Hospitality Provision in Travel and Tourism Sector: Analysis Report

This report delves into the crucial role of hospitality within the travel and tourism sector, emphasizing the importance of customer service and adapting to the changing global economy. It examines the scope of hospitality, including airlines and hotels, and highlights the interconnectedness of tourism and hospitality. The report analyzes integration strategies, specifically vertical and horizontal integration, within hospitality companies like Thomas Cook, discussing their impacts and consequences. It further proposes a rationale for hospitality based on product service concepts and suggests new hospitality organization models. The analysis covers the benefits of integration, such as cost reduction and increased market share, alongside potential challenges like reduced flexibility and the need for quality control. The report concludes by suggesting measures to mitigate the negative impacts of integration and enhance customer loyalty.

Hospitality provision in travel
and tourism sector

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
A. Scope of Hospitality in travel and tourism sector..................................................................1
TASK 2............................................................................................................................................2
A. Explanation in relation to integration in hospitality sector companies..................................2
B. Impact of integration and the manner in which its consequences will be responded.............4
TASK 3............................................................................................................................................5
A. Rationale for hospitality about product service concept........................................................5
B. New hospitality organisations proposal..................................................................................5
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
In the global economy it is very important that customers should be provided best
services according to the changing environment. For this purpose various laws and regulations
have been prescribed in relation to customer services and they will be known as hospitality
provisions. The needs and requirements of the visitors are different and it is required that they
should be dealt with in the most appropriate manner (Medlik, 2012). For this it will be needed
that the company should understand the roles and responsibilities in this regard so that work can
be carried out in the most effective and efficient manner. In this report various aspects in relation
to hospitality will be discussed in reference to Thomas Cook. In this the role of hospitality
industry, horizontal and vertical integration, its implications will be discussed and also a
proposal will be prepared.
TASK 1
A. Scope of Hospitality in travel and tourism sector.
Travelling is done by every person for one or the other reason whether it may be for work
or just for leisure and this travel for a specified period of time is covered under tourism. Small
business sector includes various operations and among them tourism is also included and this is
done under hospitality sector (Sigala, Christou and Gretzel, 2012). In this various services are
provided to the visitor that will include airlines service, hotel service and various other services
that are used by them on their trip. By this it can be said that tourism can never be successful
without the hospitality sector so they both are interrelated. Any activity that is done in order to
help others will be called as hospitality. When a person goes out he needs some facilities that
make him comfortable at that place and by them enjoyment will be achieved and those services
are provided by some or the other person which will be the one from the hospitality sector. There
are different organisations in today's world which have been formed with the aim of merging
these two sectors and providing the customers with the best facilities and also will be making
itself most successful. In Thomas cook also such facilities are provided in which all the services
required by a tourist are provided and that is named by them as package. This is offered to the
customer when they approach the company in relation to their travel and in this every thing that
will be provided to them together with the amount that will be charged is specified in advance.
1

These services are provided at such prices that are affordable for the person and in it all
the services that will be required from the travel to the food and accommodation are provided
(Mok, Sparks and Kadampully, 2013). Visitors are highly attracted by these packages as by it
they will not be required to move to different agents for the various services and will be able to
get all of them under one roof and that too at the most convenient prices. Due to the diversified
services that are provided the travel and tourism sector is growing at a very fast pace.
As these both sectors are connected so there are very high chances that scale and scope of
hotel industry will be achieving growth. For this Thomas cook will be entering into contract with
such organisations that will help it in providing various services to the customers. By this the
customers will be provided with the best facilities that will meet their expectations and when
they will be fully satisfied with the services then it will be helpful for the company in retaining
the customers for the long period of time. Due to the supportive services that are provided along
with the travel and tourism it can be ascertained that there is large scope for the hospitality sector
to grow by using this opportunity so that it can establish itself in the market. Thomas cook is
having a great advantage due to the hospitality services (Pulina, Detotto and Paba, 2010). It first
finds thae customers who will be availing the services and then their needs and requirements will
be ascertained and then measures will be taken in order to provide them with the most
satisfactory services. By this the organisation will be able to gain the loyalty of the customers
and also its image in the market will be improved which will help the company in maintaining
its position and also the scope will be expanded by which the growth of both the sectors will be
ensured.
TASK 2
A. Explanation in relation to integration in hospitality sector companies.
The main purpose due to which all the businesses are established is to earn more profits
and also to increase the market share. For this purpose it will be required that the cost that is
incurred in relation to the various expenses should be reduced and this can be done by managing
its services in the most appropriate manner (Smith and Puczkó, 2014). For this the main focus is
provided on the production of the services in house which means that the services will not be
outsourced to other parties. In this the strategies that will be made will be implemented by
collaboration. By this the other organisations will be integrated with the company and their
2

services will be used by the company. By this the funds will be saved that would have otherwise
been expended. The both the sectors will be benefited by this scheme as they both are dependent
on each other so they will be affected by the functions of one another. They both will help each
other in the process of integration as the tourism department will provide the information and
will try to bring more and more visitors and they will be then send to the hotels who will increase
their level of services that will be provided. In this manner both will be able to expand their
business and will increase their market share.
There are two types of integration that can be achieved which are vertical and horizontal
integration. In case of the vertical integration the organisation brings itself under some other
company and the main purpose of it is to decrease the cost and thereby increasing the overall
profitability of the company (Hudson and Thal, 2013). This can be further divided into three
parts which will include lateral, forward and backward. In case of the Thomas cook the method
that is adopted by it is the vertical integration in which various groups are operated by it which
are Thomas cook tours, Thomas cook Travel agents, etc. In order to decrease the cost of the
airlines it is also adopting forward vertical integration in which the business is merged with the
other organisation. By this the resources that are available will be used in the most effective and
efficient manner and the company will be able to have an additional advantage over the other
competitors as it will have the opportunity to provide its customers with some different services
and that too at affordable prices.
In case of the horizontal integration the main focus is provided to the increase of the
customer base and economies of scale and by this the profitability of the company will be
increased. In this it will combine with the company in the same sector which means some other
travel company by which more job opportunities will be created (Mak, 2011Tsang, 2011). Also
the resources will be increased and it will be able to provide the services to more number of
customers so that the market power will be increased and the cost will be decreased in the
international market. There are certain negative impacts also that will have to be borne under this
situation such as there will be lack of control, productivity of the company will be decreased and
also the decisions that will be taken will be less authenticated. So from the discussion that has
been carried out it can be said that both the sectors are highly interrelated. Also by following
these methods of integration there will be certain positive as well as negative impacts that will
have to be borne by them.
3

B. Impact of integration and the manner in which its consequences will be responded.
In any business there are various policies that are followed by the company and they will
be affected by the horizontal and vertical integration. There are many advantages that will be
achieved with the help of it such the efficiency with which the work will be performed will be
increased and also the internation trade will also be enhanced and company will be able to take
the benefit of it (Murphy, 2013). By this Thomas cook will be able to reach the markets that have
been unused till now and due to this its sale of services will be increased which will increase its
profitability. The resources that were wasting earlier will now be utilised in proper manner. But
by this the company will have to share its profits with the other organisation which will be
negative factor for it and also there are chances that the services may not be able to satisfy the
customers and by this company will be required to face the decline in its brand value.
In case of the vertical integration also business will have to face various impact and they
may be positive as well as negative. With the help of this the new services will be developed as
the investment that is made in the business is increased and will be used for the purpose of
development. As there will more new services so this prove to be advantageous as now
customers can compare the services of the company with other and there will be high chances
that they will choose Thomas cook and it will help in increasing the market share by which the
overall profitability will be enhanced (Heung, Kucukusta and Song, 2010). In this the company
will be using the services of others so it will be required that the quality that is provided by them
should be checked on the timely basis so the services that are provided will be of best quality. By
the integration the demand will be increased but it will become difficult for the company to
manage the demand in case of the fluctuations in it.
By this the flexibility of the company will be reduced as it will have to be dependent on
the other organisations and this will be the disadvantage of using vertical integration. There are
various impacts that will have to be born in this reference and for that various measures will be
taken by the company. The partners who are providing various services from different nations
and to ensure that they provide good quality it will be required that standards should be fixed in
this regard. The other measure that will be taken will be in relation to the maintenance of the
capacity, flexibility and the capabilities. By following these the dependency on the others will be
reduced and also the brand image will be improved by which the company will be able to
increase the loyalty of the customers thereby retaining them for the long duration of time.
4

TASK 3
A. Rationale for hospitality about product service concept.
In the case of the hospitality business it is required that proper rationale should be
developed and in this process there are various stages that will be required to be undertaken.
Product service concept is the method in which it is decided that what all will be provided to the
customers in relation to the tour that they are availing (Scott, Peeters and Gössling, 2010). There
are various services such as accommodation, food, travel that will be provided so it should be
ensured that the quality of the services that will be provided should be maintained at the most
appropriate level.
In the first stage the plan will be required to be developed in which various factors that
include market research, location, product and location will be considered. In this all these will
be identified and specified so that plan can be formulated about how all these can be achieved.
The details regarding the product will be provided and also if any license is required to be
obtained then that will also be done in advance.
The next stage that will be considered will be in relation to the designing. In this all the
factors that will enhance the outlook of the travel will be included. It must be ensured that the
ambience of the place should be good together with the interiors and exteriors of the rooms that
will be provided to them for the stay. It will also be required that culture should be given
importance and visitors should be provided things that are related to culture. Sometimes there are
certain individuals who have certain needs and requirements and it is the duty of the company to
cater to them in the proper manner.
At last it will be required that all the functions that are to be performed in the business
should be done in such a manner by which proper balance is established among them (Teng,
2011). By this all the work will be completed on the timely basis and the customer will be
provided with the best quality services which will give them all the satisfaction needed.
B. New hospitality organisations proposal.
In the hospitality sector there are various aspects that are required to be taken into
consideration and for that it will be required that a new proposal should be formulated by which
the growth will be achieved and this will be done by following various steps. Firstly it will be
required that the market research should be conducted in which the potential market in which the
5

expansion or the correction is required to be made will be identified. There are various other
organisation that are available in this sector and they are offering same type of services so it will
be required that some new service is provided to increase the market share by attracting new
customers (McIntosh, Lynch and Sweeney, 2011). The proposal will include various factors
which include product service concept, target market, location etc.
It is necessary that the target market in which the services will be required to be provided
should be identified by which the customer base will be increased. In the new proposal that is
being made the target will be on those who are from the medium and high class and will be
willing to spend their income for the travel and leisure activities. It is required that the whole
market will be divided in various segments as by this it will be easy to identify the needs of them
and in this manner it will be possible to serve them in the best manner that too in the less
duration of time (Darcy and Pegg, 2011). The arrangements in the company will be made in that
manner by which the customers will be satisfied in the best way possible.
In today's world everyone wants to visit the new and exiting locations. There are various
destinations which are famous for some or the other thing and it will be needed to identify the
place that will be most suitable and will be liked by majority of the visitors. This will be required
to be done as by this the company will be able to attract more people and in this way the proposal
will prove to be a success. Together with the destination other factors will also be considered
which will include the services in relation to the hotels and other things that are provided. So it
will also be ensured that the place that will be chosen should be such in which good facilities will
be provided at the most affordable prices.
In order to make the business success it is highly required that a suitable operations
model is chosen. One of the best among them will be the business operating model (Ip, Law and
Lee, 2011). In this it is required that the responsibilities should be clearly stated that will be
required to be fulfilled and it should also be specified that who will be doing them. For this it
will be required that proper staffing should be there and that will be possible when the
recruitment and selection process will be the one that will be best and by which the best
employees can be hired. It is required that proper promotion should be done about the business
and the proposal that is being offered by the company. For this various measures will be used
and the best among them is the social media. Company will also provide all the information on
the website. It will also be required that the price that will be fixed for the proposal should be
6

such that will be affordable and various standards will be set by which the quality of the services
that will be provided will be maintained.
CONCLUSION
From the above mentioned report it can be concluded that hospitality and travel and
tourism sector are highly dependent on each other and the functions that are performed by one
will be affecting the other one. For this Thomas cook is undertaking the method of integration by
which the resources will be utilised in the effective manner and business will be able to achieve
the required amount of growth. There are negative as well as positive impact of this which have
been discussed above and also the measures that will be used to overcome them have also been
provided. A proposal has also been made in which all the factors are mentioned that are required
to be considered to achieve the success.
7

REFERENCES
Books and Journal
Darcy, S. and Pegg, S., 2011. Towards strategic intent: Perceptions of disability service
provision amongst hotel accommodation managers. International Journal of Hospitality
Management. 30(2). pp.468-476.
Heung, V. C., Kucukusta, D. and Song, H., 2010. A conceptual model of medical tourism:
Implications for future research. Journal of Travel & Tourism Marketing. 27(3). pp.236-
251.
Hudson, S. and Thal, K., 2013. The impact of social media on the consumer decision process:
Implications for tourism marketing. Journal of Travel & Tourism Marketing. 30(1-2).
pp.156-160.
Ip, C., Law, R. and Lee, H. A., 2011. A review of website evaluation studies in the tourism and
hospitality fields from 1996 to 2009. International Journal of Tourism Research. 13(3).
pp.234-265.
Mak, B. L., 2011. ISO certification in the tour operator sector. International Journal of
Contemporary Hospitality Management. 23(1). pp.115-130.
McIntosh, A. J., Lynch, P. and Sweeney, M., 2011. “My Home Is My Castle” Defiance of the
Commercial Homestay Host in Tourism. Journal of Travel Research. 50(5). pp.509-
519.
Medlik, S., 2012. Dictionary of travel, tourism and hospitality. Routledge.
Mok, C., Sparks, B. and Kadampully, J., 2013. Service quality management in hospitality,
tourism, and leisure. Routledge.
Murphy, P. E., 2013. Tourism: A community approach (RLE Tourism). Routledge.
Pulina, M., Detotto, C. and Paba, A., 2010. An investigation into the relationship between size
and efficiency of the Italian hospitality sector: A window DEA approach. European
Journal of Operational Research. 204(3). pp.613-620.
Scott, D., Peeters, P. and Gössling, S., 2010. Can tourism deliver its “aspirational” greenhouse
gas emission reduction targets?. Journal of Sustainable Tourism. 18(3). pp.393-408.
Sigala, M., Christou, E. and Gretzel, U. eds., 2012. Social media in travel, tourism and
hospitality: Theory, practice and cases. Ashgate Publishing, Ltd..
Smith, M. and Puczkó, L., 2014. Health, tourism and hospitality: Spas, wellness and medical
travel. Routledge.
Teng, C. C., 2011. Commercial hospitality in restaurants and tourist accommodation:
Perspectives from international consumer experience in Scotland. International Journal
of Hospitality Management. 30(4). pp.866-874.
Tsang, N. K., 2011. Dimensions of Chinese culture values in relation to service provision in
hospitality and tourism industry. International Journal of Hospitality Management.
30(3). pp.670-679.
Online
Travel and tourism. 2017. [Online]. Available through:
<https://www.pwc.co.uk/industries/hospitality-leisure/insights/travel-and-tourism.html>
. [Accessed on 7th July 2017] .
Travel, Tourism & Hospitality Research. 2017. [Online]. Available through:
<https://www.mrs.org.uk/event/conferences/travel,_tourism_and_hospitality_research_/
course/5332/id/13642> . [Accessed on 7th July 2017] .
8