Analysis of the UK Hospitality Industry's Economic Impact

This report examines the UK hospitality industry's significant contribution to the local, national, and international economies. It highlights the impact of multinational organizations, the growth of franchising and licensing agreements, and the industry's role in providing employment opportunities. The report emphasizes the industry's substantial revenue generation, particularly in the UK, and its contribution to the nation's economic development. Key factors driving growth include the expansion of international hotel chains, brand identity, and the adoption of franchising and licensing models by major food and beverage brands like KFC and McDonald's. The analysis covers the industry's influence on local economies through job creation and tourism, and its contribution to the national economy with impressive annual turnovers and employment figures. The report uses data from the Online statistical office to show the positive effects of the hospitality sector on the UK economy.

International economy: There are several multinational organisations
exists in hospitality sector of UK whose operations are situated in more than one
nation due to which their contribution towards growth of global economy is high.
As per the report of Online statistical office, around 42 million visitors have visited
UK along with different purposes that is automatically supporting in growth of UK
nation. From the discussed information’s, it has been analysed that Hospitality
industries in UK not only providing employment opportunities to individuals but
also supports them in raising their standard of living
Key factors driving growth
Expansion of international hotel chains and brand identity: Entering of
multinational hospitality organisations supports the economic growth of nation at
local, national or international level. Due to having wide presence, multinational
hospitality organisations have built strong brand image because of which large
number of travellers of different nation prefers to stay or take services from these
firms. This will impact positively on international economy as hospitality sector
will grow due to new expansion that will increase revenue of local industry and
global economies.
The growth of franchising and licensing agreements: Nowadays,
franchising and licensing agreements is becoming popular because lower
investment is needed for promotion and heavy benefits are received within a
shorter span. Several international organisations have expanded their operations by
using franchising or licensing as this method is beneficial for them in entering in a
new market with a specific investment. These expansion makes positive impacts on
the local economy as it supports the local individuals by providing them
employment so that their living standard can be improved. Due to growth of
hospitality sector, several big brands of food and beverages sector like KFC,
McDonald have used this method for establishing their business in UK.
P3 The contribution of hospitality industry to local, national and
international economies
◦ Hospitality organisations are very important for economic
growth of nation as they not only satisfies the needs of travel
but also provide employment opportunities to local
individuals or in market in which they are performing their
business operations. These organisations and their impact on
economies at each level like local, national or global are
described as under:
◦ Local economy: Hospitality organisations operates their
functions at each level as in local level these firms provides
employment opportunities to local individuals in form of guides,
handmade crafts etc. that automatically leads towards raising of their
standard. Hospitality industry also fulfils needs and wants of travellers
at local level so that it can be said that this sector is impacting positively
on the local economy and residential.
◦ National economy: In UK, Hospitality sector is rapidly
growing as compare to others such as in year of 2018, this
industry has reached an annual turnover of £102b that
defines huge growth of industry in nation (Hospitality sector
to reach annual turnover of £102b in 2018). It is also known
as third largest employer of UK like 3 million individuals in
UK are providing their services in hospitality industry.
Therefore, it has been identified that hospitality industry is
not only supporting in nation's economy but also increasing
revenue that is useful for development of nation.
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◦ Contemporary Hospitality Industry
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