CHAPTER -1 INTRODUCTION

1.1 INTRODUCTION TO HOTEL INDUSTRY

Hospitality is all about warmth to someone who looks for help at a strange or unfriendly place. It refers to a process of receiving and entertaining a guest with goodwill. Hospitality in the commercial context refers to activities of hotels. According to British laws a hotel is a place where a bonafied traveler can receive food and shelter provided he is in a position for it and is in a fit condition to receive. (Bonvin, 2003) The hotel industry is a 3.5 trillion dollar service sector within the globe economy. The industry is cyclical in nature as dictated by the fluctuation that occurs with an economy every year. Today hotel industry is one of a fastest growing sector in India. It is expected to grow at a rate of 8% between year 2007 to year 2016. It is also estimated that hotel industry and tourism will account for nearly 5.3% of GDP and 5.2% of total employment. The boom in travel and tourism industry has led to the further development of hotel industry. (hospitality industry, 2009) According to a report hotel industry in India currently has a supply of 110000 rooms and there is a shortage of 150000 rooms fuelling hotel rooms rates across India. To overcome this shortage industry is adding 60000 quality room which should be ready by 2014. The future scenario of Indian hotel industry looks extremely rosy. It is expected that the budget and mid-market hotel will witness huge growth and expansion while the luxury segment will continue to perform extremely well over the next few year. (Hotel sector analysis report, 2011)

1.2 History background of the company

This all began in way back 1999 when with the efforts of Mr. Rajesh kumar walia and their father late Mr. lakshman walia the hotel opened its doors. The iconic hotel soon became the citys venue of choice for glittering balls, presidential visits and political gatherings, making the name hotel Paras synonymous with place of occasion. The hotel was first to introduced E-conferencing technology in the city in 2005. The hotel has scene many celebrities, political leaders and people for different backgrounds. Tourism has always been a priority to the hotel. They introduced wild life safari, track camping etc and other competitors followed their footsteps.

The hotel completed their 45 rooms construction and to add a lot of transformation in 2009. It altogether changed the image of hotel so as there fortune. Hotel became an eye of attraction for the tourist and a place of hanging out for local city crowed. (hotel introduction , 2009)

1.3

Product portfolio and business of the company

Hotel industry is known as the commercial context of hospitality. The services provided by hotels are very diversified. The product portfolio of Hotel Paras is also very strong. List of services offered by the hotel is as follows 45 quality rooms available as according to the budget of customers of al class. 2 restaurants serving food of many types and specializing in Indian (Punjabi) food. 1 conference hall with a capacity of over 120 person. A special dine inn with a kitchen garden.

1.3.1 Major business The major business that hotel get is from the tourism. The 70% of the total sales turnover of the firm is from tourists. The hotel also enjoys a kind of monopoly in serving Indian food in the city as no other competitor can serve the same quality and taste. The hotel failed to get much business from the companies and corporate of the city but looking forward to cover the same by many promotional programs.

1.4 Profitability
The firm has a total sales turnover of over Rs 90 lacs per year with the profit margin of over Rs 63 lacs as stated by the previous year balance sheet of the firm. The firms total sales turnover was just Rs 47 lacs in 2007 before the transformation process. The hotel has a target of Rs 1.05 cr for the next financial year and hotel is well on its road to achieve the target. (Hotel paras, Balance Sheets, 2013)

1.5 Market share and major competitors

The hotel has a privilege of being one of the old names in the market and the easy to access location over their competitors. As where market share is concerned hotel holds the 2nd major market share after the hotel Visco resorts. Hotel covers 35% of the total sales turnover of the hotels in the city. The major competitors of hotel are

 Visco resorts, mandi. Hotel River bank Hotel regent palm Hotel velly view.

Organization structure

CEO
MR. Rajesh walia

Head manager
MR. raj kumar malhotra

front desk manager

Mr. dhyan singh thakur

supervisor (rooms) Mr. Desh raj singh

supervisor (restaurant) MR. sanjay verma

1.6

SWOT ANAYSIS:

There are some strength too which is still making the hotel work successfully. 1.6.1 STRENGTH: LOCATION: According to me the biggest advantage which Paras hotels have is its location on the running highway and when corporate comes from outside city they prefer to stay in this hotel because it is easy to reach to the meeting point, or location which would probably be near the highway and approachable to the tourists too. HIGHLY SKILLED EMPLOYEES: Employees working in the firm are person selling meetings and by using their personal relations, they are doing good job for their hotel. MORE TYPES OF ROOMS: Hotel Paras is popular for its types of rooms.Like standard single and double, deluxe premium and double, deluxe and executive suits. This quality differentiates Hotel Paras from the other hotels. EXPERIENCED STAFF: Staff mostly from the marketing department is highly experienced and they have every knowledge about the marketing and because they have worked in other hotels or marketing departments of other companies before so they can understand the situation very well.

AFFILIATION: One more big advantage the Hotel has is its affiliation, especially with the Hotels in Manali so this helps a lot to transfer their guests in very moderate rates TARGET MARKET: Hotel Paras mostly deals with tourist customers as well as business clients. MODERATE RATES: Competitors of hotel Paras are Visco resorts, Holiday inn hotel, River Bank hotel, and Valley View hotel .And compare to them rates of Hotel Paras are more adjustable.

1.6.2 WEEKNESS: DISCREPANCIES AMONG STAFF:

Thats what I have noticed that there is some unhealthy p rofessional jealousy among the people working in the organization. Which is effecting the Hotels performance over all. And there is a bit less team work among employees

INCOMPETENT EMPLOYEES: There are some incompetent but old employees which are working because of good relationship with the owner which is decreasing the our all efficiency of the hotel.They are now in some powerful positions which can be reason for the hotel decline in the future hotel position. SWIMMING POOL: Mostly good hotels have swimming pools but not in hotel Paras because its location does not allow them to make it. And there is no place left for building a swimming pool. Sometimes customer prefers swimming pools. LACK OF INTERNEES They are not interested in for internships. They usually prefer full time workers. When I was doing internship at that time I was the only internee in the whole hotel. Their performance can improve by giving more opportunities internees.

FAVORITISM: The promotions and bonuses etc are often powered by seniors favoritism or depends

upon their wills and decision. This adds to the negative factors, which denominate the employees thus resulting in affecting their performance negatively.

LACK OF SPACE: With the growing needs I think the space of the hotel is bit less, they should do something to solve this problem. Space gives a good open looks to the hotel like other big hotels. But in thatit is hard to do so. LACK OF GARDENS: Gardens give a new and fresh looks to hotel where you can have seasons plants growing seasons flowers and gives the broader looks to the hotel. And may be customers like to have some open.

LESS ROOMS FOR A CROWDED SEASON: In the overcrowded season of April-July hotel has seen the shortage of rooms. As the demand of rooms increases by 200% and rooms available are far less. This adds to onr of the limitation as the regular customers need suffer because of it.

1.6.3 OPPORTUNITIES: INNOVATION: For growth everyone has to innovate and find new idea and make new solutions. Its not easy to make an innovation but just to do anything in a new way is innovation. Hotel has also planned to employ such plans to get there growth going. LOW RATES: Hotel has realized that by reducing the room prices in the off seasons the hotel can take good business. But all this should be done by person to person basis. Hotel has planned to give special discounts to regular business clients. GROWTH OF THE BUSINESS SECTOR: India is a developing country where business is growing day by day and as the business grows the need of hotels will increase and there will be the opportunities, and thats the reason why there are many projects building in the city. INCREASE OF LINKS AND AFFILIATIONS:

In the environment of competition a hotel can only grow by increasing its affiliation and links. For obvious reasons hotel with better links with business customers will have more guests. Hotel Paras has also increased their links and business over a period of time and planning to go at a even higher level.

1.6.4 THEREATS: . THE DECLINE IN HOTEL INDUSTRY: The Hotel industry is among the top three constituents of the world economy after oil and autos and is growing faster than the petroleum and arms. It is larger than automobile industry in Japan, agriculture in the U.S.A. and banking in Switzerland. It is unfortunate to know that instead of growing with world trend, the tourism industry n India has increased but at very slow pace as the revenue generated services. Its importance can be judged by the fact that it is the only industry that earns the foreign exchange without exporting anything. The hotel industry with its charming and lively environment is apparently flourishing but the reality negates the fact and depicts the other side of the story . Most of the hotels and motels here, particularly in the far flung areas, hill stations and the tourists spots and even in the major cities are dependent upon tourism, international business tri

1.7 CONTEXT OF STUDY:

Aim of the study

To measure the change in sales turnover of the hotel in context of the change in expenditure on sales promotion program and to recommend the appropriate ways to achieve the maximum profit out of it. The report also aims at improving the sales and promotion techniques and suggesting the firm the limitations of the present promotional program.

Objective of the study To study the impact of change in promotional programs on the sales turnover. To analyze the impact of changing sales promotion techniques and to find out the limitations of the previous planes. To evaluate the level of program. To recommend the firm about the new areas of enhancement in trade as well as consumer promotion. business the firm gets from this trade promotion

1.7.1 Relevance to the company :

This study can help the firm to understand that whether the expenditure on sales promotion are worthwhile or not. It will help them to understand the level of such impact. Company can find out those trade promotion techniques that gives no business to them and try to minimize effort on such techniques.

Chapter-2 Task Process

Task Process is the work done by the student and how he went ahead with the task, and limitations with respect to task completion related to the company.

ABOUT THE PROJECT 2.1 OBJECTIVE OF THE STUDY:

This report was commissioned to examine how sales turnover of Hotel Paras changes with the application of promotional techniques. The objective behind doing this study is to figure out the pattern of change of sales turnover with the change in level of promotional techniques commenced before there tourist season. Change in level of promotional techniques? From last few year hotel has understood the value of promoting the hotels name and using trade promotions for attracting new business. The previous promotional programs adopted by the hotel includes : Covers references from other hotels in Manali, Shimal and Chandigarh. Covers taxi unions of Chandigarh, Manali, shimla, and Delhi. Few travel agents on commission bases from Manali,Delhi and Kolkata

Change in level of promotion covers the following: Joined some new big business associates (travel agents) from Delhi like pankire travels, Swaghatam travels etc. Attended 2 big trade fairs in Delhi and Kolkata covering a good chunk of local small travel agents, providing them catalogs, brochures and visiting card. Made Online booking available directly on hotels website with exciting offers. Meetings with the high level corporate managers of the city to introduce them to the new corporate schemes for the bookings. Covers more taxi unions in Chandigarh and Delhi providing them catalogs, brochures and visiting card and introducing them to the new commission schemes.

The task process I was assigned was to execute the promotional program designed for the year 2013-14. The promotional program for 2013-14 covers Visit to the taxi Union offices in Delhi, Manali and Chandigarh. Arrange Meetings with the high level corporate managers of the city to introduce them to the new corporate schemes for the bookings. Attend trade fairs in Delhi and Kolkata. Maintain the daily account book, help the manager in evaluating the luxury tax. Send emails to the clients and responding to their feedback and responses.

 Visit new business associates in Delhi and Chandigarh to convince them to enter in to a contract for permanent bookings. Plan to visit corporate offices in other cities in Himachal Pradesh or to arrange meetings cum lunch parties to introduce them with new corporate planes.

2.2 To execute the same plane a design was made with different schedules and time tables.

Time period May 30 June 1

Schedule Tour Delhi to have a meeting with big travel giants like Panikers, Swaghatam,Haryyson etc. Cover old business associates and taxi unions. Tour Chandigarh to have meeting new travel agents. Cover old business associates and taxi unions. Tour Manali to have meeting new travel agents. Cover old business associates and taxi unions. Planning for the lunch meeting with the corporate managers of the city. It includes Invitation to the offices, preparation of the event and presentation for the event.

June 1 June 4

June 5 June 7

June 8 June 15

June 15 June 22

Attended trade fair arranged in ITC Morya, New Delhi. Attended trade fair arranged in Hyatt Regency hotel, Kolkata. Accounts handling, sending ebrochures, compiling data for project.

June 23 June 30

June30 July15

2.3 Limitations while task completion I was not able to complete the whole promotion process which was followed by the tourist season as the time required to complete the assignment was not enough.

Chapter 3 Analysis and discussion

3.1 Analysis
The objective of my study was to examine the impact of change in technique and expenditure on sales promotion process over the sales turnover of the firm. To study the same impact I have gone through the financial statements of the firm from the financial year 2012 -13 to 2013-14 (till August 2013) . The study draws attention to the fact that as according to the sales account and balance sheet the sales turnover of the firm in 2012- 2013 was around Rs 52 lacs and the expenditure incurred on the sales and promotion program was around 1.7 -1.9 lacs. And in the financial year 2013-14 (till august 2013) the sales turnover came out to be around 42 lacs. And as calculated the overall expenditure on the sales promotion program was around 3.75 (from april 2013 till june2013). To make the study more accurate and precise we have decided to take expenditure on sales and promotion from month April to May and sales turnover from April to July. The same financial information is presented in the following table.

Particulars

2012-13(April-August)

2013-14 (April-august)

Sales turnover

35 lacs

42 lacs

Particulars

2012-13(April-June)

2013-14(April-June)

Expenses on sales promotion program

1.7 lacs

3.75lacs

To get the exact idea of the impact of the promotional program and the conversion rate of trade promotion in depth study of the reservation books and visitors entry book was done for the months April- August 2012 and April-August 2013 and following results were found.

Particulars April August (2012)

No of room booking

April August (2013)

1860 Rooms

2640 Rooms

In terms of Sales (in rupees)

2232000

3168000

No of Rooms
3000 2500 2000 1500 1000 500 0 2012 2013

No of Rooms

sales (in rupees)

35 30 25 20 15 10 5 0 2012 2013 sales (in rupees)

(Hotelparas, Fiancial statements, 2011-2013)

3.2 Discussion
As according to the analysis done on the impact of change in sales promotion program over the sales turnover following interpretations can be made

Sales turnover has increased by 20% due to change in expenditure incurred over sales promotion program and enhancement in the promotional program by adding new business associates and attending trade fairs in Kolkata. Only Kolkatas trade fair benefited the firm by over 600 room bookings.

The increase in sales promotion expenditure from the year 2012- 13 is about 120%, but the firm in the beginning of the project decided to increase it by just 50%. Even 120% rise in sales promotion expenditure could only get 20% rise in sales turnover which is far less. But it should be included that the conversion time of such trade promotion is not limited to 3-4 months. There benefits can be availed for long.

The main finding that can be considered from the study is that this trade promotion program has increased the sales by 42%. Sales turnover converted due to trade promotion was just 22.32 lacs which increased to 31.68 lacs. And the number of reservation for such rooms increased by 780 rooms which is quite impressive.

The results of the promotional program could have been much more favorable if the Manalis tourist season was not affected due to natursudden climate change and Uttrakhands natural disaster.

Chapter 4

Summary, Conclusions and Recommendations

4.1 Summary
This report was commissioned to examine how sales turnover of Hotel Paras changes with the application of changed and enhanced promotional techniques. It covered the comparison of last year sales with the sales of this year after the promotional program being commenced to increase the sales volume and to recommend the appropriate ways to achieve the maximum profit out of it. The research draws attention to the fact that the sales turnover of the firm in 2012- 2013 (April-August) was around Rs 35 lacs and the expenditure incurred on the sales and promotion program was around 1.7 -1.9 lacs. But in year 2013-14 (April-August) the sales were about 42 lacs and the expenditure incurred on the sales and promotion program was around. The trade promotion program has increased the sales by 42%. Sales turnover converted due to trade promotion was just 22.32 lacs in 2012-13 which increased to 31.68 lacs. And the number of reservation for such rooms increased by 780 rooms which is quite impressive. The increase in sales promotion expenditure from the year 2012- 13 is about 120%, but the firm in the beginning of the project decided to increase it by just 50%. Many of the promotional techniques did not contribute to the sales turnover and hence have no conversion. Such techniques like sending E-broachers can be considered as waste of effort and should be minimized.

Conclusion and Recommendations

4.2 Conclusions:
The impact of this sales promotion program can be judged by the fact that sales turnover for the same time period in 2013 increased by 7 lacs. But the impact was not enough as the increase expenditure on sales promotion was 5 fold more than the increase in actual sales. While considering the impact of sales promotion on sales it should be included that the conversion time of such trade promotion is not limited to 3-4 months. There benefits can be availed for long.

 It was not possible to complete the whole promotion process which was followed by the tourist season as the time required to complete the assignment was not enough.

4.3 Recommendations

The time period selected for the sales promotion program is not appropriate as it is very close to the tourist season and trade promotion gets very less time to show results. The best suitable time for such promotion is from January to April of every year. The firm should minimize the trade promotion practices that have no conversion in to business like E-broachers, trade fairs in local areas of Himachal Pradesh. To attend more and more trade fairs and contact more travel agents in Kolkata and areas adjoining to it as the response from the agents was notable. To plane and enhance the promotional programs in Maharashtra and Gujrat and Rajesthan because as according to a survey 35% of the tourist in post- tourist season come from these states.

 To try and execute a program with help of local authorities to promote tourism in the city by highlighting the beautiful surroundings and natural side scene.

Bibliography

Bibliography
Bhardwaj, C. R. (2013). balance sheets(2007-2013).

Bonvin, J. L. (2003). Retrieved from hospitalitynet: http://www.hospitalitynet.org/news/4017990.html

hospitality industry. (2009, 11). Retrieved from wikipedia

hotel introduction . (2009, september). Retrieved from hotelnewparas.com: hotelnewparas.com

Hotel sector analysis report. (2011, november). Retrieved from equitymaster.com : www.equitymaster.com/research-it/sector-info/Hotel-Sector-Analysis-Report.asp

paras, h. (2011-2013). financial statements. Mandi (HP) : Hotel new Paras .