Analyzing Hospitality Provision within the Travel & Tourism Sector

This report provides a comprehensive analysis of hospitality provision within the travel and tourism sector, emphasizing the interrelationship between the two industries and the implications of their integration. It begins by highlighting the mutual dependence of hospitality and tourism, where hospitality components such as food, lodging, and transportation are crucial for a satisfying tourism experience. The report then delves into the impact of integrating hospitality firms, like Hilton and Marriott, to streamline processes and gain a competitive edge through vertical and horizontal integration strategies. Vertical integration involves expanding business operations within the supply chain, while horizontal integration focuses on increasing production in the same part of the supply chain through mergers or acquisitions. The report also outlines the development of a hospitality business plan, covering the stages of development, design, and operation, to ensure a safe and enjoyable atmosphere for tourists. The analysis concludes that integration is essential for business growth, brand value creation, and cost reduction in the hospitality and tourism industries.

Hospitality Provision in Travel &
Tourism Sector

CONTENTS
INTRODUCTION...........................................................................................................................................2
TASK 1 ARTICLE............................................................................................................................................3
1.1 INTERRELATIONSHIP BETWEEN HOSPITALITY AND TOURISM SECTOR........................................3
TASK 2 MANAGEMENT REPORT..................................................................................................................7
EXECUTIVE SUMMARY.............................................................................................................................7
INTRODUCTION.......................................................................................................................................7
DISCUSSION.............................................................................................................................................7
2.1 IMPLICATIONS OF INTEGRATION FOR HOSPITALITY INDUSTRY.....................................................7
2.2 EFFECT OF INTEGRATION ON HOSPITALITY BUSINESS.................................................................11
CONCLUSION.........................................................................................................................................11
TASK 3........................................................................................................................................................12
3.1 RATIONALE FOR SELECTED PROJECT................................................................................................12
CONCLUSION.........................................................................................................................................13
3.2 DEVELOPING A HOSPITALITY BUSINESS PLAN..................................................................................14
STAGE 1 – DEVELOPMENT.................................................................................................................15
STAGE 2 – DESIGN.............................................................................................................................16
STAGE 3 - OPERATION.......................................................................................................................17
CONCLUSION.............................................................................................................................................18
REFERENCES..............................................................................................................................................19
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INTRODUCTION
In recent years the term hospitality is becoming increasingly popular and it is interpreted in a
number of ways whether it is industrial, commercial or public services. Hospitality sector has
many attributes and relates to the relationship between individuals who take the role of host
and this relationship could be private or commercial.
The hospitality and tourism industry cannot be separated because hospitality is the key to the
success of the tourism industry. This assignment will highlight the importance of hospitality in
the tourism sector. The impact of integration of the hospitality and tourism industry will also be
explained in brief in the form of a management report. The last section of the assignment will
explain how to develop a hospitality business plan covering the operational requirements.
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TASK 1 ARTICLE
1.1 INTERRELATIONSHIP BETWEEN HOSPITALITY AND TOURISM SECTOR
The hospitality and tourism industries are
both dependent on each other for example
several components in the tourism industry
like food, beverages, lodging, transportation
and place of attractions etc. (Cook, et al.
2014). are all part of the hospitality
industry. All the components of the
hospitality industry have a relation in the
tourism sector.
Figure 1: Scope of Hospitality in Tourism
Sector
Source:[https://lostintourism.wordpress.c
om/2014/09/17/welcome-to-lost-in-
tourism/]
Therefore, in order to ensure that customer
feel satisfied while using the tourism
services, it is essential to ensure that
customer’s feel satisfies while using all of
these components. Hospitality industry
provides food and beverages to the
customer so that they feel satisfied with
their lunch or dinner (Walker and Walker,
2016). Transportation services are also
required by the customers so that
customers feel satisfied with their travelling
needs during the whole journey. There are
several other components tourism
components that need hospitality. Hence it
concludes those hospitality and tourism
sectors are both interrelated.
The product offered in the tourism industry
is the intangible products. Customer or
Tourist in the tourism sector will never feel
or experience the product unless they have
bought the product from their side.
Therefore, when the customers buy the
services it is essential that they are given
the best services so that they feel satisfied.
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For example the services like the guest
greeting, clean and tidy room etc. are forms
of hospitality services. If the customers
check in the hotel we cannot just give them
the room key and let the guest keep looking
for his room without any help or assistance.
This is definitely not hospitality instead the
guests must be treated in a friendly
manner; they should be assisted and helped
for their needs (Walker and Walker, 2016).
The hospitality and tourism industry go
hand in hand for example hospitality
industry offers food, accommodation,
transportation, recreation and leisure. The
tourist avail the products and services of the
hospitality industry for fulfilling their
tourism needs. Tourism is the activity where
the tourist engages themselves in travelling
to various destinations where they want to
experience leisure or recreational activities
which require availing the hospitality
services like accommodation, food and
beverage (Mok, et al. 2013). The hospitality
industry is the biggest supplier of the
services of the tourism industry. The
purpose of the hospitality industry is to
provide a safe and enjoyable atmosphere to
the customers which also ensure
responsibly serving liquor so that they do
not become unduly intoxicated thereby
avoiding problems of conflict for the
management of the hospitality
organizations (Mok, et al. 2013). Without
the hospitality industry, there will be no
place for tourists to stay which will decrease
the prospects of travelling in that area. This
further cause tourism activities like tours,
excursions and tourist attractions to decline.
The hospitality industry is also built upon
the fact that visitor will visit various
destination and will need a place to sleep.
But if people do not travel then they will not
need places to sleep beside their homes.
There can still be the existence of the
hospitality industry but it would be a tiny
industry as compared to billion dollar
industries.
Tourism can also be referred to as a
segment of the hospitality industry as
tourism industry works for a hand in glove
with the accommodation, lodging attraction
segments of the industry. For example, in
some market, the tour providers offer some
exclusive arrangements for the guests like
lodgings, eateries and attractions and also
escort guests to someplace as part of their
package deals. Moreover, if the quests wish
to visit some sites as a part of their package
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they can also purchase individual tours. In
some markets, the operators have their
own arrangements for the tourists (Mok, et
al. 2013). The tourists can also inquire at
their lodging about things of interest and
hotels that have a financial relationship with
the tour providers that supply necessary
information and also make relevant
recommendations.
As the hospitality industry consists of
hotels, restaurants, transportation and
leisure. The tourists from around the world
purchase these services for their tourism
needs. For leisure, tourists stay in the hotels
and enjoy their leisurely travel. Due to an
increase of globalization even the
hospitality industry has emerged as one of
the leading industries just like the tourism
industry.
The composition of Hospitality Industry
The tourism industry makes use of
hospitality variables and these variables are
described below.
Hotels
Figure 2: Hotel Services
Source:[http://guide.vacationxtravel.com/
top-hotels-accommodation-places-
dammam-saudi-arabia/]
The hotel is basically determined by its size
and location (Barrows, et al. 2012). It is
essential that hotel provides top class
services to the tourists so that they are
satisfied. A hotel is classified by some
variables like the number of rooms, types of
services available etc.
Restaurants and Night Clubs
A restaurant is a place where people come
to have a meal and to enjoy their time for
fun, dancing and other fun activities.
Pubs and Bars
These are places where people especially
couples come for having a meal and for
consuming beer or other drinks.
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Membership Clubs
In membership clubs, various conferences
and events are being organized for
entertainment, leisure and fun. Tourists can
take membership pass provided by the
membership clubs as it gives various types
of monetary benefits to the tourists, for
example, they gain access to webinars,
developments programs etc. (Barrows, et al.
2012).
Hospitality Services
There are many types of hospitality services
that can be availed by the tourists for
example food and beverages services,
catering, banquet, events etc. The
customers can also make use of hotel
services like front office services or some
additional guest services (Barrows, et al.
2012).
Visitor attractions and tourism services
Figure 3: Visitor Attractions
Source:
[https://previews.123rf.com/images/claud
iodivizia/claudiodivizia1108/
claudiodivizia110800065/10231989-
famous-glasgow-landmarks-scotland-
uk.jpg]
There are many popular destinations
around the world like monuments, historic
buildings, beautiful landscapes etc. A tourist
can visit these destinations by making use of
hospitality services like airlines, cruise ships,
agency services, tour operators etc. The
tourist can also avail some additional
hospitality services like cleaning services,
maintenance services etc. (Barrows, et al.
2012).
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TASK 2 MANAGEMENT REPORT
EXECUTIVE SUMMARY
As hospitality and tourism sector are interlinked it is essential to analyze the advantage and
disadvantages of the integration of these two sectors. In the present era of globalization,
companies need to integrate in order to become successful in business as integration allows
companies to share their resource that helps in attaining larger customer base for the business.
INTRODUCTION
Integration refers to the merger of two or more companies thereby resulting into a new legal
entity. In general, it refers to the process of attaining or acquiring several departments, groups,
systems and organizations. When two businesses integrate it gives a competitive advantage to
both the businesses and helps in increasing productivity and efficiency of both the businesses.
Integration also helps firms in creating brand value and also helps in reducing cost. In this
particular report, it would be analyzed how big hospitality firms like Marriott, Hilton etc. have
integrated with other firms for gaining competitive advantage in the business followed by
implications of integration covering various advantages and disadvantages.
DISCUSSION
2.1 IMPLICATIONS OF INTEGRATION FOR HOSPITALITY INDUSTRY
Hospitality firms like Hilton and Marriott integrate by linking its organizational systems together
in order to streamline the processes that can lead to greater efficiency. For example, Hilton has
streamlined its operation by integrating its HRM, accounting, business intelligence, supply chain
and CRM services (Šerić, et al. 2014). Both the companies have integrated with several IT
companies for IT assistance like maintaining employee database, server maintenance, managing
applications and various other forms of assistance. Integration benefits both the companies as
they share their services for example hospitality and IT firms can integrate based on interrelated
functions thereby giving a competitive advantage to both the businesses.
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For example, IT companies need office supplies like furniture, chairs, water, food and beverages
services etc., that can be fulfilled by integrated with hospitality firms (Šerić, et al. 2014). Hence
it can be stated that in order to gain competitive advantage and business growth it is essential
for businesses to integrate. Two types of integration processes are explained below.
Vertical Integration
The vertical integration occurs when a business acquires another organization for expanding its
business. For example, the integration of Virgin trains with the Virgin group as they both have
partnered with the stagecoach (Joskow, 2012). Similarly, in the travelling industry, two
companies integrate in order to find different ways of marketing and selling its products to the
customers.
Vertical integration can also be defined as when companies expand its business operations by a
series of steps within its manufacturing, production, distribution and suppliers. With the help of
vertical integration, business is able to cut cost and improve the productivity and efficiency of its
operations and supply chain segments. Vertical integration can also be carried out by
forwarding and backward integration (Joskow, 2012). In backward integration companies
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expand backwards following the production path while vertical integration occurs when firms
expand in forwarding direction by following the path of distribution.
The implication of Vertical Integration
There are many positive advantages of vertical integration and helps in raising the firms brand
value in the market. When companies vertically integrate they can lower down the prices of
goods and services without compromising on the quality of the product or services being
offered to the customer (Joskow, 2012). This helps firms in acquiring loyal customers and also
helps in repeat purchases. Another example of vertical integration is when TUI and Thomas
Cook vertically integrated across thereby expanding its chain of services like airline, tour
operators etc.
Figure 4: Vertical Integration
Source: (Fareham, 2014)
Horizontal Integration
Horizontal integration is the process when companies increase the production of goods and
services in the same part of the supply chain process. This can be done by various ways like
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internal expansion, merger or acquisition (Álvarez, et al. 2013). For example, the Hilton
Company horizontally integrated with stakes and acquired its chain of hotels. Similarly, Hilton
also acquired premier hotels of Scandic Company that helped Hilton in becoming one of the
biggest hotel brands in the world. Moreover, Marriott acquired Starwood hotels worldwide.
When companies horizontally integrate they make sure that the products and services match
with their services so that after integration there is no hotchpotch in aligning tasks and
managing the services of both the services as a result of integration.
Implications of Horizontal Integration
There are many advantages of horizontal integration and the biggest advantage is the economic
success as the company acquires a bigger market share in the business (Álvarez, et al. 2013).
There are some disadvantages too as there can be legal issues for having integrated with a
company that was already under loss. Hence it is essential for companies to integrate with
caution in order to avoid any legal constraints in the business or to avoid the negative
consequences of integration like loss of brand value, financial loss etc.
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2.2 EFFECT OF INTEGRATION ON HOSPITALITY BUSINESS
There are many advantages of integration for the hospitality firms. The employees working for
the hospitality firms are getting good compensation for their work than ever before. Companies
are getting support from the government as hospitality is one of the biggest industries today
(Grigoli, 2012).
Some additional positive effects of Integration are explained below.
Communication Savings
When two or more companies integrate and become one single chain of business then it
provides one stop shop solution to the customers thereby making it easier for the customers for
discussing the range of benefits provided by the company, tax issues etc. (Grigoli, 2012).
Staff Saving and Motivation
The staff members employed in the hospitality firms are now trained for dealing with a range of
services and issues like how to meet customers etc. (Sadri and Bowen, 2011). Hence employees
are given more responsibilities that help in their growth and financial success.
Procurement and Commercial Saving
Procurement refers to obtaining resources for running the business but due to integration
entrepreneurs and small business owners have started buying resources in bulk quantity that
helps in commercial savings (Rauch, et al. 2010).
CONCLUSION
The management report successfully concludes that it is essential for hospitality firms or any
firm to integrate with caution thereby gaining competitive advantage in the business.
Companies must integrate by acquiring proper knowledge and knowing the background of the
company to which they want to integrate in order to avoid legal or financial repercussions.
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