Avi Batra

: BBA/4501

Saloni Nanda : BBA/4519

The basic function of hospitality is to establish a relationship or to promote exchange of goods and services, both material and symbolic, between those who give hospitality (hosts) and those who receive it (guests) (Lashley and Morrison)

Hospitality Management refers to different areas of Tourism Reflects aspects of

Hotel Management Restaurants Holiday Destinations

Prosper in certain destinations and attractions

Paris Hollywood The most Cancun famous ones New Zealand

being

Estimated at US$17 billion Contributes 5.9% of Indias GDP Expected to reach US$35 billion by 2017

Growth of over 5% in hotel rooms in the past 3-4 years A total investment of US$12.7 billion and 20 international hotel brands are soon to arrive in India Some existing ones are - Ginger Hotels, Lemon Tree, Sarovar Hotels, Fortune Hotels, etc.

US-based casual dining chain California Pizza Kitchen(CPK) planning to launch new outlets in India Its bullish as existing outlets have proved successful

Whitbread, UK based hospitality company, has announced to invest US$53.3 million by 2020 With the investment, over 80 properties shall be developed over the new 10 years

Provides employment to over 42 million people Also on the verge of becoming a major hub for medical tourism, as US$333 million in 2007 is predicted to rise to US$2.2 billion by end of 2012

Available rooms are approx. 110,000 as against the demand of 250,000 100% FDI for construction of infrastructure and airport development projects has been permitted Estimated to receive investments of US$11.41 billion from 2011-2014
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Conrad Lashley and Alison Morrison formulated 3 domains, i.e., interactions of people and service provided

First domain is about interaction and relationships between them and their consumers
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Second domain or Private domain

Standalone food outlets that establish relationships with consumers on food based elements

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Commercial Domain, i.e., business side of hospitality industry

Refers to service or business promoted to consumers

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Role of Tourism with Hospitality

Tourism industry attracts consumers to different destinations Generally through promotion & marketing Hospitality provides comfort and leisure to those consumers
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Have global connections with Hospitality services To provide the best deals and top-notch service to consumers Helps in relationship building with clients

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5000 year history, culture, religion and alternative medicine fascinate both budget & luxury travelers The focus is on Atithi Devo Bhavah campaign, which translated literally means, Guest is God

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Tourism is 3rd largest foreign exchange earner Accounting for 5.9% of GDP

Direct contribution to economy with handicrafts, horticulture, etc.

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WTTC named India & China fastest growing Tourism industries for the next 10 to 15 years Despite poor infrastructure, tourism industry has shown an impressive doubledigit growth

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According to HVS International, strong performance in 2005 can be attributed to

Strong GDP performance Strengthening of ties with developed world Opening sectors of economy to

private/foreign investment

o Efforts made by Ministry of Tourism & Culture

have had a salutary effect on the industry

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Directly employs 150,000 people as of date Prior to 1980s, very-slow growth and static single-hotel companies existed ASIAD meet in 1982 and partial liberalization boosted demand
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As per IMF, Indias economy liberalized in FY 1991 Euphoria prompted major chains, new entrants and international chains Target consumers were business travelers and foreign clientele
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Classified into 7 categories

Five star deluxe Five-star

Ratings are reviewed every 5 years

Four star Three star Two star

One-star

Heritage

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Business Traveler Corporate, both domestic & foreign Extended stays and use PCs, fax, conference halls, etc Demand lesser discounts and give better F&B revenues

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Leisure Traveler Domestic or foreign traveler Main purpose is sight-seeing India has wild life, hill resorts, beaches, etc. Seek higher discounts and provide lesser F&B revenue

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Airline Cabin Crew Provide repetitive and guaranteed business Part of annual contract and, for a fixed rate, demand fixed number of rooms Ask for highest discounts and provide low-yield to hotels

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According to HVS International

Delhi 11,000 Mumbai 9,000 Bangalore 8,000 Hyderabad 7,500

rooms are expected to be added in the next 5 years

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Indian Hotels Company(Taj Group) EIH Limited (Oberoi Group) ITC Hotels Limited ITDC (Ashok Group)

Aggressively expanded after economic boom and are well established entities now
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Hotel Leela Venture(with Kempinski) Asian Hotels(Hyatt Corp.) Bharat Hotels(formerly with Hilton)

Late entrants and lack of experience

Plans to initiate expansion before 2020

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Marriott Starwood Berggruen Hotels

Joining with Indian players to raise awareness Ambitious expansion plans

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Mainly comprise of early entrants whose sole focus is localized presence and loyal customer base No immediate expansion plans

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Incredible India Atithie devo bhava Promotion of Buddhist abodes Other projects such as

Rs. 5,400 million National Highway Dev.

Project 6000km Golden Quadrilateral 7,300km north-south and east-west Sagarmala

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Opportunities : Need to exploit cost advantage for a health tourist Unique basket of services such as yoga, meditation, ayurveda, allopathy, etc Provided by internationally qualified and experienced specialists

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Site & Location

Convenient access and connectivity

Positioning
Approaching target segment by providing

services to both leisure as well as business travelers

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Financial Flexibility
Development of hotels is capital intensive.

Proper funding is essential during early years of operations

Brand Equity
When classified, chain and independent

hotels gain association with the brand, this reducing advertising and promotion cost
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Poor domestic infrastructure India being highly prone to prevailing socio-economic and political conditions

Growth in tourism sector is followed by imminent destruction of local ecology, which in the long run, will negatively impact us
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Entry of new players only in mid-market segment Aman Resorts, Shangri-la Hotels, Four Seasons Hotels and The Hilton Group provide fierce competition to new entrants

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9th largest aviation market in the world Approx. 30million passengers traveled to/fro India in 2008, increased by 30% w.r.t 2007 Predicted to touch 50million passengers by 2015 69 foreign airlines from 47 countries are likely to enter

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Sales
Kingfisher Airlines and Kingfisher Red Jet Airways & Jet Lite

21 12 14 16 24 3

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Air India and Indian

IndiGo Spicejet GoAir Paramount Airways MDLR Airlines
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Name of the players

Market Share

Kingfisher Airlines and Kingfisher 28% Red (previously Air Deccan) Jet Airways and Jet Lite (previously Air Sahara) Air India and Indian (previously Indian Airlines) IndiGo SpiceJet GoAir 25% 16% 14% 12% 3%

Paramount Airways
MDLR Airlines

2%
0.004%
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Civil Aviation market grew at a CAGR of 18% (round value US$5.6 billion in 08) Domestic Airlines flew 3.67 million as of August 2009 as against 2.92 million in August 2007 Estimated to handle 100million+ passengers yearly
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Growth provided by Aviation industry increased GDP above 8%. Rate will be sustained for a good number of years Air traffic has grown enormously and expected to have growth above 25% in travel segment

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Februrary 18th, 1911, first commercial flight from Allahabad to Naini by a French pilot named Monseigneur Piguet

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Initializing privatization of airport activities Modernization of airlines fleet to handle pressure of competition Rapid expansion plans for major airports Immense development of regional airports
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