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ANALYZING THE PERFORMANCE OF THE HOTEL INDUSTRY IN THE

PHILIPPINES
I. BACKGROUND AND HISTORICAL ACCOUNT OF THE INDUSTRY-SPECIFIC
BUSINESS

EDSA SHANGRI-LA
Shangri-La Hotel and Resorts started in Hong Kong on April 23, 1971. A
multinational hospitality company that was founded by the Malaysian tycoon Robert
Kuok in 1971. The company has over 100 luxury hotels and resorts in many countries. It
has 5 brands across the different market segments including Shangri-La Hotels,
Shangri-La Resorts, Traders Hotels, Kerry Hotels, and Hotel Jen. As globalization was
nearing and an idea that time expanding the Hotel and Resort to different parts of the
world will serve as a way to open up borders and welcome foreign guests and let them
experience international cuisine and have an excellent experience in the hotel and
resorts. It is a 5-star hotel located in Ortigas Centre in Mandaluyong, Philippines. It is
managed by the Shangri-La Hotels and resorts that were located in Metro Manila and
was the first Shangri-La property in the Philippines. The hotel has a soft opening on
April 27, 1993, and the hotel was launched and opened to the public on August 28,
1993. It was located in Makati Avenue and Ayala Avenue which are two of the busiest
avenues in the whole country. It has contributed to the iconic progress of the country.
The hotel has a total of 632 rooms and suites, has four international restaurants, has
two lounges, a café, and a bakeshop, across two wings that were considered a city
resort. It was originally Shangri-La’s Edsa Plaza Hotel, it was designed to recreate five-
star hotels such as those in Cebu and Boracay but within the Metro Manila. It is also a
99.99% foreign-owned hotel. As of 2018, Greg Findlay was appointed as the General
Manager of the Hotels and Resorts in the Philippines. He was tasked with overseeing
the management and the operation of the 696 hotel rooms and seven restaurants and
bars. In the 2002 renovations, General Manager Richard Riley directed and design the
amenities. The design team includes many specialists including Billy Llinas, Leese
Robertson Freeman Ltd., Warner Wong, Wilson Associates, BUZdesign, Adam Tihany,
and Alan Chang. With almost 40,00 hotel rooms, Shangri-La was on the top of the
game with its good brand philosophy wherein they want you to experience serenity and
quality service. They wanted to show humility, respect, courtesy, helpfulness, and
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sincerity that were all rooted in the Asian Culture. It has a unique brand architecture with
one corporate brand and four sub-branches that cater to different target customers. The
communication with the target market was on point. It was seen all overall their
campaign advertising. It gives justice to its people and workers under them with its
Asian roots. Shangri-La wants to bring Asian Hospitality to the World and let them
experience the unique values and principles at the very core and heart of all the Asian
cultures.
DUSIT THANI
Dusit Thani opened in 1948 in Thailand, Bangkok to introduce a new level of
service. They wanted to offer services that are warm, attentive, and gracious to have an
edge over their market competition. The Hotel has over 30 properties in over 13
countries and has been led by Thai national Suphajee Suthumpum. In the Philippines, it
has more than 22 companies and has a total of 300 employees employed across its
location. It was incorporated in the country in 1974 with its hotels and motels. Dusit
Thani’s first hotel was called “Princess” in Thailand and has 30 rooms and has a
distinction among the hotels in Thailand because of its modern features and its
swimming pool. Dusit Thani in Thai means “town in heaven” and its mythological name
in Thai was the fourth of the seven levels of heaven. Built-in 1976 and was called
Manila Garden Hotel and was later renamed Hotel Nikko Manila. In 1995, Hotel Nikko
Manila was acquired by Dusit International and started to purchase shares in the
holdings of the company is the Philippines Hoteliers Inc. (PHI) which is under Japan
Airlines Development Company Limited and JAL Trading Inc. Hotel Nikko Manila came
under the management of the Dusit Thani Hotels and Resort after the acquisition and
was under later renamed as Dusit Thani Nikko, Manila. It has a major renovation in April
and was later renamed Dusit Thani Manila in 2008. In November of 2006 Dusit Thani
added another brand extension which is the Dusit Lifestyle Collection with dusitd2
hotels and resorts. It expanded widely in the Philippines having branches on Cebu,
Makati, Taguig, and Davao which has 3 branches. Dusit Thani Manila was one of the
first Dusit Thani outside Thailand. In 2013, Alex Willats was appointed as the General
Manager at Dusit Thani Manila. He first joined the Dusit Thani in Bangkok as the
resident manager and was later promoted to general manager of the property. He
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spearheaded the significant improvement works to the hotel’s facilities and

infrastructures. As a result of their amazing job, he receives honors and awards from
the industry of restaurant services and accommodation. But in 2018, it was changed
and Stanley Lo is the General Manager of the Dusit Thani Manila. He wanted to now
only focus on the major trends in the outstanding services but he wanted to value the
rank and file which are crucial in fulfilling his vision of the hotel. They have partnered
with Metro Pacific Investments Corporation for the hospitality and real estate venture in
the country. It is a strategic partnership that will expedite the growth of Dusti Thani
Manila as one of the largest international operations in the country. The partnership is a
total of 1, 605.00 million pesos and is lined with the three-pronged strategy for
sustainable and profitable growth that includes balances, diversification, and expansion.
They have recently diversified into a food business that has strategic investment to
mitigate risk, expand to the customer base, and generate revenue from the adjacent
lines of the commerce. They valued their development, the media hub, investors
relations, partnership, sustainability, travel agents, and their career. They have a holistic
approach to their guest’s experience and value the time they have spent in and out of
the hotel. They have packages for business travelers and convention guests that
include airport transfer, spa services, late checkouts, and dining privileges. They also
have a flexible meal for privileged foreign travelers. They have a smaller menu but offer
a new menu that can cater to the hotel’s predicts. They have a strict rule for breaking
and stealing that is why the employees are careful. They also provide medical
assistance to guests who got injured while staying with the hotel. Their strategy focuses
on the balance of 50:50 domestic revenue, Expansion, and Diversification.
II. PERFORMANCE OF THE INDUSTRY
EDSA SHANGRI-LA
Shangri-La’s top competitors are Hilton Worldwide a hospitality company that
owns, leases, manages, develops, and franchises hotels and restaurants, Hyatt Hotels
is a hospitality hotel that offers luxurious hotels and resorts to its customer, Oberoi
Hotels Resorts is a luxury hotel, and lastly the Cox & Kings is a good travel company.
They offer services and facilities that are topped from the game. It varies from
accommodating the adults and children. It created perfect competition amongst its
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competitors because of the similarities and homogeneity of services being offered. In

2001, the Edsa Shangri-La hotel has a total of $1.3 billion contributing 9.7% in revenue.
The Shangri-La in the Philippines has a 343.8 value of the hotel properties and 937.0 in
the replacement cost of the hotel properties. The group’s equity interests of Edsa,
Boracay, and Makati are 100%, while in Cebu it has 93.95%, and The Fort has 40%. In
2020, it has only 49.0 revenue while in 2021 it has 189.9, the change was -74.5%. The
occupancy of the Philippines in 2020 was 19% and has a 52% decrease from the
previous year which has a 71% occupancy rate. Due to COVID-19, there is a decrease
in the revenue by 72% to $49.0 Million. In 2020, there is 100% of the medium and high-
risk F&B suppliers fulfilled stringent hygiene and safety standards. 85 hotels-maintained
ISO 22000: FSMS/HACCP certification for food safety. It has 36 certified green
buildings, a 55% waste diversion rate, 10 active Sanctuary projects, and has 54 species
at risk of global extinction that are protected. It has 41, 314 online colleagues, 2.1
million training hours, 51 hours, and has 100% Code of Conduct & Ethics Learning. It
also has 22, 489 volunteers that are increasing in 21, 700 value, and have 88 hotel
support that was rooted in nature initiative.

DUSIT THANI
Dusit Thani’s competitors in the industry were strong since the services and
products they are producing and serving are all the same. Their competitors are the
Dauin Diver’s Club Inc, Jiang Nan Shi Fu Food Corp., Isabella Royal Hotel & Suites
Inc., and Hospitality Development Inc. were all hotels and motels that were similar and
nearby to the Dusit Thani Manila. The competition between them created a Perfect
Competition with the services and products being offered being like each other. The
Dusit Thani Manila has a 88% of the shares holdings and has generated revenue for
2020 in 315, 222, and 21.65% in revenue for that year. In March of 2020, 40% of the
Dusit Hospitality Management College was supposed to be disposed of but the school
still hold it up in that year. In 2020, they have total assets of 21, 860,601 million, total
liabilities of 17, 700, 728 million, and the company’s equity was 3, 469, 432 million. They
have a total of 3, 320, 200 million revenues for 2020. But despite that, they have 1, 011
million in the net profit loss of the company because of the COVID-19 Pandemic. In
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2020, the Dusit Thani Manila RevPAR declined by -55% in YoY. But in May of that year,
they are the first hotel to have guests to quarantine coming from abroad. They do not
have competitors between April to July of 2020. Their digital Marketing launched the
new Dusit.Com in June of 2020 to let the people interact with them and enhance their
appeal among their customers. The conversion rate doubled in the first few months of
the launch; the returning audience increased by +11% in YoY. Because of the digital
launch, there is a 10.85% increase in their Dusit Gold Members. It generated over 9.3
million in various membership bases worldwide. As they offer one of the best services in
the market, they have gained the reputation of serving with warm, attentive, and
gracious they are also located in the premier financial district of Manilla. They combine
Thai Style with accents of the Filipino Hospitality that were known internationally. They
have over 500 luxury hotels rooms and suites that promote timeliness and uniquely Thai
traditions and cultures. They offer solace and satisfaction to their customers. They are
also a 5-star rated hotel meaning they mainly cater to people in the upper class and
their rates just reflect the job they have done for the past decades in the industry. They
have higher rates because of the onsite food and beverages in their room rate. They
can enjoy all the amenities the hotel is offering.
III. MAJOR PROBLEM/S ENCOUNTERED OR CURRENTLY ENCOUNTERED BY
THE INDUSTRY AND ITS POLICY IMPLICATIONS
EDSA SHANGRILA
In 2020, COVID-19 Pandemic happened that halted almost all the businesses in
the Philippines. Hotel Industry was one of the many businesses that were greatly
affected because of the lockdowns. It was mandated by the Government to follow strict
healthy protocols and advised that everyone should stay indoors and always wear a
face mask whenever going out. There are many mandates to the businesses nationwide
are temperature checks. The response of the Shangri-La was to roll out the enhanced
hygiene protocols across their employees and to comply with the recommendations
being made by the World Health Organization and other local authorities. Personal
Protective Equipment is also used to avoid direct contact with customers most
especially people at the front desk. Comprehensive Monitoring and Compliance
Regime, a group of hygiene quality teams (HQT) utilize a smartphone app to record and
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report the results of the cleanliness hotel inspections. The data gathered were tabulated
at a group level to facilitate transparency and accountability to adhere to the strict and
high standards. The enhanced hygiene protocol in the hotel will be a short-term solution
to the problem. Food Safety was also strict as the supplier of the food and beverages
are mandated to meet the stringent requirement for hygiene and food safety. The Strict
Enforcement of Food Safety Standard has 3 methods to follow in inspecting the food
and beverages from the suppliers. Fire Life Safety was an answer to monitor and
maintain the FLS systems by the group standard and the local code requirements. It is
to always check the lines and to avoid drastic fires that can kill guests and employees.
Security and emergencies are cross-functional emergencies. It is a response team that
was in the hotel 24/7. They operate and do emergency response procedures to
guarantee the highest safety to the guests, colleagues, and visitors. They also have
Data Protection to protect the personal information of the guests that will respect their
privacy and be compliant with the law and regulations. Food Safety, Fire Life Safety,
Security and Emergencies, and Data Protection are all long-term solutions to the
problems that the hotel will face. With the pandemic happened that shocked all the
employees a “Clock in, get in: Keeping Connected and Healthy in Lockdown” was
created to ease the mental state of the employees in the Hotel. It has self-care topics
like exploring the anxiety, exploring the positive habits, self-discovery through our
mindfulness, and developing ourselves. As a result, it helped many employees
understand themselves and discover many things about them that will uplift them in
these trying times, it can be a long-term solution because of how it values and tackles
the mental state of the employees. They also want to improve eco-efficiency and
mitigate the impacts on the environment. They want to reduce their ecological footprint
by saving energy, water and reducing the emissions of carbon dioxide. By doing that
they have to temporarily close some of their hotels and resorts and with that, a huge
decline happened. They also wanted to reduced purchasing energy like electricity, heat,
and chilled water that the hotel guest consumes. They wanted to let hotels produce
smaller amounts of renewable energy by using solar panels. Another long-term solution
for many companies is also reducing their energy consumption to lessen their
consumption and contribution to waste. Waste Management is another problem, as they
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are consuming more and contributing to the overflowing landfills, thus they wanted to
reduce the waste by advocating and promoting the abandoning of the single used
plastics and food waste. They can donate the food to many charities around the area for
the food not to be sent to the landfills to rot.

DUSIT THANI
The risk factors that the Dusit Thani encountered were the following: first was the
economic recession risk due to the risk induced by the COVID-19 pandemic. With the
imposition of the lockdowns and strict community quarantines, the hotel industry was in
a crisis. The confidence of the customers is ineffective, and the revenue ability of
businesses is at risk. But the company continued to nurture and sustain its business
relationship with its market and still has the potential and the purchasing power to travel
when the borders open. As tourism was drastically affected and has been subjected to
the great depression, the company still considers that travels locally and internationally
will resume in 2021 and remain vulnerable to the sudden lockdowns. To lessen such
risk the Company has partnered with local businesses to emphasize their driving non-
room revenues as the revenues are dependent on the domestic market. The
partnership with local businesses proved to be a success because it generates revues
and helps the company expand their market. They have captured a new and wider
market. The solution can be long-term with its success and the ability to capture a wider
and newer market can increase their revenue and help the small businesses to also
gain. The changes in consumer behaviour led to significantly induced due to COVID-19.
Because those online meetings or forums are held to avoid going outside of their
comfort. The hotel then hosted and let them enjoy the video conferencing technology.
Wellness and sustainability tourism made the consumers conscious. The company
wanted wellness and sustainable tourism to be in high demand in the future. They
redesigned their business ecosystem to be more holistic and customer, centric. They
have renovated and upgraded to meet the changes in the business environment and
future growth. they also redefined the products and services as they emphasize
sustainable tourism. Business Disruption was also at risk as the external factors are
highly volatile. They employ a crisis management plan to developed and ensure that
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they are prepared and are effective and have resiliency. They also get various
insurance to support the possible financial losses. Their human resource management
and cyber security were also at risk. The human resource management was effective
because of the plan to reduce the employees due to the decreasing number of
customers but they also have ventured to another business that needed recruiting and
retention of employees. Salary surveys were also sent to attract qualified talents. Cyber
security was at risk because of how vital the data and information of the clients,
employees, and the hotel were. The company has then improved their data security
system in their hardware and software, they also raised to the employees that they
should be aware of the relation between cyber and security in training arranged by the
external parties, and lastly their IT developed Business Continuity Plan to ensure that
the crisis will be handled well, and they are prepared for the future damage. They also
apply for cyber insurance. Almost all the solutions of the Dusit Thani Hotels were long-
term and can be used for a long time with upgrading and innovation.
IV. AREAS FOR FUTURE POLICY PRESENTATION
EDSA SHANGRI-LA
Shangri-La was a Hong Kong-based company, and it is Asia Pacific’s leading
luxury hotel. They are best known for the company showing Asian Hospitality. The
SWOT analysis for the Shangri-La hotels and resorts are. Their strengths mainly
focused on how they are leading the industry and have a well-established brand that the
customers and clients know, they also have recently developed their strategic changes
in the senior management, and they have good visionary forecasting and planning. With
their strengths, it created various opportunities for the chain to expand. They are always
renovating and re-positioning as they wanted to innovate the image, they present in
public but still have the classy Asian Hospitality they are known for. They have
renovated to gain more profit and to also re-position their market value. With the
renovation, capital expenditure will come to an end that will be profitable in the next year
and will give them long-term gains. They also reduce the foreign currency exchange
rate uncertainty using hedging. Hedging is a way for the company to minimize or
eliminate foreign exchange risk or a way to pass the risk on someone else. It can create
certainty in the cash flow that can help the budgeting and encourage management to
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tackle investment. It also reduces the possibility of financial collapse, and it can make
the company attractive to a risk-averse staff. With the usage of the hedging policies,
they are lowering their corporate debt every year and since then created an immense
scope of opportunity to bring financial stability with the hedging policies. They also
collaborated with the Taj Group, an Indian group to improve their market share in the
highly competitive hospitality industry. Their weakness is that they are very specific to
Asia-Pacific as there is many growing competitions in the market they need to expand
to Europe and America as they are also leaders in the hotel industry. With them unable
to expand to Europe and America, the global interest rate with them will increase
unfavourable because of how fast and innovative the expansion of the Hotel Leaders in
the West is penetrating the Asian Hotel Industry. With the impact of the pandemic, the
Hotel Industry was still recovering from the losses in 2020. In 2021, the travel restriction
was lifted, and tourism was allowed again that is when they are started to recover and
run the operation full time again despite the lockdowns and impositions of strict
community quarantine in Metro Manila. As the economy of the country was slowly
thriving and recovering from the losses, they are also thriving with the guests. The
company will continue to stay at the top with its many branches in Asia, Oceania, Fiji,
Europe, Africa, the United Kingdom, and North America. They will continue to expand,
lead the industry, and regain the losses in 2020 for the next 5 years.
DUSIT THANI
Dusit Thani is an international hotel that is engaged in the operations of
hospitality services. They operate their own hotels and have offers like hotel
management and franchise services. Their strengths are they are one of the leading
hotel groups in Asia and expanding to more, they also have a wide range of hotel
operations that is accessible to all the market bases, they also have strategic marketing
cooperation that is well-known in the international group hotel scene that allows them to
fast- track their expanding in the international market like the Bird group in India, they
also have the high ability to main their high-level reputation in the market, and the
locations of the hotel are amendable as it is easy to access. They have a growing
opportunity with their expansion in alliance with colleges. They have created this
positive image and reputation in the tourism and travel industry in their Hometown. They
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also employ well-developed strategic planning in their future growth. Their only
weakness is that they have low operating performance and have an inconsistent
operating margin with their competitors in the market. As they have a lot of competitors
in the market, they also have uncertainty in entering the European Countries that is one
of the major market customers, high risk of tpolitical instability in Thailand, and the high
risk of online fraud and internet hacking. That is why they developed a tracking system
and invest in cyber insurance to lessen the burden when hacking happened. They need
to grab the chance when the high demand for the Thai culture happened in the
international market scene as the cuisine and dances were being introduced in the
market. They also need to hire many employees to combat the labour shortage. They
are updating the old technology they have to the more advanced and innovative for
more efficient data storage. They also have increased environmental awareness and
have since then joined the green trend. Dusit Thani is one of the leading hotels and
properties in Thailand and has development plans for the company. They will continue
to pursue growth opportunities in the next 5 years. They will grow under the
management, they will continue to franchise, and lease or be in an investment
arrangement with other companies. They will continue to stay at the top and serve
graciously to their clients and guest. They will continue to showcase the Thailand
Culture mixed with Filipino Hospitality and be able to gain loss profits and revenues for
the next 5 years as the rollout of Vaccines is becoming faster making the country open
to foreign tourism. They will continue to stay afloat because of their good policies and
preventions to uncertain circumstances that will help them. Maybe, they will enter the
European Market and start expanding to the union introducing the Thai Culture,
Cuisines, and Dances that were introduced to the international market by various
personalities.
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REFERENCE
https://bmcpublichealth.biomedcentral.com/articles/10.1186/s12889-021-11746-0
https://t.co/MqWgzKPrGf
https://t.co/6rw7nEiRNJ
https://t.co/xBlibamRSW
https://t.co/9ew2D5bizY
https://t.co/gu00S69hqA
https://t.co/Q3WNkE0vxR
https://t.co/jcf2KlXCPt
https://t.co/pB06uFltO2
https://t.co/1PfYw7qAHc
https://t.co/6fjytFFYVI
https://t.co/zPkAOBNzHO
Dusit Thani (DUSIT) (dusit-international.com)