Hospitality Provision in Travel & Tourism

This report examines the role of the hospitality industry within the travel and tourism sector, focusing on the InterContinental Hotels Group (IHG). It details the interrelationship between hospitality and tourism, exploring how integration impacts the hospitality industry and IHG specifically. The report analyzes different integration types (horizontal and vertical), their implications for branding, globalization, and pricing strategies. A case study on IHG's potential new theme park project in London is presented, outlining the rationale, design, operational requirements, and human resource needs. The report concludes by summarizing the significant role of hospitality in tourism and the impact of integration on business development, highlighting the need for resources like human capital and financial investment in new ventures.

HOSPITALITY PROVISION IN
TRAVEL & TOURISM SECTOR

TABLE OF CONTENTS
INTRODUCTION .........................................................................................................................3
TASK 1............................................................................................................................................3
1.1) Role of hospitality industry and interrelationship between hospitality and travel and
tourism sector...............................................................................................................................3
TASK 2 ...........................................................................................................................................5
2.1) Implication of the integration to the hospitality industry.....................................................5
2.2) How integration affected the hospitality business of IHG...................................................7
TASK 3............................................................................................................................................9
3.1) Develop the rationale for new project of IHG......................................................................9
3.2 Developing a plan for a hospitality business which includes the operational requirements
of the business in relation to human resource requirement..........................................................1
CONCLUSION................................................................................................................................2
REFERENCES................................................................................................................................4

INTRODUCTION
Hospitality provisions are related to different regulatory frameworks which are made by
the government of the country for helping the travel, tourism, accommodation of the restaurant
industry (Alberts, 2014). This are made to avoid the legal issues in the hospitality business. Other
than this, it can also be said that hospitality business is also contributing in economic growth of
the nation. The present report is based on InterContinental Hotels Group (IHG) which is the
British multinational hotels chain that is headquartered in Denham, UK (About us, 2016). It has
more than 742,000 rooms and 5,028 hotels around 100 countries of the world. The report
explains different kinds of aspects of hospitality provisions. Other than this, the role of
hospitality industry in the travel and tourism sector has been explained. Interrelationship between
hospitality as well as travel and tourism business has also been explained. More than this,
implications of the integration to the hospitality industry has also been elaborated. Furthermore,
effect of integration on the business of the hospitality business has been analysed.
TASK 1
1.1) Role of hospitality industry and interrelationship between hospitality and travel and tourism
sector
Role of hospitality business in travel and tourism industry: Hospitality industry is a
wide field which includes facilities such as accommodation, travel and transportation,
entertainment, food and beverage, cruise line, event planning and membership etc. All of these
sectors are included in the travel and tourism business sectors (Bernard, 2013). Other than this, it
is also known as the major economic booster which provides maximum support in the
development of nation. It also defined as the corporation which provide lodging, food, beverage
and travel facility. The hospitality industry of YK provides 2.9 million jobs to the individual and
which helps in reducing unemployment in the country. Other than this, it also contributes in the
total GDP of the nation by £57 billion (Earls and Myers, 2010).
Further, it is considered as a highest growing sector of the country in compare to the
other industries country. According to this, it can also be stated that the hospitality industry also
provides many opportunities to large number of people who are doing business in the hospitality
management. There are different types of categories in the hospitality business such as resorts,

restaurants, travel and tourism entities and pubs and bars (Chou and et.al., 2013). The present
scenario states the interrelationship between hospitality as well as travel and tourism sector
business. The business of IHG is providing great hospitality services to their customers which
will aid in enhancing business of the travel and tourism industry (Golden and Earp, 2012).
Other than this, it is also providing comfortable and healthy services to the visitors so that
they will find it more attractive to visit the place. It is not only increasing the profitability of
business but also it is generating the flow of income within country which would result in
increasing national income of the country (Earls and Myers, 2010). IHG is also working on
arranging free visits to their customers through which this can make the people attracted towards
making plan for tours.
Interrelationship between the hospitality and tourism business:
Business of hospitality and travel and tourism both are dependent on each other. People
experience great living facilities than they will develop plan for tours which will result in
increasing the business of tourism (Kim, Vogt and Knutson,201). IHG is ranked among the top
hotel which is providing great facilities to people through which it is possible for them to gets
the people more attracted. The interrelationship can be more elaborated as follows: Travel purpose: Different type of purpose are there throguh which people visit different
kind of places in a country. Some people visit for business purposes, some for the
purpose of spending holidays. The individual who visits place for business purpose
requires some extra facilities such as providing facilities of WI-FI. For that, IHG is giving
facility of conference rooms and others so that they can complete their work in an
efficient manner (Golden and Earp, 2012). This will help to increase business of travel
and tourism business. Various exhibitions and conferences: This has proved to be a major support to the travel
and tourism business. As per the online available source, it is found that Malta invited
more than 5000 guest to attain the international conference. For example, the conference
of Oriflame is taken place in which every guest stayed in 4 and 5 star hotels which had
resulted in increasing business of the whole tourism industry (Legohérel and et.al., 2015). Package holidays: Package holidays are also playing an important role in developing
business of the tourism industry because of due to availability of the good living services

people like to visit the places. Other than this, various tour operators are also providing
different type of tour packages which is enhancing the business of tourism industry. More
than this, tour operators are also working on developing adventures tour packages
through which people are getting interest in planning their tour (Maggon and Chaudhry,
201). IHG is also providing the best tour packages to people which will help in
increasing profitability of the hospitality business.
 Attraction points: Various types of attraction points are there which is making people
interests in development of the tour planning. Through the development of the attractive
centers people like visit the various kinds of places such as museum, theme park and
natural parks.
TASK 2
2.1) Implication of the integration to the hospitality industry
Integration is basically refers to the merger of the organisation through which they can
get more profits in their business (McKercher and Tung, 2015). Integration take place when
both internal and external factors of the business successfully meshed up with the other company
with the aim of getting more profits in the market. Horizontal integration: It is refer to expanding the business on the consumer base. It can
be happened within those companies which are having the same level of distribution
chain. With the help of this , the company will be able to increase their market share.
This will help to gain competitive advantage in the market. For example, according to the
online source it is found that Hilton Hotel has purchased a hotel at Walt Disney World
Resort for €92,202,465. This process helps Hilton Hotel to make their customer more
attractive to wards developing tour plan (Oromendía and et.al., 2015). Other than this,
many airline industries are also working on doing mergers of their companies to get the
market share and get more profits. This will supports the business enterprises to make
people attracted towards the different kind of services. Other than this, For example
merger of Marriott and Starwood Hotels and resorts is also very successful. It is the
largest merger which has taken place in hospitality business (Legohérel and et.al., 2015).
It will helps both the companies in generating more revenue in the market. More than

this, through this, both the organisations will be able to face the market competition
(Slocum, Kline and Holden, 2015). Vertical integration:It is refers to that arrangement where supply chain of a company is
taken by any another company with the aim of making more profit in the market.
Basically it is related to acquire the distribution channel of one company by the other
company (Couture and et.al., 2015). For example, TUI has taken the many hotel brands
such as Robinson, Magic life, lberotel etc. with the help of this, the company will be able
to increase their market share and profits both.
Implication of integration on the business of hospitality industry:
According to the above described type of in integration it is said that integration will
help to increase the business of tourism industry (Maggon and Chaudhry, 2015). The implication
of the integration can be done as follows: Branding policies: Brand is related with the emotions and trust of people as people will
prefer to use the products which are having good image in market (McKercher and Tung,
2015). Other than this, brand is also has the major contribution in the making the business
successful in the market. Merge of the two companies will help IHG to increase their
brand value (Desai and Eric, 2015). More than this, it will also enhances the image of the
company in market. It affect on the pricing polices of the company as they are able to
provide more improved services to their customers. Globalization of the tourism industry: Increase in the globalization of the business of
tour industry will leads to increase in the business of whole tourism industry across the
world. Through this, IHG will be able to cover the more business area to get the profits of
the market. Apart from this, the business will also be able to find the more opportunities
of business development and it will also increases the business of the company globally
which leads to increase the image of the company across the world. Social media also
help to increase the business of the company as majority of people are available on the
social media sites to found various things (Kim, Vogt and Knutson, 2015). With the help
of this, IHG will be able to enhance the business of the company.
 Pricing policies of the company: Integration can make impact on pricing strategies of
IHG as merger of two different organisation will help to provide more improved services

to their customers that will help to increase the profits of the company. Through doing the
integration among the companies IHG will can make increase in their pricing as they can
giving more better facilities to the visitors and also it will provide a better experience to
the customers.
As per the detailed study it is found that IHG should use vertical integration through which IHG
will be able to make control over the supply chain of another company. It will help the company
to increase their supply chain in the market through which they will be able to cover more
market area to get profit (Legohérel and et.al., 2015). Other than this, horizontal integration will
help IHG to make control on the market competition through which they can get competitive
advantage in the market.
2.2) How integration affected the hospitality business of IHG
Integration has the major impact on the business of IHG. As through integration the
companies will be able to expand their business in the market. Through this, IHG will be able to
get competitive advantage in the market (Alberts, 2014). Apart from this, the organisation will
also be able to own the supply chain of another company through which it is easy to cover the
more market area. Other than this, it will help the company to develop their services through
which the customer will get more improved services. It also help to enhance the brand image of
the company in the market. The major improvement are elaborated as follows: Economies of scale: It will be possible to reduce the total operating cost of IHG through
which they will be able to gain more profit in the market. It will also help the
organisation to enhance their market share among the competitors (Bernard, 2013). Apart
from this, the company will be able to cover more market area to increase their business.
For example, integration of Hilton Hotel and Walt Disney will help them to cover the
new market area. Other than this, it will also help the company to finalize a fixed amount
of cost to be spended. Standardization:Through integration IHG will be able to make their services more
standard than before (Earls and Myers, 2010). This will help to increase interest of
people in the hotel services. Apart from this, the visitors will get more innovative and
unique thing which make their trip more excited. With the help of this, the organisation
will be able to find the scope of improvement in the services of the company.

 Reduction in the big organisations: Integration will results in development of few major
organisation through which it is easy to reduces the number of the large business entities
(Chou and et.al., 2013). If the companies will get started merging, it will leads to
reduction in the small sector hospitality business which is beneficial for IHG. Other than
this, it will also give support to the small and weak enterprises to save their business.
More than this, the tourism industry will be able to find the more better ideas to improve
their services (Legohérel and et.al., 2015). Control over the sub sectors: With the help of integration IHG can make control on the
sub sector of the business which leads to get more focused production. Through this,the
company will be able to develop more better strategies through which it is possible to get
better results from every sector of the business. IHG can make concentrated strategy to
get the goals more easily and effectively (Maggon and Chaudhry, 2015). More improved quality:As the integration is related to merging of the two business so it
is possible for the company to provide more better services to their customers. It will help
the customer to get more improved services (McKercher and Tung, 2015). Through this,
the company is also providing different kind of services that are related to technological
and other services. IHG is working on providing WI-FI and other type of services which
make the business people feel more comfortable during their stay. Other than this, they
are also working on providing some extra facilities to the kids through which they will
feel more good. Less independent business: Integration will leads to reducing the independent business
in the country through which the organisation will be able to expand their business.
Merger of the companies will leads to make increase the profits of the company because
it will reduces the number of small businesses in the market (Slocum, Kline and Holden,
2015). Through reducing the small and independent business enterprise, IHG will be able
to get more profit within the marketplace. Required huge amount of money: As integration is having many positive factors but on
the other hand it also has some negative factors in which the most effective is the expense
which have to be done by both the companies. For doing integration the companies have
to make a lot of expenses that are related to legal factors. So it is not possible for every

company to get integrated with another company (Kim, Vogt and Knutson, 2015). As if
IHG wants to be integrated with another company than they have to make a huge amount
of expenses for that for reducing the legal issues.
 Failure of integration: It is not possible that every time integration will carries profits for
the business sometimes it will get failure in its operations. If integration will get failure
than it will be huge amount of loss for the both organisation (Legohérel and et.al., 2015).
Other than this, it can also affect the customer base of both the company. Both the
business will face loss in that.
TASK 3
3.1) Develop the rationale for new project of IHG
IHG is now planning for developing a new theme park in London, United Kingdom. The
development of the theme park is related to ancient time in which roads and machine vehicles are
included.
Stage 1: Development of rationale:
As the demand of the customers are contiguously increasing for visiting the theme park
so it is beneficial for the company to develop the theme park. After looking at the attraction and
demand of the visitors IHG will be decide to develop the rationale of Fairy Land Park. Other
than this, IHG also wants to develop contract with other hospitality or tourism industries for
establishing huge the park. For this, IHG have to do research about the idea of type of themes
parks are there in the market. This will give them the idea about the perception and requirement
of people in the theme park. Other than this, it will give company thew idea about the market
competition.
For this, IHG have to create the model on for the project so that it will be easy to get the
idea of cost and expenditure which can be occur in the entire process. Other than this, It will
also make focus on look at the various areas of technology and creativity as well as healthy
research through which it will help the company to made the order to build a solid base for the
travellers. Other than this, the company have to make targets on the market through which it is
possible to get the goals easily. The target market decided is according to the demographic
segmentation. Demographic segmentation is related to make discrimination of people on the base
of age of the people. As people of young age more like to viStage 2: Design: sit such kind of

places. Other than this, the theme park should be located on the area that is having more space.
More than this, the place for the development of theme park has been purchased for £ 23000. the
money for development of the park has been arranged from bank loan as it is more easy for IHG
to take loan from the bank.
Stage 2: Design:
In the next stage it is necessary to prepare design of the park. The major things which are
included in the design are related to accommodation, interior, culture and exterior of the park.
The ambiance should be designed according to Disney theme that gives perfect looks to the park.
Special cartoon characters will come to entertain the kids and youngster. Other than this, the
light colors has been used to decorate the walls such as yellow and pink. More than this, water
park has also be there through which people will get more fun there.
Stage 3: Operation:
To make effective completion of the business operations IHG has to make effective
recruitment process to get the skilled and experienced people. For this, the company requires that
kind of people who are having experience in the travel and tourism sector and also have the
degree of tourism industry. More of that the people should be selected on the base of their ability
people to handle the conflict arise in the business. For making effective positioning of the
business the company will go for using their products and views which make the customer
attracted towards the restaurant.
Furthermore, penetration pricing method is used to make the people attracted towards the
therm park. This pricing method is related to settling the prices below the market rate. At the
initial level it will help to make the customer attracted. Apart from this, the company should also

have to take care about the various laws and regulations to reduce the chances of legal issues.
Illustration 1: Illustration 1: organisation structure
(Source: organisational structure, 2014)

3.2 Developing a plan for a hospitality business which includes the operational requirements of
the business in relation to human resource requirement
To make the plan for hospitality business. availability of the human resources is
necessary for organization. If organisation do not have the talented and experienced people then
it can lead towards failure due to inappropriate strategies. Presence of the skilled people will aid
to achieve the target easily because they can give the services at the workplace. For managing
different problems like food and beverages, safety concern and others, firm should make focus
on the staff for better improvement. To design effective plan, it is also necessary for IHG Hotel
to consider about the different rules and regulations.
Specialist qualifications: Due to existence of various departments, Hotel should select
qualified candidates so that they can achieve goals and objectives easily. Applicant which are
hired for manager must have the appropriate experience minimum 3 years. So person can be able
to manage hospitality activities at the workplace of IHG. In addition to this, for the post of
financier, candidate must have the proper degree so that he will be able to handle financial
operations in a appropriate manner (Bernard, 2013). Further, applicants of production division
must have better knowledge of cooking the food
Recruitment and selection policies: For hiring candidates, management of IHG must
have to take care about the legal rules and regulations so that they will not suffer with the legal
obligations. In addition to this, they should follow the discrimination and equal pay act to
decrease the complexities regarding of the legal policies. Generally, follow up these acts are
necessary because they aid to protect right of staff members at the workplace.
Promotional mix: Management of IHG can use many promotional techniques to promote
hospitality services in the market (Alberts, 2014). For this, hotel can use Social media, television,
newspapers and magazines better promotion its living, food and beverages. This process can aid
the corporation to create effective awareness regarding organisational products. In addition to
this, management of IHG plan an event on the opening of the theme restaurant.
Staffing by the functional area: To meet out operational requirements, management of
hotel can divide its functions in different department like finance, Human resource as well as
production (Earls and Myers, 2010). Generally, the main function finance department is to
manage financial operations like reduction of operational cost and forecasting for increasing
profit and revenues at the workplace. Along with this, the major function of HR department is to
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