Hospitality Sector: Integration and Business Development Analysis

This report delves into the interrelationship between hospitality and the broader travel and tourism sector, emphasizing the importance of providing quality services to meet consumer expectations. Using TUI Group as a case study, the report explores the interconnectedness of hospitality, transportation, and accommodation services. It analyzes the implications of integration, including vertical and horizontal strategies, on the hospitality industry, focusing on how integration impacts business operations and market share. The report further develops a rationale for a hospitality business, considering target market analysis and strategic location, and proposes a business plan outlining operational requirements to enhance customer satisfaction and achieve long-term sustainability. The analysis covers key aspects such as interrelationships, integration, and business strategies within the hospitality and tourism sector.

Hospitality Provisions
in the Travel
&Tourism Sector

Table of Contents
INTRODUCTION......................................................................................................................4
TASK 1......................................................................................................................................4
1.1 discuss the interrelationship between hospitality and wider travel and tourism business4
TASK 2......................................................................................................................................5
2.1 analyse the implications of integration to the hospitality industry..................................5
2.2: Discuss how integration has affected a hospitality business...........................................6
TASK 3......................................................................................................................................7
3.1:Develop a rationale..........................................................................................................7
3.2: Develop a plan for a hospitality business including the operational requirements.........8
CONCLUSION........................................................................................................................10
REFERENCES.........................................................................................................................11

INTRODUCTION
Travel and tourism are the part of hospitality industry and it is one of the fast growing
industry. As people travel to spend vocations, to attend the business meetings, sports and
other programmes. There are various services which are provided by the hospitality industry
which involves accommodation, transportation, food and beverage and other entertainment
facilities. It is important for the travel and tourism business to fulfil the expectations of
consumers by providing quality products and services. To better understand this concept TUI
group has been chosen which is a travel and tourism company and it belongs to United
kingdom. As organisation has a collaboration with travel agency, hotel, airlines & ships. It
makes control over 1800 travel agency & 300 hotels & resort. In this report, there are various
topics has been covered such as: interrelation among hospitality & wider travel and tourism
business, implication of integration to the hospitality and how it affects the business. Apart
from this it also discuss about to develop a rationale for the chosen project and to develop a
plan for a hospitality business.
TASK 1
1.1 discuss the interrelationship between hospitality and wider travel and tourism business
There is an interrelationship between hospitality and travel and tourism business. As
the travel & tourism comes under hospitality industry and in the success of this industry
tourism plays an important role. It is most necessary for the companies to provide better
products and services in order to satisfy the needs of consumers. It involves: transportation,
event planning, theme park etc. As the facilities and services which are provided by the
hotels are includes, club, bar, pub, swimming pool etc. There are various facilities which are
provided by the UTI Group as per the requirement of consumers. It is important to understand
the needs of consumers so that it can generates more revenue as a result organisation will able
to capture more market share. To sustain for a long term it is important for the tourist industry
to provide the products and services as per the needs of travellers and that they become loyal
with the corporation (Iancu and et. al., 2013).
There are various companies which are involved in this sector because of high
growth and scope in the business. It is require for the company to provide quality services at

affordable price so that consumers can retain and does not go outside to find any alternative
or substitute. As the tourism industry provides various services and facilities to the tourist and
so that they feel happy and get better experience. The services which are provided by the UTI
group are based upon demand and as per the budget of the consumers. As hotel and travel
industry both are linked to each other. As an instance, if there are family members who want
to travel at different locations and for that purpose they have to make contact to the specific
tour operator of United Kingdom which provide best package with quality services (Ghany
and Latif, 2012). The services which are provided by it as food and beverage,
accommodation and other facilities. As hotels will provide the food & accommodation to the
tourist and with it tour cannot be possible so it can be said that hotel and travel industry are
interlinked to each other. As TUI is famous company who provide the services which are
related to the travel and tourism business. It provide travel and tourism services and provide
the facilities which are related to accommodation and food because it has contact with the
hotels and while tour the tourist visit the hotel and get the services and facilities as per their
desire so that their needs can be satisfy. As the TUI group has contact with the
Intercontinental hotel group which provide various facilities and services to the tourist of TUI
Group which involves, accommodation, breakfast, lunch, dinner, pool, bar, swimming and
other facilities as per the desire of consumers. So it has been analysed that hospitality and
travel and tourism business are interlinked with each other and it contribute in the growth of
hospitality industry (El-Gohary, 2016).
TASK 2
2.1 analyse the implications of integration to the hospitality industry
Integration is beneficial for the growth of company and generally corporation choose
this so that it can maximize its reach by focusing on economies of scale as a result they can
lower its operating cost. To increase the reach and minimize the cost the production there are
various companies which prefer outsourcing so that their time as well as money can be save
and TUI Group can make integration which is helpful for the growth of company and there
are two types of integration which can be seen in the organisation which involves: vertical
integration and horizontal integration (Lam and McKercher, 2013). When a company buys its
suppliers or buys other corporation in distribution chain than it is consider as vertical
integration. It is beneficial for the business of corporation because it minimize the cost and
maximize the revenue. For that purpose company can provide training to the employees

rather than employing from outside. As organisation will emphasis to deliver quality products
and services and focuses to maintain standard of services. As an instance, company try to
provide the services to another city and it has good reputation so consumers will attract
towards the organisation. TUI Group has focuses to provide better services in order to satisfy
the needs of consumers so that they become loyal and feel great experience with the
corporation. For that purpose company can merge with hotel Magic life and it is helpful for
both because maximum profits can will be generated which provide help to achieve the
objectives. After this integration name of company will be TUI Magic Life and this is
successful when innovative technology has been used by the organisation which is helpful to
make the supply chain more stronger and provides the requirements of consumers by
delivering the quality products and services (Airey and Gross, 2015).
Horizontal integration: In this type of integration two companies integrate to make
bigger corporation but is required that products have to be similar in nature and both
companies have provide similar types of products and services. As an instance, TUI Group
has merged with First Choice Airways to make bigger company. As a result its sales will
increase which is helpful the capture more market share and help the company to maximize
the revenue. As an instance, Company can make integration with Edward House Hotel so that
it can improve accommodation & service and other facilities which are require to provide in
order to fulfil the desires of consumers (Martínez and Rodríguez, 2013). This is beneficial for
the growth of corporation and business will expand and large number of people will attract
towards the company. As the resources will increase and consumers will get better facilities
and services as a result their needs can be satisfy which help the corporation to improve its
brand image. There is more competition in the market because of high growth in this business
so if two companies will merge than its strength will be double which provide help the
corporation to maximize its profits and expand its market share and to achieve its goals and
objectives within stipulated time period (Abubakar and Ilkan, 2016).
2.2: Discuss how integration has affected a hospitality business
In hospitality sector travel and tourism sector plays a vital role, As a huge amount of
revenue is generated from the sector. The main reason of adopting integration is to get global
exposure, that why company focuses on integration. There are mainly two types of
integration –Horizontal and Vertical.

 Horizontal Integration – A process by which a company can ensure the rapid
increase or rise in production of goods and services by being a part of the same supply
chain. They can opt for horizontal integration by means of merger and acquisition.
 Vertical Integration – These is different from horizontal integration. Different
supply chain are responsible for the production of different goods and services.
With the help of integration the company was able to get a significant control over
market and by that they were able to get cost advantage as well. After associating with the top
companies, TUI Group was able to get the advantage of economies of scale and by that they
were able to avoid the competition by restricting the entry of new firm via economies of scale
which was only possible after integration. As the company have the market control, they
become price maker. They had a control over prices and other companies had to alter the
pricing according to the companies pricing. Tourism success also depends upon the branding
techniques by different companies in the industry. Providing different hospitality services
with the name of one brand helps a company to retain their old customer and it also give them
assurance that the service rendered by the company will not get compromised. Brand names
gives customer loyalty and if a brand is for long period the chances of more loyal customer
are always there. Globalization not only provide global exposure to a company but it also
provide opportunity to generate revenue and extract an untapped market too. Trade barriers
are also reduced with the help of globalization. Furthermore, the European countries benefit
from the products and services when the trade regarding the same occurs within the Eurozone
which in turn proves to be beneficial for the accommodation and the catering providers as
well. The organization in travel and tourism sector generally uses horizontal integration.
TASK 3
3.1:Develop a rationale
If a company had to develop rationale for their business they need to analyze the
target market first. By target market we mean the public who are really interested in the
goods and services of the company and company sees a scope of doing business with them. If
the company can analyze the target market and the necessary services a company can place
for that target market, rationale can be prepared after that. In this regard the destination of the
hotel must be identified as the location can impact over the cost and the resources along with
the type of holiday destination.As the company deals in travel and tourism the target market
in that case will be both male and female, even children will be considered in the target

market as by tempting children a company can convince the parents also for travel and
tourism. As travel and tourism is done out of hobby, for refreshment, for luxury basis. The
target market in that case can be premium customers who are high income group people and
are ready to spend money. Company is mindful of that in most the cases travel is done in
group. A group can be of friends, family or in any form so targeting is done by taking that
into consideration as well.
On considering new location within UK the hotel can approach the target market
through the analysis over the demographic factors along with socio-cultural factors within the
region. Proper location will be efficient for attracting both inbound and outbound customers.
Various lucrative offer can be offered by the company. They can offer free breakfast in hotels
or some discount for customer, so that they can gather the attention of the customer and by
that more application can be received by the company as the interested customer may
increase because of those offers. Different offers in the transport like airlines and other
facilities will be efficient to attract outbound tourists. The local tourists can be approached
with business facilities like conference, banquette etc. Some benefits are given to those
customer who goes for a complete package of the company which includes hotels, air tickets
which means a complete package.
3.2: Develop a plan for a hospitality business including the operational requirements
Customer satisfaction or services is one of the most important component which
needs to be taken care by the company. The information are provided to customer on time so
that no conflict is aroused and customer loyalty can be maintained. The market that is
targeted is of premium customer as travel and tourism is done by the people who have a
purchasing power so company try to entertain those customer only. As they know they are
ready to spend money so the services which are provided to them is on premium basis. As
they are providing service to the people who have purchasing power, they should not
compromised in the services provided by them. As one thing is clear money is not a problem
in this case so they should not think of compromising in any case and try to provide what is
best for the customer. Company should make sure that proper training is given to the
employees also. As employees are the face of the company so they are carrying the goodwill
of the company. Any fault from their part may hamper the company, so company should train
the employee regularly. The main focus behind the training is development of employee, so
that they know the best way to handle any tricky situation and they know how to satisfy
different types of customers and build relations with them. A healthy relation with the

customer is a favorable situation for any company as it also spread word of mouth and it may
result in new customers for the company. Funding for the same can be raised by the company
through shareholders, company can put their money also whichever they find feasible or
possible at that moment of time. If s business don’t want any hindrance in the operation they
should opt for licensing in various services provided by them. The ambiance should be such
which attract customer and that can be done with creative measures and some innovation.
Health and hygiene is also one factor that should be taken into consideration by the company.
The whole reason behind an attractive ambience is that customer should choose the company
over their competitors. As the company is well aware about that tourist from different places
will come to avail the services, so culture of the company should be of reflective nature and
tourist should feel comfortable and that can be made possible by implementation of their own
culture. Providing various services with a brand name may help a company as the loyalty of a
customer to a brand can be attained. The external environment should also be taken into
consideration as the tourist should get all the facilities they thrive for and that can be made
possible by giving them a good exterior also along with interior. Promotions should be done
so that the market know about the company and the services provided by the company.
Staffing by functional areas: there are different functional areas within the hotel such as:
 Management team as well as managers
 Finance department
 Line managers
 Housekeeping department
 Front line
 Kitchen staff such as chef
 Security department
 Conyence and transport
 Area management
While doing staffing also all the factor should be taken into consideration. Proper
background check of the employee should be done. All the amenities should be given to the
employee so that they are in good space and while doing their job they are giving everything
to it. Employee should be recruited from various part of the world so that the company can
get the cultural diversity in their management too. As the company had to handle the
customer from different backgrounds, recruitment should be done taking that point into

consideration. Qualification required for a particular job should be checked with the applicant
and they should be interviewed accordingly. It is obvious that different type of qualification
are required for different employees so that should be maintained properly. Company should
make sure managerial experience is utmost for hotel job and a person who have that only
those would be qualified for such type of jobs. All the conflict related to the season staffing
should also be taken care by the management as in travel and tourism business staffing are
also done on basis of seasons. Staff should be sophisticated and should know how to carry
themselves in front of customers.
CONCLUSION
As from the above report, it has been concluded that it is required for the travel and
tourism business to fulfil the requirement of consumers by providing quality products and
services. As hospitality industry and travel and tourism business are interlinked with each
other. For the growth and success of a company integration is very helpful. Because strength
will be double which provide help the corporation to maximize its profits and expand its
market share. As integration affect the industry in positive way because it help the
organisation to increase its profits and achieve the objectives as per requirement. To
accomplish the goals it is important to take effective decisions which are linked to the target
market. It is important to develop business organisational structure in relation to the human
resource allocation.

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