Professional Documents
Culture Documents
UNIT 1 1.1 1.2 1.3 Meaning and definition Historical evolution and development Hospitality as an Industry
1.1 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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historical sites.
1.2
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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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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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 executives 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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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 ICHM Page 9
2.1 Complementary roles with other industry Hotel industry in India Indias 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 worlds 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 worlds 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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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 FutureBranda leading global brand consultancyin 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 JanuaryOctober 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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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 guests 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 ICHM Page 27
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REVIEW QUESTIONS 1. 2. 3. 4. 5. What is the meaning and definition of hospitality industry? Write a note on historical evolution and development of hospitality industry Give an overview on hospitality as an Industry Discuss on role of hospitality industry in complement with other industry Write a note on contribution of hospitality industry to Indian and global economy
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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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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) b) c) d) e) f) Reservation, registration, room & rate assignment Fulfills guest services and updates room status Maintains & settles guest accounts Creates guest history records Develops & maintains a comprehensive database of guest information 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) b) Careful designed front office organization chart Comprehensive goals, strategies and tactics ICHM Page 36
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 ICHM Page 37
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 dcor, 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 guests automobiles . Transportation Personnel: Ensure transportation services for guests from and to the hotel ICHM Page 39
. 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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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. ICHM Page 43
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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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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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 ICHM Page 48
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. 2. 3. 4. What do you mean by hospitality accommodation? What are the Food and beverage facility in the hotels? Write a note on Support service in hotels Comment on hospitality organization B.Sc. (HOSPITALITY AND CATERING MANAGEMENT) INTRODUCTION TO HOSPITALITY INDUSTRY UNIT 4 4.1 Hospitality distribution channels- meaning and definition, function and
level of distribution
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SALES FORCE
PUBLIC RELATION
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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 The packaging: It must provides a better appearance and a convenient use. In food The safety: It does not concern fun board but it matters very much for products used by The "green": A friendly product to environment gets an advantage among some segments. board must offer a good and fashionable design adapted to young people. business, products often differ only by packaging. kids. 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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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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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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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. o You should also determine the alignment of the sales force: Alignment by territory divides the market into geographical areas such as counties or Alignment by product specializes each salesman in a product Alignment by customer specializes each salesman in a customer (it means that the 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. ICHM Page 59
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Gathering and distributing market research and intelligence - important for marketing planning Developing and spreading communications about offers Finding and communicating with prospective buyers Adjusting the offer to fit a buyer's needs, including grading, assembling and packaging Reaching agreement on price and other terms of the offer
Physical distributionTransporting and storing goods Financing Risk taking Acquiring and using funds to cover the costs of the distribution channel Assuming some commercial risks by operating the channel (e.g. holding stock) Page 61
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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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Wholesalers
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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 ICHM Page 75
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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 travelers 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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SABRE
American Airlines All Nippon Airways Cathay Pacific Airways China Airlines Singapore Airlines Aer Lingus Air Canada Alitalia Swissair TAP United Airlines
Galileo
Abacus
SABRE All Nippon Airways Cathay Pacific Airways China Airlines EVA Airways 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. 2. 3. 4. 5. What is hospitality distribution channels- meaning and definition? What are the function and level of distribution of hotel market What is market mix? Explain What are the major Hospitality distribution channels for hotels? 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 ICHM Page 84
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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operating in Rajasthan, Punjab, Himachal Pradesh, Madhya Pradesh, Uttaranchal, Jammu & Kashmir, West Bengal, Tamil Nadu, Haryana and Karnataka.) MARKET CAPITALIZATION Month July 2006 August 2006 October 2006 High 69470.81 71935.59 73136.79 Low 61622.49 63162.11 68235.51 69172.79 66984.82 Average 65132.68 66907.27 69865.82 70595.60 69353.40 Page 87
Key Stats & Ratios Quarterly Net Profit Margin Operating Margin EBITD Margin Annual (2006) 21.70% 31.32% 34.70% 18.35% 26.75% Annual (TTM) -
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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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 ICHM Page 91
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 air diploma in engineering, ITI conditioning, refrigeration, certificate utilities Accounts Assistant general accounting, Up to accounts 27 B. Com payable, accounts receivable, literacy purchasing, store keeping HR Assistant human resource, training Up to 27 with computer
The market capitalization of EIH as on march 21, 2007 was Rs. 3,748.74 cr.
Key Stats & Ratios Annual (2006) Net Profit Margin Operating Margin EBITD Margin Return on Average Assets Return on Average Equity 22.32% 30.45% 48.13% 8.81% 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
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 ICHM Page 94
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 Operating Margin EBITD Margin 9.03% 15.40% 21.06%
Return on Average Assets 1.65% Return on Average Equity 3.65% The market capitalization of Asian Hotels limited is Rs.16,076,512,620
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 ICHM Ashok Yatri Niwas Bharatpur Forest Lodge Khajuraho Ashok Temple Bay Ashok Beach Resort at Mamallapuram Hotel Qutub at Delhi Page 96
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, 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 To provide innovating, dependable and value-for-money solutions to the needs of tourism Travelers' Lodges/Restaurants;
changers, etc; 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 ICHM Page 97
affordable, insist that all guests are introduced to neighborhood, value-priced F&B options .
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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 publicsector 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 industrys 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 ICHM Page 100
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 nights 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 ICHM Page 102
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. ICHM Guests on the basis of status: For example, Page 103
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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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 ICHM Page 106
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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 ICHM Page 109
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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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 callers 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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Remember, good service means giving customers a little bit more than they expect. 10 Ways to Build Customer Loyalty: 1. 2. 3. Take ownership of your customers problemeven if you are not the cause of it. Follow-up with every customer who was upset or had a difficult problem. Ask yourself with every customer interaction you have, "If this were me, what would I
want?" 4. 5. Thank your customers and co-workers every chance you get! 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. 8. 9. SMILE every time you are on the telephone. Look for ways to bend the rules and remove service obstacles. Time is a person`s most precious commodity. Respect your customer`s time and
schedule. 10. Provide your customers with respect, friendliness and knowledgeand, oh yes, the products and services you sell. ICHM Page 112
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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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 Butlers 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. ICHM Page 119
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
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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. ICHM Page 121
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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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: ICHM Inaccessible, or only partly accessible, web sites Lack of accessible airport transfer Lack of wheelchair accessible vehicles Lack of well-adapted hotel rooms Page 124
Tourist amenity refers to the accommodation on tourist spots which may include hotels, motels, resorts, lodges etc. REVIEW QUESTIONS 1. 2. 3. Who are the major players in the hospitality industry? Write in detail What are the existing and emerging markets of the hospitality industry/ Write a note on the role of support services an infrastructure in the hospitality industry
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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 Hospitality jobs are not nine-to-five jobs. Hours are highly flexible in many positions. There are opportunities for long-term career growth. If you are ambitious and energetic,
guests, motivating employees, and negotiating with vendors and others. (Some see this as a disadvantage, however. 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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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 Nontraditional schedules. Hospitality managers do not work a Monday through-Friday
not the norm, and 50- to 60-hour workweeks are not unusual. 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 Low beginning salaries. Entry-level jobs for management trainees tend to be low-paying pressure to perform. 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 Managers Advertising Specialists Food Preparation Hosts Workers and Hostesses ICHM Page 129
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 assistantmanager 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, quickservice 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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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. ICHM Page 135
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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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 Casino Clerks 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. ICHM Page 137
Airline Passenger Service & Airport Food & Agent Beverage Staff Airport Meet & Greet Airport Station Manager Assistant Cruise Purser Banquet & Catering Staff Banquet & Sales Manager
key travel-related sectors in 1994 Front Desk Agent/Front Office Staff and this number is forecast to Functions Coordinator expand rapidly to nearly 895,000 Gift Shop Staff Ground Host/Hostess by 2005. These are top-level 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 travelrelated 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 ICHM Page 138
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 Streets 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.
Position
Minimum Base Median BaseMaximum Salary Base Salary Average Bonus Salary $23,577.67 $78,944.17 $250,000.00 $7,923.01 Page 139
Director of Food & Beverage 31,000.00 74,269.66 Asst. Director of Food & Beverage 24,520.78 49,513.11 Restaurant Manager Resident Manager Front Office Manager Asst. Front Office Manager Controller Assistant Controller Accounting Manager General Manager 14,146.60 35,366.50 22,398.79 82,521.84 15,325.49 39,276.27 13,008.74 35,375.00 22,842.66 64,838.59 21,762.19 44,595.98 21,219.90 36,754.69 31,877.01 114,833.66
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
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REVIEW QUESTIONS 1. 2. What are the career opportunities in the hospitality industry 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
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