Hospitality Provision in Tourism: Integration Implication Analysis

This report examines the intricate relationship between the tourism and hospitality sectors, highlighting how hospitality services enhance the tourism experience and contribute to economic growth. It analyzes the implications of business integration within the hospitality sector, focusing on horizontal and vertical integration strategies, using Marriott's acquisitions as a case study. The report further discusses how integration influences various aspects of the hospitality business, including market share, service standardization, and quality, while also addressing potential challenges like customer preference changes and employment losses. The study concludes with a rationale for developing a business plan to expand the Marriott chain within the UK, outlining key stages such as concept development, market analysis, and financial projections, aiming to enhance customer satisfaction and loyalty through improved service offerings and strategic marketing initiatives. Desklib provides access to this assignment and other resources for students.

Hospitality provision in tourism and tourism

Table of Contents
INTRODUCTION..........................................................................................................1
TASK 1..........................................................................................................................2
1.1 INTERRELATION BETWEEN THE TOURISM AND HOSPITALITY BUSINESS
..................................................................................................................................2
TASK 2..........................................................................................................................4
2.1 ANALYSIS OF IMPLICATION OF PROCESS OF INTEGRATION IN THE
HOSPITALITY SECTOR...........................................................................................4
2.2 DISCUSSION ON THE WAY IN WHICH INTEGRATION HAS INFLUENCED
THE HOSPITALITY BUSINESS...............................................................................6
TASK 3..........................................................................................................................8
3.1 RATIONALE DEVELOPMENT...........................................................................8
3.2 BUSINESS PLAN.............................................................................................10
CONCLUSION............................................................................................................14
REFERENCES...........................................................................................................15

INTRODUCTION
The organisations that provide leisure, entertainment, accommodation and other
facilities for comfort to the customers fall into the category of hospitality organisations
It is a very widely spread concept that includes a lot of categories of the hospitality
organisations. Good interrelations between the hospitality and tourism are
established when the customers gain good satisfaction level with the services of the
hospitality industry. These sectors together help in the growth of economic condition
of a region.
In the assignment, firstly an article is formulated for a hospitality magazine by the
consultant of PKF hotel experts on describing the relationship between the
hospitality in the tourism sector. Secondly, a management report will be prepared for
depicting the influence of merger within the hospitality industry. Lastly, a business
plan will be prepared for the development of hospitality industry.

TASK 1
1.1 INTERRELATION BETWEEN THE TOURISM AND HOSPITALITY
BUSINESS
The services that the hospitality firms provide to the customers are related to each
other such as dining and accommodation etc, a strong link is established between
the tourism and the hospitality service sector. Thus it opens up great opportunities
for the businesses to expand themselves and thus gain growth and development in
economic terms. The firms like Marriott hotel are the organisations that are widely
established across the globe. They are focussed towards providing services to its
consumers that include attractive packages for them (Buhalis and Amaranggana,
2015). The provisioning of high-quality services develop good satisfaction levels in
the travellers and thus they become the potential customers of the firms. They visit
the hotels with the similar hopes of getting high-quality services and recommend the
same to others. This helps in enhancement of the hospitality services of these firms.
This gives positive results and the significance of the hospitality sector is well
understood and its role in enhancing the tourism sector. The tourists visit various
destinations with the purpose to explore more, spend some leisure time with great
comfort and to explore the diversity and culture of various places (Cook, et al. 2015).
The hospitality firms offer attractive packages for exploring the cultural diversity of
the places and organising several programs for the tourists who are keen to know
about the historical events of the tourist place. A number of programs and events
are organised by the hospitality firms like music shows and events, dance programs,
fun activities and other cultural programs for the guests who visit the hospitality firms
such as hotels, restaurants etc. For the business person who visits for business
works from domestic and foreign countries are provided with the facilities such as
conferences, business dinners and meeting facilities. Effective arrangements are
made for the business class and the investors of the firm so that they can contribute
more towards the business activities and thus the firm can gain more financial
benefits (Jones, et al. 2016).
The hotels such as Marriott have a number of policies and strategies designed in the
form of conducting market analysis and organising surveys for demonstrating the
requirements of the customers in the travel and tourism sector. These strategies and

plans are beneficial in the management of the relations between the tourism and the
hospitality firms. The generation of present necessities and getting information on
the current requirements provide a lot of aid in provisioning high-quality facilities and
services to the customers and thus gain customer satisfaction to a great extent.
The tourism and the travel industry has gained significant development in the form of
establishment of a number of hotels, amusement park and the other leisure and fun
place. The connectivity between the travel and tourism firms and the various
hospitality industries is spread to a huge level. The individuals visiting different place
for various types of tourism such as medical, adventure, sports and other niche
tourism they always wish to find comfortable and affordable places to stay and get
great food. The accommodation and food places that are successful in providing
great services to the customers gain good potential customers. This depicts that
good services with great facilities provisioned by the hospitality firms help in
enhancement of the tourist’s experiences and thus get a prominent position in the
industry. The management of the hotels like Marriott is considered to provide great
dining, accommodation, safety and security services that help in generation of great
responses from the customers (Šerić, et al. 2014).
A large number of firms together with the tourism industries work together to
collectively generate profits. The helps in enhancement of the sales ratios and profits
such as in the contract held between Thomas cook, an advisory firm for organising
trips and the Marriott hotel chain. The hotel chain has agreed upon the contract to
provide a 10% profit share to Thomas cook which will be gained by tourists who
select the hotel for staying as one of the marketing strategy adopted by Thomas to
suggest Marriott for the stay. The deal between both the firms has helped in an
increase in the profit share of both of them and also maintaining a good relationship
between the organisations. Also, the management of the hotel has a separate tour
agency that provides special offer and packages to the tourist at a global level (Chen
and Chen, 2010). Also, the customers are provided with special discounts on pre-
bookings and bookings on special occasions. The mutual relationship between the
hospitality and the tourism and travel sector has helped in development and growth
of both as well as provide ease to the customers to get the benefits in the form of
attractive packages. Also, due to these packages both the industries are mutually
dependent on each other for gaining best profits and market share.

TASK 2
2.1 ANALYSIS OF IMPLICATION OF PROCESS OF INTEGRATION IN
THE HOSPITALITY SECTOR
The process of business integration was initially adopted for decreasing the costs of
operations of the firms. In the 1990’s, business integration was instantiated and
helped the firms to generate great market shares and also achieve high market
value. The process of integration has always provided positive outcomes in the form
of generation of satisfactory results thus increasing the customer base and reducing
the operational expenses to a great extent (Brotherton, 2012). The firms have as a
result expanded globally and move towards future development.
Various types of integration are adopted by the hospitality firms-
 Horizontal- This is concerned with internal expansion in the form of
enhancement of supply chain production. It can be well understood by the
example of a contract between Marriott and Thomas cook. Also, the
integration between Hilton hotels and the Walt Disney World resort is a
horizontal integration. The formation of a contract between various airlines
and the tour and travel agencies is a result of horizontal integration (Aziri and
Nedelea, 2013).
 Vertical- This involves the firms planning their self-management and
ownership divisions with the help of recruitment of skilled employees and
planning a large asset base (Wan and Sanders, 2017). This is vertical
integration. This helps to get good market returns from the diversified markets
and increase in sales revenues. The vertical integration has types-
 Forward vertical- change in services and products by taking help of
integrated services
 Backward vertical- Merge with suppliers and expanding the whole
supply chain
 Lateral vertical- the integrated firms do not have liability to share their
resources such as products and services (Helfat and Campo-
Rembado, 2016)

For maintenance of sustainable tourism, Marriott has merged with many tour
agencies and small restaurant chains. The process of integration can be done in the
following firms-
 Stigmatization- The hotel brands which are on top of priority list of the
tourists are highly dependent on the tour operators. To maintain the
dependency, stigmatization is done.
 Market power and the act of merging between large enterprises is done by
the travel and hospitality organisations for establishing an alliance between
the prominent brands for gaining good customer base of both the brands and
thus gain topmost position in the market (Kusluvan, et al. 2010)
 Raised globalisation- The integration will provide aid in protecting the
environment and also lessen the influence of the external and internal
globalised aspects

2.2 DISCUSSION ON THE WAY IN WHICH INTEGRATION HAS
INFLUENCED THE HOSPITALITY BUSINESS
The integration between the firms has helped in the expansion of the business on a
global scale. The Marriott has acquired the Starwood Hotels & Resorts and Delta
Hotels & Resorts that are one of the biggest mergers in the hotel industry (Bernardo,
et al. 2015). The 3 P’s of the marketing mix have a control over the integration
process.
Product- As a result of integration, the customers get a great choice of products and
services and thus their satisfaction levels increase (Bowie, et al. 2016). This saves
time and costs also from the customer's end as they get products from two brands
under the same label. In case of Marriott acquiring the Starwood Hotels & Resorts,
the amenities and services of both the firms were merged up.
Price- The firms after merging need to decide prices as per the convenience of the
customers so as to avoid any loss at the initial level of integration. The services not
being liked by the customers will result in huge loss for both the merged firms and
also the settlement of the business can cost higher amounts then the profit
generated. The acquisition by Marriott has changed the financial state of Starwood
Hotels & Resorts and it has helped the firms to gain a competitive advantage over
others.
Promotion- It depicts the promotional activities required to be met by the firms for
establishing good customer base after the integration. The customers of the firms
after integration must know about the merger and not get into any confusion
regarding the same (Law, et al. 2014).
The implications are explained below of integration-
Market share and economies of scale- The business activities after integration
may get higher profits but in some cases, the profit gained by the companies on
working independently was much higher before integration. It all relies upon the
repose of the customers towards integration (Armstrong, et al. 2015)
Standardisation- It confines the services offered by the individual firms. As a result
of the contract, both the integrating firms may have to confine some of their offered
services. This can have a negative impact on the customers purchasing behaviour.

Quality of service- The firms after integration are required to maintain the quality of
service of the products and the services it offers. Any kind of compromise after
integration by the firms may hamper the growth of the organisation as a merger and
also reduce the customer base to a great extent (Mok, et al. 2013).
There are many other aspects that may have an impact on the business integration.
For instance, if the customers gain satisfaction level with only one brand and its
merger thereafter will change his preference to some extent due to the change in
policies and services provided by the firm (Wan and Sanders, 2017). It can cause a
reduction in profits and employment loss due to many employees facing layoff as a
result of the merger. Also, different goals and objective of the firm can mislead the
integration processes and cause loss to both the companies.

TASK 3
3.1 RATIONALE DEVELOPMENT
The companies keep on developing strategies and business plans to expand their
business and gain good market share. This business plan will emphasis on the
development of the hotel sector of the Marriott chain by extending its branches to
unreached parts of UK.
Stage 1 development
Concept- The concept that is followed by Marriott group of Hotels is to expand its
chain and provision valuable and affordable accommodation and dining experiences
to its customers. Also, to provide a good platform for hosting meetings and
conferences as well as various business and cultural events (Nieves and Segarra-
Ciprés, 2015).
Market research has to be conducted to collect information about the size of the
market, the customers who are willing to avail the services, the competitors and the
threat of rivals, the funds required and the professionals needed etc. It can be
conducted with the help of various tools such as the tools of analysing the macro and
microenvironment like the PESTEL and SWOT analysis, Porters 5 forces etc.
Target Market needs to be identified for expansion of the hotel chain. It will give
more emphasis on the tourists’ belonging to high and medium income levels as they
form a large part of the potential customers of the target market. The targeted market
will assist in providing best of the profits for the organisation.
The location selected must be the destinations near the tourist destinations as it will
help the tourists to choose the place of stay near their area of the visit. The location
on the busy streets will attract a large number of customers all-round the year. The
area near the tourist destination will provide the visitors to get a beautiful view of
their tourist place and thus make them recommend the same to others also
(AbuKhalifeh and Som, 2012).
Scale- The expansion of the hotel chain takes time and is a complicated task for the
business of Marriott. An area covering approximately 8 to 9 thousand square feet

that has space for the events of around 25 to 35 hundred square feet so that it can
accommodate around 400- 500 people at a time in the open space for events.
Funding- the analysis of the funds required for the project has to be done by the
management of Marriott. The hotel chain despite having a good profit ratio is advised
to gather an amount of around £ 280,000 from the investment module and £ 170,000
from the standard bank procedures through loans (Cairncross and Buultjens, 2010).
Products and services- The firm has to provide the best of services and best in
class products for building a good customer base in its area of the establishment.
This may include introducing new cuisines and other offers such as discounts on first
bookings and advance bookings. These services will develop good satisfaction level
in the visitors who will feel internal satisfaction regarding their brand choice.
Licensing- For the establishment of hotels or the restaurants in the UK region there
are certain rules and regulations formed and some policies that need to be followed
by the Marriott group. The permissions may be in relation to lease of land and
business certificates. Also, to provide the alcohol services, a separate licensing is
needed. The standards made by a government related to food services such as FSA
and the HACCP must be followed for good food quality by the organisation (Walker,
2016).

3.2 BUSINESS PLAN
Stage 2 Design
Ambience- A calm and relaxing atmosphere gives good feelings and vibes to the
visitors that will add to the good services of the hotel. A comfortable arrangement for
stay with a mixture of the modern and classical culture will attract people from all the
age groups. Proper facilities for the lights and music must be made.
Culture- The management of the hotel chain must try to maintain a peaceful culture
where the staff must coordinate with each other as well as with the customers
causing no or fewer conflicts.
Brand- The brand needs no recognition but in the areas of establishment its
promotion is important in order to promote its brand image with the success rate in
the last few years (Phillips and Moutinho, 2014).
Interior- A classy and trendy interior with latest furniture and other decorative items
with best of the technological equipment for entering and locking the rooms will be
eye catchy. The relaxing interior of the hotel will be the first on the priority list of the
customers.
The exterior of the hotel must be best in class with proper parking and lawns along
with its restaurants and the lobby for meetings. Also, a separate garden area and
visitor area must be made that will add to the exterior look of the hotel and thus will
attract the customers.
Areas such as the business department like the booking section, the management
place, the reception, room service department and kitchen section etc. fall under the
category of functional areas of the hotel. The well managed functional of these
departments and fast problem-solving facilities will help to maintain the smooth
working of the functional departments (Sloan, et al. 2014).
Customer flow- The ratio of customers availing the facilities of the hospitality firms
fluctuates with changing trends and seasons. For maintenance of a proper flow of
customers, it is important to provide standardised and regular services to the
customers in the form of giving discounts and attractive package offers at frequent
intervals of time.