Download - ITH Chapter04
-
7/30/2019 ITH Chapter04
1/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.Pearson Prentice HallUpper Saddle River, NJ 07458
Chapter 4The Hotel Business
-
7/30/2019 ITH Chapter04
2/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.Pearson Prentice HallUpper Saddle River, NJ 07458
After Reading and Studying This
Chapter, You Should Be Able to: Define the following terms: hotel franchising,
partnerships, leasing, syndicates, and
management contracts Classify hotels by type, location and price Explain vertical integration Name some prestigious and unusual hotels Describe the effects of a global economy on
the hotel industry
-
7/30/2019 ITH Chapter04
3/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.Pearson Prentice HallUpper Saddle River, NJ 07458
Franchising Allows for a company to expand
rapidly
Uses other peoples money(franchisee)
Franchisor
The company Over 180 franchised hotel brands
in North America today
-
7/30/2019 ITH Chapter04
4/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.Pearson Prentice HallUpper Saddle River, NJ 07458
Figure 4-1Franchised Hotels Among the Top 10 Corporate
Chains
-
7/30/2019 ITH Chapter04
5/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.Pearson Prentice HallUpper Saddle River, NJ 07458
Figure 4-2
Top 10 Management Companies
-
7/30/2019 ITH Chapter04
6/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.
Pearson Prentice HallUpper Saddle River, NJ 07458
Trends in Franchising Curb appeal (fresh looks) Location near highways, airports and
suburbs Expansion in smaller cities New markets in proximity to golf
courses and other attractions Foreign expansion to increase brand
awareness
-
7/30/2019 ITH Chapter04
7/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.
Pearson Prentice HallUpper Saddle River, NJ 07458
Benefits Set of plans and specifications for
building
National advertising Centralized reservation system Participation in volume purchasing
discounts Listing in the franchisors directory Low fee percentage charged by credit
card companies
-
7/30/2019 ITH Chapter04
8/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.
Pearson Prentice HallUpper Saddle River, NJ 07458
Drawbacks Lack of operational power; mustconform
High fees both to join andongoing
Central reservations produces 17-26% of reservations
Must meet standards as set by
franchisor
-
7/30/2019 ITH Chapter04
9/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.
Pearson Prentice HallUpper Saddle River, NJ 07458
Benefits and
Disadvantages for Franchisor Benefits
Increased market share/recognition Up-front fees
Disadvantages
Need to be careful in selection offranchisees Difficulty in maintaining control of
standards
-
7/30/2019 ITH Chapter04
10/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.
Pearson Prentice HallUpper Saddle River, NJ 07458
Management Contracts Contract
The Players Owner - financial responsibility
Management company - operationalresponsibility
Fee structure Trend toward expansion of contract
provisions
-
7/30/2019 ITH Chapter04
11/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.
Pearson Prentice HallUpper Saddle River, NJ 07458
Hotel Rating Services Rating Services
AAA American Automobile Association
Diamond Award
Mobil Travel Guide Five Star Award
-
7/30/2019 ITH Chapter04
12/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.
Pearson Prentice HallUpper Saddle River, NJ 07458
Ways to Classify Hotels Classifying Hotels
LocationTypes of services offered
Market price levels
-
7/30/2019 ITH Chapter04
13/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.
Pearson Prentice HallUpper Saddle River, NJ 07458
Figure 4-5
Hotel Rating Guide
-
7/30/2019 ITH Chapter04
14/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.
Pearson Prentice HallUpper Saddle River, NJ 07458
Location Center city hotels Resort hotels
Airport hotels Freeway hotels Casino hotels Full service Convention Economy Extended stay Bed and breakfast
-
7/30/2019 ITH Chapter04
15/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.
Pearson Prentice HallUpper Saddle River, NJ 07458
Hotels by Price Segment Budget - $29-$39
Economy - $40 - $60
Mid-price - $60 - $100
Up scale - $100 - $200
Luxury - $140 - $450 All-suites - $95 - $175
-
7/30/2019 ITH Chapter04
16/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.
Pearson Prentice HallUpper Saddle River, NJ 07458
City Center Hotels Public transportation available
for business or leisure
Range of accommodations andservices
Typically have a signaturerestaurant
-
7/30/2019 ITH Chapter04
17/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.
Pearson Prentice HallUpper Saddle River, NJ 07458
Resorts Originally began due to
rail travel
Greenbrier in WestVirginia www.greenbrier.com
The Halekulani in Wikki,
Hawaii www.halekulani.com The Ritz Carlton Kapalua
in Maui, Hawaii
www.ritzcarlton.com
http://www.greenbrier.com/http://www.halekulani.com/http://www.ritzcarlton.com/http://www.ritzcarlton.com/http://www.halekulani.com/http://www.greenbrier.com/ -
7/30/2019 ITH Chapter04
18/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.
Pearson Prentice HallUpper Saddle River, NJ 07458
More on Resorts Captured Clientele
Food service isunique
Diversifiedmarketing mix Children Groups
Eco-tourism
-
7/30/2019 ITH Chapter04
19/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.
Pearson Prentice HallUpper Saddle River, NJ 07458
Vacation Ownership Fastest growing segment of travel
industry Time share
A condo that is owned Purchaser uses for a specific period of time each
year
Vacation club Purchase points that entitle purchaser to use of
facility Not real estate based
-
7/30/2019 ITH Chapter04
20/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.
Pearson Prentice HallUpper Saddle River, NJ 07458
Vacation Ownership Estimated that 2 million households
own vacation intervals at 3500 resorts
in almost 90 countries Helps ensure purchaser todays prices
for tomorrow
Yearly maintenance fees Fixed or floating times Example
www.rci.com
http://www.rci.com/http://www.rci.com/ -
7/30/2019 ITH Chapter04
21/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.
Pearson Prentice HallUpper Saddle River, NJ 07458
Airport Hotels High occupancy due to location Business, group and leisure travelers Full service 200-600 rooms Convenient location Airport shuttle service Economical pricing
-
7/30/2019 ITH Chapter04
22/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.
Pearson Prentice HallUpper Saddle River, NJ 07458
Freeway Hotels Prominent in the 1950s Easy access to roadways Park outside the room entrance Example
Motel 6 www.motel6.com
http://www.motel6.com/http://www.motel6.com/ -
7/30/2019 ITH Chapter04
23/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.
Pearson Prentice HallUpper Saddle River, NJ 07458
Casinos Heavy growth segment Low room rates Subsidized food and beverage Themes are popular
500 plus guest rooms Variety of food operations Contains a gaming room
-
7/30/2019 ITH Chapter04
24/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.
Pearson Prentice HallUpper Saddle River, NJ 07458
Convention Hotels Meet the needs of large groups
500 plus rooms
Larger public areas to accommodategreater public demand
Banquet areas within and around thehotel
High percentage of double occupancy
Full-service oriented
-
7/30/2019 ITH Chapter04
25/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.
Pearson Prentice HallUpper Saddle River, NJ 07458
Full-Service Hotels Typically Business Oriented Multiple food and beverage
outlets Meeting and convention services
Chain representation Doubletree www.doubletreehotels.com
Sheraton www.sheraton.com
http://www.doubletreehotels.com/http://www.sheraton.com/http://www.sheraton.com/http://www.doubletreehotels.com/ -
7/30/2019 ITH Chapter04
26/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.
Pearson Prentice HallUpper Saddle River, NJ 07458
Economy/Budget Hotels Represents 12 percent of total hotel rooms Accomplished 37 percent of industry growth
Average room rate of $48.68 However, profit revenue is slow with an annual
rate of 1 percent Also considered budget hotels Clean rooms Reasonably sized and furnished Continental breakfast
-
7/30/2019 ITH Chapter04
27/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.
Pearson Prentice HallUpper Saddle River, NJ 07458
All-Suite Cater to guests for an
extended period
Reduction in rate based onlength of stay
More space than typical hotel Examples
Embassy Suites
www.embassy-suites.com
http://www.embassy-suites.com/http://www.embassy-suites.com/http://www.embassy-suites.com/http://www.embassy-suites.com/http://www.embassy-suites.com/ -
7/30/2019 ITH Chapter04
28/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.
Pearson Prentice HallUpper Saddle River, NJ 07458
Bed and Breakfasts
A home away from home
Accommodation with an ownerwho lives on premises
Maintains a few rooms
Offers breakfast Personable and quick service
-
7/30/2019 ITH Chapter04
29/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.
Pearson Prentice HallUpper Saddle River, NJ 07458
Vertical Integration Lodging companies meeting the
needs of several types of guestsbased on price, facilities and
amenities Choice hotels which have several
chains that meet its diverseclientele
Luxury - Clarion Mid-scale - Quality Inn/Suites Budget - Comfort Inn Economy - Sleep Inn
www.hotelchoice.com
http://www.hotelchoice.com/http://www.hotelchoice.com/ -
7/30/2019 ITH Chapter04
30/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.
Pearson Prentice HallUpper Saddle River, NJ 07458
Marketing Consortiums
Also called referral organizations Numerous independent properties
unite to compete with themarketing power of chainoperations
Similar benefits as franchises, ata lower cost
Provides incentives for clients
-
7/30/2019 ITH Chapter04
31/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.
Pearson Prentice HallUpper Saddle River, NJ 07458
The Best Hotels
Some previous winners:
Oriental Hotel in Bangkok,Thailand
Regent of Hong Kong
Bell-Air of Los Angeles
-
7/30/2019 ITH Chapter04
32/33
Introduction to Hospitality, Fourth EditionJohn Walker
2006 Pearson Education, Inc.
Pearson Prentice HallUpper Saddle River, NJ 07458
Unusual Hotels
Ice Hotel in SwedishLapland
The Treetops Hotel in Kenya Underwater Hotel in
Australia Capsule Hotel in Japan The Burj Al Arab in Dubai
-
7/30/2019 ITH Chapter04
33/33
Introduction to Hospitality, Fourth Edition
2006 Pearson Education, Inc.
Pearson Prentice Hall
Trends
Capacity control
Safety and security Assets and capital
Technology
New management Globalization