Analysis of Factors Impacting the Hospitality Industry (IHG Hotel)

This report provides an analysis of the contemporary hospitality industry, with a specific focus on IHG Hotel. It begins with an introduction to the industry's economic significance and the importance of customer satisfaction. The report then delves into internal and external factors impacting the industry, including political, economic, social, and legal considerations, alongside a SWOT analysis of IHG Hotel. The report explores current and potential trends, such as changing consumer lifestyles, digital revolution impacts, and emerging markets, and discusses how the hospitality industry, particularly IHG, should respond to these trends. The conclusion summarizes the key findings, emphasizing the importance of understanding external factors, responding to trends, and utilizing SWOT analysis for effective business management and performance.

The Contemporary
Hospitality Industry

Table of content
Introduction
Internal and external factors that impact the hospitality
industry and how they relate to current issues facing the
hospitality industry
Current and potential trends and developments affecting
the hospitality industry
Conclusion
Reference

Introduction
 Now a days, Hospitality industry has become a economic point which have contributed
in making social economy that increases business performance. People wants to spent
their holidays so they are required to select a best hotel and services that can make
them satisfied and happy after obtaining services. This assignment is about IHG hotel
that provides different services.

Political, social, economic,
technological, legal and environmental
that affected the development of
organization
In business environment different types of factors which are
required to focuses by management in order to run the business
and know which factor has impacted on business. This is
important for IHG hotel to consider all factors that can affect
organisation development such as:

COST AUDIT REPORT
Under section 233B of the companies Act, the
cost auditor has to submit his report to the
central Government in the prescribe form and
simultaneously send a copy of the report to
the company . The company has to furnish to
the central government full information and
explanations on every reservation or
qualification contained in the cost audit with
in 30 days from the date of receipt of the
copy of the report.

Cont..
 Political: This involves tax rates, political stability and governmental rules
that are needed to follow while operating a business. In UK, political stability
is stable where IHG hotel is operating its hospitality industry by providing
hotel services. In case of instability it will be difficult for organisation to
develop the business activities.
 Economical: This consist inflation arte, interest rate, GDP rates, population
etc. that should be consider by business concern in order to run business. IHG
hotel is operating and running business in UK effectively as there is less
inflation rates that attracts customers to book the rooms at less cost. This
increases organisational performance.

Cont..
Social: In society different types of people are living who have
different demand and lifestyle so this may be difficult for
hospitality industry to be sustain and operate the business. IHG
Hotel is giving preference to customers demand and arrange
the rooms accordingly which make them satisfied and helps to
develop the organisation effectively.

Cont..
Legal: For running business it is important to follow all
legislation which are related to business and employees can help
to attracts customers. This may be affected factor for IHG
because all legislation should be follow become difficult for
organization that can impacts negatively.

Cont..
 The SWOT analysis of IHG hotel are as defined:
Strength Weakness
 This is larger size hotel that is having
842,749 guest rooms.
 It has 5656 hotels near by 100 countries.
 High skilled workforce through successful
training and development programme.
 Superb performance in new markets.
 International marketing strategies that
helps to face the competition.
 High level of customers satisfaction.
 This organisation has build a strong
dealer community by maintaining relation
with distributor and tour operators.
 Days inventory is higher than competitors
that raise more capital to invest the money.
 It is require more invest in new technology.
 The ratio of profitability and net
contribution % is below than industry
average.
 Financial planning is not done properly that
increases cost.
 Limited success outside core business.

Cont..
Opportunities Threats
 Decreasing cots of transportation
due to low shipping prices.
 Retaining of existing and new
customers from online method.
 Opening of new market as
government supports such industry.
 Focuses on customer needs and
wants.
 New trend in consumer behaviour.
 Low inflation rate.
 Uses to digital revolution.
 Shortage of skilled workforce.
 Gaps in customers and employees
understanding.
 Continuously changing in consumer
behaviour
 Seasonable demand of hospitality
services.
 Changes in political factors or system
that may affects the IHG hotel.
 Providing similar services and
products by other hotel.

Factors affecting supply and demand in
IHG:
From the above discussion it has defined that political factor,
legal and social factor are most influencing factor which may
affect the business negatively and may limits the operation. This
is important for management to focuses on such factors, customer
lifestyle and needs so products and services of IHG hotel can be
sale effectively. This helps to operate the business and increase
the profitability in competitive environment.

Implications of current and potential
trend in hospitality industry
The drivers of current trend and development in context to IHG
Hotel are as defined:
Changing consumer lifestyle trend: This is influencing factor
which can affect the business operation in competitive business
environment. In current trend, the lifestyle and needs of people
are changing day by day where management is required to
provide kind of products and services.