Hospitality Today Introduction to Restaurant and Hotel Industry

1
Hospitality TodayIntroduction to Restaurant
and Hotel Industry

• RHM 175

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Chapter 6 Understanding the World of
Hotels

• Competencies
• Briefly describe the dynamic hotel industry, and
  summarize information about important hotel guest
  segments.
• Describe center-city, resort, suburban, highway,
  and airport hotels, including their services and
  facilities, and summarize their historical
  development.
• Explain various ways hotels can be owned and
  operated, distinguish chain hotels from
  independent hotels, and explain how hotels can be
  categorized by price.
• Describe the following hotel categories
  all-suite hotels, conference centers, timeshare
  properties, condominium hotels, and seniors
  housing.
• Outline the following steps in developing and
  planning new hotels site selection, the
  feasibility study, and financing.

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Hotels A Dynamic Industry

• Industry Trends
• 1960s, New locations fueled expansion
• 1970s, Competition made each hotel stand out on
  their own
• 1980s, Pampering fueled change
• 1990s, Quality Service fueled change

Page 144 - 146
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Hotels A Dynamic Industry

• Hotel Guests who are the customers?
• Corporate individuals
• Corporate groups
• Convention and association groups
• Leisure travelers
• Long-term stay/relocation guests
• Airline-related guests
• Government and military travelers
• Regional getaway guests
• Guest mix

Page 146 - 150
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Hotels A Dynamic Industry

• Hotel Categories Location
• Center city New York, Chicago, Los Angeles,
  London
• Resort Vacation spots because of their climate,
  scenery, recreational attractions, or historic
  interest
• Suburban smaller hotels (250 500 rooms),
  chain affiliated, have sports and health
  facilities

Page 150 - 157
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Hotels A Dynamic Industry

• Hotel Categories Location
• Highway can be seen from the highway parking
  space is plentiful atmosphere is informal most
  are franchised depend mainly on commercial
  traffic.
• Airport guest rooms near airports

Page 150 - 157
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Hotels A Dynamic Industry

• Hotel Categories Ownership
• Six different ways hotels can be owned and
  operated
• Independently owned and operated.
• Independently owned but leased to an operator.
• Owned by a single entity or group that has hired
  a hotel management company to operate the
  business.
• Owned and operated by a chain.
• Owned by an independent investor or group and
  operated in a chain.
• Owned by an individual or group and operated as a
  franchise of a chain.

Page 157 - 158
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Hotels A Dynamic Industry

• Hotel Categories Ownership
• Independent hotel not connected with any
  established hotel company and is owned by an
  individual or group of investors.
• Management Company contracts with hotel owners
  to operate their hotels.
• Hotel chain a group of affiliated hotels.
• Franchise authorization granted to use a hotel
  chains trademark.
• Referral system independent properties or small
  chains that have grouped together for common
  marketing purposes. (Calling a 1-800 number and
  reserving a room across the country)

Page 158
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Hotels A Dynamic Industry

• Hotel Categories
• Chain Hotels
• See Exhibit 1 on Page 159 (next slide)
• Independent Hotels

Page 158 - 159
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Hotels A Dynamic Industry

• Price
• Hotels provide a variety of experiences at a
  variety of price
• The broad categories
• Limited service economy and budget
• Motel 6, Holiday Inn, La Quinta, Days Inn
• Mid-price full-service and limited-service
• Hampton Inn, Sheraton Inns, Holiday Inn Select
• First-class/luxury
• Hyatt, Hilton, Marriott, Four Seasons,
  Ritz-Carlton

See Exhibit 2 Page 163 See next
slide
Page 163 - 166
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Hotels A Dynamic Industry

• Other Hotel Categories
• All-Suite Hotels
• two connected hotel rooms for approximately the
  price of one.
• Developed during the 1980s
• Developed for extended-stay travelers
• Example Embassy Suites and Residence Inn by
  Marriott

Page 167 - 172
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Hotels A Dynamic Industry

• Other Hotel Categories
• Conference Centers
• Exclusively book conferences, executive meetings,
  and training seminars.
• Four General Classifications
• Executive conference centers
• Corporate-owned conference centers
• Resort conference centers
• College and university centers
• Example American Express, IBM, Chase Manhattan
  Bank, Duke, Columbia, Universities of Virginia
  and Pennsylvannia

Page 167 - 172
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Hotels A Dynamic Industry

• Other Hotel Categories
• Timeshare Properties
• Created by times of inflation
• Began in the Swiss Alps in the 1960s
• Came to the United States in the 1970s
• See Page 170 Exhibit 4 See Next Slide
• Example Beach Condominiums, Chalets

Page 167 - 172
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Hotels A Dynamic Industry

• Other Hotel Categories
• Seniors Housing
• Independent-living units
• Congregate communities
• Assisted-living facilities
• Continuing-care retirement communities

Page 167 - 172
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Developing and Planning New Hotels

• Site Selection
• A feasibility study
• Financing is arranged

Page 172 - 179
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Developing and Planning New Hotels

• A. Site Selection
• Convenient to the central business district, the
  financial district, the entertainment district,
  or a major convention hall.
• Should be accessible by public transportation.
• Zoning ordinances
• Parking requirements

Page 172 - 179
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Developing and Planning New Hotels

• B. Feasibility Study
• Determines to size and scope of potential guests
• Helps negotiate contracts
• Guide planners and architects
• Operating and Marketing plans
• Prepare initial capital and operating budget
• Market area characteristics
• Site and area evaluation
• Competition analysis

Page 172 - 179
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Developing and Planning New Hotels

• C. Financing
• Hard Costs
• The land in which the hotel will be built
• The building
• Furniture, Fixtures, and Equipment
• Soft Costs
• Architectural fees
• Pre-opening expenses
• Financing costs

Page 172 - 179