lingus CheapTickets
Air Canada Destinia
Alitalia ebookers
Swissair Ixeo
TAP
United Airlines
Worldspan Delta Orbitz
Northwest Hotwire
Priceline
Patheo KLM Online Travel agencies including
Finnair Airgorilla
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Lufthansa Flights
VA Kayak
Anyfares
American Express
Abacus SABRE Online travel agencies including
All Nippon Airways Zuji
Cathay Pacific Airways Over 450 individual airlines
China Airlines Over 25 countries in Asia Pacific
EVA Airways Over 80,000 hotels
Garuda Indonesia
Dragonair
Philippine Airlines
Malaysia Airlines
Royal Brunei Airlines
SilkAir
Singapore Airlines
In December 2006, Travelport, which owns Galileo, agreed to buy and merge with the
Worldspan GDS. The combined company would then control a 46.3% market share using
2002 airline booking data.
Worldspan's market share is 16.9% globally and 31% in the U.S. according to 2006 MIDT
airline transaction data.
In March 2007, Royal Dutch Airlines KLM switched from Galileo to Amadeus as a result of the
merger with Air France.
REVIEW QUESTIONS
1. What is hospitality distribution channels- meaning and definition?
2. What are the function and level of distribution of hotel market
3. What is market mix? Explain
4. What are the major Hospitality distribution channels for hotels?
5. Write a note on travel agents, tour operators, and reservation system in hotels
UNIT 6
6.1 Major players in the industry
6.2 Emerging markets
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6.3 Role of support services and infrastructure
6.1 Major players in the industry
The major players in the Indian hotel industry can be broadly classified into private players
and public players. The major private players include Indian Hotels Company limited, East
India Hotels Limited (The Oberoi group), Asian Hotels and ITC Hotels. ITDC and Hotel
Corporation of India are the major public sector players.
The Top Players in Hospitality Sector
Public Sector Players:

3 ITDC hotels
4 Hotel Corporation of India
Private Sector Players:

 ITC Hotels
 Indian Hotels Company Ltd.(The Taj Hotels Resorts & Palaces)
 Oberoi Hotels(East India Hotels)
 Hotel Leela Venture
 Asian Hotels Ltd.
 Radisson hotels & Resorts
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Hotel Corporation of India
The Hotel Corporation of India Limited is a public limited company wholly owned by Air India
Limited and was incorporated on 8 July,1971 for providing in-flight catering services to the
national carriers and for operating a chain of hotels, particularly near the airports. The
company has a total of 3923 employees and its net worth is Rs. 55.40 crore. HCI has an
authorized capital of Rs. 41 crores and a paid up capital of Rs. 40.60 crores.
All the hotels of HCI operate under the name of "Centaur Hotels". Currently, HCI is operating
two hotels in Delhi and Srinagar.
Centaur Hotel Delhi Airport, Delhi

The Centaur Hotel at Delhi Airport was commissioned in November 1982. It has 376 rooms,
including 4 Deluxe Suites and 2 Presidential Suites, a 24 hour Coffee Shop, 2 Speciality
Restaurants, Bar, Health Club, Swimming Pool, Beauty Parlor, Tennis Court and a Shopping
Arcade. The hotel has a magnificent lobby and a fully automatic electronic Telephone
Exchange. This is the only 5 Star Deluxe Hotel near the Indira Gandhi International Airport at
Delhi. The hotel provides free Transport Facility into town and also offers facility for sight-
seeing Tours, Hire of Cars and has an Air India Office situated within its premises. The hotel
has now been upgraded to a 5 Star Deluxe Hotel.
(B) Centaur Lake View Hotel, Srinagar

The Centaur Lake View Hotel at Srinagar was commissioned in December 1983 and is part of
a Modern Convention Center Complex. It has 249 rooms including suites, Health Club, a 24
hour Coffee Shop, 2 Speciality Restaurants, a Bar, Shopping Arcade and other recreation
facilities. The hotel was planned as a Holiday Resort and is located on the banks of Dal Lake.
The hotel had been a popular venue for a large number of Conference and Convention but the
business has suffered a lot on account of terrorism.
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Management:
Commodore D. Jena is the Managing Director of HCI.
ITC Hotels Limited
ITC was founded on August 24, 1910 in Kolkata. ITC's hotel business operates over 60 hotels
across more than 50 destinations in India.
Management: (Hotel Division)

Chairman: Mr.Yogesh C Deveshwar
Divisional Chief Executive: Mr. Nakul Anand
Executive, Vice President(Operations): Mr. Pawan Kumar Verma
Sr. Executive-VP(Projects, Growth & Development): Mr. S C Shekhar
VP, Sales & Marketing: Mr. B Hariharan
ITC Hotels:
 ITC Hotel Maurya Sheraton & Towers, New Delhi
 ITC Hotel Grand Maratha Sheraton & Towers, Mumbai
 ITC Hotel Sonar Bangla Sheraton & Towers,Kolkata
 WelcomHotel Mughal Sheraton, Agra
 WelcomHeritage ( These hotels are spread over all over india and are currently
operating in Rajasthan, Punjab, Himachal Pradesh, Madhya Pradesh, Uttaranchal, Jammu &
Kashmir, West Bengal, Tamil Nadu, Haryana and Karnataka.)
MARKET CAPITALIZATION
Month High Low Average

July 2006 69470.81 61622.49 65132.68
August 2006 71935.59 63162.11 66907.27
September 2006 71616.29 68235.51 69865.82
October 2006 73136.79 69172.79 70595.60
November 2006 71870.11 66984.82 69353.40
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December 2006 71557.75 63306.15 67001.52
Key Stats & Ratios

Quarterly Annual Annual
(2006) (TTM)
Net Profit Margin - 21.70% -
Operating Margin - 31.32% -
EBITD Margin - 34.70% -
Return on Average Assets
- 18.35% -
Return on Average Equity
- 26.75% -
RECRUITMENT POLICY:
The potential candidates who are looking forward to build their career in ITC Hotels should
possess several qualities like integrity, intellectual rigor, a 'will do' attitude, team skills, ability
to think strategically, high energy, creativity and leadership.
For entry level, ITC relies on campus recruitments and visits various management and
engineering institutes. Some of the institutes include IITs, IIMs, FMS, XLRI, etc.
ITC also provides summer internships. The internships are for a total of 8 weeks during
April - July every year. For middle level opportunities, advertisements are placed on the
company website and the interested and eligible candidates are invited to apply on-line. The
middle management level provides opportunities in Marketing, Finance, Human Resources,
Information Technology, Logistics and many more.
Corporate Office:
Virginia House 37, Jawaharlal Nehru Road
Kolkata, 700 071
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+91-33-22886426
http://www.itcportal.com
Indian Hotels Company

The Indian Hotels Company (IHC) is the parent company of Taj Hotels Resorts and Palaces. It
was founded by Jamsetji N. Tata on December16, 1903. Currently the Taj Hotels Resorts and
Palaces comprises 57 hotels at 40 locations across India. Additional 18 hotels are also being
operated around the globe. During fiscal year 2006, the total number of hotels owned or
managed by the Company was 75.
The Taj hotels are categorized as luxury, leisure and business hotels. The Taj Luxury Hotels
offer a wide range of luxurious suites with modern fitness centres, rejuvenating spas, and
well-equipped banquet and meeting facilities. The Taj Leisure Hotels offer a complete holiday
package that can be enjoyed with the whole family. It provides exciting activities ranging from
sports, culture, environment, adventure, music, and entertainment. The Taj Business Hotels
provide the finest standards of hospitality, which helps the business trips to be productive.
They offer well-appointed rooms, telecommunication facilities, efficient service, specialty
restaurants and lively bars, well-equipped business centres, and other conference facilities.
Management:
Chairman: Mr. Ratan N Tata
Managing Director & CEO: Mr. Raymond Bickson
Chief Operating Officer, Leisure Hotels: Ms. Jyoti Narang
Chief Operating Officer, Luxury Hotels: Mr. Abhijit Mukerji
Chief Operating Officer, Business Hotels: Mr. Jamshed S. Daboo
Vice President-Legal & Company secretary: Dev Bajpai
Chief Financial Officer: Mr. Anil P Goel
Financial Data
Key Stats & Ratios
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(Mar '04) (2006) (TTM)
Net Profit Margin 4.86% 11.93% 5.03%
Operating Margin 8.24% 16.75% 7.77%
EBITD Margin - 29.11% 23.33%
Return on Average -Assets 5.32% -
Return on Average -Equity 15.48% -
Market Capitalization in last 6 months (Rs.crores)
Month High Low Average
July 2006 6983.18 5883.71 6640.63
August 2006 7536.56 6745.18 7229.90
September 2006 8093.45 7482.83 7835.64
October 2006 8576.75 7911.81 8146.62
November 2006 9046.91 8080.31 8681.29
December 2006 9444.76 8400.55 9001.56
Careers at IHC Ltd.
Campus Recruitments: IHC Ltd visits the campuses of premier institutes and selects
candidates. The selection procedure includes a preliminary interview or a group discussion
followed by a final interview with the senior management.
Training Programs: Taj offers two training programs, viz. Taj Management Training Program
(TMTP) & Hotel Operations Management Training (HOMT) Program. The TMTP is further
divided into 2 segments- food and operations. The duration of TMTP Operations is of 18
months and that of TMTP food is of 24 months, while the duration of HOMT program is 12
months. The recruitment for HOMT program commences in October/November every year.
The Oberoi Group (EIH)
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The Oberoi Group was founded in 1934 by Late Rai Bahadur M S Oberoi. The group owns
and/or manages 32 hotels with 3,193 rooms under names of "Oberoi Hotels & Resorts" and
"Trident Hilton", a luxury backwater cruiser in Kerala and Oberoi Flight Services, a division of
EIH that provides commercial in-flight catering and operates airport lounges and restaurants.
It has branches in five countries, situated in two continents (Asia and Africa).
The chain operates the following hotels and resorts in India:

 The Oberoi, New Delhi
 Oberoi, Mumbai, Maharashtra
 The Oberoi, Banglore, Karnataka
 The Oberoi Amarvilas, Uttar Pradesh
 The Oberoi Grand, Kolkata, West Bengal
 The Oberoi Udaivilas, Udaipur, Rajasthan
 The Oberoi Vanyavilas, Rajasthan
 Wildflower Hall, Shimla, Himachal Pradesh
 The Oberoi Cecil, Shimla, Himachal Pradesh
 The Oberoi Motor Vessel Vrinda, Kerela.
The other businesses of EIH include:

Mercury Car Rentals
Corporate Air Charters
EIH Press
Mercury Travels
FlightCatering
Corporate Office:
4, Mangoe Lane
Kolkota, 700 001
IND +91-33-2486751
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Management:
Board of Directors:
Chairman & Chief Executive: P.R.S. Oberoi
Vice Chairman & Managing Director: S.S. Mukherji
Deputy Managing Director (Operations): Vikram Oberoi
Deputy Managing Director (Development): Arjun Oberoi
Independent Directors: S.K. Dasgupta, Anil Nehru, Rajan Raheja &
Christopher Reeves
Career opportunities:
After XIIth: XIIth pass outs can become trainees for four operations areas, viz food and
beverage (F&B) service operations, front office operations, housekeeping operations, and
kitchen operations through the Systematic Training and Education Programme (STEP). STEP
is a three-year comprehensive training programme in which training in hotel operations is
coupled with the opportunity to graduate. Two elements combine to make it a meaningful
alternative to a course from an institute of hotel management:
e of Bachelor of Tourism Studies through IGNOU
Operations assistants: These positions are usually available in one of the four operational
departments:
 Food and beverage (F&B) service operations
 Front office operations
 Housekeeping operations
 Kitchen operations
The recruitment for the above positions is done through a system called "The Oberoi Central
Employment Register" (OCER).
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Operations executives: The candidates for this position are developed through The Oberoi
Center of Learning and Development.(OCLD)
Position Profile Age Qualification

Engineering Technician
electrical,mechanical,
Up to 27 diploma in engineering,
conditioning, refrigeration, certificate
utilities
Accounts Assistant
general accounting,
Up to
accounts
27 B. Com with computer
payable, accounts receivable, literacy
purchasing, store keeping
HR Assistant human resource, training
Up to 27 PGD in personnel
management, PGD
human resources, MBA(HR)
The market capitalization of EIH as on march 21, 2007 was Rs. 3,748.74 cr.
Key Stats & Ratios

Annual
(2006)
Net Profit Margin 22.32%
Operating Margin 30.45%
EBITD Margin 48.13%
Return on Average Assets 8.81%
Return on Average Equity 21.09%
Hotel Leela Venture Ltd
The Leela palaces and resorts include a chain of five star luxury hotels and resorts. It was
founded by Capt. C P Krishnan Nair in 1957. The Company's properties include The Leela
Kempinski Mumbai, The Leela Palace Goa, The Leela Kempinski Kovalam Beach Kerala and
The Leela Palace Kempinski Bangalore. The Leela properties will also enter into prime
ICHM Page 93
locations in Gurgaon, Delhi N.C.R. Udaipur, Chennai, Hyderabad, and Pune. The Company
has entered into an operations and management contract for a 409 rooms hotel in Gurgaon,
Delhi. Its subsidiaries include Kovalam Hotels Limited and Amin Group Hotel Limited (AGHL).
The land held by AGHL has been developed as The Leela Business Park. The number of
employees employed by Hotel Leela Venture Ltd. is 2,030.
Corporate Office:
The Leela Sahar
Mumbai, 400 059
+91-22-56911234
http://www.theleela.com/
Key Stats & Ratios

(Dec '06) (2006) (TTM)
Net Profit Margin 35.13% 19.36% 38.48%
Operating Margin 37.24% 29.93% 44.42%
EBITD Margin - 49.89% 59.73%
- 3.90% -
- 9.26% -
The market capitalization was Rs. 20, 860, 277, 524
Management:
Board of Directors
Chairman: Capt. CP Nair
Managing Director: Mr. Vivek Nair
Joint MD: Mr. Dinesh Nair
Deputy MD: Mr. Venu Krishnan
Other members on board include:

Mr. M. Narasimham
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Mrs. Madhu Nair

Mr. P.C.D.Nambiar
Mrs. Anna Malhotra
Mr. Vijay Amritraj
Mr. R. Venkatachalam
Mr. Anik Harish
Mr. C.K. Kutty
Careers:
One can keep track of job openings in Leela venture by visiting the career link on its website.
To apply for the job openings, candidates can directly send their resume to the following email
id:
leelahr.mumbai@theleela.com
Asian Hotels Limited

It is engaged in the business of setting up and operating hotels. Asian Hotels Ltd. owns the
Hyatt Regency Hotel in New Delhi and another hotel in Srinagar. There are 215 Hyatt hotels
and resorts in 43 countries around the world, operating under the Hyatt, Hyatt Regency,
Grand Hyatt and Park Hyatt brands.
Key Stats & Ratios

Annual
(2003)
Net Profit Margin 9.03%
Operating Margin 15.40%
EBITD Margin 21.06%
1.65%
3.65%
The market capitalization of Asian Hotels limited is Rs.16,076,512,620
Corporate Office:
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Bhikaiji Cama Place M.G. Marg

New Delhi 110066, IND +91-6791234
Company website: http://www.asianhotelslimited.com
Careers:
The Hyatt group visits almost 38 campuses every year. For corporate management training
program, applications are invited throughout the year for January and June placements.
Applicants are required to meet the following criteria:
 A bachelor's degree in a related field
 Minimum GPA of 2.8
 Nine months of related industry work experience
 Leadership and involvement in extracurricular activities and on-campus organizations
 Positive references from two previous employers
This management training program is given in various fields such as accounting, food &
beverages, human resources, catering, culinary, sales, engineering, etc.
Besides, Hyatt also provides internship programs to provide practical experience to the fresh
graduates.
ITDC Hotels
ITDC came into existence in October 1966 for the promotion of tourism in India. The hotel
portfolio of ITDC includes 33 hotels across India. Some of them are:
Hotel Ashok at Delhi
 Ashok Yatri Niwas
 Bharatpur Forest Lodge
 Khajuraho Ashok
 Temple Bay Ashok Beach Resort at Mamallapuram
 Hotel Qutub at Delhi
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The Corporation is running hotels, restaurants at various places for tourists, besides
providing transport facilities. Presently, ITDC has a network of eight Ashok Group of Hotels,
six Joint Venture Hotels, 2 Restaurants (including one Airport
Restaurant), 12 Transport Units, one Tourist Service Station, 37 Duty Free Shops at
International as well as Domestic Customs Airports, one Tax Free outlet and two Sound &
Light Shows.
Broadly, the main objectives of the Corporation are:

 To construct, take over and manage existing hotels and market hotels, Beach Resorts,
Travelers' Lodges/Restaurants;
 To provide transport, entertainment, shopping and conventional services;
 To produce and distribute tourist publicity material
 To render consultancy-cum-managerial services in India and abroad;
 To carry on the business as Full-Fledged Money Changers (FFMC), restricted money
changers, etc;
 To provide innovating, dependable and value-for-money solutions to the needs of tourism
development and engineering industry, including providing consultancy and project
implementation
As on 31st March 2005, the authorized capital of the ITDC was Rs 75 crores and the paid up
capital was Rs 67.52 crores. Approximately 90 percent of the paid up equity capital of the
Corporation is held in the name of President of India
Corporate Office:
India Tourism Development Corporation
6th Floor, Scope Complex, Core 8,
7, Lodi Road,
New Delhi
Ph: 011-24361690
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http://www.theashokgroup.com/
Management:-
Chairman: Mr. Parvez Diwan
Vice president(Hotels): Mr. M S Manchanda
Director(Finance): Shri P P Singh
Vice president(Hotels outside Delhi):Mr. Jawahar Ghadiok
General manager(Ashok tours & travels): Mr. I Majumdar
Company Secretary: Mr. C Stephen
6.2 Emerging markets
Introduction
Hotels may attract many different markets, e.g. business, holiday/pleasure, conference and
these markets could be local, domestic or overseas. Even within these classifications you may
find that every guest has a different reason for being in the hotel, for example, an individual
guest may be on business or he may just be stopping over en-route to the airport. A group
arrival may indicate that they are o n vacation but on the other hand they could b e attending
a conference. Each guest will have their own reason for being there and will have their own
expectations about the hotel and the service.
Knowing who your different types of customers are and what markets your hotel attracts will
help you to understand more fully the needs of your guests. This in turn will enable you
provide each and every guest with the type of service appropriate to their particular needs.
All hotels spend as much as six times more to capture new guests as they do for repeat
guests. I believe today's hotel mantra should be "let's optimize every guest experience so
guests can't wait to return - - and tell a friend!"
Smaller independents and boutique hotels are able to hold their own and, in many cases, out
perform chain properties all over the U.S. by focusing on a combination of solid guest
ICHM Page 98
identification needs and wants assessment satisfaction, recognition and reward programs.
"Getting to know their existing customers better"
Successful Independent and boutique hotel operators have realized that limited dollars,
resources and distribution channels make it near impossible to compete with mega-chain
brands and their sophisticated, attractive frequent guest programs. Rather than attempt to go
head-to-head in the global, national, regional and local market places, smart independent and
boutique operators are protecting and expanding market share by getting to know their
existing customers better - - their needs, their preferences and the primary reasons for their
patronage and loyalty. This vital information is now being recorded electronically and, when
deemed absolutely necessary, manually by hand.
There may be a multitude of reasons for why today's hotel guests select a small independent
or boutique hotel over a chain-affiliated property. The reason could be price. Availability.
Location. Possibly, a friend's recommendation. All things being equal, however, I believe that
more and more guests are making hotel selections based upon comfort ability, recognition
and service. Status is a whole other issue, one to be addressed in a future article.
"Build a solid data base on all guests, electronically or manually"
Here are some good tips for independents and boutique hotels for both attracting and
retaining today's (and tomorrow's) guests:
 Insist on a clean, safe, efficient, user-friendly operation
 (owners) don't assume, inspect what you expect
 If on site food and beverage can not be presented and delivered correctly, on time and
affordable, insist that all guests are introduced to neighborhood, value-priced F&B options .
 Learn as much as possible about guests and guest needs desires
 Build a solid data base on all guests, electronically or manually
 New data base mining companies can help match preferred guest profiles and deliver
lists of hundreds of prospective new guests
 Customize an appropriate reward program for your preferred guests
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 Communicate with guests via e-mail or direct mail between visits

 Recognize and thank guests at both check in and check out
 develop a satisfied guest "sales force" to spread the word amongst family, friends and co-
workers
 Insist general managers make local sales calls daily
 Seek out new, advantageous, neighborhood marketing partnering relationships.
Who Are Our Guests?

Who are the people who stay at hotels? The Worldwide Hotel Industry Study indicated that
52.6% of hotel room-nights were sourced from foreign travelers, whereas 47.4% were
domestic. Leisure travelers made up 34.1% of the market, business travelers 28.5%, tour
groups 17.7%, and conference participants 10.1%. These are worldwide averages, and
individual countries showed large variations from these norms.
Within Australia, most domestic travel is by leisure travelers. The motives for their travel are
as varied as the people themselves. Business travelers include both private-sector and public-
sector travelers, and this business sector tends to be the most attractive to hospitality
operators-not only because of the frequency of their travel and the repeat business, but also
because they are not as price-conscious (because their travel expenses are usually met by
their businesses or their employers).
Market Segmentation
The lodging industry‘s target market is all the potential guests of lodging properties – whether
visiting relatives, conducting business, or relaxing on vacation. Because the total market is so
vast, marketers break it into market segments – smaller, identifiable groups with common
characteristics. These segments can be defined using any set of characteristics, such as those
found in geographic, demographic, or psychographic information. Often, information from
different sources is combined. For example, one hotel may first narrow its target segments by
focusing on one geographic area (all people living in Thiwan). The segments may then be
further narrowed by financial status (all people living in Thiwan whose income is above
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$20,000 a year and below $50,000). By continuing this process, marketers can find
increasingly more precise targets. Marketing narrow targets is a more efficient use of
marketing dollars but is also the most expensive form of marketing, since most companies
must tarb t several segments at once.
Broad Segments
The most common marketing segment is defined by trip purpose-either business or leisure. In
an effort to maximize their occupancy rates, most lodging facilities attempt to attract
members of both groups since their differences are sometimes complimentary. For instance,
business guests are more likely to need lodging from Monday through Thursday, and hoteliers
can lessen the weekend slack by planning specials for leisure guests who are more likely to
travel on weekends. Not all of the differences balance one another so nicely, however. Since
many of the needs of both groups are often specific to each, different marketing strategies are
necessary.
Business Guests.
Business travel is the most important source of guests for80 percent of all hotels. For this
reason, recognizing and catering to the special needs of the business traveler is vital to the
success of the lodging industry. Traditionally, business travel is high on weekdays and low on
weekends, with the average trip lasting approximately 3.5 days. During their stay, business
travelers usually spend the majority of their time working. This means their needs are
specific: well-lighted workspaces; a telephone; and access to equipment like personal
computers, modems, photocopies, or facsimile machines.
The business segment can be further defined by socioeconomic and psychographic factors.
Some business travelers are on limited budgets, while other spare no expense for their
accommodations. This letter group often expects VIP treatment and luxury accommodations.
In some cases, business travelers need lodging for extended periods. For conferences,
business guests may need access to meeting and banquet facilities. The possible segments
are legion.
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Leisure Guests. Personal and leisure travel accounts for 56 percent of all hotel stays. Many
experts predict that the leisure travel market will flourish in light of the increase in
discretionary income of aging baby boomers. Discriminating and extremely conscious of price
and value relationships, leisure travelers‘ desires may vary widely – from one night‘s stay in
basic accommodations to several weeks at a resort with extensive recreation, entertainment,
food and beverage facilities. In the past, leisure trips were lengthy. Today, however, the
increase in dual-income families has influenced the trend towards shorter, more frequent
trips close to home. Weekend getaways, as these trips are
often called, have been spurred by the difficulties of coordinating vacation time. Still, families
with two working parents (76%) are more likely to vacation than those with one (64%).
Target markets
Every hotel seeks to identify target markets.
Target markets are distinctly defined groups of people that the hotel hopes to retain or attract
as guests.
Hotels frequently have a mixed market, which is drawn from both business and
holidaymakers. The most frequently defined market segments are:
 Conference
 Business
 Independent Travelers
 Local Travelers
 Overseas Holidays
 Domestic Travelers
The needs of different types of guests
The need of the business traveler may include: Ease in making a reservation Quick, efficient
check-in Reliable and comfortable product Discreet meeting places (e.g. lounges, bars and
conference rooms) Early breakfast and quick checkout Business facilities Leisure facilities
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Budget accommodation Convenient location Foreign currency exchange The needs of a tourist
may include: Friendly front office staff
Other Segmentation Criteria

There are other differences between people, which influence their needs, and preferences. For
example, their age, marital status, nationality, lifestyle and gender. Old, affluent widows from
Paris would differ greatly from young, single, working-class girls from Tokyo.
What Do Our Guests Need?
Once we know who our customers are we can then identify their needs. We can build a
customer profile for each customer to learn more about them, their reason for staying in our
hotel and the type of services they require.
This information will help the hotel in its marketing activity and overall will enhance the
service to the guest.
Business Or Pleasure?
Guests who are staying in the hotel for business purposes are interested in the services,
which the hotel provides:
 Telephone, fax or business center facilities
 Restaurants for entertaining
 Location and hotel transport
 Efficient service
 Tourist may be more concerned with:
 Leisure facilities
 Location vis-à-vis tourist attractions
 Friendly service
The needs of the guest can also vary depending on the classification of guests within the hotel
Once a visitor or caller is identified as a prospective user of hotel services, he may be studied
under different headings such as:
1. Guests on the basis of status: For example,
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 an expected guest,
 an in-house guest
 check out guest.
2. Guests on the basis of recognition: Such as,

 regular guest,
 V.I.P., special Attention and distinguished guest and
 new guests, and
3. Guests on the basis of revenue: For example,
 Paying guests, and
 Complimentary Guests.
Customer Profile Information

Once the market has been established, it is then necessary to identify the needs of individual
customers. Those guests who are staying in the hotel for business purposes will b e interested
in the service which the hotel provides, may make frequent use of the telephone system, may
require the use of a telex or fax machine, or may wish to entertain clients in the restaurant.
On the other hand, tourists may be far more concerned with leisure facilities and friendly
service. Suggest the different types of service required by:
Business traveler
Tourist
Customer Profile information is readily available to the hotel. The sources of information
available include. Information on the nationality of customers, which is available from the
registration, forms. Other information on customers can be built up by examining booking
records, by asking specific questions when bookings are made, such as how did the person
hear about the hotel, and by incorporating additional questions on registration forms such as
reason for visit.
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This data can be used to market the establishment more effectively, for example; by deciding
to attract more local business, then at a later stage measuring the results (in terms of
increased numbers of local guests) of advertising, promotional offers, and other methods
which might be used to reach the local market.
Female Customer Profile

One out of every three-business traveler is a woman and Female travelers account for one out
of every five-business trip, according to SRI, IntI, a California consulting firm. More than half
of "baby boomers" are women (baby boomers represent 70 million Americans, about 30
percent of the population) Furthermore, the U.S. Census Bureau (1980) reports that women
now hold 30.5 percent of all U.S. management positions.
Anticipating Female Traveler Needs Good Place to Start

Numerous studies have been produced recently pointing our preferences of female travelers.
Most studies indicate that female travelers differ from male travelers as far what's important
to them in hotels.
A study of Opinion Research Corporation, Princeton, NJ revealed women business travelers

are younger, more often single and have lower individual incomes than their male
counterparts.
The study determined:
 Women place more emphasis on amenities and personal safety while men are more
concerned with price (when asked to describe the reasons for hotel and motel preferences).
 Women are less likely to make their travel reservations and report more corporate travel
restrictions.
The May, 1984 issue of Hotel & Motel Management featured an article on the needs of the
female traveler. H&MM quotes a survey conducted by Metropolitan State University, St. Paul,
MN that the "typical female business traveler's prime concerns are personal safety and
comfort."
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Safety features in order of importance:
 Guest room door locking devices.

 Self-locking doors on floor exit routes
 Visible security in the hotel parking areas and a guest "escort service."
Female executives stressed, according to the survey, the importance of lighter meals,
including salads, soups, fresh fruits and cheeses, along with typical business amenities such
as reading materials in the rooms.
Nearly six out often polled said they desired "a more subtle way of checking in, one that would
not reveal they were alone."
"Basically, women business travelers don't want preferential treatment said Arnold Hewes,
executive vice president of the Minnesota Hotel & Motel Association, co-sponsor of the
project.‖They want to be treated with respect."
Women polled listed these room amenities as "most important": skirt hangers (87%), iron and
ironing board (63%), shampoo and conditioners, hair dryer and moisturizing soap.
Project Director Robert-Ian Salait summed up what the women polled were saying:"'1 has
more concern for security that the average male traveler is willing to admit, and I would like
certain amenities. But I don't want to be coddled. I don't want to be singled out. I certainly
don't want to be left alone on an all-women's floor."
What We Can Do Now?

First, all lodging owners and operators need to acknowledge that the business market is
segmented and that the female business traveler market is significant and here to stay. Your
properties need to be examined again to see how they look through the eyes of a woman is
business.
Conclusions of these new reports must be studied carefully and discussed with key staff
members. Whether it is done by personal interviews or questionnaires begin asking questions
of your present female guest to learn of their preference. The feedback you'll receive should be
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invaluable and your sincere interest and concern should make a very positive impression on
those women who frequent your property.
Listen carefully. Study the information you receive. Evaluate how well you property caters to
the real needs of women business travelers today. Make the necessary operational changes
that can be justified. Communicate what you are doing internally and externally, verbally and
in writing. Communicate by your actions. Begin to "work" your present women business
travelers for referrals. You'll find these women have their own 'networks' and will be eager to
'spread the good word' about your property.
Work your referrals, monitor the program and watch for results.
If you start only a pilot program and it begins to produce results, consider putting a budget
together to cover some advertising, publicity and promotional programs designed to attract
your fair share of this market.
To understand the personality of the ‗GUESTS‘ I would like to discuss these cases, which was
published in Express hotelier and caterer in their March 2001 issue. These cases will clear
your concept regarding the personalities of the guests who frequently visits the hotels it has
also been aided with the power point slide summarising all the cases of Guests Personality.
Every Front office Personal in his average eight to 12 hours of work at the hotel interacts with
a number of guests daily. Each of these guests vary in their personality and a personnel
needs to be very careful in dealing with them. The staff should be smart enough to identify
the nature/personality of the guests and should act accordingly while investigating them or
meeting up with their requirements. It has been universally proved that nature and nurture
does influence the personality of a person. This is mainly because different surroundings,
circumstances or situations have a major impact on how a person behaves, his nature or his
overall personality. Take an example of twins, when nurtured under two different conditions
are known to have two different characters and vice-versa.
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Similarly, guests are known to differ in their characteristics depending on the way they have
been brought up, their values and their nationality as well. There is a vast difference in how
guests of similar origin brought up in different countries would react under a given situation.
For example, an Indian guest if stopped at the hotel lobby for investigation will take offense
on the same. The same guest when, authoritatively, told to decrease the volume of the
television in his room, as the guests staying in the neighbouring rooms were getting
disturbed, will happily do so. Later if the Indian guest is facing with the same problem, will
not complain because Indians per se are adaptive and tolerative by nature.
Now, consider a Non Resident Indian (NRI) under the similar situation. If he is stopped at the
hotel lobby for investigation, he will not take any offense for the act. But, try telling him to
decrease the television volume and observe how he reacts. Firstly, he would like to know the
reason for the same and will act accordingly only if the reason is justified. Now, after some
time if he is faced with the same problem, he won‘t keep quiet but will complain. This is
because he has learned to abide by rules and also to complain if he finds people deviating
from the laid down rules.
With the help of Power point slides these cases have been discussed which will make your
concept clearer.
GUEST‘S PERSONALITY Difference in the character of the guest leads to variance in his
attitude and behaviour while interacting with people. Some guests are positive in attitude and
behaviour while others are not.
It is very important for every Front office personnel to understand the variable human
personalities if they have to be effective in their communication and interaction at work.
According to studies conducted by research organizations, Front office personnel, during his
routine, will come across guests with the following different types of personalities:
 Guests who understand and are cooperative in nature.
 Guests who are inquisitive, hesitant and demand proof for anything and everything.
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 Guests who are irritable and quick in loosing their temper
 Guests who are talkative, like to joke and waste time
 Guests who are conceited, like to brag about their position and acquaintances.
 Chaotic guests who try not to follow the rules and regulations laid down by the property.
 Silent guests who hate talking.
 Mysterious guests who do not clearly communicate what they want • Guests who are
under the influence of alcohol Now we will deal one by one with every type of guest
personality
 Guests who are quiet - hate to talk.
 Guests who are very talkative and like to joke and waste time. Most of the hotels are
frequented by business travelers. These guests prefer to stay very quiet as they are usually
busy with their work and often preoccupied with some or the other thing. They have little or
no inclination to indulge in informal conversations and small pleasantries. It is very difficult
to decide on whether this trait is natural i.e they hate to talk or has business molded them to
an extent that they talk very little. In such a case it becomes very difficult to probe owing to
their silent nature. So then, how does one deal with such a guest?
The best way of meeting the requirements of guests falling under this category is by being
very brief in putting across the facts
It is very important to read and understand his body language and facial expression when
dealing with him. His body language and facial expressions, most of the time, will indicate his
willingness to carry on with the conversation. Knowing his preference becomes important
because his silence makes it difficult to understand his needs Treat him with as much respect
and dignity as you would treat a friendly guest who loves to talk and joke and make your
work load a little lighter. So now how do you tackle a guest who is very talkative and joke a lot
and waste time Be responsive to his words at the beginning of the conversation. Listen to him
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without interrupting for a while as he may have valuable facts to tell you. To such guest try to
offer service as quickly as possible. Always remember that in a service industry, silence of a
guest needs to be cautiously stirred to render crystal service. On the other hand, joking and
talkative guest conversation needs to be rightly and constructively channel is. This ensures
that precious time is not wasted in serving and reaching out to just one guest
 Chaotic - Someone who tries not to follow the rules.
 Mysterious - A person who is not very clear about his/her requirements.
 Drunk - A guest heavily under the influence of alcohol. You may wonder why a well
placed guest, who has attained a level of understanding, break rules? Every hotel staff,
should remember that for every instance of such behaviour there is always a cause. Try to
understand that cause., Try to convince him that rules and procedures are to be followed and
not broken and that by doing so he is only helping you secure him, the hotel and everything
that's in it.
Such a guest needs to be tactfully and efficiently dealt with. Understanding a guest of the
second category - mysterious - requires some extra efforts by the Front office personal
 These guests need patient and calm handling.
 Encourage such a guest to clarify his ideas, wants or needs by positive questioning.
 Ask such a guest direct questions and suggest alternatives to the answer
 Do not give him a choice. After you have suggested alternative to the answer, also use
silence sometimes to pressurise him into thinking and clarifying his ideas
 When such a guest does begin to speak listen to him carefully and give him the
impression that you have begun to understand him.
 Do not rebuke or contradict such a guest either by words or gestures.
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 After he has finished, make it a point to thank him for cooperating Coming to the third
category - Drunk guests,
 A drunken guest needs patience handling as well
 Such a guest is not in his right senses, is emotionally sensitive and could take offense of
your behaviour.
 Do not cough or smile at his actions or comments.
 Avoid doing anything that will irritate him.
 Ask him direct questions and give him enough alternatives.
Guest history card

Some hotels keep a personal record of each guest. What began as handwritten notes on file
cards has become computer-stored data. Management can use guest history information to
better understand its clientele and to determine guest trends. Linked to reservations and
registration files, guest history data informs a reservationist of a caller‘s past record with the
hotel. It provides details on:
 Guest address
 Number of stays
 Method of payment
 Preferred room category, and
 Any special requirements
The hotel can use this information in two ways: To provide a better and more efficient service
to the guest, and As a source for mailing lists or to identify guest characteristic – important
for strategic marketing.
This information may help the hotel develop and place advertisements that appeal to the
types of clientele the hotel is attempting to attract. Guest history records may also point out
the need for new, additional or improved services.
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Courteous Service
All guests expect and are entitled to courteous service
This is under your control and at all times you should try to provide service which is:
 Prompt
 Efficient
 Friendly
 Courteous
Remember, good service means giving customers a little bit more than they expect.
10 Ways to Build Customer Loyalty:
1. Take ownership of your customer‘s problem„even if you are not the cause of it.
2. Follow-up with every customer who was upset or had a difficult problem.
3. Ask yourself with every customer interaction you have, "If this were me, what would I
want?"
4. Thank your customers and co-workers every chance you get!
5. Fax articles or other materials to your customers if you think they can benefit from the
information.
6. Remember personal details about your customers such as birthdays, children`s names
and accomplishments.
7. SMILE every time you are on the telephone.
8. Look for ways to bend the rules and remove service obstacles.
9. Time is a person`s most precious commodity. Respect your customer`s time and
schedule.
10. Provide your customers with respect, friendliness and knowledgeƒand, oh yes, the
products and services you sell.
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The Customer Service solution is simple. Educate people as to how the customer feels when
things go wrong. Teach them to empathize, as this gate agent did. But then empower them to
make a real difference in creating opportunities to build customer loyalty. The cost to the
company of doing so is typically small to insignificant. The payoff is GIGANTIC!
10 Steps to Improved Service:
Improving the quality of your customer service requires commitment and consistent effort
from everyone. Since creating a product that is unique in the eyes of the customer is
becoming increasingly difficult in today's competitive environment more companies are relying
on service to achieve competitive advantages. Outstanding service companies share some
basic similarities, but they also customize systems, structures, management styles and
employment practices so suit their strategic goals. To improve the quality of your service take
the following 10 steps:
1. Make a commitment to service.
The return on investment for companies that impress their customers with value added
service can be staggering. These returns are not the result of providing excellent service but of
customers perceiving that a company delivers service that is unique. Achieving quality service
takes a serious commitment from every employee in the organisation to remove the "s" word
(satisfy) from service goals and instead work to exceed customers' expectations to the point
that customers are willing to tell others.
2. Develop a proactive recovery strategy.
The quickest way to improve your service reputation is to improve your recovery process.
Customers are impressed by companies that make an empathetic, hassle free effort to recover
when customers perceive that they received less service than they expected. These efforts
dramatically communicate to customers that the company cares, that it is sensitive to the
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customer's business and that it will stand behind its product or service - no matter what. An
effective recovery strategy requires going all out to find disgruntled customers.
3. Ensure continuous improvement.
Effective service improvement is the cumulative effect of a thousand small improvements

made daily at every level in the organisation. It often requires changing the culture from one
that accepts the status quo to one that is excited about change and continuous improvement.
Innovating service practices and redefining service delivery must be everyone's job -start small
and demand improvement from everyone. Define success as continually improving in all
areas, including service, first-time quality, cost reduction, productivity and development of
human resources.
4. Listen to customers.
Listening is the foundation of all good relationships and a prerequisite to business success.
But suprisingly few companies systematically listen to customers, suppliers, employees and
competitors. The radical service improvements needed in this decade will require better
customer information systems. The more we know about a customer's business, the easier we
can form strategic partnerships. Because service professionals spend so much time with
customers, they must be the primary source for developing and updating the system.
5. Facilitate change.
Service problems are leadership problems, often resulting from management's unwillingness
to change structures, reduce the number of inflexible policies and procedures, set higher
service goals for themselves and their work groups and spend more time on customer-related
issues. Service improvement efforts fail more from ineffective management practices than
from lack of front-line effort. Yes, the front-line people are often unwilling or unable to take
risks necessary to embrace their changed role and enthusiastically deliver service that
consistently exceeds customer expectations. But this happens because leaders fail to ensure
that:
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1) Desired service outcomes are well defined; 2) the service delivery process is clearly
communicated and perceived to be flexible; 3) guiding principles and core values are
established; and 4) everyone understands their role in the show.
6. Define the playing field.
Front-line employees must understand the rules of play and how to win before they can
successfully customize service for the customer. There must be a clearly defined direction (a
goal-line that indicates how to score) and predefined parameters (the "rules" or boundaries)
that outline the limits of responsibility and decision making. In the past, outlining boundaries
has been accomplished primarily by correcting mistakes. Unfortunately, this does not
communicate what is desirable, only what is out of bounds. When employees are not secure,
they focus on avoiding problems and mistakes and not on creativity and customisation. This
uncertainty often results in such responses as "I'd like to help you but It's not my job," "I just
work here, "or "It's just our policy." These responses are the consequence of a risky service
culture created by uncertain boundaries and inconsistent goals.
7. Provide autonomy.
Creative, dedicated, enthusiastic service professionals who routinely make business decisions
and improvise when necessary are the foundation of excellent service. Yet many companies
ignore the benefits of engaging the talents of their work force. Too often they ask front-line
employees to park their brains at the front door and blindly obey pre-determined policies and
procedures. Serious service improvement involves people meaningfully in every aspect of
service delivery, including service planning. innovation and process improvement. It means
replacing many "rules" with judgment, allowing for greater flexibility in front-line decision-
making within well defined parameters. It requires more trust between leaders, employees
and their unions, a greater sharing of information and an unprecedented commitment to
continuous education. The heroes in a customer-focused culture must be highly trained,
enthusiastic front-line service professionals who make hundreds! of decisions daily to deliver
a customized product faster than ever before.
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8. Measure performance.
Managers must educate everyone to routinely measure all of the responsibilities crucial to
success. Cost-reduction measures should be balanced with measures of service, quality and
leadership, employee flexibility and continuous improvement. The most valid measures of
service quality are the subjective opinions of customers. Only customers can evaluate service
in light of their unique expectations. Consequently, responsibility for measuring and
demonstrating continuous service improvement should be focused closer to the service
professional. Only when service teams are actively involved in every facet of the service
business, including measurement of quality; can organisations capture the creativity and
enthusiasm needed to radically enhance service delivery?
9. Hold everyone accountable.
When we ask, "Who is responsible for service improvement in your organisation?", we are
usually given the names of several people whose responsibilities cross many functional areas.
When a service problem surfaces, these people point out that the root cause of the problem
exists with another group This "fragmented accountability" is no accountability at all, Until a
single person is accountable for service improvement and until serious personal
consequences are set for failing to achieve service goats, continuous service improvement is
unlikely. Lack of individual accountability allows leaders to avoid focusing on ineffective
managerial practices, such as adhering to time-wasting routines, attending endless meetings,
failing to set goals that test their talents and failing to change ineffective reporting and
promotional structures. If all employees were held personally accountable for influencing the
perception of the customer, customer service wou! ld be perceived as a part of the strategic
plan instead of a "slogan" or theme program.
10. Celebrate success.
Every organisation must develop a culture of celebrated discontent - a simultaneous feeling of

accomplishment and a desire to improve. Too often, though, organisations create an almost
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schizophrenic "either/or" mentality celebrate one minute and be emphatically discontent the
next. People find these environments confusing and uncomfortable.
Organisations must celebrate often, making the celebrations sincere and spontaneous. Those
who consistently demonstrate improvement must become the heroes.
These 10 fundamentals will help create a culture of continuous service improvement.

Companies must define success for everyone in the organisation as continually improving
everything -everyday. Nothing less will do. In Taking Care of eBusiness, Siebel shares eight
key principles that he believes will help companies make the most of their customer
opportunities in the Internet Age. Like many top executives who produce strategy books on
the side, Siebel brings his intelligence and energy to about two-thirds of the book -- and
clearly relies on news clippings and safe, puffy phrases to pad out the rest of the manuscript.
But even if Siebel the author isn't quite as formidable as Siebel the CEO, his best ideas are
highly compelling. As Siebel points out in his opening chapter, the opportunities to gather
customer data have never been better. Used effectively, that data can translate into better and
more profitable service -- where the "right" products and services are offered to the "right"
customers at the "right" time. But the playing field is also increasingly complex.
Customers with an order or a complaint don't just call a toll-free number or wait for their
district sales representative to arrive. They may turn to email, a Web site, or a host of other
channels to do business. If companies can't make each of those channels work well or can't
integrate information throughout each piece of their sales, marketing, and service systems,
well, it's never been easier for customers to say good-bye and take their business elsewhere.
So, straight from Siebel's playbook, here are five of his best insights for connecting with
customers.
Personalise the customer experience:
Siebel writes admiringly of Marriott International's ability to gather data on repeat customers'
preferences, so that it can present them with appealing choices for restaurants, golf courses,
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and the like - as well as a night's lodging. One such program, he notes, has produced both an
improvement in guest-satisfaction ratings and a $100-a-day jump in spending beyond the
basic room rate. In essence, Marriott has become smart enough about its customers that it
can cross-sell with clarity and success. That sort of personalization is easier than ever when
dealing with customers through email, the Web, or even a call centre with Internet-based
technology. There's no easy way to reconfigure a physical store for each customer or to print
customized catalogues for each shopper. But in the online economy -- as shown by the early
success of customized home pages on Yahoo -- it's easy to tailor information and presentation
to suit each customer's own tastes.
Store your data in one place:
Most companies, Siebel notes, have allowed customer data to become incredibly fragmented
over the years. Billing departments, marketing divisions, and service centers all may know a
bit about the same customer, but companies have no effective way to tie that knowledge
together. Those discontinuities are likely to sound grimly familiar to anyone who has bought
or serviced a car recently. But Siebel is optimistic about a $300 million initiative being
undertaken by Saturn Corp., which he calls "an emerging e-Business leader in the automotive
industry." Saturn is creating a Web-based information system that will link all 400 of its retail
facilities nationwide with each other and with customers and partners. That should make it
easier for car buyers to canvas multiple dealerships in search of their exact model choice; it
also should help owners schedule service appointments no matter where they are.
Get relevant data to your frontline workers as fast as possible:
The biggest users of Siebel software are regional sales reps on per diems and call-centre
specialists who wear headsets all day long. Their jobs may not be as glamorous as a CEO's --
but to Siebel Systems, they are crucial to a company's success. And the only way for those
employees to reach maximum effectiveness is to put knowledge on their screens and in their
hands.
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Siebel approvingly cites computer and telephony integration at the global-accounts call centre
for WorldCom, the long-distance and Internet-services company. The system "ensures that a
customer's complete account profile automatically appears on screen before an agent takes a
call," he says. That avoids exasperating - and unproductive -- calls where call-centre agents
struggle to track down relevant information. Instead, that approach should let agents
anticipate customers' needs, handling calls faster and more effectively.
6.3 Role of support services an infrastructure
The Destination Lifecycle
In discussing tourism, the term destination becomes ubiquitous; however, it is not always
clear what a destination is. Is it a hotel, a city, a region, or a country? Bierman (2003, P.2)
defines a destination as ―a country, state, region, city or town which is marketed or markets
itself as a place for tourists to visit.‖ Regardless of what geographic scope one assigns to the
term destination, a destination is a product that must be marketed to its consumers.
Like most products, destinations have a lifecycle. In his 1980 article, Butler proposed a
widely-accepted model of the lifecycle of a tourist destination. The basic idea of Butler‘s 1980
Tourism Area Life Cycle (TALC) model is that a destination begins as a relatively unknown
and visitors initially come in small numbers restricted by lack of access, facilities, and local
knowledge, which is labeled as Exploration
As more people discover the destination, the word spreads about its attractions and the
amenities are increased and improved (Development).
Tourist arrivals then begin to grow rapidly toward some theoretical carrying capacity
(Stagnation), which involves social and environmental limits. The rise from Exploration to
Stagnation often happens very rapidly, as implied by the exponential nature of the growth
curve.
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The possible trajectories indicated by dotted lines A-E in Figure 1 are examples of a subset of
possible outcomes beyond Stagnation. Examples of things that could cause a destination to
follow trajectories A and B toward Rejuvenation are technological developments or
infrastructure improvements leading to increased carrying capacity. Examples of things that
could cause a destination to follow trajectories C and D are increased congestion and
unsustainable development, causing the resources that originally drew visitors to the
destination to become corrupted, or no longer exist. The trajectory in Figure 1 of most
interest to this research is trajectory E, which is the likely path of a destination following a
disaster or crisis.
It is also important to point out that the Law of Diminishing Returns could cause a
destination to follow trajectories similar to those of C or D, and that the concepts and
practices of destination recovery, as applied to destinations recovering from a disaster, could
easily be applied to a destination in Decline as a result of the Law of Diminishing Returns.
Butler is not the only researcher to acknowledge this concept; in fact, many tourism
researchers have written about it. Stankey wrote about destination lifecycle in his 1985
article, referring to it as ‗recreational succession‘, which he defines as the gradual
deterioration of a camping site as it becomes increasingly popular with visitors (Stankey and
McCool, 1985). Iyer (1988, p.30) also eluded to the destination lifecycle in the following quote
about Bali, ―Hardly has a last paradise been discovered than everyone converges on it so fast
that it quickly becomes a paradise lost.‖
Mediterranean Tourism Life Cycle Model
The life cycle of the tourism product
STAGNA
DISCOV LAUNCH TION DECLIN REJUVINA
ERY TION
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As in other economic sectors, tourism follows a "product life cycle", with a curve similar to
that of the above graph. In this process several stages can be identified:
STAGE 1: DISCOVERY During the early "discovery stage" of the cycle a small number of
unobtrusive visitors arrive seeking "unspoiled" destinations. These early "explorer" tourists
generally speak the language and identify with the local culture. The social impact in this
stage is generally small and resident attitudes are fairly positive towards tourism.
STAGE 2: LAUNCH During this stage the number of incoming tourists increases. The host
community responds to the increasing numbers of tourist by providing facilities. Businesses
remain family based and the visitor-resident relationship is still harmonious. Later in this
stage, visitor numbers increase and the community becomes a tourist resort. Outside
interests become involved developing businesses and tourist facilities. This is typically the
stage during which TNC (Trans-National Corporations) foreign investment enters the cycle.
Migrant workers, attracted by the prospect of tourist-related jobs, may enter the community
and reduce resident contact with visitors. The tourist-relationship is converted into one of
business as the novelty of new visitor arrivals declines. The more culturally sensitive
"explorers" move on to new "unspoiled" areas and are replaced by the mass market.
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STAGE 3: STAGNATION The stage in which saturation is reached. The quality of tourist
services falls, demand levels off, and the environmental degradation of the tourist destination
begins to be obvious and worrying. The tourist destination at this stage is said to have
reached 'maturity'.
STAGE 4: DECLINE which represents the current state of mature tourist destinations on the
Costa Brava in Spain. Falling profits lead to foreign-owned businesses withdrawing and the
community is left to "pick up the pieces".
The three ―A‖ of tourism
1. Tourist attraction
A tourist attraction is a place of interest where tourists visit, typically for its inherent or
exhibited cultural value, historical significance, natural or built beauty, or amusement
opportunities.
The Eiffel Tower in Paris, France, a popular tourist attraction. Almost 7 million visit the tower
each year.
A tourist attraction is a place of interest where tourists visit, typically for its inherent or
exhibited cultural value, historical significance, natural or built beauty, or amusement
opportunities.
Some examples include historical places, monuments, zoos, aquaria, museums and art
galleries, botanical gardens, buildings and structures (e.g., castles, libraries, former prisons,
skyscrapers, bridges), national parks and forests, theme parks and carnivals, ethnic enclave
communities, historic trains and cultural events. Many tourist attractions are also
landmarks.
Tourist attractions are also created to capitalise on unexplained phenomena such as a
supposed UFO crash site near Roswell, New Mexico and the alleged Loch Ness monster
sightings in Scotland. Ghost sightings also make tourist attractions.
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Ethnic communities may become tourist attractions, such as Chinatowns in the United
States and the black British neighborhood of Brixton in London.
In the US, owners and marketers of attractions advertise tourist attractions on billboards
along the side of highways and roadways, especially in remote areas. Tourist attractions often
provide free promotional brochures and flyers in information centres, fast food restaurants,
hotel and motel rooms or lobbies, and rest areas.
While some tourist attractions provide visitors a memorable experience for a reasonable
admission charge or even for free, others can have a tendency to be of low quality and to
overprice their goods and services (such as admission, food, and souvenirs) in order to profit
from tourists excessively. Such places are commonly known as tourist traps
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2. Accessible tourism
Is the ongoing endeavour to ensure tourist destinations, products and services are accessible
to all people, regardless of their physical limitations, disabilities or age. It encompasses
publicly and privately owned tourist locations. The improvements not only benefit those with
permanent physical disabilities, but also parents pushing buggies, elderly travelers, people
with temporary injuries, such as a broken leg, and their relatives, friends and other
companions.
As of 2008, there are more than 50 million persons with disabilities in Europe, and more than
600 million around the world. When expanded to include all beneficiaries of accessible
tourism, as defined above, the number grows to some 130 million people in Europe alone.[1] In
addition to the social benefits, the market represents an opportunity with new investment
opportunities and new service requirements, rarely provided by the regular travel agencies,
transport providers and other key players in the tourism sector.
According to ENAT, the European Network for Accessible Tourism, accessible tourism
includes: [1]
Barrier-free destinations: infrastructure and facilities

Transport: by air, land and sea, suitable for all users
High quality services: delivered by trained staff
Activities, exhibits, attractions: allowing participation in tourism for everyone
Marketing, booking systems, Web sites & services: accessible for all (i.e. accessible
information)
Specific needs and requirements
Specific problems found by the disabled tourist when booking a holiday include:
 Inaccessible, or only partly accessible, web sites
 Lack of accessible airport transfer
 Lack of wheelchair accessible vehicles
 Lack of well-adapted hotel rooms
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 Lack of professional staff capable of informing and advising about accessibility

issues
 Lack of reliable information about a specific attraction's level of accessibility
(church, castle, exhibition, etc.)
 Lack of accessible restaurants, bars, etc
 Lack of adapted toilets in restaurants and public places
 Inaccessible streets (cars parking in the stepwalk, etc)
 Lack of disability equipment (wheelchairs, bath chairs, toilet raisers, electric
scooters)
Brief history
Europe and United States of America share the majority of the existing companies in this
niche. However, around the world many companies are starting to appear as the result of a
growing need, largely driven by "senior tourism" due to increasing life expectancy in developed
countries.
Portugal, Spain, the United Kingdom, Germany, France and other northern European
countries are increasingly prepared to receive tourists in wheelchairs, and to provide
disability equipment and wheelchair accessible transport.
3. Tourist amenity
Tourist amenity refers to the accommodation on tourist spots which may include hotels,
motels, resorts, lodges etc.
REVIEW QUESTIONS
1. Who are the major players in the hospitality industry? Write in detail
2. What are the existing and emerging markets of the hospitality industry/
3. Write a note on the role of support services an infrastructure in the hospitality industry
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UNIT 7
7.1 Impact of international and national events, Present scenario and future projection
of HR issues an technology in industry
Careers in Hospitality Management

Choosing the right career can sometimes be a difficult decision for the recent high school
graduate. The best way to start your decision-making process is to do a self-evaluation to
determine what you would enjoy doing and whether that career would lead to your personal
success. Successful people are highly motivated individuals who have confidence in
themselves and their abilities. They don‘t view their profession as a grind, but look on it as
fulfillment.
Hospitality Management, including the Food Service Industry, is one of the fastest growing
occupations in the world. There are predictions that by the year 2005 there will be 12 million
workers in this industry. Food Service personnel are needed at the rate of one to every 10 to
12 positions, and the industry is seeking those with a culinary and hospitality education to
meet the complex demands of the 21st century.
How will you know if you would be good in these careers? The hospitality industry is
comprised of friendly, courteous, and helpful individuals who are willing to deliver great
customer service with a passion. If you possess these qualities and have good communication
skills, then this exciting industry could be for you.
Upon graduation, students of Hospitality Management and Culinary Arts schools may seek
employment in hotels, restaurants, catering, resorts, cruise ships, casinos, and entertainment
venues, just to mention a few. Jobs in hospitality operations can be found in almost every
community in the United States and abroad.
Earning potential varies and is limited only by your ability and willingness to succeed.
Starting wages are $8 to $16 per hour; however, this can increase substantially with
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experience and perseverance. Many Hospitality Management positions offer benefits such as
health insurance, paid vacations and sick days, and reduced rates on accommodations, food,
and travel. Annually, travel and tourism employers around the world pay more than $1.6
trillion in wages and salaries and create 12.5 million new jobs.
Hospitality is an industry that is known for promoting from within and for having a large
number of young managers. If you‘re talented and demonstrate a good work ethic, you can
advance quickly. There is no limit to where your dreams and ambitions can take you in the
exciting and fascinating world of Hospitality Management. Remember, it is not where you
start that matters, it‘s where you finish. It is important for you to select an industry segment
appropriate to your ability and personality.
Skills Inventory.
One of the best ways to select a career niche you will be happy with is to start by listing your
own skills. What are the tasks you do best? Most skills fall into one of three areas: skills
dealing with data, skills dealing with people, or skills dealing with things. You will probably
find that the majority of your skills will fall into one or two of these areas.
People whose skills fall into the data group are often good in subjects such as math and
science and enjoy working with computers. They tend to like such activities as analyzing
information, comparing figures, working with graphs, and solving abstract problems. Such
individuals might enjoy doing feasibility studies for a hospitality management consulting firm.
They might also be happy in the corporate planning departments of large hotel and restaurant
chains, where data is analyzed and demand is forecast. Most auditors and accountants fall
into the data-skills group.
If you like to deal with people, you probably enjoy helping them and taking care of their
needs. You can take and give advice and instructions. You may also enjoy supervising and
motivating other people, and may find that they respond to your leadership. Individuals with
people skills are often good at negotiating and selling-they like to bargain and are not afraid
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to make decisions. In the hospitality industry, general managers and marketing and sales
managers of hotels often fall into this category. So do independent restaurant owners,
catering managers, and dub managers.
Careers in the Hospitality Industry

Why do people go into the hospitality industry? If you were to ask people who have spent their
careers in this business what they like most about it, you would get a wide variety of answers.
Some of the most popular are:
 The industry offers more career options than most. No matter what kind of work you
enjoy, and wherever your aptitudes lie, there is a segment of the industry that can use your
talents
 •The work is varied. Because hotels and restaurants are complete production,
distribution, and service units, managers are involved in a broad array of activities.
 There are many opportunities to be creative. Hotel and restaurant managers might
design new products to meet the needs of their guests; produce training programs for
employees; or implement challenging advertising, sales promotion, and marketing plans.
 This is a "people" business. Managers and supervisors spend their workdays satisfying
guests, motivating employees, and negotiating with vendors and others.
 Hospitality jobs are not nine-to-five jobs. Hours are highly flexible in many positions.
(Some see this as a disadvantage, however.
 There are opportunities for long-term career growth. If you are ambitious and energetic,
you can start with an entry-level job and move up. The industry is full of stories of people who
started as bellpersons or cooks and rose to high management positions or opened their own
successful businesses.
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 There are perks associated with many hospitality jobs. If you become- the general
manager of a resort, you can dine at its restaurants with your family and friends,and use its
recreational facilities. Airline and cruise employees get free or reduced-fare travel.
Despite these advantages, there are some aspects of the business that many people don't like:
 Long hours. In most hospitality businesses the hours are long. The 40-hour workweek is
not the norm, and 50- to 60-hour workweeks are not unusual.
 Nontraditional schedules. Hospitality managers do not work a Monday through-Friday
schedule. In the hospitality field you will probably often find yourself working when your
friends are relaxing. As one manager told his employees, ―If you can't come to work Saturday
or Sunday, don't bother to come in on Monday.‖
 Pressure. There are busy periods when managers and employees are under intense
pressure to perform.
 Low beginning salaries. Entry-level jobs for management trainees tend to be low-paying
compared to some other industries.
Travel-Related Sectors Offer Wide Variety of Jobs, Including Executive Level

Eating And Drinking Places
Eating and drinking places are the leading source of travel industry jobs. This is due to the
labor intensiveness of the industry and the high proportion of traveler dollars spent on food.
During 1995, eating and drinking places employed 7.35 million workers. Approximately 25
percent of these jobs were directly attributable to travel and tourism.
Eating and drinking places provide a variety of job opportunities, including, but not limited
to:
Executive Chefs
District Managers
Accountants Waiters
Unit ManagersAdvertising Specialists
Food Preparation
Hosts
Workers
and Hostesses
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General Managers
Controllers
Public Relations
Dieticians
Food Service Managers
Purchasing Agents
Bartenders Personnel Directors
There is a great deal of diversity in eating and drinking establishments, including hundreds of
thousands of small businesses and many large chain-owned restaurants.
The types of jobs available in smaller independent restaurants consist almost entirely of
cooks, cashiers, and waiters/waitresses. Managers tend to be promoted from within by
excelling in entry-level positions. Larger restaurants employ general managers as well as
assistant managers. At the top of the restaurant spectrum are luxury restaurants, which are
for the most part owned and operated by independent entrepreneurs. Within the trade, these
restaurants are sometimes called "white tablecloth" restaurants. Most of their patrons are on
expense accounts.
Chain-restaurant Chain restaurants recruit the majority of their managers from hospitality
schools. Entry-level jobs for graduates with hospitality degrees are often on the assistant-
manager level, with progression to manager, then district manager responsible for a group of
restaurants, and then regional manager.
Restaurant chains are the fastest growing part of the restaurant business today. Many of
these chains are made up of fast-food restaurants or, as they prefer to be called, ―quick-
service‖ restaurants. Menus rarely change in these restaurants. Their strategy calls for
delivering a large number of meals at fairly low prices. These firms, however, offer a variety of
executive and management positions in the following career path:
Management Trainee to Assistant Manager to Unit Manager to District Manager to Regional
Manager
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Corporate headquarters of chain-restaurants offer the same type of top executive positions as
other large firms across all industries. These include CEOs, COOs, CFOs, and several Vice
President levels.
Social Caterers. Social catering is another part of the food service industry that many
hospitality graduates become interested in. Catering is another business that is most often
started by independent entrepreneurs, as it requires very little start-up capital-facilities can
be rented as needed, equipment can usually be' leased on a short-term basis from restaurant
supply houses, and food servers can be hired as needed. In some cases, caterers provide only
food; in others, they are responsible for tables, chairs, utensils, tents, servers, and
decorations.
Contract Food Companies. Contract food companies are generally hired by orga-nizations
whose major business purpose is not food service, but they provide it for some reason. The
biggest users of contract food services are large manufacturing and industrial concerns in
which workers have a short lunch period. Contractors such as ARAMARK and Sodexho
operate cafeterias and executive dining rooms for these companies. The service is often
subsidized by the contracting company, which may supply the space and utilities and, in
some cases, underwrite some or all of the food costs. Schools and colleges, hospitals, sports
arenas, airlines, cruise ships, and even prisons use contract food companies. In the case of
airlines, meals are cooked and prepackaged in central commissaries and then delivered to the
airplanes for preparation and service as needed.
Contract food management is somewhat unusual because the manager must please two sets
of employers-the manager's home office and the client that has contracted for the service.
Many contract food programs, such as those at schools and hospitals, have strong nutritional
requirements as well. Others, such as airline programs, require knowledge of advanced food
technology.
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Careers in contract food service are attractive to many hospitality majors. Contract food
managers work more regular hours and are under less pressure than restaurant managers.
Why? Because many of the users of contract food service, such as office building tenants,
work a regular 40-hour week, Monday through Friday, which allows the contract food
managers to work more normal hours. Also, contract food managers are able to predict with
more certainty how many people they are going to feed, what they will feed them, and when
the meals will be served.
Because of the large volume of meals involved, contract food managers must be highly skilled
in professional management techniques and cost control. For this reason, contract food
companies usually hire people with experience within their industry and recruit from
hospitality schools.
Institutional Food Service. Although contract food companies can supply food for schools
and hospitals, the majority of these institutions handle their own food service programs. Most
public schools belong to the National School Lunch Program established by the federal
government in 1946. The purpose of this program is twofold: (1) to create a market for
agricultural products produced by America‘s farmers, and (2) to serve a nutritious lunch to
schoolchildren at a low cost. Public elementary schools tend to offer only those menu items
that qualify for government support, but many high schools add items such as hamburgers,
French fries, and even diet sodas. High school food managers work hard to come up with
creative and innovative menu plans to keep students in school cafeterias. Even the look of
school cafeterias has changed as managers have developed new methods of merchandising
food.
Colleges and universities have also experienced changes in their food service programs.
Because more students live off-campus now, there is a trend toward flexible meal plans in
which students have a choice of how many meals they wish to purchase from the institution.
To compete successfully, many universities have opened special table-service restaurants in
addition to their traditional cafeterias. Another move has been to offer a more varied cafeteria
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menu featuring salad bars and popular items such as croissant sandwiches, bagels, lox and
cream cheese, and even Belgian waffles for breakfast. Some universities have brought on
campus quick-service outlets such as Pizza Hut and Taco Bell
Hospital programs are usually administered by a trained dietitian or a professional food

service manager working with one. Menus are generally simple and nourishing. In the past,
most hospitals had a central kitchen where all foods were prepared and then sent in insulated
carts or trays to the patients rooms. Some hospitals have decentralized their food service.
With a decentralized system, the hospital purchases frozen and portion-packed entrees and
salads and keeps them in small pantries in various parts of the hospital. The meals are then
plated and heated in microwave ovens as needed. Another trend has been the attempt to turn
hospital food service from a cost center into a revenue center. Some hospitals sell take-home
food to doctors and employees and even do outside catering.
As you can see, institutions are beginning to compete with commercial food service operations
for consumers, This means that there are more opportunities than ever before for hospitality
students to enter what is clearly a growing field.
Executive employment within eating and drinking places, including top management, general
managers, accountants, and auditors, numbered 427,000 in 1994. These top executive-level
jobs are expected to grow by 30.8 percent by the year 2005. This compares with a much
slower growth rate of 14.9 percent for total U.S. employment.
According to the Department of Commerce, over half of all restaurants employ less than ten
workers, significantly fewer than businesses in most other industries. This means that
restaurants offer a better chance than most industries for self ownership. According to the
BLS, there are 276,000 workers in the industry who are self-employed or family workers in a
family owned business. This is more employment than provided by the entire steel
manufacturing industry in the U.S.
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Air Transporation
Air transportation represents the largest employment sector of the transportation segment of
the transportation segment of the travel and tourism industry. This sector comprised 748,000
jobs in 1994 and 787,000 employees in 1995.
Employment in air transportation offers a wide variety of technical and managerial jobs. A
brief list of the types of job opportunities available in air transportation includes:
Pilots Baggage Handlers
Customer Service Representative
Aircraft Mechanics
Reservations and Ticket Agent Flight Attendants
Public Relations Food Service Workers
General Managers Controllers
CEOs and other top executives
Employment within the air transportation industry usually requires specialized skills and
training. Jobs such as pilots and mechanics need to be certified by the Federal Aviation
Administration. The advancement ladder for a pilot starts as flight engineer followed by co-
pilot followed by captain. Advancement also exists by moving from small airlines to larger
airlines.
Mechanics require a great deal of technical training and there are opportunities to advance to
head mechanic or supervisory positions.
Flight attendants need to have good personal interactive skills, as they must deal constantly
with the traveling public. Although flight attendants are considered to be limited in
advancement, opportunities do exist to become customer service directors, instructors, and
recruiting representatives.
Like flight attendants, reservations clerks need to deal constantly with the public.
Advancement tends to be limited to supervisory positions, although it is possible to advance
to district sales managers and into marketing positions.
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Executive employment within the air transportation industry, including top management,
general managers, and accountants and auditors, numbered 39,000 in 1994. These top-level
executive jobs are expected to grow by 16.2 percent by the year 2005.
Hotels, Motels, And Other Lodging Places

Hotels, motels, and other lodging establishments employed over 1.6 million Americans in
1994 and slightly over 1.65 million in 1995. Nearly all this employment is directly generated
by travel and tourism.
A brief list of some of the employment opportunities offered within this industry includes:
 Marketing Representatives
 Housekeepers
 Front Desk Clerks
 General Managers
 Chief Engineers
 Reservation Clerks
 Food and Beverage Directors
 Bellman
 Front Office Managers
 Personnel Directors
 Meeting/Conference Planner
 Controllers
 Concierges
 CEOs and other top executives
The hotel industry, like the eating and drinking industry, has a great deal of diversity in the
types of establishments and, therefore, the types of jobs offered.
The smaller "mom and pop" hotels generally offer limited employment opportunities. However,
it is important to keep in mind that these establishments are fulfilling small business
ownership goals.
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Larger hotels and chain hotel firms offer a large number and variety of job opportunities, as
well as advancement potential. Headquarters of chain-hotels, for example, offer the typical top
executive positions such as CEOs, COOs, various department heads, and Vice President
positions. In recent years, hotel operations have become more service-oriented and have
required a great deal more job responsibility for guest contact employees. Demand for persons
who have skills obtained in colleges, junior colleges, and technical institutes is increasing, as
most upper-management positions require considerable training.
Career paths exist within many departments of large hotel properties. Supervisory positions
exist in food and beverage operations, front office management, personnel, marketing and
accounting department to name a few.
Executive employment within the lodging industry, including top management, general
managers, accountants and auditors, numbered 123,000 in 1994. These top executive level
jobs are expected to grow by 27.8 percent by the year 2005.
Would you rather be part of a large chain or work for an independent operation? There are
many opportunities in both areas. The arguments for working for a large chain include:
• Better training. Companies such as Ritz-Carlton and Hyatt have very sophisti-cated
operating systems.
• More Opportunities for advancement. Hotel managers of chain properties who wish to
advance might be offered opportunities for promotions within the division in which they work
or, if none are available there, in different divisions
• Better benefits. You are more likely to get superior life and health insurance benefits, more
generous vacation and sick time, use of a company car, moving expenses, stock purchase
options, and so forth from a large chain.
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A career with an independent operation also offers some advantages, however:

• More chances to be creative. You will have a chance to set standards and initiate changes
instead of just adhering to company programs and rules.
• More control. You are more likely to be in control of your own destiny. In an independent
operation, you deal on a regular basis with the people who will be deciding your fate. And, as
mentioned earlier, with an independent property you are not likely to b transferred.
• Better learning environments for entrepreneurs. Independent operations offer better

learning environments for entrepreneurs, because all of the financial and operating decisions
are made on-site. If you intend to buy your own lodging operation some day, you will learn
more at an independent than at a chain operation where data is forwarded to headquarters
for analysis.
Amusement And Recreation Services

The amusement and recreation services sector represents a wide range of products and
services from large theme parks to ski areas to water slides to casinos. Many of the types of
jobs offered in this sector are seasonal in nature.
Types of employment available in this industry are:

Ski Instructors
Guides
Musicians
Actors, Actresses
Lift Operations
Park Managers
Information
CasinoClerks
Workers
Due to the variety of establishments in the amusement and recreational services sector and
the part-time nature of much of its employment, many jobs have little opportunity for
advancement. However, corporations in this sector provide numerous upper-level
management jobs which require a college degree and offer opportunities for advancement.
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Since promoting events or facilities is involved for many attractions, a variety of marketing
and sales jobs also exist.
Amusement and recreation services has been one of the fastest growing sectors of the travel
industry, including during the recession of the early 1990s when steady growth was still
maintained. Executive employment within this sector is projected to increase 39.8 percent by
the year 2005.
Large Volume Of Executive Jobs - Now And In The Future
Career Career Approximately 684,000

Accounting Staff Exhibits Coordinator Americans were employed in
Adventure Tour Operator Flight Attendant executive, managerial, and
Airline Reservation & Agent Food & Beverage Manager
administrative positions in four
Airline Passenger Service & Airport
Food & Agent
Beverage Staff
key travel-related sectors in 1994
Airport Meet & Greet Front Desk Agent/Front Office Staff
and this number is forecast to
Airport Station Manager Functions Coordinator
Assistant Cruise Purser Gift Shop Staff expand rapidly to nearly 895,000
Banquet & Catering Staff Ground Host/Hostess by 2005. These are top-level
Banquet & Sales Manager Ground Transportation Representative
executive jobs, general managers,
and employees in administrative departments such as marketing, advertising, public
relations, and human resources. Administrative support staff is not included in this category.
The forecast growth between 1994 and 2005 in executive and managerial jobs in the four key
travel sectors is significantly greater than projected total employment for any of the other
leading manufacturing segments, mining, and construction. In fact, in the year 2005,
executive, managerial, and administrative department employment in these four key travel-
related segments will be greater than the total employment in all but three of the
manufacturing segments.
Given below is a list of Positions available in travel related businesses
Given below is an interesting article about the growth paths in the hotel industry
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What is The Most “Rewarding” Career Path?

Keith Kefgen & Michael S. Kogen The talents required of a hotel General Manager have
dramatically changed, as significant advancements in technology are pushing the entire
hospitality industry to keep pace with other Fortune 500 industries. The evolution of the
Internet, sophisticated yield management applications, expensive training initiatives,
increased market competition, and Wall Street‘s short-term prospective are forcing General
Managers to be multi-disciplined. We have investigated the typical career paths of General
Managers in the hotel industry, and have determined which is the most lucrative. By
conducting an informal survey of our clients, we identified four primary career paths to the
GM seat:
• Finance
• Food & Beverage
• Rooms
• Sales & Marketing
While the majority of companies cited multiple career paths of GMs, they expressed a
preference for one or two. For example, Hilton had a penchant for Food & Beverage expertise,
Marriott was more Sales & Marketing oriented, and Ian Schrager Hotels was Rooms-driven.
The data table set forth below illustrates the base salaries for three positions in each of the
four departments. The positions start at the Manager level, graduate to the Assistant
Department Head, and conclude at the Department Head. For the purpose of comparison, we
have also included the salaries of General Mangers. The data was gathered from the 2000
®
HCE Lodging Property Report and represents all luxury and first-class hotel properties in the
database.
Minimum Base
Position Median BaseMaximum
Salary Base Salary
Average Bonus
Salary
Dir. of Sales & Marketing $23,577.67

$78,944.17 $250,000.00 $7,923.01
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Senior Sales Manager 21,707.7647,155.34 97,718.76 4,029.31

Sales Manager 20,000.0038,478.76 64,838.59 3,275.20
Director of Food & Beverage 31,000.0074,269.66 130,000.00 6,981.15
Asst. Director of Food & Beverage

24,520.7849,513.11 79,500.00 2,019.75
Restaurant Manager 14,146.6035,366.50 90,000.00 856.74
Resident Manager 22,398.7982,521.84 206,872.83 10,944.49
Front Office Manager 15,325.4939,276.27 85,000.00 1,415.01
Asst. Front Office Manager 13,008.7435,375.00 60,000.00 600.06

Controller 22,842.6664,838.59 141,466.02 8,176.94
Assistant Controller 21,762.1944,595.98 81,932.40 1,174.31
Accounting Manager 21,219.9036,754.69 80,000.00 436.95
General Manager 31,877.01

114,833.66 412,609.21 28,169.94
Source: HVS Executive Search
The median salaries of manager-level positions are as follows:

• Sales Department, Sales Manager: $38,478.76
• Food & Beverage, Restaurant Manager: $35,366.50
• Rooms Division, Assistant Front Office Manager: $35,375.00
• Finance, Accounting Manager: $36,754.69
In addition to having the highest median salary, Sales Managers recorded the most lucrative
average annual bonus, at $3,275.20. Accounting Managers had the smallest bonus at a mere
$436.95. Restaurant Managers and AFOMs were nearly identical in both salary and bonus.
The following information sets forth the median salaries of Assistant Department Heads:
• Sales Department, Senior Sales Manager: $47,155.34
• Food & Beverage, Assistant Director of Food & Beverage: $49,513.11
ICHM Page 140

• Rooms Division, Front Office Manager: $39,276.27

• Finance, Assistant Controller: $44,595.98
The Assistant Department Head of Food & Beverage saw a dramatic jump in median base
compensation, rising more than $14,000 from the Manager level. The Rooms Department
Head had the smallest increase at nearly $4,000. Sales Managers continued to see the most
rewarding average bonuses at $4,000, nearly four times that of the other Assistant
Department Heads. The Department Head salaries changed the outlook considerably with
median salaries as follows:
• Sales Department, Director of Sales & Marketing: $78,944.17

• Food & Beverage, Director of Food & Beverage: $74,269.66
• Rooms Division, Resident Manager: $82,521.84
• Finance, Controller: $64,838.59
At the Department Head level, the most impressive increase in median base salary was the
Resident Manager, rising nearly $43,000 from Front Office Manager. The largest bonus
($10,944.49) was also awarded to the Resident Manager, followed by the Controller
($8,176.94), the Director of Sales & Marketing ($7,923.01), and the Director of Food &
Beverage ($6,981.15).
Although requiring prospective General Managers to have years of valuable and assorted
employment experiences will remain constant, the path and the accompanying financial
rewards may not. Corporate Operations Managers are now seeking professionals who are
leaders, are self-disciplined, have a passion for service, and can motivate employees. Manfred
Timmel, General Manager of the new Ritz-Carlton Downtown in New York, is a perfect
example of a hotelier who worked hard to not only complete a scholastic education, but to
also build a rewarding career. Manfred began his diverse career at the age of 14 as an
apprentice in Stuttgart, Germany. He subsequently held approximately 17 positions, studying
and working at the same time in Germany, France, and Spain before eventually becoming the
General Manager of the Peninsula Hotel Group‘s Marco Polo Singapore Hotel 23 years later.
ICHM Page 141

Manfred additionally obtained the equivalent of an MBA, further identifying him as a hotelier
of high standards. We recommend that aspiring GMs follow in the footsteps of Manfred and
other ―new-breed‖ operators as they look to succeed in this highly competitive industry
Your first moves

Here's an imaginary scenario. You apply for a job that seems absolutely perfect for you. You
send your resume with a cover letter to the prospective employer. Plenty of other people
think the job sounds great too and apply for the job. A few days later, the employer is staring
at a pile of several hundred resumes. Several hundred? you ask. Isn't that an inflated
number? Not really. A job offer often attracts between 100 and 1000 resumes these days, so
you are facing a great deal of competition.
Back to the prospective employer staring at the huge stack of resumes: This person isn't any
more excited about going through this pile of dry, boring documents than you would be. But
they have to do it, so they dig in. After a few minutes, they are getting sleepy. They are not
really focusing any more. Then, they run across your resume. As soon as they start reading
it, they perk up. The more they read, the more interested and awake they become.
Most resumes in the pile have only gotten a quick glance. But yours gets read, from
beginning to end. Then, it gets put on top of the tiny pile of resumes that make the first cut.
These are the people who will be asked in to interview. In this mini resume writing guide, we
aim to give you the basic tools to take this out of the realm of fantasy and into your everyday
life.
While you are still in school, you probably will want to gain some job experience in the
hospitality industry. To do that, you will need some basic knowledge of how to prepare a
resume and handle a job interview. The following sections contain information that may be
useful to you.
Note:
The above given data gives a fair idea of salaries and may vary due to the present
scenario in the hotel industry
ICHM Page 142

REVIEW QUESTIONS
1. What are the career opportunities in the hospitality industry
2. What is the present scenario and future projection of HR issues in the hospitality
industry
REFERENCES:
 Successful Toursim Management, Premnath Seth
 Principles and Practices of Management, A K Bhatia
 Tourism Today, Maneed Kumar
 Indian Economy, Dhingra
 An Introduction to Travel and Tourism, Jagmohan Negi
ICHM Page 143

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Introduction to Hospitality Industry

1.1 Meaning and definition

1.1 Meaning and definition

Who Are Tourists?

There are several basic types of tourists:

1.2 Historical evolution and development

Origins of Hospitality Industry

Nature Of The Hospitality Industry

Traditional Style Hospitality for Visitors

1.3 Hospitality as an Industry

History Of Hotels And Accommodation Industry And Their Development

B.Sc. (HOSPITALITY AND CATERING MANAGEMENT)

2.1 Complementary roles with other industry

Hotel industry in India

Demand of manpower in hospitality industry

Hotel industries GDP contribution in an Indian economy.

Role of Hotel management Courses in Hospitality Sector

Introduction to Hotel Management

2.2 Contribution to Indian and global economy

Dynamics of the Lodging Industry

The Influence Of Economic Fluctuations

Contribution to Indian and global economy

Role of multinational chains/groups of Hotels in the Indian hospitality industry and

SOME FINANCIAL ISSUES :

Tourism & Hospitality

Classifying Lodging Properties

Luxury Hotels And Resorts.

How Important Is Tourism To The Economy?

As an hotelier, keep on checking the hospitality attitude of your organization. Make a

B.Sc. (HOSPITALITY AND CATERING MANAGEMENT)

3.1 Hospitality accommodation

3.1 Hospitality accommodation

• There are two approaches to classify departments in typical hotels:

c) Planned work shifts

Rooms Division: Concierge

Rooms Division: Transportation / Garage

Rooms Division: Guest Relations

. Cleans occupied and vacant rooms

An efficiently managed housekeeping department ensures the cleanliness, maintenance and

Management of the accommodation or housekeeping department will be influenced by factors

. Valet Parking Attendants: Ensure parking services for guest‘s automobiles

. Concierge: Assists guests by making restaurant reservations, arranging for transportation,

3.2 Food and beverage facility

Food & Beverage: Restaurants/Bars/Lounges

Food & Beverage: Banquets

Food & Beverage: Culinary

Food & Beverage Night Cleaners

Food & Beverage: Room Service

Food & Beverage: Stewarding

Food & Beverage: Storeroom

Food & Beverage Service Department:

3.3 Ancillary service, Support service

Sales & Marketing Division:

• A typical Sales & Marketing Division is composed of four different departments:

Sales Reservations & Revenue Management

Sales & Marketing: Catering Sales

Sales & Marketing: Conference Sales

Engineering and Maintenance Division:

Human Resources Division: