Contemporary Hospitality Industry

This presentation focuses on the internal and external factors impacting the hospitality industry, including PESTLE analysis, SWOT analysis, and the impact of external factors on firm development. It also discusses the implications of current and potential trends in the industry and evaluates the ability of the hotel industry to develop products and services to meet these trends. Examples and case studies are provided throughout the presentation.

Contemporary Hospitality
Industry
LO3 - LO4

Table of Contents
 Introduction
 PESTLE factors affecting the development of firms in Hospitality industry
 SWOT analysis for hotel industry
 Impact of external factors on the development of firm using specific
examples
 Implications of the current and potential trends in hospitality industry
 Evaluation of the ability of the hotel industry to develop products and
services for meeting the trends
 Impact of external factors on current trends and development using specific
examples
 Conclusion
 References

Introduction
The current presentation will focus on the internal as well as external
factors that impacts the hospitality industry and will throw light on the
issues being faced by this industry currently. Trends and potential
developments influencing the industry will also be discussed
effectively

PESTLE factors affecting the development of firms in Hospitality industry
 POLITICAL – Stability of the political environment, policies, laws and
the regulations affect the hospitality industry as a whole.
 ECONOMIC – Economic factors plays a major role in hospitality industry
as it impact the crucial decisions such as marketing and managerial
decisions as well as implications.
 SOCIAL – Social factors plays a role which help in developing stronger
relations in the hospitality industry.

Continued…
 TECHNOLOGICAL – Utilisation of the new technological factors,
inventions are an important factors that affect the hotel industry in a lot
many ways.
 ENVIRONMENTAL - When we advance the travel industry there are a
huge number of travellers released yearly in the nation, without legitimate
arranging, there will undoubtedly be not kidding natural and supportability
issues.
 LEGAL – Legal factors comes as discrimination law, tourism laws,
consumer as well as employment laws.

SWOT analysis for hotel industry
Strength:
 Safe bode which is away from home.
 Local economy is hugely impacted.
 High employment opportunities.
 Profit margins are always higher.
Weakness:
 Rates of the hotels are high
 Tax rates are not favourable to the industry

PESTEL analysis of Costa Coffee
Political
 Execution of free trade area
 Increase in the value added tax rates
Economic
 Buying power of the people is limited
 Unemployment rate is high
Social
 Growing living standard of people in UK is increasing the demand for quality
products
 Decreasing alcohol consumption among the population

Continued..
Technology
 Selling through E-commerce methods is prevailing in the current world
 High-tech methods such as EPOS are in trends
Environmental
 Higher request on coffee production because of raised environmental
concern
 Carbon emission reduction
Legal
 High labor and taxes in coffee beans origins
 Agreement with FSA

SWOT analysis of Costa Coffee
Strength
 Largest coffee chain in UK
 High base of customer
 Large profit margin
Weakness
 Only single product line
 Store layout concentration
 Coverage is small

Continued..
Opportunities
 Coffee is a mainstream trend these days
 Market gap in international student
 Few outside services in transportation hub
Threats
 Threats from carbonated drinks
 Competition in the market
 Threats from new cake shops selling coffee

Continued..
Opportunities:
 Increase in the tourism day by day
 Restaurants segment is also being explored
 Full year in flux of the customers.
Threats:
 High Competitiveness
 Conditions existing are not very favourable.
 High entry barriers.
 Affected by the country’s economy and tourism downfall.

Impact of external factors on the development of firm using specific examples
Kentucky Fried Chicken (KFC) is a promise of fast meat restaurants founded in
the year 1997 in the United States. The restaurant has been marked as one of the
best fast food outlet selling fried chicken. Because of the economic
liberalization act of India, KFC started its operation in India
Impact of external factors
 Considered many health and safety guidelines
 Labelling food by FSSAI
 Animal right Campaign
 Varied needs of the customers like vegetarian options
 Health concerns
 Home delivery and use of apps and mobile websites

Implications of the current and potential trends in hospitality industry
 Explosion of technology
 Influx of international visitors
 Destination promotion
 Changing behavior of guest
 Uneven distribution of demand

Evaluation of the ability of the hotel industry to develop products and services for meeting
the trends
 Hospitality business modify and update their portfolio mix for meeting
out the altering needs of the target market
 They add new brand to its range
 Efficient value added services for good relationship with the customers
 Effectively managing their service employees through training,
compensation, behaviour based evaluation and empowerment

Continued…
 Scouring websites as well as blogs
 Networking
 Effective communication and process management

Impact of external factors on current trends and development using specific examples
External factors including political, legal and societal framework can
influence the current trends in the hospitality industry a lot. Due to the
change in the regulations of government rules or any country’s policies,
hospitality industry may need to alter its current and potential trends to
gain the competitive edge and sustain in the market (Davis and
Lockwood, 2012).
 McDonalds entry into the Chinese market – When McDonalds entered
into the Chinese market, it faced the issue of using the current trend of
social media marketing for the promotion. As social media marketing
is ban in China, it had to develop a new promotional marketing to
create awareness about its presence in the Chinese market.

Continued..
 International travellers faced issue while travelling to Myanmar-
Due to the recent outbreak of migration and pushing out of
Rohingya Muslim from the Myanmar , many international travellers
faced issue in travelling to Myanmar especially Muslim Travellers,
this led to decrease in the influx of the international travellers in
Myanmar and resulting in the decrease economy contribution from
hospitality industry (Brymer, Mall and Brymer, 2017).

Current and future trends with examples
People these days are becoming health conscious and are more concerned
about their health issues. This trend is positively impacting the companies.
Here are some of the examples:
 Greggs – It is a famous bakery chain of UK. They have introduced a vegan
sausage roll after 20000 people signed a petition by animal welfare
organization. they have chosen different approach and adopted this trend
positively.
 Subway – Soon after Greggs, subway also introduced vegan sub. the new
product will help people suffering from obesity and will protect the
environment as it involves less packaging and use of less plastic

Conclusion
The current presentation has significantly thrown light on various
external as well as internal factors that impacts the hospitality industry. It
is vital for the hospitality businesses to addresses these factors and their
impacts in order to function and operate smoothly.

References
 Aragon-Correa, J.A., Martin-Tapia, I. and de la Torre-Ruiz, J. (2015)
Sustainability issues and hospitality and tourism firms’ strategies: Analytical
review and future directions. International Journal of Contemporary
Hospitality Management, 27(3), pp498-522.
 Barron, P. (2008) Education and talent management: Implications for the
hospitality industry. International Journal of Contemporary Hospitality
Management.
 Baum, T. (2010) Implications of hospitality and tourism labour markets for
talent management strategies. International Journal of Contemporary
Hospitality Management.
 Chon, K.S. and Yu, L. (2012) The international hospitality business:
Management and operations. Routledge.

Continued…
 Poulston, Jill (2008) Hospitality workplace problems and poor
training: a close relationship. Journal of Contemporary Hospitality,
(20)4, pp.412-427.
 Brymer, R., Mall, L. and Brymer, R. (2017) Hospitality: An
Introduction. 16th ed. Dubuque: Kendall Hunt Publishing.
 Davis, B. and Lockwood, A. (2012) Food and Beverage
Management. 5th ed. Oxford: Routledge.

Thank You