THE LODGING INDUSTRY

Chapter 1

Managing Front Office Operations 8th Edition

Lodging Is Part of the Travel and Tourism Industry
 Segments in the Travel and Tourism Industry

Travel and Tourism Industry
Lodging Operations F&B Operations Transportation Services Destination (Activity) Sites

Retail Stores

The Travel and Tourism Industry
 The Travel and Tourism industry is:
 The third largest retail industry
 Following automotive and food stores

 The nation’s largest service industry  One of the nation’s largest employers

Classifying Hotels  Hotel  Primary business is providing lodging facilities to the general public  Services may include:  Food and beverage  Room attendant  Concierge  Bell and door attendant  Laundry and dry cleaning  Other services .

Classifying Hotels (continued)  Motel  Contraction of “motor hotel”  Caters primarily to those traveling by auto  Suburban or roadside  Do not offer a full range of services .

Classifying Hotels (continued)  General classifications:  Hotel size  Target market or location  Level of service  Ownership and affiliation .

Hotel Size  Size categories:  Under 75 rooms  75–149 rooms  150–299 rooms  300–500 rooms  Over 500 rooms .

or market segment .Target Markets  Distinctly defined groups of travelers  Broken down into smaller segments within target markets  Products and services developed specifically to satisfy these segments  Market segmentation  Lodging companies have created different brands  Each directed towards a type of guest.

Types of Hotels  Commercial hotels  Vacation ownership  Airport hotels  Suite hotels  Extended-stay hotels      Residential hotels  Resort hotels  Bed-and-breakfast hotels and condominium hotels Casino hotels Conference centers Convention hotels Alternative lodging properties .

Target Markets  Commercial Hotels  Business travelers. airline passengers. small conference groups. etc…  Airport Hotels  Business clientele. vacationing families. professionals . tour groups. individual tourists. and meeting attendants  Suite Hotels  Frequent travelers. airline personnel.

Target Markets (continued)  Extended-Stay Hotels  Travelers who intend to stay five days or longer and required reduced hotel services  Residential Hotels  Long-term or permanent accommodations for those want and can afford daily. limited hotel services  Resort Hotels  Leisure travelers and vacationing families  Relaxed atmosphere & wide range of facilities and activities .

personal service.Target Markets (continued)  Bed-and-Breakfast Hotels (B&Bs)  Leisure travelers  Uniqueness. and homelike atmosphere  Vacation Ownership and Condominium Hotels  Leisure travelers and vacationing families  Individuals purchase the ownership of accommodations for a specific period of time .

Target markets (continued)  Casino Hotels  Leisure and vacation travelers  Conference Centers  Group meetings  Convention Hotels  Business travelers  Alternative Lodging Properties  Backpacker. mobile home parks . campgrounds. leisure / vacation travelers  Recreational vehicle parks.

Target Markets (continued)  Commercial Hotels  Airport Hotels  Conference Centers  Convention Hotels  Suite Hotels Business Travelers  Extended-Stay Hotels  Resort Hotels  Vacation Ownership and Condominium Hotels  Bed-and-Breakfast Hotels (B&Bs)  Casino Hotels  Alternative Lodging Properties Leisure Travelers .

Typical Lodging Guests  52% travelled for business  48% travelled for pleasure .

Level of Service  Measure of the benefits provided  Usually reflected in room rates charged Range of Lodging Property Service Alternatives Luxury Hotels and Resorts Full-Service. Upscale Hotels Mid-Scale Hotels Limited-Service Hotels .

Basic Essential accommodations. Usually food within walking distance. Usually small to medium sized hotel chains. First class accommodations. Enhanced level of quality throughout.Comprehensive Multifaceted and comprehensive.Superior   .Upscale Upscale in all aspects. Impeccable standard of excellence.First Class  .Luxury Characteristics of ultimate luxury and sophistication.   .Rating Services AAA Diamonds     .Deluxe    . In house dining available with many other services     . Upgraded physical attributes.Moderate  . Limited food service. Usually associated with business travelers. Appeal to budget minded travelers while keeping in mind cleanliness  .Economy Sources: American Automobile Association & Mobil Travel Guide .    . Above average level of service. Mobil Stars     . Highly personalized service. and comfort.Modest Aimed toward traveler looking for more than just the basics. service.

334 7.279 467.970 716.99 $45–$59.305 1.296.369.196 By Size Under 75 rooms 75–149 rooms 150–299 rooms 300–500 rooms Over 500 rooms 27.102.094 509 1.680 14.999 860.144.845 1.149 Rooms 444.99 $60–$85 Over $85 853 7.855 50.038 478.923 .862 16.860 1.633 1.312 2.239 18.490.523. Property and Room Breakdown By Location Airport Suburban Urban Highway Resort Property 3.476 5.297 4.983 407.S.408 18.642 499.485 1.393.753 1.102 By Rate Under $30 $30–$44.350 1.379 14.2003 U.

they will do well  Consistent delivery of quality products and services to guests must be addressed first. rather than considering tactics to maximize revenue  Minimizing costs comes next! .Lodging Is a Service Business  Successful hotels greatly emphasize serving their guests to the best possible extent  The brand name a hotel uses is not the most important factor in a hotel’s success  When hotels put guests’ needs first.

Lodging Is a Service Business (continued)  Questions that must be addressed to deliver quality service:  How will we demonstrate to our own staff members the need for high-quality guest service?  How exactly will we evaluate the level of service quality being provided to our guests?  What exactly are our service strategies and our service procedures?  How will we train our staff about service concerns and the tactics to deliver service?  How will we reinforce our service strategies?  What can we do to emphasize service as a philosophy rather than as a program with a definite start and end time?  What can we do to excel in the guests’ moments of truth? .

Ownership and Affiliation  Hotel Ownership/Management  Single-unit property not affiliated with any brand  Single-unit properties affiliated with a brand  Multiunit properties affiliated with the same brand  Multiunit properties affiliated with different brands  Multiunit properties operated by the brand or others  Multiunit properties owned by the brand .

Ownership and Affiliation (continued)  Hotel Ownership/Management Alternatives Hotel Property Affiliation Ownership Franchise Non-Franchise Independent Franchise Company (Franchisor) Independent Operation Independent Franchise Company (Franchisor) Management Company Independent Management Company .

.Franchise Hotels  Franchising is selling the right to conduct a business  Franchisor s develop standards for design. décor. equipment and operating procedures.

Independent Hotels  Independent hotels have no relationship to other hotels  Its unique advantage is autonomy and flexibility  Independent hotel can quickly adapt to changing market conditioning .

rules. management. policies and procedures  Some chains have strong control over the architecture.Chain Hotels  Chain ownership imposes certain standards. and standards  Advantage:  Advertising and marketing  Purchasing  A chain is classified as operating under a management contract or franchise or referral group .

Management Company  Management companies are organizations that operate properties owned by others  Advantages:  Expertise in operations. financial management. staffing. marketing and reservation services .

Accor 5. Cendant Corporation 3. Choice Hotels International Rooms 534.977 .000 463.600 3.396 2. InterContinental Hotel Group 2. Marriott International 4.540 6.806 Properties 3.973 4.427 403.Lodging Industry Overview  World’s Largest Hotel Groups Hotel Group 1.860 478.202 520.

236 278.701 Properties 4. Holiday Inn 3. Marriott Hotels Resort 5.787 182.415 490 1.Lodging Industry Overview (continued)  World’s Largest Hotel Brands Brands 1. Days Inn of America Rooms 309.519 153. Comfort Inn & Suites 4.038 179. Best Western 2.484 2.114 1.872 .

523 3. Choice Hotels International. Marriott International.238 2.891 .332 337.279 380.184 2. Hilton Hotels Corporation 4.643 313.Lodging Industry Overview (continued)  Largest Hotel Organizations in the United States Organization 1. 3.982 Properties 5.218 357.622 2. Inc. Rooms 439. Cendant Corporation 2. Inc. InterContinental Hotel Group 5.

social. or pleasure  International Travelers  Bring a different set of needs and expectations .Classifying Guests  Business Travelers  Important source of business for many lodging properties  Pleasure / Leisure Travelers  Segmentation of this market often depends on attractions. products and services offered  Group Travelers  Can be business.

Lodging Industry Characteristics  Emphasis on safety. cleanliness. and service  Guests also consider “intangible” aspects of the purchase decision  Inseparability of manufacture and sales  A room exists and is sold at the same site  Perishability  If a guest room is not rented on a specific date. the revenue is lost forever .

Lodging Industry Characteristics (continued)  Repetitiveness  Some operating procedures are routine  Labor Intensive  Much of a hotel’s daily work involves employees providing services .

site navigation. and availability of reviews .Buying Influences on Travelers (continued)  Buying influences include:  Satisfactory experiences with a hotel  Advertisement by hotel or a chain organization  Recommendation by others  Hotel’s location  Preconception of brand  Marketing activities  Brand loyalty and reward programs  Website design.

Buying Influences on Travelers  The most important factors for repeat business:  The quality of services  The property’s overall cleanliness and appearance  Good service is good business .

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