Hospitality Provision in Travel and Tourism: Business Strategy Report

This report examines the interrelationship between hospitality and the wider travel and tourism industries, highlighting the interconnectedness and mutual influence between these sectors. It uses Hilton Hotel as a case study to explore the implications of business integration, including both vertical and horizontal strategies, on hospitality businesses. The report also delves into the development of a business plan, with a focus on target market justification, operational requirements, and human resource allocation within a hospitality setting. The analysis covers customer satisfaction, the impact of integration on market share, and the importance of adapting to changing consumer preferences within the tourism landscape. The report provides insights into how hospitality businesses, like hotels, restaurants, and entertainment providers, contribute to and are affected by the travel and tourism industry's dynamics.

Hospitality Provision in
Travel and Tourism
industry
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TABLE OF CONTENTS
INTRODUCTION................................................................................................................................3
TASK 1.................................................................................................................................................3
1.1 Discuss the interrelationship between hospitality and wider travel and tourism businesses.....3
TASK 2.................................................................................................................................................6
2.1 Analyse the implications of integration to the hospitality industry...........................................6
2.2 Discuss how integration has affected a hospitality business.....................................................7
TASK 3.................................................................................................................................................8
3.1 Develop a rationale for the chosen project, clearly justifying decisions linked to target market8
3.2 Develop a plan for a hospitality business which includes the operational requirements of the
business’ organisational structure in relation to human resource allocation....................................9
CONCLUSION...................................................................................................................................11
REFERENCES...................................................................................................................................12
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INTRODUCTION
Tourism is one of the fastest growing and largest industries which are increasing their revenues
day by day. This is because; people are getting attracted to the places which they want to visit in their
leisure time. Tourism is the part of broad category that is hospitality industry. People want to enjoy
their life and spend time at some good places irrespective of the busy schedule. Tourism attraction
points are those where most of the tourists see its culture, its historical importance and environment
beauty which offer different aspects such as leisure, adventure, learning and amusement. Tourist
destination and the hospitality provision should be in accordance with the preferences and lifestyle of
people because then only, they will visit the places. In addition to this, hospitality industry is a vast
organization in which tourism is one of the main aspects (Chen, Shang and Li, 2014). Tourism and
hotel are interconnected to each other as well as part of the hospitality industry. For conducting the
current research, Hilton Hotel has been chosen. It is an independent hotel chain that is based in
London, United Kingdom. In this report, it includes three tasks about hospitality provision in the
tourism industry and first task involves the scope of interrelationship between hospitality and wider
travel and tourism businesses which help in generating revenues. The second task is all about
implications of integration to the hospitality industry and the way it affects business. Third task is
about developing the decisions to link with the target market as well helps in the business plan with
operational requirements for the business organizational structure in relation to human resource
allocation.
TASK 1
1.1 Discuss the interrelationship between hospitality and wider travel and tourism businesses
Hospitality industry is a wide sector which constitutes of many hotels, restaurants, pubs and
bars, nightclubs, contract food service providers and other hospitality services. In hotels, there are 1
star to 5 star, budget hotel, bed and breakfast hotels which serve their customers according to their
tastes, preferences and lifestyles (George and Mawby, 2015). However, restaurants comprise of fast
food, cafes, coffee shops, mainstream, fine dining, etc. where visitors visit according to the taste of
food and the atmosphere they experience there. Furthermore, pubs and bars includes managed houses,
tenanted or leased pubs, free houses for their customers at time of accommodation. All these come
under the hospitality industry.
Hospitality sector has gained much significance in the present world and thus, it is catering
large business for travel and tourism industry. Hospitality and travel and tourism industry are
interconnected to each other. These both businesses get affect by each other as if any one of the
business get influenced. Hospitality industry assists in handling tourists who visit for tourist
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destinations. For this sector, customer satisfaction is the main objective where organization tries to
fulfil all expectations of their customers (Hsu, Tsai and Wu, 2014). For example, Hilton hotel is serving
their customers by satisfying their expectations through identifying their actual needs and
requirements. Through this, company’s reputation is increasing as well as it is also helping in the
maximization of profitability. In the current world, there are many organizations which are operating to
provide tourism facilities to the travellers along with other hospitality services. Moreover, in Hilton
hotel, it is been connected to the one of the local tour operator of UK. This is because they both can do
their business by inviting more customers and these are opportunities for Hilton Hotel to increase their
customers base and their revenues. So, these both businesses are interconnected to each other. Now,
Hilton hotel is offering various reviews of the loyal customers to their websites where they can write
about their experiences and provide suggestions to the hotel. Travellers who want to travel to the
particular tourist destination for leisure time and to spend vacations for business or any other purposes
can be able to read the reviews based on personal experience of customers who have already used the
services of Hilton hotel (Kontogeorgopoulos, Churyen and Duangsaeng, 2015). Thus, accordingly,
visitors will make choice regarding the destinations, food and services, hotels and sites, etc.
The hospitality sector comprises of hotel business, accommodation services, entertainment
activities providers, restaurants, cafes, catering, etc. Main thing which a traveller needs while reaching
to the tourist destination is search for good accommodation. For this purpose, hotels, motels and guest
houses play an important role. It is the responsibility of hotel staff to take care of the customers and
provide them quality services. If travellers need comfort without having any issue about the price then
Hilton hotel suits them. The responsibility of service providers of this hotel also comprises of their
customers by facing their problems (Middleton, and et. al., 2010). Moreover, to provide proper
services to their guests which includes maintenance, room service, cleaning service, laundry services
etc. The services which are provided by Hilton hotel are not same in the other organizations. It is
depends on the star rating that what quality of services they provide to the customers. Restaurants are
the places where visitors can eat and drink according to their requirements and choices. Every
restaurant and hotel is different from each other in terms of ambience, menu variety, prices, services,
etc. The choice of restaurant is often made on the basis of recommendations by the hotel staff or by
other tourists. Tourists also visit cafes to fulfil their needs of beverages and snacks at the time of
visiting different places in the tourist destination (Moutinho, 2011). However, cafes have less menu
items as compared to the restaurants.
Packages holidays is also one of the important aspect in the hospitality industry. The hotels
which included in packages holidays ultimately depend on the price of paid for the package. The
touristy holiday packages are often mass purchased and this is because customers would gets benefit
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from good hotel rates and airline ticket prices. Hotel also have special agreements with individual
travel agents which offers the special rates to their loyal companies which guarantee them to provide
with the good number of customers. The aviation industry success is also mainly depend on the
accommodation availability which may affect their business in the negative way if hotels have the full
capacity (Navickas and Malakauskaite, 2015). Hospitality is also present onboard airlines in the form
of the catering as well as sleeping arrangements. Moreover, visitors attraction is also one of the
important factor of the hospitality industry. Here, theme parks are most popular visitor attractions in
which they also caters restaurants and cafes, where families can enjoy a meal and have the other fun
and play activities. For example, Disneyland Paris has the two hotels at the resort which often featured
in the selected package holidays and are getting popular.
In the hospitality sector, there are some entertainment aspects are also been included. These
entertainment providers are the cinema theatres, shopping malls and amusement parks which all
provides the entertainment to the tourists when they visit the particular place. These places also caters
the food and beverages services and this is because people need them while getting entertainment. In
addition to this, hospitality organization are one of the important service providers to the travel and
tourism industry (Chi and Qu, 2010). Whether, it for leisure or for business, people which spend
significant amount of time to their hotel, particularly if it is of a luxury status. So for this aspect Hilton
hotel has been chosen to reap the benefits offered by their hotel and this is for particularly for the
premium prices paid. This all shows the connection between the hospitality industry and the travel and
tourism business because none of them operate successfully without incorporating with each other.
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TASK 2
2.1 Analyse the implications of integration to the hospitality industry
There are certain implications of integration to the hospitality industry which has to be followed
by the Hilton hotel. When companies provide their own products or services through in-house efforts,
outsourcing is no longer required, therefore saving the company money in the long run. Through such
integration companies are also able to increase their global presence and increase their market share.
There are different types integration and they are as given below: Vertical integration: Vertical integration is a process through which a company buys another
company in the distribution chain, or enters a merger agreement. This is primarily done to
maximise profitability and benefit from lower operating costs. It is traditionally characterised
by forward, backwards and lateral integration. Forward vertical integration is a process through
which a company merges with another company further along in the distribution chain. For
instance, a hotel chain may decide to buy its own travel agency or tour operator in order to
expand into other markets (Haddad and Teixeira, 2015). Hotels often strike agreements with
travel agents and tour operators, providing special room rates and offers for clients brought to
them. In addition to this, barriers to entry will develop, limiting competition in the marketplace.
Companies may gain control of suppliers such as accommodation and transportation providers
to further limit potential competition. If monopolistic behaviour develops through wide scale
integration, government agencies will interfere and set restrictions because competition is
fundamental for improving quality in the services industry.
 Horizontal integration: Horizontal integration is important for companies which want to
expand their customer base, benefit from economies of scale and above all, maximise
profitability. It occurs when a company purchases or merges with a company at the same stage
of the distribution chain. A fitting example of this occurred last August when Hilton hotels
international purchased a hotel at the Walt Disney World Resort for €92,202,465 (Komppula,
2014). Horizontal integration can also be complementary in nature as opposed to competitive.
Airlines often work closely with hotel chains, reaping some of the benefits which are offered by
mergers without the actual risks. Such relationships are visible in the choice of airlines made by
hotels for their airline miles schemes. Airlines gather data from hotels to try and make their
flight schedules correspond with accommodation availability, however this is not always
possible due to the dynamism and complexity of the hospitality and travel industries. To avoid
disappointment, the majority of tourists book their accommodation before hand to ensure that
they have their rooms available upon arrival.
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2.2 Discuss how integration has affected a hospitality business
This integration may have positive and negative aspect which can impact the hospitality
businesses. To offer a better customer service and keep loyal client come back today's hospitality
industry require integration system. Thereby they can maintain their controls and improve their
business. To have a smooth running integration system can aid organizations with a sustainable
competitive advantage by improving quality of the service while reducing cost. Superior performance
and sustainable product with good quality can help a company to reduce the threat of
conflicts/problems with their Suppliers, Staff, Local People, and Government and improve its position
as an esteemed partner in destination (Lamers Nthiga and van Wijk, 2014). That mean, better access to
major business resources such as funds, the capability to improve products to meet rising market
demand, better dealings with governments, and a motivated and faithful staff. However, there are some
advantages in this integration. It helps to reduce the cost of transportation as the general ownership
outcome in closer geographic regions. The costs for transactions can be managed if a firm gets hold of
the other firms in the vertical chain, so the one division of the company can transfer the goods to the
other divisions of the same company.
Thereby, transaction costs for transport, negotiations; Monitoring, control & etc. will be
eliminated. The by and large, average cost of the firm will be reduced, because if the divisions are in
under the same management, then there will be internal supply and department heads will decide the
transfer price. If a firm purchases half finished goods from an outside firm then the work culture could
be different and there are opportunities of dispute concerning terms and conditions of supplying or if
the outside supplier make a contract and couldn't supply the goods on time then the firm cannot
accomplish its assurance to the third party and the good will of a firm will come to an end (Mills and
Law, 2013). Organizational inferences; if the supplies provider supplying the goods to a firm is big, in
terms of sales, size and structure, then it will state the terms and conditions. On the other hand if an
internal source is used then there will be no market difference and the supplier cannot oblige any
adverse conditions. The establishment of the Single market within Europe has led to significant gains
for the participating member states. The removal of internal market barriers and the harmonization of
national regulations are expected to lead to an increase in trade and reductions in cost.
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TASK 3
3.1 Develop a rationale for the chosen project, clearly justifying decisions linked to target market
The project which has been chosen for the hospitality based project to attract large number of
the customers to the Hilton hotel of United kingdom. For this, the organization has to makes some
stages to justify their decisions which are linked to the target market. There are two stages which are to
be needed in the hospitality project and they are as follows:
Stages 1 – Development Concept – The general idea of the Hilton hotel is to gathered large number of the customers and
to gets them satisfied. And it also includes the expansion of the business to over the globe so
that company reputation remain high and able to achieves their goals. The objectives of the
Hilton hotel is to gain profitability as well as provide the customer satisfaction (Oliveira,
Ramos and Rey-Maquieira, 2014). The vision also states that to become one of the largest and
most profitable firm in the hospitality industry. Market Research: it is important for organization to do the market research because they will
able to know the new trends and expectations of the customers. To know the needs and
requirements of the customers, the market research are to be done. It various stages in which
qualitative and quantitative research has been done to know the exact environment of the
business. The market research will be done through the questionnaire, surveys, taking
feedbacks and suggestions etc. and also by the internet sources. Target market: Here, Hilton hotel has targeted the rich people who loves the lavish and
luxurious life with comfortableness (Stalidis and Karapistolis, 2014). To target the particular
segment, the chosen hotel will target the psychological segmentation in which they will target
the customers on the basis of attitude , perceptions, lifestyles etc. Hilton hotel has targeting the
people while keeping their lifestyles and accordingly serving to them. Location: For setting the Hilton hotel new venture, the company has chosen West Yorkshire in
the London, United Kingdom. This is because it is very posh as well high class area where rich
people likely to visit to the Hilton hotel. So the company has chosen this place for their
upcoming project. Scale: The size of the target market will be large so that able attract each and every customers
and influences them to try their services. Through this many of the customers will gets attracted
and want to try once for Hilton Hotel (Woodside and Martin, 2015). As the Hilton hotel is
targeting every level of markets so that larger number of customers can take benefit from the
services.
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 Funding: To fund all the business operations which are required in making the plan as well as
to target the specific target market, the budget are to be needed. The estimated budget will be
drawn by the investors, loans, own firm's budget etc. These sources will helps the Hilton hotel
in making the appropriate funding. Products and services: the Hilton Hotel will able to provide various types products and services
to their customers through which they gets attracted. Hilton supply management will provides
with national and regional food and beverages in which it will includes the dairy, bakery,
produce, meat, poultry, seafood, grocery, and alcoholic beverages (Wongkit and McKercher,
2015). It will also offers guest rooms, public spaces which will comprises of linens, terry,
amenities, hair dryers, uniforms, toiletries, and housekeeping supplies etc. Moreover, the other
facilities will include corporate responsibility which will provides the sustainability. Licensing: In this, it will constitutes quality, signs, grading, categorization, memberships etc.
which are to be needed at time of licensing of Hilton hotel. This is because licensing will be
only given by government if there is a good quality, excellent grading of the hotel etc.
Stage 2 – Design
It is one of the main aspect of the organization and it is needed when design are to be made for
the organization. The ambiance of the hotel should be sound and safe which should attracted the
customers to visit again and again. The culture of the Hilton hotel should be friendly in which staff has
to communicate with their customers properly. Moreover, brand also matters in the hospitality industry
because most of the people attracted to the products and services for their brand image in the market
(Zhang, Fu and Lu, 2014). So the branding strategy should be powerful in making the effective plan
for the organization. The exterior and interior should be also eye catching so that customers gets
attracted and try to visit again. For this, the interior should have good lightening, seating arrangements
and sound atmosphere. On the other hand, the exterior should have the automated doors , a good
security guard and good parking facilities etc. the functional areas of the Hilton hotel should be also
work properly and organized as well as able to support the business operations. In addition to this,
there should be good number of customers flows and the staff should also behave good to the
customers so for this, there should be effective communication between both the parties. The chosen
hotel has to link with the target market so that they able to connected with each other and apply in the
business operations. The company has to full fill the needs of the customers' needs and requirements
(Travel and Tourism impact, 2015). For this, they are serving their services according to customers'
tastes, preferences and lifestyles and makes them satisfied. The sustainability of the hotel is also one of
the important factor which are to be needed in the hospitality industry. So the Hilton hotel is practising
the corporate sustainability in the organization which is indirectly benefiting the organization.
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3.2 Develop a plan for a hospitality business which includes the operational requirements of the
business’ organisational structure in relation to human resource allocation
To developed a plan, after completing two stages, there will be the third stages which has to
follow to create a effective plan for the Hilton hotel. The operations which are needed for the business’
organisational structure are as follows: Staffing by functional areas: The employees which are needed for the staff of Hilton Hotel
should be well behaved, skilled and talented so that they able to do their work effectively and
efficiently. In their functional area, the staff should be well trained so that they able to serve
better to their guests and makes them satisfied from their services. The staffing is main aspect
for the Hilton Hotel which shows its abilities to cater the people among the eyes of the
customers (Hilton, 2016). Specialist qualifications: the employees which are required for the Hilton hotel should be well
trained as well as some qualities in the hotel management so that able to cater best towards the
employees. As well as it also helps in keeps them performing well in the organization. In
addition to this, the specialist qualifications should be preferable in the organization for the
higher posts which helps in gathering the more customers to the Hilton hotel. Staffing issues related to seasonality: Seasonality based on tourism can be challenging for
many food service owners and operators. Sure, all restaurants have peak periods throughout the
year, but having to deal with spikes based on seasonal tourism (Lim, 2010). Put seasonal
employees through the same training process as you would a regular employee. Yes, the time
frame may be shorter and training may be faster, but do not shortcut the training. Cultural diversity and ways to deal with conflicts: The resolution process should start from the
parties' acknowledgement that their conflict contains a cultural dimension. Next, there should
be willingness on all sides to deal with all conflict dimensions including the cultural one. Third,
systematic phased work on the conflict is needed. People can prevent cross-cultural conflicts by
learning about cultures that they come in contact with. This knowledge can be obtained through
training programs, general reading, talking to people from different cultures, and learning from
past experiences. Recruitment policies and procedures: the company has to follow the recruitment process o9f
Hilton hotel which has some steps to recruit the certain candidates to their firm. So there will
some rules and regulations regarding the recruitment and selection process which has to follow
so that the operations are done smoothly without any hurdles. The recruitment and selection of
Hilton hotel is to fill out the application, then the initial Screening of Applications & Resumes
will be done to know the qualifications. Then the informal interview will be done, after passing
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that reference check are to be done. Then offer letter are given which should be accepted by the
desired candidates (Jin-Zhao and Jing, 2013). Then on boarding process will gets started to
trained the employees and then afterwards, the management provide feedback to the employees
by doing monitoring. Compliance with legislation: compliance means conforming to a rule, such as a specification,
policy, standard or law. Regulatory compliance describes the goal that organisations aspire to
achieve in their efforts to ensure that they are aware of and take steps to comply with relevant
laws and regulations. Furthermore, examples of regulatory compliance legislations include the
Dodd-Frank Act, Payment Card Industry Data Security Standard (PCI DSS) , Health Insurance
Portability and Accountability Act (HIPAA), the Federal Information Security Management Act
(FISMA) and the Sarbanes-Oxley Act (SOX). Promotional activities: Product and service promotion is the most common form of marketing.
Promotional activities can be defined as advertising which help in advertising the product,
service or brand in newspapers, radio, television, magazines, outdoor signage and online. There
are other aspects also through which promotions can be done and they are social media, print
media , websites etc. (Bharwani and Butt, 2012).
 Pricing: There are many pricing strategies which are to be used by the Hilton Hotel. They are
dynamic pricing, rate optimization, differential, positioning strategy etc. e. Rate Optimization is
the practice of selecting the room rates offered in a rate (or price) range based on the historical
price sensitivity of demand. The goal of rate optimization is to understand the demand
characteristics of rooms and the price sensitivity of demand and utilise the data to define room
prices that will capture the maximum revenue over time.
CONCLUSION
In this report it has been concluded that the travel and tourism plays an important role in the
hospitality industry. But these two are interconnected to each other as well as can gets affected if one
gets affected. There are various factors which are to be needed to build a strong relationship between
these two aspects. In addition to this, there are certain implications of integration such as vertical and
horizontal which are needed in the Hilton hotel so that good connection can be done between these two
businesses. Furthermore, the integration can also affect the hospitality businesses. Lastly, the plan has
made on the Hilton hotel 's new project in which three stages are being full filled and they are
development, design and operations with their different factors.
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