Report on Hospitality Provision in Travel & Tourism Sector - Unit 12

This report provides a detailed analysis of hospitality provision within the travel and tourism sector. It explores the interrelationships between hospitality and broader travel and tourism businesses, emphasizing the importance of hospitality in enhancing tourist satisfaction and promoting destinations. The report also examines the implications of vertical and horizontal integration within the hospitality industry, discussing their effects on branding, pricing policies, and market control. Furthermore, it outlines a business plan for a new hospitality venture, focusing on target market justification and operational requirements, including human resource allocation. The analysis highlights the role of integration in fostering collaboration, resource sharing, and competitive advantage within the tourism industry, providing valuable insights for businesses seeking to optimize their strategies and improve customer experiences. Desklib offers students access to this assignment and numerous other solved examples and past papers.

Unit 12 - Hospitality Provision in Travel & Tourism Sector
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Contents
Introduction...........................................................................................................................................3
Task 1- LO1..........................................................................................................................................4
1.1 Discuss the interrelationships between hospitality and wider travel and tourism businesses.......4
Task 2 - LO2.........................................................................................................................................7
Executive Summary...........................................................................................................................7
Introduction.......................................................................................................................................7
2.1 Analyse the implications of integration in the hospitality industry..............................................7
2.2 Discuss how integration has affected a hospitality business......................................................10
Conclusion.......................................................................................................................................11
LO3.....................................................................................................................................................12
3.1 Develop a rationale for a selected project clearly justifying decisions linked to the target market.
.........................................................................................................................................................12
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.....................................15
Conclusion:..........................................................................................................................................17
References...........................................................................................................................................18
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Introduction
Tourism is the growing business across the world. Tourism commerce will be generating the
productivity and profitability by providing the Quality services to their customers. Various
quality services are being provided by the hospitality sector across the globe to provide
satisfaction to their tourists and also rise above the competition. Any significant change in the
services will make the tourists appeal towards these services. In this report, a detailed
explanation and interrelation have been conducted. Besides this, this report has also overseen
the role of integration in developing effective business strategies and its impacts on the
hospitality industry. In addition to this, a detailed business plan for starting a new business
has been framed.
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Task 1- LO1
1.1 Discuss the interrelationships between hospitality and wider travel and tourism
businesses.
Title: Interrelationships among hospitality and tourism businesses
Date: 23rd July 2018
Figure1: Interrelationship between travel and hospitality)
( Source: Yeni.mescale.co, 2018)
Introduction
This task is exploring the relationships among the wider spectrum tourism and hospitality
sector. The hospitality sector is the core of the tourism industry as the satisfaction is the most
important aspect of this industry. Hospitality will promote a specific destination among the
international and foreign tourists. Hospitality is one of the crucial component of the tourism
business across the UK.
Role of the tourism and hospitality sector
Hospitality is the method that will make the tourists satisfied, delighted and sense of
belongings among them. All this will make hospitality an very important component of the
tourism business. Hospitality is one of the fastest growing businesses across the nations.
Hospitality will develop revenue for the nation and generate avenues for the employment.
Hospitality compromises of various associated business such a budget and luxury hotels, food
services, bars etc. The sensation of the hospitality sector business will be highly dependent on
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the style and process the business be responding to their guests.
Composition of the hospitality industry: The hospitality sector will be divided into four
broad sectors:
Food & Beverage: This is the sector that will be associated with the serving food to the
tourists. It is one of the biggest components of the hospitality sector in the UK. It has been
assumed that this sector will be providing the 50 per cent of all the food that is eaten by the
people in the UK. Due to this many opportunities are emerging for the new budding
entrepreneurs. A business in this sector will be divided into economical, fancy and premium
food quality. It has been expected that by 2022 the number of human beings that are
employed in this industry will be doubled by 22 million approximately.
Lodging: This is the component that is dealing with providing accommodation to the
tourists. The sector is the most crucial factor of the hospitality business because it is dealing
with the comfort of the people. Lodging can be divided further on economy hotels that
compromise 1 to 3-star hotels, motels and guest houses 2 to 4-star hotels and Luxury resorts
and premium hotels compromises of 5 star and luxurious properties.
Recreation: The primary objective of leisure is to refresh the person’s mind and body. This is
the movement that people do for relaxation, rest and gratification in order to refresh the mind
and body. There are generally four types of relaxation business participatory sports,
adventure sports, entertainment sports or travel, tourist attractions.
Travel & Tourism: The tourism sector is compromises of the trade that is dealing with the
business of moving people from one place to another and providing the tourists with services
that will promote travel and vacations. The hospitality and tourism business will help in
growing the other business (Atalay, et. al., 2014). It is the basis of an emerging economy.
The transportation system, accommodation services, visitor attractions, events and
conferences etc all part of the tourism business. The tourism sector is very broad and its
classification is very complex. There are people who are working in this sector making their
livelihood from this sector. Tourism business is defined as the sector that is classified into
three dimensions Business travel, personal travel, adventure tourism and pilgrimage travel.
All these are further classified into subcategories and will change as per the requirement of
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the tourist.
Relationship among hospitality and travel & tourism: Hospitality will provide a significant
impact on the travel and tourism industry. Travel and tourism commerce is dependent on the
various attributes of the hospitality business. It can safely state that Travel and tourism trade
is more or less dependent on the hospitality business. Customer who is availing the travel and
tourism business will highly dependent on the hospitality services and are very critical in
reviewing the hospitality services (Atalay, et. al., 2014). Due to a rapid increase in the
competition, tourists are now a day is always looking for better alternatives and exceptional
services. In such type of increased completion, the hospitality is providing an edge over the
competition.
Conclusion
Hospitality in the tourism and travel sector will include providing effective infrastructure for
the tourists while they will travel. All the components of the hospitality industry will the
drive the business of travel and tourism across the UK. In the hospitality industry, there is a
requirement of extremely pro-active and vigilant people are required to solve the customer's
issues.
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Task 2 - LO2
Executive Summary
Integration is the method that will help the tourism industry to jointly work together by
sharing their resources and customers. Hospitality sector will manage the integration of
organisational resources with the help of vertical and horizontal integration. The implication
of both the horizontal and vertical integration has been seen in the hospitality industry by
enhancing the satisfaction of the customers. The idea of the integration is not innovative and
companies are using it for decades (Kandampully, et. al., 2015).
Introduction
PKF Hotelexperts is a leader in the business of tourism and hospitality and is in this business
for 90 years. They are planning to do the integration of their business and thinking of the
various avenues by the help of which they can do the effective integration. This report will
help in understanding the different types of integrations and their implication on the
hospitality industry. Besides this report will help in exploring the reasons and ways by
integration is affecting the hospitality business.
2.1 Analyse the implications of integration in the hospitality industry.
Integration has been stated as the term that has been derived from the economics and has
been utilized to define the formal association between two business entities. Due to the rise in
the completion and increase in tourism trade, many integration activity has been taken place
in the tourism business and in hospitality sector. Integration has been done to attain the
seamless and close coordination among the various departments of the business, systems,
groups and organizations etc. This a process of combining and adding the two different
components to become an integral whole component
Vertical Integration: This is a method by which the supply chain of a specific company has
been owned by the parent company. This is one the management style that will bring the
large segment of the supply chain under the common business ownership. The history of
vertical integration has been started in the late 1920s when the Ford automobile company has
started manufacturing their own steel instead of procuring it from their suppliers. This form
of integration has been needed by the company because this will secure the firm’s supplies
that have been needed by the company to develop their own product as well as the market to
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sell the output (Scott, 2015). Vertical integration and expansion will be very much in need in
case of intense competition and the company have decided to eliminate competition and
increase is market share. Vertical integration will derive a monopoly in the business world.
Vertical integration can be further classified into three forms
 Backward Vertical integration: This is the form of integration when the firm is
controlling its own subsidiaries that are producing the inputs that are further used in the
assimilation of the final product, For example, an automobile manufacturing company
will manufacture its tyre, glass and metal supplying subsidiaries.
 Forward vertical integration: This form of integration will happen generally on the
circumstance when the company needs to control its own distribution centres and its
retailers to market their products as per there selling strategy, For example, an ice-cream
manufacturing company will control its retail selling ice cream parlours.
 Balanced vertical integration: This form of vertical integration will happen only when
the firm will be needed to conduct both the forms of forwarding and backward integration
at the same time. In this form of integration, the firm will develop its own supply chain
and further distribution by integrating with its subsidiaries.
Horizontal integration: It is the process by which the company will increase the production
of the output or services by doing acquisition or merger via internal expansion. This type of
integration will develop a monopoly of the company by helping the company in gaining the
vast majority of the market (Scott, 2015). This is also known as the horizontal cooperation. In
this form of the integration, the associating companies will go through an agreement but are
remaining independent. The primary objective of the horizontal integration is to grow the size
of the company, develop product differentiation, accomplish economies of scale and further
reduce competition or enter into new markets. This integration has first initiated by the
Gustavus Swift that is very often purchasing the railroad companies and iron mines to
develop a monopoly on this sector.
Implications of Vertical and Horizontal integration: There are some key implications of
both vertical and horizontal integration
Significance of pricing and branding policies: Branding is stated as the significant
component of the business in the today’s world. In the hospitality and tourism industry
branding will play a very significant role. Brands are the identity that will help the business to
develop a brand aspiration on the minds of the customers. Branding strategy and pricing
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strategy are often correlated. In the context of the integration, the branding will help in
developing the effective integration. People will be ready to pay a specific price point only
for the brand. It will take years to develop a specific brand. On the contrary, the pricing is
also affecting the buying decisions (Scott, 2015). It has been seen that people who are not
comfortable to pay a specific price for a particular brand will easily pay the higher price if the
same product has come with a brand name that has higher aspiration value. Integration will
make the company’s brand image higher and smaller firms are more beneficial in this case.
Independent establishments joining associations to compete with the larger organisations:
There are several organisations that are present in the hospitality and travel & tourism sector
are competing with each other. In the current competitive scenario, there is very tough to
compete with the bigger organisations (Iizuka and Katz, 2015). So to eliminate competition
the smaller organisations are joining hands with bigger organisations to exit from the
competition. Integration will help smaller or allied organisations to increase their productivity
and reducing their overall costs by integrating with bigger organisations.
Control and manipulation of the market: Integration will help the companies to control the
manipulative practices of the market. Hospitality is very sensitive and easily gets affected by
the bad reputation. Smaller companies are generally affected easily by the manipulation of
the market. It better for the smaller firms to associate with bigger organisations in the case to
avoid the manipulation (Kim, et.al., 2015). It has been seen that the companies that are united
will able to control the market better and more effectively. The companies who are integrated
will not get the impact of any market manoeuvring.
Increased globalisation of the industry: Due to a rapid increase in the globalisation the
hospitality industry has been affected significantly. People are now capable enough to travel
to different destinations across the globe and tourism and travel industry has affected
positively because of the integration of transport services. People are now days will get
economical travel services and economical lodging services that are conducted changes in the
paradigm of tourism and hospitality industry.
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2.2 Discuss how integration has affected a hospitality business.
There are several effects of integration on the hospitality business. Integration will develop
the core competency of the two organisations that are merging together for a specific cause.
Integration will focus on the optimum utilisation of the resources, define competitive pricing
and technology. Below are the effects of the integration on the hospitality commerce.
Reduction of free businesses: Integration will reduce the small independent business because
of the merger happen between the few small businesses to become sole large business entity
and merger of one big organisation and smaller organisations (Iizuka and Katz, 2015). Bigger
organisations will also merge with the smaller supply chain to reduce their overhead costs
and eliminate competition.
Developing economies of scale: Integration will reduce the service cost of services of the
tourism and hospitality sector. It is because of the integration the companies will be able to
increase their customer base and this will help in increasing their turnover and sale. In that
case, the integrated companies can reduce their average costs to eliminate competition and
this will significantly increase their revenues.
Few major organisations left: Integration will eliminate from the market the smaller
companies and significantly create a loss of job and much budding business those are in the
start-up phase. This is the negative effect of integration and affects the competition to a large
extent. This will also disturb the balance of the market and shift the market only to one side.
If only fewer organisations will leave in the market it will develop a monopoly in the market
and force the customers to high prices for lower quality in the long run (Hartmann, et. al.,
2017).
Able to control sub-sectors: Integration will able to control the sub-sectors that are
associating with the bigger organisation for supplies etc. This will reduce the overhead costs
of the services and products. For example, the five-star hotels will able to produce their own
bakery products by procuring the local bakery unit that is supplying them with baked
products.
Market share increased: Integration will significantly increase the market share of the
integrated company. Both the companies will have separate market share before merging and
after merging the market share has also been increased rapidly along with increased reach in
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the different parts of the geography. For example, Accor Hotels of France purchased Toronto
bases Fairmont and increase its market share in Toronto by operating from France.
Develop standardisation: Integration will develop the standardisation for their services. It is
very important in the hospitality and tourism industry. Standardisation will develop brand
perception in the consumers’ minds. Hospitality industry will be totally working on the
aspiration value of the services. Standardisation will create a reputation for the services in the
customer’s minds. For example, the merger of Marriot and Starwood Hotels & Resorts will
develop the service standards of the Starwood Hotels & Resorts (Hartmann, et. al., 2017)
Improvised Quality: Integration will improve the quality of the services in the hospitality
and in the tourism industry. For example, the Marriot hotel acquired Delta hotels and resorts.
It will definitely improve and modify the standards and quality of the Delta hotel and resorts
as per the quality standards of the Marriot group that is known for exceptional international
quality standards. This will help the customer in getting value for money.
Conclusion
The integration approach is not innovative in the tourism and the hospitality industry and
travel and tourism sector is utilizing this approach from last decade. Integration will occur in
this industry only when the firms are focusing on reducing their operational cost along with
the elimination of the competition. There are several positive and negative effects of the
integration but positive effects are more useful both for society as well as for businesses.
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LO3
3.1 Develop a rationale for a selected project clearly justifying decisions linked to the
target market.
PKF Hotelexperts has assigned me a task of development of the new fast food restaurant and
asked to prepare a detailed report that will justify the rationale for the project.
Stage 1: Development
Concept of the business: The concept of the business has to be framed properly. The concept
of this project is to develop a fast food restaurant in the busiest city in London. The objective
of developing this restaurant is to offer the exceptional and unique taste in fast food. The
name decided for the restaurant will be “Let’s Eat”
Market Research: Market research should be done in order to build up a startup. It is
fundamental to conduct the market research before launching the business. Market research
has been done in two phases i.e. Primary research and secondary research stage. In the
primary research, the survey was done after asking questions about different people who are
usually visiting the fast food restaurant in the London. This will help in understanding the
preferences and tastes of the customers. In the secondary research, the survey has been
conducted via journals and newspapers. Both this research will help in developing the
strategy of operational strategy (Yoo and Bai, 2013).
Target: This restaurant has targeted the youth and people who are young and engaged and
love to eat fast foods in the weekdays. The aim of this restaurant is to serve the unique and
exceptional taste in the fast food.
Location: 12F Hammersmith Broadway, Hammersmith, London W6 7AL.
Location is one of the most crucial aspects of the restaurant business. Any eating joint will
effectively work if the visitors will find the flavour of the food exceptional, unique and value
for money. Besides this, a restaurant will be in the place where there is sufficient footfall of
the target customers. The location that has been selected for the restaurant has one of the
busiest places of London and generally visited by locals and specifically youth.
Scale: Scale will define the spread of any specific organisation. Since this is a new
organisation and initially small in size at its inception.
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Funding: Funding is the most significant factor in starting a business. In this case, the PKF
Hotelexperts can easily provide funds to the new venture as they are running their primary
business with significant success. Also in the long-run, they can get funding from bank loam
after getting success in the first restaurant.
Products and services: The “Let’s Eat” restaurant has been developed for providing the
exceptional fast food at exceptional prices. Also, this restaurant will provide the customer to
celebrate the customer their special moments and can provide an arrangement on short notice
that is making them different from the customers.
Licensing: It is essential in the UK for a food business to take proper licensing. Foods
standard agency (FSA) a government authority that is providing the rules and regulations for
running a restaurant business in London. It is essential for the restaurant to take the licensing
before the inauguration of the restaurant. It should ensure that licensing should be procured
by the proper way and licensing number should be displayed on the stationeries of the
restaurant.
Stage 2: Design
There are various steps in the design and all the aspects have evaluated and framed in detail
pre- inaugurating the restaurant (Boniface, et. al., 2016).
Ambience: Ambiance will define the internal structure of the restaurant. The internal
framework of the restaurant should be warm, safe and hospitable for its visitors so that they
will feel delighted.
Culture: It should ensure that the restaurant should respect the culture of all the parts of the
world and should not do any differentiation in the context of race, colour, religion etc. Any
differentiation in culture will produce a negative impact on the image of the restaurant.
Branding: Branding should be done to develop the brand image of the restaurant at the
inception phase. A well-framed branding strategy will affect all the aspects of the business
and help in attracting the consumers. Branding should be designed as per the needs, emotions
of the consumer and also as per the competitive environment.
Interior: Interior should be designed by taking proper care of the taste and consumer
preferences. Interior will help in developing the prospective customers into loyal customers.
Restaurant Interior should be designed by assessing the taste and preference of the customer.
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Innovative furniture and colourful wall and fabrics can be used to present a unique and
vibrant atmosphere.
Exterior: Exterior of the restaurant should be attractive and appealing to the customers. The
exterior is the brand identity of the restaurant. Proper lighting and restaurant name should
place on the exterior at a place that it should attract the customers.
Functional areas: Reception, dining place and kitchen are the functional areas of the
restaurant and it should be designed for efficient operations. The kitchen should be well
organized and designed by following designed of professional architects.
Customer flows: Organising the customer flow is necessary for operating the restaurant at the
initial level. The proper record has to be maintained for tracking the customer flow.
Link to the target market: It should ensure that the restaurant has been properly targeted to
the target segment. Ambience and design should be inclined towards the taste and preferences
of the youth generation.
Customers with individual needs: There are customers such as senior citizens and disabled
individuals who have their individual requirements. “Let’s eat” should also make their
interior and facilities as per the convenience of these senior citizens and disabled individuals
Sustainability: In order to sustain in the business world the company should take care of the
environment and ensure that business is not progressed in the cost of damaging the
environment. The restaurant should make an effective contribution to the prosperity of its
investors and stakeholders, promoting social equity and enhancing the people lives.
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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.
It is very essential that operational requirements and manpower allocation for the restaurant
have to be decided in advance. Below stated are operational requirements assessed for the
restaurant.
Stage 3: Operational requirements of business
Staffing by functional areas: It has been ensured that the necessary staff should be appointed
to run the restaurant. “Let’s eat” restaurant should always ensure that the professional chef,
manager, receptionist and waiters are appointed for the initial operation of the restaurant.
After a specific time period, more staff members can be appointed as per the requirement.
Specialist Qualifications: Receptionist should have previous experience of managing
bookings and waiters should be pleasant and able to handle the orders in peak hours. The
manager should be skilled to handle the grievances and specific demands of the customers.
The chef should have professional experience and have the ability to develop innovative
recipes.
Staffing issues related to seasonality: Waiters should be given over time to address the peak
time issue that is usually happening on weekdays and holidays.
Cultural diversity and ways to deal with conflicts: The employees that are employed in the
restaurant should have respect for all cultures. Recipes in the restaurants should not harm any
specific religion. Staff should be skilled enough to manage any cultural conflicts inside the
restaurant.
Recruitment policies and procedures: Recruitment should be carried out in an unbiased
manner and proper training has been given. There should be a proper dress for each staff and
roles are defined as per suitability (Yoo and Bai, 2013).
Compliance with legislation: All the essential safety rules and compliances should be
followed properly.
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Promotional activities: Advertising has been done via social media & mobile marketing to
make people aware of the newly opened restaurant. Youth are more attached to social media
so effective advertisement is made on these channels.
Pricing: This is a most crucial aspect and has to be developed after proper assessment, Menu
should be developed in such a way that is affordable to the customer of all class, Initially
pricing should be kept low to attract the customers and can be reviewed after a certain time
period.
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Conclusion:
Hospitality is the most crucial component of the tourism sector across the world. Hospitality
is the component that will make difference in the services that are being provided to the
tourists. Tourism is dependent on the same basic components such as accommodation, safety,
food quality etc. Tourists are looking for ultimate satisfaction. The organisations are using the
method of integration when the companies are focusing on increasing their effectiveness in
the business world along with the reduction of operating cost. Transportation services, leisure
services as well as exceptional comfort levels all are important and crucial for the tourism
industry.
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