BAC 157 – ROOMS DIVISION OPERATIONS

Module – I: Introduction to Hospitality Industry

Structure

1.1 Overview of Travel and Tourism Industry

1.2 Nature of the Hospitality Industry
1.3 Historical Background
1.4 Scope and development of the Hospitality Industry
1.5 Trends that accelerate the growth of the industry
1.6 Role of Travel Agency in Hospitality Industry

1.1 Overview of the Travel and Tourism Industry

Tourism is important to the economic development of a country since
1. It contributes to its growth and provides employment opportunities
2. Funds a large percentage of countries gross domestic product thereby helping to raise the national
income. GDP or gross domestic product is the total monetary value given to all the goods and
services produced by a country over a set period of time. A healthy tourism industry helps to
increase the volume of sales of these goods and services thereby in turn helping to raise the
country’s national income. This could also lead to lowering unemployment and inflation.
3. It helps to earn to foreign currency through goods and services provided to foreign visitors.
4. It encourages cultural/international trade
Hospitality Industry Tourism Industry

Institutional/ Commercial Transportation

welfare catering, accommodation services e.g. tour
e.g. hospital services e.g. operators,
catering hotels airlines

Retail shops e.g.

shopping malls

Other Commercial food

accommodation and beverage Leisure activities
services e.g. operations e.g. e.g. theme parks
student hostels restaurants

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Travel and Tourism Industry

Lodging Operations Transportation Food and Beverage Retail Stores Activites

Services Operations
Hotels Ships Restaurants Gift Shops Recreation
Motels Airplanes Lodging Properties Souvenir Shops Business
Motor hotels Autos Retail Stores Art/Craft Shops Entertainment
Resorts Buses Trains Vending Shopping Malls Meetings
Camps Bikes Catering Markets Study Trips
Parks Limousines Snack Bars Miscellaneous Stores Sporting Events
Pensions Cruise Ships Ethnic Festivals
Motor Homes Bars/Taverns Art Festivals
Cultural Events
Seasonal Festivals

1.2 Nature of the Hospitality Industry

Hospitality industry is a part of a larger enterprise or industry known as the travel and tourism industry.

The travel and tourism industry is a vast group of businesses with one goal in common providing
necessary or desired products and services to travelers. According to a recent world travel and tourism
council report – Travel and tourism is the largest industry in the world employing one out of every ten
people worldwide.

The hospitality industry provides for people who are away from home regardless of the period of stay. It
includes everything arising from the interaction of travelers with businesses, governments and people
who make that travel possible.

These services vary according to the specific needs.

1. The hospitality industry provides services for people who are away from home regardless of
whether its for long or short period of time. These services can vary according to specific needs of
both the person away from home and the organization operating these services. For example, the
needs of a businessman at home would be different from his needs when he is traveling and
staying away from home.

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2. Person staying in a small guest house would have different demands than from a businessman
staying in large five start business hotel
3. A student staying in a residential set up would expect to be treated and accommodated differently
from a hotel guest

Therefore, whatever the nature of the hospitality industry, it is most important that staff in the hospitality
industry must be able to identify needs of their customers and be able to provide them what they
expect. The service provided in the hospitality industry can be for profit motive and non-profit making
motive.

A profit-making business is one which is set up with the intention to earn a profit. Example: commercial
hotel or restaurants. A non-profit making business is one which is not run specifically to make profits. It
is usually operated with the intention of promoting the benefits and welfare of its members. If there is
any excess income it is usually invested back into the business.

Example: Private clubs, industrial catering for offices, factories, institutional or welfare catering and
accommodation and provision of food in government hospitals or universities or other institutions.

1.3 Historical Background

1000 BC TO 500 BC
• First resorts at minerals and hot springs in Greece
• Ancient cities; Corinth in Greece
• Manorial lodges, Monasteries, Cathedrals, Buddhist Gharas
500BC TO 400AD
• Brick paved roads throughout Europe and Asia developed by the Roman Empire
• Road side lodges constructed
• Roman posting houses – Mansions or Stabulae ; also known as Diversoria ;
• Also had Ale-house or Bibulium (drinking shop); Taverns at Chester, Londonium, Eboracum
; Sutlers’ both attached to commissariats of the legions.
1110 AD
• “Three king Inn” in Basle, Switzerland Earliest Inn still operating.
11th CENTURY AD TO 17th CENTURY AD
• Law established in England and France regulating lodges and Inns.
• Early Inns in England and the continent.
1634 AD
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• Samuel Coles develops and starts taverns on US. Popular meeting places for wine, dine
and dance.
1700’S INDUSTRIAL REVOLUTION
• European taverns began to combine food and beverage service with lodging.
1760: ‘Hôtel Garni’ by fifth Duke of Devonshire – London
1765: ‘Restorants’ by Monsieur Boulanger.
1773: Boston Tea Party was planned at Green Dragon Tavern which sparked the
American Revolution
1783: George Washington bids farewell to his officers at Fraunces Tavern in Manhattan,
New York City symbolizing the Independence of United States.
1780s Viharas, Dharamsalas, Musafir Khanas, Dak Bungalows part of Indian culture;
valuable institutions providing a vital service.
1794: “The City Hotel”, New York : first American downtown hotel (73 rooms)
1800: “Exchange Coffee House”, First atrium hotel in Boston
1820: Second “City Hotel” in Baltimore, Maryland first with gaslight.
“Mansion House” Philadelphia
“Adelphi Hotel” New York ; first high rise structure in New York
1826: Union Oyster House
1827: Delmonio’s in New York
1829: “Tremont House” - Earliest first class hotel in America by an architect named Isaiah
Rogers. First Hotel to offer private rooms with locking doors and lots of innovations –
each guest with a wash basin, a water pitcher and a bar of soap, full service staff,
including a uniformed bell boy to greet and assist guests, a French restaurant in the
lobby.
1841: Book salesman and Baptist preacher Thomas Cook’s travel agency idea taken shape.
Strange coincidence : Amex Co. in US also starts in the same year as Thomas
Cook.
1874: ‘The Palace Hotel”, San Francisco, First luxury hotel, 800 rooms built by William
Chapmen Ralston.
1880’s: “Hotel Everett” in New York. First with partial electric light.
“Sagamore Hotel” in New York : first with electricity in all rooms.
“Savoury Hotel” in London Opens.
1890’s: “Hotel Netherlands” in New York : first with phones in all rooms.
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“E’cole Hoteleire” in Lausanne, Switzerland is the first hotel school.

1900: “Ritz” in London opened.
1902: April 1st, Indian Hotel company was incorporated.
1903: “Taj Mahal Hotel”, Bombay was incorporated.
1908 In January, “Buffalo Statler”, Buffalo, New York, first commercial hotel opened by
Ellsworth M Statler. Concepts of private sanitary rooms, private bath, light inside
every entryway for additional security, free pitcher of ice water and a morning
newspaper.
Statler’s advertising slogan – “a room and a bath for a dollar and a half”.
1919: Conrad Hilton purchased The Mobley in Cisco, Texas
1920: School of Hotel Administration established in Cornell University; First Airport Hotel at
Corydon U.K.; First motel in California.
1922: Rai Bahadur Mohan Singh Oberoi goes to Shimla to get a job in Cecil Hotel, eventually
becomes a partner in Clarks Hotel, Shimla
1927: 3000 rooms “Stevens Hotel”, Chicago which was later renamed the “Conrad Hilton”.
1931: Waldorf Astoria, New York City; tallest at that time – 13 stories.
1933: Mr. M.S. Oberoi takes over Grand Hotel, Calcutta and restores the defunct hotel to life.
1937: Ernest Henderson operated New England Hotels and founded Sheraton brand.
1940s: “Flamingo” in Las Vegas; first Casino Hotel.
1946: Oberoi Hotels Pvt. ltd. established.
1949: Conrad Hilton (Hilton Hotel Corporation) purchased Waldorf Astoria
1950s: Hotel room generated by mass travel; Resorts at Caribbean; Casino Hotel; Trans-
Atlantic Jet service; Motel trend throughout Western United States
1952: Kemmons Wilson opened Holiday Inn in Memphis, Tennessee
1954: Hilton purchased Statler Chain of Hotels; Howard Johnson’s first lodging ‘Howard
Johnson Motor Lodge’ in Savannah, Georgio (All his hotels later sold to Marriott
Corporation founded by Willard Marriott, which also operates residence Inns and
Courtyards)
1956: First economy hotel ‘Travelodge’ opened in Tacoma, Washington and the chain
expanded nationwide by 1966
1960s: Cruise business takes off; Airlines enter into hotel business; Growth of Holiday Inns
(1600 hotels in 50 states and 52 countries).
1962: Oberoi group enters into a collaboration agreement with Intercontinental Hotels
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Corporation, New York.

1965: In August, Oberoi Intercontinental Delhi opened marking the first success of joint
hoteleering in India.
1969: Sheraton Brand sold to International Telephone and Telegraph Corporation (ITT)
1970s: “No smoking floors” concept introduced; Computerization introduced; Economy hotel
chain Days Inn, founded by Cecil B. Day
1971: In July, Hotel Corporation of India (subsidiary of Air India) established.
1974: “Centuar Hotel”, Bombay airport opened by HCI.
1975: The India Tobacco Company (ITC) enters the hotel industry with the opening of
Chola in Madras (Sheraton Chola).
1976: Mughal, Agra (ITC Mughal- Luxury Collection) opened
1977: Maurya, New Delhi (ITC Maurya- Luxury Collection) opened.
1979: ITC signs a marketing services and reservation agreement with Sheraton International
Incorporated.
1982: Windsor Manor, Bangalore opened.
1989: Holiday Inn sold to Bass PLC, Also added to group – Hampton Inn, Embassy Suites
and Crown Plaza (1988 to 1990, All Suite hotels)
1998: Sheraton Brand bought by Starwood

1.4 Scope and development of the Hospitality Industry

The hospitality industry is a rapidly growing business in many parts of the world, particularly in regions
where tourism is also being developed. Furthermore, there is tremendous growth in business travel
also.

The growth of this industry will primarily depend on:

1. Economies opening up to international trade and business relationship. This will lead to more travel
into the country.
2. Increase in per capital income or economic prosperity which means people earning more will now
be able to spend on travel
3. Improvements in infrastructure facilities such as transportation, roadways, etc.

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1.5 Trends that accelerate the growth of the industry

 Globalization
 Consolidation
 Product Segmentation
 Expansion of Entertainment
 Distribution Methods
 Use of Computers
 Media Planning
 Environment Awareness
 Guest Preferences
 Relationship Marketing

1.6 Role of Travel Agencies in Hospitality Industry

i) Preparation of preplanned itineraries – personally escorted tours – group tours – sale of prepared
package tours
ii) Making arrangement for hotels, motels, resort accommodation, meals, car rentals, sight seeing,
transfer of passengers and luggage between terminals and hotels
iii) Handling and advising on the many details involved in modern day travel. E.g. travel and baggage
insurance, language, study material, travelers cheques, foreign currency exchange, visa, passport
and other documentary requirement and health requirement
iv) Selling tickets – thorough knowledge of schedules of various modes of transport like air, rail, sea –
connections, rate and quality
v) Special interest activities

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