1 Evolution Of Hotel And Service Industry

Learning Objectives  Explain the importance of accommodations to the tourism

and hotel industry  Identify and describe the major classifications of accommodations  Identify and describe the primary ownership patterns of lodging/ hotel properties  Describe the basic organizational structures in lodging properties  Describe the differences between front-of-the-house and back-of-the-house operations  Identify and describe key marketing, management, and financial considerations in lodging operations  Demonstrate knowledge of basic accommodation terminology

Brief History of Accommodations  Age-old profession  Started as way stations for travelers needing

safe shelter for the night stay  Evolved into local gathering places for meetings and entertainment  Inns expanded in size and became hotels  Development in lodging facilities closely followed improvements in transportation

There are Choices!!

 No two are exactly alike, Bed and Breakfasts

(B&B), started in small towns and similar to early small inns

 B&Bs exist worldwide-often supplement family income  Wide variety of B&B establishments  Referral organizations have evolved to assist B&B

owners in marketing  Internet has been effective in reservation booking  Personal attention and breakfast are major distinction

Same Time, Same Place, More privately  Time-Share Condominiums:  Usually have amenities similar to a luxury apartment  Vacation ownership is appealing to people who can plan in

advance and want to be assured of accommodations at set times at specific locations  Fee-simple or right-to-use basis  Flexibility to swap occupancy rights with other owners  Point system is new way to sell time-shares and make swapping easier  Destinations and week of year vary in popularity  Condos in rental pools

Incorporated with Function Rooms Conference Centers Accommodations built to serve the needs of

meeting attendees Service is designed to enhance the meeting experience

Enjoying the Great Outdoors Camping and Parks Camping is no longer “roughing it”; often find

amenities similar to other forms of accommodations Add additional “rooms” during the tourist season Shift the capital investment burden to the traveler

Brief History of Hotel Development  Boston’s Tremont House, 1829, 1st Hotel  Brown Palace in Denver, 1892, 1st atrium  Statler Hotel,1908 added services and

amenities  Great Depression resulted in 85% of hotels going bankrupt  End of WW II gave rise to development of hotels  1990’s had a period of growth and high profits

Classification and Rating systems  Organizations such as American Hotel and

Motel Association have developed rating systems to clarify the amenities and services at a type of lodging property  Classification systems provide managers with reference groups and benchmarks against which they can evaluate performance  Best practices have been identified for a variety of hotel operations

HOTEL CATEGORIES  Location  Center city

 Downtown - often built as part of depression programs  Near railroads

 Attract business travelers  Now rebuilt downtown areas meant new or

refurbished hotels

 Majority chain operated  Majority full service

 

Resorts  Found in desirable vacation spots  Elaborately landscaped, sports facilities  Romans first to build hotels for recreational

purposes

 Usually around hot springs

 First American 1789 - Pennsylvania  Grew during 1800s - mostly seasonal  Trend now is to stay open year round  450,000 resort hotel rooms in us  Have highest occupancy rate of any type but has highest cost to operate because of high service level  Target other groups besides leisure - business

Airport On or near airport Primarily weekday guest High occupancy rate Little notice for high demand (storms) Promoting longer stays and business

meetings

LODGING SIZE (LODGING)  Size  45,000 properties in US - 3,000,000 rooms 70% have fewer than 75 rooms  30% have more than 300 rooms 

 Most establishments are small and owned by

individuals, partners or corporations - operated by owner

Categories of Lodging Properties  Limited-service budget hotels  Limited-service economy motels  Full-service mid-priced hotels and motels  Full-service upscale hotels  Luxury hotels  All-suite hotels  Extended-stay hotels >>>>>>Transient hotels, motels, inns  Resident hotels  Resorts  College dormitories  Hostels  Boarding houses  Condominium rentals  Hospitals

Organizing for successful operations  Going it alone  Small independent properties, managed by owners  Not bound by corporate policies so have complete decision-making authority  No corporate support/resources  Franchising  Provide use of brand name, reservation system and management systems from parent company in return for royalties and fees  Franchisee gives up some decision-making freedom  Franchising in the lodging business is still rare in Europe and Asia

Organizing for successful operations, continued  Management Contracts  Owners of lodging property hire a company to manage/operate the property  Management company receives percent of revenue as compensation  Owners retain all financial obligations  Chain Operations  Chain operations have common ownership or management  Chains provide similar benefits as franchises

Hotel and Service Industry Establishment that charges fees for

providing furnished sleeping accommodations to persons who are temporarily away from home or who consider these accommodations a temporary or permanent home. May also provide food and beverage Typically provide other things such as cleaning services, entertainment, recreation and general services.

Organizing for successful operations Strength in numbers: Referral associations Referral organizations offer freedom of going

it alone plus some benefits of chains Marketing, especially through central reservations system and widely distributed member directory, is the primary benefit May also offer operational benefits such as cooperative purchasing and training

Started in Sales  Goal of sales is to attract future bookings  Variety of methods to gain sales  All employees are involved in the sales process  Providing a Home Away From Home  Meeting Guest’s needs  Achieving profitable operations

Technology Property Management systems integrate all

of the information needed to manage Need such systems for communication among different functional areas Enterprise systems further combine information for multiple properties

Criteria For Classifying Hotels ·         ·         ·         ·         ·        

Price Function Location Particular market segment Distinctiveness of style or offerings

Hotels Classified By Price ·         Limited-service hotels ·         Full-service hotels ·         Luxury hotels

Hotel Classified By Function ·         Convention hotels ·         Commercial hotels

Hotels Classified By Location ·         ·         ·         ·        

Downtown hotels Suburban hotels Highway/interstate hotels Airport hotels

Hotels Classified By Distinctiveness of Style or Offerings ·         All-suite hotels ·         Extended stay hotels ·         Historic conversions ·         Bed and breakfast inns ·         Boutique hotels

Hotels Classified By Market Segment ·         Executive conference centers ·         Resorts ·         Casino hotels ·         Health spas ·         Vacation ownership

Ownership Independently owned and operated Independently owned but leased to an

operator Owned by an entity that has hired a management company Owned and operated by a chain Owned by independent group and operated by a chain Owned by independent group and operated as a franchise of a chain

Three Main Objectives of the Hospitality Manager Make the guest feel welcome. Make things work for the guest. Make sure the operation continues to

provide service and make a profit.

Hotel Operations Can Include ·         Rooms department ·         Food and beverage department ·         Staff and support departments

Comparison of Typical Departmental Incomes Rooms department—70 percent or more Food and beverage department—15 to 30 percent

Principal Customer Types  ·         Transient business travelers─29%  ·         Business travelers attending

conferences─25%  ·         Vacationers─24%  ·         Travelers for other reasons─22%

You can make generalizations about hotel prices and the star ratings. A four star hotel will indeed cost more than a one star in the same city. The four star hotel will have more services and amenities, including meeting space for conferences. The one star will usually be very basic; not all rooms may have bathrooms in them.

Hotel Rating  You can make generalizations about hotel

prices and the star ratings. A four star hotel will indeed cost more than a one star in the same city.  Four star hotel will have more services and amenities, including meeting space for conferences. Three star will usually be simple and very basic for bathroom. Two/One Star not all rooms may have bathtub in rooms and very simple.

Standards of Hotel Classification   In some countries, there is an official body

with standard criteria for classifying hotels, but in many others there is none but they have to abide with their respective government mandatory requirements such as government institutions ( for the mandatory part).  There have been attempts at unifying the classification system so that it becomes an internationally recognized and reliable standard but large differences exist in the quality of the accommodation and the food within one category of simple hotel.

Manila Hotel Traditional Philippine Splendor at this Central Manila Luxury Hotel Famed as the "Aristocrat of the Orient," the Manila Hotel has stood as a distinguished Far East landmark since its historic inauguration in 1912. .

The Old Hotel Built as a Hotel for the Mill across the

street.  The Old Hotel has been welcoming guests for over 150 years.    Located in the Midst of the Green Mountain

National Forest, Lincoln and the Hotel is centrally located between the Adirondack Mountains and the Connecticut River Valley

Hoshi Ryokan Hōshi (is a Japanese traditional inn in the

Awazu Founded in 717, it is the world's oldest hotel still in operation according to Guinness World Records [1] and the world's oldest continuously operating company after the liquidation of Kongō Gumi in 2006.

Hyatt 1957 LA International Airport. Founded by

Hyatt R. Von Dehn 1969 Opened Hyatt Regency Hongkong 1980 – Grand Hyatt and Park Hyatt Today – 340 Hotels Worldwide

MANILA Hotel 1900 – Pres. Mc. Kinley appointed Judge

Howard Taft to evaluate the needs of the territory. Later became the 1st Civilian Governor General in the Phils. 1912 – opening of Manila Hotel Residence of Pres. Mc Arthur from 19351941

Palace Hotel Designed as American Counterpart to the

Grand Hotels in Europe 1875 Most luxurious hotel in the world Called majestic hotel, hailed 7000 windows, enprecented opulence

HOTEL RITZ PARIS 1854 – acquire by P’ereire Brothers as

private dwelling 1898 – converted by Cesar Ritz to luxury hotel 1979 – Ritz family sold the hotel to Egyptian businessman Mohamed Al Fayed 1988 – refurbished 1997 – Dodi and Princess Diana visited Ritz when emplyee Henri Paul drove them from the hotel which crashed in Port de l’Alma road tunnel

CROWN HOTEL MACAU 6 star hotel and casino /220 gaming tables

and 500 gaming machines Opened may 2007 by James Parker – wealthiest man in Australia

5 ***** PROPERTY AMENITIES  Dry cleaning service  Playground  Spa Tub  Beauty services  Conference room(s)  Concierge desk  Express check-in  Internet public area - surcharge  Exhibit space  Sauna  Bar/lounge  Laundry service  Breakfast services  Gift shop or newsstand