15

Chapter I

Introduction

The first chapter deals with a brief introduction, background of the

study, research methodology and its limitation. It also gives the

sources of data objectives of the study hypothesis tested the methods

used for primary survey, the tools and techniques and different

questionnaire have been clearly mentioned. This chapter also gives

the overall presentation of the study.

The Prologue

India draws more than 2.5 million foreign and domestic tourists

annually. The primary factor that motivates majority of the foreign

tourist to visit India is country of bountiful nature, snow covered

mountains in the Himalayas, colorful deserts in Rajasthan, beautiful

beaches in Goa, Kerala and Orissa and tropical lush green forests

spread far and wide in most part of the country. Besides the nature,

the country rich cultural heritage in Maharashtra has been a

tremendous attraction to a large numbers of foreign as well as the

domestic tourists.

Success in the hotel industry increasingly demands an

understanding of many other aspects of popular culture and trends.

The term life style hotel that has now been adopted by brand name

says it all. The boutique hotels it carries even further the Idea that

hotel is about how people live, and what they want beyond life. The

personal touches of the lifestyle and boutique hotels, lodges, resorts

and other accommodations speak to the almost hyper-individuality

of today’s travelers- whether business person or tourist.

This hyper individuality is as feature of much of fashionable culture.

The hotel industry must permit itself to be directed by the same

powerful forces that have shaped and dramatically transformed

16

modern society. The diversity in climate, religions, languages and

traditions has always been a matter of curiosity for the people of

other countries and other nations.

Maharashtra being one of the most glamorous states of India attracts

thousands of tourists round the year, people from all over the world

get attracted to the multi faced, and multicolored state of hilly land,

fresh greens, and the golden beaches and especially in Marathwada,

historical places like Ajanta & Ellora caves, Daulatabad fort etc. and

holy palaces too.

With strong deep history and with versatile cultural depth to

mesmerize one and all, the state of Maharashtra is favorite among

the tourists irrespective of the geographical and religious barriers. In

early days people were visiting different places, only for reasons, like

visiting to the holy places rarely in the year, foreigners they were

coming to visit & see the historical places like Ajanta and Ellora.

But now days due to effect of the globalization and establishment of

so many multinational companies in the Maharashtra state,

foreigners as well domestic tourists are frequently coming for the

business purpose and along with that they are visiting to historical

places for the enjoyment.

If we can see the scenario of 2 decade back, those were the days

when tourism industry was not in boom or we can say people were

not aware about the tourism sector at all, but now there are

tremendous changes happening in the tourism industries, and

providing luxurious services to the tourists. Travels like Mahindra

travels, Yatra travels, Raj travel, Prasanna travels, City link travels,

Kingfisher travels, Keshari Travels are the famous travels in India.

Indus travels, Skyway International are the international travels.

These travels are having string tie-ups with hotel industries, and

impact of that increases hotel tariffs.

There are several reasons for not attracting & not providing desired

17

satisfaction to the tourists Vis, Downtown location, hotels operating

strategies, amenities of the hotels, shortage of skilled employees,

shortage of rooms, increasing customer’s expectations.

And some of the factors which are affecting on the service area like

maintain the quality workforce , intense competitions and image of

India, manual back-end and human resource developments and

some other problems are also, which can not seen, affecting on the

hotel business.

HISTORICAL BACKGROUND OF HOSPITALITY

Hospitality refers to the relationship process between a guest and a

host, and it also refers to the act or practice of being hospitable, that

is, the reception and entertainment of guests, visitors, or strangers,

with liberality and goodwill.

Hospitality frequently refers to the hospitality industry in which jobs

in the hotels, restaurants, casinos, catering, resorts, clubs and any

other service position that deals with tourists. Hospitality is also

known as the act of generously providing care and kindness to

whosoever’s need.

Hospitality has been formally defined as a “Pleasant reception:

kindness in welcoming guests or strangers” the dictionary’s

definition of hospitality only begins to touch upon the world’s

importance as it utilized in action to serve patrons.

The hospitality constitute creating a scenario in which customer /

guest needs are placed first and, so achieving, it is integral to achieve

an atmosphere that will serve to allow guests from a variety of

background to feel equally at relive.

Moreover, hospitality cannot be completely achieved unless each

worker is committed to the mission, which requires leadership from

the top down exhibiting commitment to the quality service;

maintenance of a good attitude and good personal appearance.

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The hospitality hub will focus primarily on facilities that provide

lodging or short term accommodation and meals, snacks and

beverages for travelers, vacationers and others.

The hospitality industry includes a wide range of establishment.

Some provide lodging only, while others offer food, beverage, laundry

services and recreational opportunities.

The History of Hotels

Evidence of hotels and the hospitality industry have been recorded

as far back as biblical times when Mary and Joseph arrived in

Bethlehem during the census.

As the Bible depicts, Mary and Joseph were refused accommodations

because there "was no room at the inn." Since the beginning of time,

people have been traveled for commerce, religion, family, health,

immigration, education and recreation. As cited by Texas Tech

University, the word "hospitality" comes from the Latin root meaning

"host" or "hospice."

The university further noted that the first hotels were nothing more

than private homes opened to the public. Most, unfortunately, had

poor reputations. Under the influence of the Roman Empire, inns

and hotels began catering to the pleasure traveler in an effort to

encourage visitors.

The first inn located in America was recorded in the year 1607 and

lead the way with many other firsts in the hospitality industry. The

first publicly held hotel (the City Hotel) opened in New York in 1792.

The first modern hotel (the Tremont) opened in Boston in 1809 and

the first business hotel (the Buffalo Statler) opened in 1908.

From there a surge of hotels flooded American and the rest of the

world with prominent names such as Radisson, Marriot and Hilton.

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Background and Overview of Hotels in India

A Building, that provides lodging, meals and other services to the

traveling public on a commercial basis. Inn have existed since

ancient times (e.g. along the Roman road system during the Roman

Empire) to serve merchants and other travelers. Medieval European

monasteries operated inns to guarantee haven for travelers in

dangerous region. The spread of travel by stagecoach in the 18th

century stimulated the development of inns, as did the industrial

revolution. The modern hotel was largely the result of railroads;

when traveling for pleasure become widely popular, large hotels were

often built near railroad station.

In 1889 the Savoy Hotel in London set a new standard, with its own

electricity and host of special services; Hotel chains became common,

making purchasing, sales, and reservation more efficient.

Categories of the Hotel’s

Hotels (as well as other forms of accommodations) are generally

segmented by the services and amenities offered. These two factors,

along with location, also have a bearing on the price range.

BUDGET HOTELS

Offer clean even if simple rooms that provides the basics of places to

sleep and shower. Usually budget hotels are designed for travelers

looking to maximize their funds and minimize expenses.

BUSINESS HOTELS

Offer a high standard by providing rooms equipped with what

business travelers would consider necessities. Usually found in

business-class hotel rooms are high speed Internet connections,

alarm clocks, comfortable beds, irons and ironing boards, coffee

makers, complimentary newspaper delivery and hairdryers.

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The facility of a business hotel would also offer an in-house

restaurant, bar, exercise room and shuttle service to nearby airports.

Limited caretaker assistance is often included as well as room

service, laundry and dry cleaning and wake-up calls.

LUXURY HOTELS

Are known for its lavish decor and extraordinary services. With

superior amenities, accommodations at luxury hotels are designed to

thoroughly pamper and impress guests. According to a Business

Week Online article, those in the luxury market are getting harder to

please stating that luxury goods and service providers can't afford to

blunder with the level of service and customer experience they

provide.

For this reason, many luxury hotels go far beyond the norm by

providing a lifestyle experience equal to or better than what guests

have become accustomed to at home.

Luxury hotels frequently offer full-service day spas, five-star

restaurants staffed by world-class chefs, ballrooms, lavish pools, golf

packages and guest services that are unsurpassed by any other class

of hotel. In addition, luxury rooms generally include those amenities

found in business class hotels plus in-room safes, goose down

comforters and pillows, marble showers and tubs, larger rooms,

separate sitting or living area and fog-free bathroom mirrors.

Rates can range from $129US (Rs.6063/-) per night to $2,000US

(Rs. 94000/-) per night. Rates vary greatly depending on location and

proximity to popular events and attractions. There are other

classifications of hotels; however, most will fall into one of these

three or a combination of these three.

With the lines between business and personal becoming more

blurred, many entrepreneurs and business executives will attend

conferences or embark on business trips with family in tow. Hotels

21

are aware of this common occurrence and have become adept at

providing facilities and service both business and recreational

travelers enjoy.

CLASSIFICATION OF HOTELS

One Star Hotels

Hotels in this classification are likely to be small and independently

owned, with a family atmosphere. Services may be provided by the

owner and family on an informal basis. There may be a limited range

of facilities and meals may be fairly simple. Lunch, for example, may

not be served.

Some bedrooms may not have en suite bath/shower rooms.

Maintenance, cleanliness and comfort should, however, always be of

an acceptable standard.

Two Star Hotels

In this classification hotels will typically be small to medium sized

and offer more extensive facilities than at the one star level. Some

business hotels come into the two star classification and guests can

expect comfortable, well equipped, overnight accommodation, usually

with an en-suite bath/shower room. Reception and other staff will

aim for a more professional presentation than at the one star level,

and offer a wider range of straightforward services, including food

and drink.

Three Star Hotels

At this level, hotels are usually of a size to support higher staffing

levels, and a significantly greater quality and range of facilities than

at the lower star classifications. Reception and the other public

rooms will be more spacious and the restaurant will normally also

cater for non-residents.

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All bedrooms will have fully en suite bath and shower rooms and

offer a good standard of comfort and equipment, such as a hair

dryer, direct dial telephone, toiletries in the bathroom. Some room

service can be expected, and some provision for business travelers.

Four Star Hotels

Expectations at this level include a degree of luxury as well as

quality in the furnishings, decor and equipment, in every area of the

hotel. Bedrooms will also usually offer more space than at the lower

star levels, and well designed, coordinated furnishings and decor.

The en-suite bathrooms will have both bath and fixed shower.

There will be a high enough ratio of staff to guests to provide services

like porterage, 24-hour room service, laundry and dry-cleaning. The

restaurant will demonstrate a serious approach to its cuisine.

Five Star Hotels

Here you should find spacious and luxurious accommodation

throughout the hotel, matching the best international standards.

Interior design should impress with its quality and attention to

detail, comfort and elegance.

Furnishings should be immaculate. Services should be formal, well

supervised and flawless in attention to guests' needs, without being

intrusive.

The restaurant will demonstrate a high level of technical skill,

producing dishes to the highest international standards. Staff will be

knowledgeable, helpful, well versed in all aspects of customer care,

combining efficiency with courtesy.

PROCEDURE GRANTING THE STAR STATUS

The Hotel and Restaurant Approval and Classification Committee

(HRACC) inspect and assess establishments based on the facilities

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and services they offer. The Department of Tourism then grants star

status based on how well the establishment scores in the HRACC

report.

The General Structure of the five star hotels:

Chart No:-1.1

Department Structure in the Hotel Industry

Departments of a Full-Service Hotel (under 500 rooms) In the five

star hotel industry

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Chart No:-1.2

Hierarchy of Room Department

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Front office

Front office is the department which is noticed by the guest

whenever they enter the hotel. It is the first department guest come

into contact in the hotel; therefore it is also called the 'nerve center'

of the hotel.

Housekeeping department

House Keeping Department is responsible for the cleanliness and

upkeep of the entire hotel and public areas.

Security department:

This department works for maintaining the safety and security of the

guests, staffs and the entire hotel properties. Security department

comes into action when there is theft, fire, and any emergency cases.

The very department is also responsible for the lost and found

procedures also.

Engineering and maintenance department:

This department is responsible for the maintenance and repair of the

damaged items, for example, plumbing, repair or the a/c, furniture’s,

fixtures etc. all are maintained by maintenance department.

26

Chart No 1.3:

Hierarchy of Food & Beverage Department

27

Food and beverage production :

This department is responsible for the production of food and

beverage items as per the guest’s order. A kitchen are fully equipped

with skillful chefs who can prepare the recipes according the demand

of the guests. There are various ranges in the job as per the skills,

experience and knowledge.

Chart No:-1.4

Hierarchy of Human Resource Department

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Human resource department:

This department is responsible for the Hiring and firing of the Staff,

maintaining rules and regulations of the hotel, providing uniform

to the staff, providing extra hands when required, Identity cards for

the staff, Training programmes etc

Chart No:-1.5

Hierarchy of Account Department

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Account:

This department is responsible for maintaining the financial

Statements and reports of the entire hotel. It is responsible for the

calculations of the total profit or loss of the hotel.

Chart No:-1.6

Hierarchy of Marketing & Sales Department

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Significance of Tourism Industry:

♠ Tourism is one of the world's fastest growing industries at present

and holds the status of the world's no. 1 industry.

♠ The tourism industry as a whole is presently estimated to earn

over US$ 3.5 trillion worldwide.

♠ The industry creates a job every 2.4 seconds with every one of

those direct jobs creating another 11 indirect ones.

♠ Spending on tourism amounts to 5%-10% of total consumer,

spending in a year worldwide.

♠ India's share of the total market is a pittance at 0.51%. The non-

tourist countries like Malaysia and Indonesia get much more tourists

than India.

♠ However, the average duration of stay of foreign tourist in India is

one of the highest in the world. On an average, it exceeds 27 days in

the case of non-package tourists and is 14 days in the case of

package tourists.

♠ Tourism has the distinction of being the third largest export

industry after gems and jewellery and readymade garments in India.

♠ The Tourism industry's foreign exchange earnings in India are

around $3.2 billion. Tourism is the highest foreign exchange earner if

we consider the fact that net value addition in Gems and jewellery is

less than 30 % whereas, in tourism it is more than 90 %.

♠ It also has one of the best employment multipliers when compared

with any other industry in India. It generates maximum job

opportunities, as it provides direct employment to 9.1 million people

and indirect employment to another 12.4 million. But these statistics

do not appear so impressive when viewed in the global perspective

and compared with that of other countries shown in the graph below.

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♠ Tourism has been a neglected sector in India. Though it was

recognized as a priority sector in the Seventh Five Year Plan, hardly

anything was done to promote this industry.

♠ Though the government has promised to give industry status to

tourism, still, budgetary support for this department is a mere Rs.

379 crore. This is despite a total tax collection of about Rs. 2000

crore in 1996 from this sector.

♠ The tourism industry currently stands 127th on the list of

priorities of the Indian government. It is true that India has yet to

reach the prosperity level where leisure activity can be included in

the priority sector but, if solving the country's unemployment and

foreign exchange problems are on the top of the national agenda, the

potential of this industry cannot be neglected.

Tourism at a glance in India

Table No:-1.1

Foreign Tourists in India (Number) from 2001 to 2011

Year 2001 2002 2003 2004 2005 2006 2009 2011

Jan 283750 228150 274215 337345 385977 459489 532088 584765

Feb 262306 227529 262692 331697 369844 439090 498806 560658

Mar 248965 225558 218473 293185 352094 391009 444186 509926

April 185338 155378 160941 223884 248416 309208 333945 369677

May 151098 132998 141508 185502 225394 255008 267758 -

June 176716 143100 176324 223122 246970 278370 310104 -

July 224432 186432 225359 272456 307870 337332 377474 -

Aug 196517 161477 204940 253301 273856 304387 360089 -

Sept 162326 151721 191339 226773 257184 297891 325893 -

Oct 181605 212191 260569 307447 347757 391399 440715 -

Nov 209685 243566 290583 385238 423837 442413 510987 -

Dec - - 319271 417527 479411 541571 575148 -

Total 2282738 2073025 2726214 3457477 3918610 4447167 4977193 2660337

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Source: - Ministry of tourism Govt of India (2010-11)

The above table depicts the foreign tourists’ arrival in India from 2001

to 2011; it can be seen from the table that the inflow of the foreign

tourist has increased from 2001 to 2011.

The maximum numbers of tourists have arrived in the year 2009 i.e

4977193, followed by 4447167 in the year 2006.

The number of tourist in the year 2002 was low by 2073025 number of

foreign has arrived in India in this year; the reason would be the post

9/11 attack on US.

Table No:-1.2

Percentage Changes in Foreign tourists’ arrival

Month 2002/01 2003/02 2004/03 2005/04 2006/05 2007/06 2008/07

January 19.6 22 23 14.5 19 15.8 9.9

February 13.3 13.1 26.3 17.3 18.7 13.6 12.4

March 9.4 1.6 34.2 25.2 11.1 13.6 14.8

April 16.2 5 39.1 16.5 24.5 8 10.7

May 12 0.2 31.1 23.8 13.1 5 8.6

June 19 27.5 26.5 16 12.7 11.4 11.1

July 16.9 22.5 20.9 7.3 9.6 11.9 -

August 17.8 26.91 23.6 6.9 11.1 18.3 -

September 6.5 26.11 18.5 11.4 15.8 9.4 -

October 16.8 22.11 18 7 12.5 12.6 -

November 16.2 19.4 32.6 7.8 4.4 15.5 -

December - - 30.8 11 13 6.2 -

Total 9.2 13.1 26.8 13.2 13.5 11.9 11.5

Source: - Ministry of tourism Govt of India (2007-08)

The table no 1.2 shows the change in percentage in foreign tourist

arrival in India, it can be seen that in the year 2004-03 the

percentage was very high i.e 26.8 followed by 13.5 in the year 2006-

05, 13.2 and 13.1 in the year 2005-04 and 2003-02, the lowest

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percentage of change in foreign tourist arrival was 11.5 % in the year

2008-07 i.e only 11.5.

Table No:-1.3

Foreign tourists’ arrival according to country from 2005 to 2010

Arrivals from

Region/ Country2005 2006 2007 2008 2009 2010

USA 329147 348182 410803 526120 611165 696739

UK 405472 387846 430917 555907 651803 734240

Canada 88600 93598 107671 135884 157643 176567

Germany 80011 64891 76868 116679 120243 156808

France 102434 78194 97654 131824 152258 175345

Australia 52691 50743 58730 81608 96258 109867

Italy 41351 37136 46908 65561 67642 79978

Japan 80634 59709 77996 96851 103082 119292

Malaysia 57869 63748 70750 84390 96276 107286

Singapore 42824 44306 48368 60710 68666 82574

Nepal 41135 37136 42771 51534 77024 91552

Sri Lanka 112813 108008 109098 128711 136400 154813

Netherlans 42368 31669 40565 51211 52755 58611

China 13901 15422 21152 34100 44897 62330

South Korea 27150 29374 35584 47835 49895 705407

Source: - Ministry of tourism Govt of India (2005-10)

The above table shows the foreign tourist arrival according to

country in India for the period of 5 years i.e from 2005 to 2010, it

can be seen that the number of tourist arrival from all countries have

increased by the end of year 2005 to 2010.

The highest number of tourist arrival in India are from UK i.e 405472

in the year 2005 and 734240 in the year 2010 followed by USA i.e

329147 number of tourist have arrived in the year 2005 and 696739

have been arrived in the year 2010 there are very few number of

tourist arrived from the countries like Italy and Netherlands,

government of India should concentrate on more marketing of tourist

place in these countries.

34

HOTEL INDUSTRY IN INDIA

Hotel Industry in India has witnessed tremendous boom in recent

years. Hotel Industry is inextricably linked to the tourism industry

and the growth in the Indian tourism industry has fuelled the growth

of Indian hotel industry.

The thriving economy and increased business opportunities in India

have acted as a boon for Indian hotel industry. The arrival of low cost

airlines and the associated price wars have given domestic tourists a

host of options.

The 'Incredible India' destination campaign and the recently

launched 'Atithi Devo Bhavah' (ADB) campaign have also helped in

the growth of domestic and international tourism and consequently

the Indian hotel industry.

In recent years government has taken several steps to boost travel &

tourism which have benefited hotel industry in India.

These include the abolishment of the inland air travel tax of 15%;

reduction in excise duty on aviation turbine fuel to 8%; and removal

of a number of restrictions on outbound chartered flights, including

those relating to frequency and size of aircraft.

The government's recent decision to treat convention centers as part

of core infrastructure, allowing the government to provide critical

funding for the large capital investment that may be required has

also fuelled the demand for hotel rooms.

The opening up of the aviation industry in India has exciting

opportunities for hotel industry as it relies on airlines to transport

80% of international arrivals. The government's decision to

substantially upgrade 28 regional airports in smaller towns and

privatization & expansion of Delhi and Mumbai airport w

35

ill improve the business prospects of hotel industry in India.

Substantial investments in tourism infrastructure are essential for

Indian hotel industry to achieve its potential.

The upgrading of national highways connecting various parts of India

has opened new avenues for the development of budget hotels in

India. Taking advantage of this opportunity Tata group and another

hotel chain called 'Homotel' have entered this business segment.

Over the last decade and half the mad rush to India for business

opportunities has intensified and elevated room rates and occupancy

levels in India. Even budget hotels are charging USD 250 per day.

The successful growth story of 'Hotel Industry in India' seconds only

to China in Asia Pacific.

‘Hotels in India' has supply of 110,000 rooms. According to the

tourism ministry, 4.4 million tourists visited India last year and at

current trend, demand will soar to 10 million in 2010 - to

accommodate 350 million domestic travelers.

'Hotels in India' has a shortage of 150,000 rooms fueling hotel room

rates across India. With tremendous pull of opportunity, India is a

destination for hotel chains looking for growth.

The World Travel and Tourism Council, India, data says, India ranks

18th in business travel and will be among the top 5 in this decade.

Sources estimate, demand is going to exceed supply by at least 100%

over the next 2 years.

Five-star hotels in metro cities allot same room, more than once a

day to different guests, receiving almost 24-hour rates from both

guests against 6-8 hours usage. With demand-supply disparity,

'Hotel India' room rates are most likely to rise 25% annually and

36

occupancy to rise by 80%, over the next two years. 'Hotel Industry in

India' is eroding its competitiveness as a cost effective destination.

However, the rating on the 'Indian Hotels' is bullish. 'India Hotel

Industry' is adding about 60,000 quality rooms, currently in different

stages of planning and development and should be ready by 2012.

MNC Hotel Industry giants are flocking India and forging Joint

Ventures to earn their share of pie in the race.

Government has approved 300 hotel projects, nearly half of which

are in the luxury range. Sources said, the manpower requirements of

the hotel industry will increase from 7 million in 2002 to 15 million

by 2010.

With the USD 23 billion software services sector pushing the Indian

economy skywards, more and more IT professionals are flocking to

Indian metro cities. 'Hotel Industry in India' is set to grow at 15% a

year.

This figure will skyrocket in 2010, when Delhi hosts the

Commonwealth Games. Already, more than 50 international budget

hotel chains are moving into India to stake their turf. Therefore, with

opportunities galore the future 'Scenario of Indian Hotel Industry'

looks rosy.

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Table No. 1.4

Hotel and restaurant approval and classification committee:

quality assessment

CriteriaMax

MarksArea

Marks

Granted

Exterior &

Ground8

Approach 2

Landscaping 2

Exterior Lighting 2

Parking 2

Guest Room 10

Furniture 2

Furnishing 2

Decor 2

Room Facilities and

amenities2

Linen 2

Bathroom 8

Facilities 2

Fittings 2

Linen 2

Toiletries 2

Public areas 8

Furniture 2

Furnishing 2

Decor 2

Restrooms 2

Food & Beverage 8

Choice of the cousin &

Manu 3

Decor 2

Food Quality 3

Kitchen 8

Equipments 3

State of repair 2

Food Storage 3

Cleanliness 8 Overall Impression 8

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Hygiene 8

Pot & dish washing 2

Drinking water 2

Staff facilities 1

Pest control 2

Garbage disposal 1

Safety &

Security8

Fire fighting equipments 2

Signage 2

Awareness of procedure 2

Public area & room Security 2

Communication 6

Phone service 2

E-mail access 2

Internet access 1

PC & other Equipments 1

Guest Services 5 Overall Impression 5

Eco-friendly

practices5

Waste management,

recycling, no plastic 1

Water conservation and

harvesting 1

Pollution control, air, water,

sound, light 2

Alternative energy usage 1

Facilities for the

disabled5

At least one room for

disabled person 1

Public toilet in lobby 1

Telephone in public place 1

Ramp 1

Facilities for visually

handicapped 1

Staff Quality 5 Overall Impression 5

Total 100

Source: Indian Hospitality: the industry, regulation & Incentives

– Vijay Goel and Himanshu Pimplekhute.

90% = five-star deluxe;

80% = five star;

75% = four star;

65% = three star;

55% = two star; and

50% = 0ne star.

Classification is valid for five years from the date of issue or, in the

case of reclassification, from the date of expiry of the last

classification. The hotel is expected to maintain the required

standards at all times.

The HRACC may inspect a hotel at any time without prior notice, and

may request that its members be accommodated overnight to inspect

the level of services. Based on an inspection report, the

establishment may be downgraded instantly. Upgrades are allowed

on a fresh application for a stated category.

REGULATIONS FOR FIVE STAR HOTELS

The raft of legislation governing the hospitality industry can be

divided into three sectors.

The first governs the construction and commissioning of hotels,

restaurants, guest houses and other establishments, and includes

the Foreign Exchange Management Act, the industrial licensing

policy, the Transfer of Property Act, and various development control

orders issued by central and state governments and local municipal

councils.

The second governs the operation, maintenance and management of

establishments, and the health and safety of occupants.

This legislation includes the Indian Contract Act, health and safety

laws, insurance laws (notably public liability insurance), and fire

safety and hygiene regulations. Establishments must obtain various

licenses, such as a liquor license, dance license, lodging house

license, eating house license, police permissions, a license under the

Shop and Establishment Act, or a license under the Food and Drug

Administration Act, all of which are granted on an annual basis.

40

If an establishment fails to meet the requisite criteria the license is

not renewed, effectively closing down the business.

The third set of rules governs taxation, employment and other

contractual relationships. This includes laws on income tax, service

tax, expenditure tax, excise duty, luxury tax, entertainment/

amusement tax, as well as laws on pension, gratuity and provident

funds, and other employment laws.

Chart No: - 1.7

Source of Revenue from 2006-07 to 2010/11

Source: - Indian Hotel Industry Survey 2010-2011 (FH & RA

India)

Chart No:-1.7 Highlights the trends for sources of revenue for hotels

over the last five years. As evident from the above chart that F&B has

been fairly steady with respect to its overall contribution to hotel

revenues. F&B revenues (including banquets) in India continue to

support top lines since they are largely independent of factors that

41

affect room demand and more driven by the local market. However,

going forward we expect F&B revenue contributions to the overall

revenue pie of a hotel to come under pressure in the medium to long

term. Several branded budget hotels that are estimated to enter the

market over the next few years, are expected to include minimal F&B

facilities and in some cases lease out the F&B outlet of the hotel to a

third-party vendor. Additionally, the increasing number of stand-

alone dining options across several cities, which include both fine-

dining and casual-dining options, is also expected to affect the

number of locals visiting hotel restaurants.

Chart No:- 1.8

Revenue and Net Income 2006-07 to 2010-11

Source: - Indian Hotel Industry Survey 2010-2011 (FH & RA India)

Chart No:- 1.8 Illustrates the PAR trends in revenue and net income

over the past five years. While revenue increased by approximately

13.0%, net income showed a decline of 4.0% as a percentage of

revenue over the previous year. This could be attributed to a POR

increase in departmental and operating expenses over last year; both

42

of which grew by 2.8% and 10.5% respectively. The growing inflation

in 2010/11 resulted in POR expenses for the rooms division and

F&B to grow by 4.0% and 1.0% respectively. Additionally, POR

expenses pertaining to administrative and general (A&G) and

property operations and maintenance also saw a 16.0% and 15.0%

rise respectively over last year.

Chart No:- 1.9

Occupancy and Average Rate 2006/07 to 2010/11

Source: - Indian Hotel Industry Survey 2010-2011 (FH & RA India)

Chart No:- 1.3 Illustrates the earlier mentioned trend of the year

2010/11 being one of consolidation wherein all- India occupancies

grew by approximately 4% over the previous year and average rates

grew by approximately 10%.

The current scenario:

• Existing hotel rooms in India: 202,963, source FHRAI

43

• Revenue of the Indian hotel industry FY 2007-08: INR 38,558

crore

• 30% of this revenue i.e. INR 11,567.4 crore went back into the

market in FY 2008-09 as operating expenses

Table: 1.5

Number of hotels and restaurants in India

Sr. No Hotel category No. of

Hotels

No. of

employees

No. of

Rooms

1 5 star deluxe/5 star 297 17820 43, 965

2 4 Star 134 11550 20, 770

3 3 Star 505 6930 30,100

4 2 Star 495 5280 22,950

5 1 Star 260 4125 10,900

6 Heritage 70 6600 4,200

7 Uncategorized 7,078 3135 -

Total 8,839 55440 1,32,885

Restaurants 12,750 7590

Source: Global hospitality Services. (2011)

It is seen from the table no 1.5 that there are 297 5 stars hotels with

17820 employees and 43,965 rooms, the number of 3 stars hotels

are 505 with 6930 number of employees and 30,100 numbers of

rooms in these hotels.

Overall it can be seen from the above table that there are 8,707

number of hotels and 55440 number of employees with over

1,32,885 number of rooms in India at the end of the year 2011.

44

Table NO:-1.6

City wise classification of five star Hotels in India (2011).

Sr. No City Total No. of

Hotels

States

1 Bengaluru 10

Karnataka

15

2 Mysoor 1

3 Kabini 1

4 Manglour 1

5 Coorg 2

6 Goa 23 Goa 23

7 Jaipur 02

Rajasthan

21

8 Udaypur 06

9 Jodhpur 05

10 Jaisalmer 01

11 MauntAbu 01

12 Mysore 4

13 Pali 2

14 Mumbai 29

Maharashtra

56

15 Shirdi 02

16 Lonavala 03

17 Pune 12

18 Aurangabad 03

19 Nagpur 02

20 Nasik 04 Maharashtra

0321 Khandala 01

22 Mahabaleshwar 02

23 Ratnagiri 01

24 Manali 03 Himachal

Pradesh

9

25 Chail 01

26 Simala 01

27 Chamba 01

28 Darjiling 01

45

29 Parwanoo 02

30 Khajurao 04Madhya

Pradesh

9

31 Bhandhavgarh 01

32 Gwalier 02

33 Kanha 01

34 Pench tiger 01

35 Kolkatta 09 West Bengal

1036 Raichak 01

37 Alibagh 01 Konkan

238 Ratnagiri 01

39 Ludhiyana 02Panjab

7

40 Amritsar 01

41 Chandigarh 02

42 Dalhouzi 01

43 Phagwara 01

44 Nainital 01 Uttarakhand

245 Almora 01

46 Auli 01

Uttarakhand

10

47 Haridwar 01

48 Khimsar 01

49 Nanital 02

50 Rishikesh 01

51 Simla 04

52 Guhahati 01 Assam

253 Guwahati 01

54 Ooty 02

Tamilnadu

28

55 Kodaikanal 01

56 Madurai 05

57 Coimbatore 02

58 Chennai 13

59 Coonoor 01

60 Mahabalipuram 01

46

61 Mamallapuram 01

62 Pondicherry 02

63 Bhuveneshwar 05 Orissa

10

64 Puri 01

65 Bhuvaneshwar 04

66 Cochi 09 Madras

1367 Corbet 04

68 Faridabad 01 Hariyana 1

69 Gangatok 01 Sikkim 1

70 Jamshedpur 01 Jharkand 1

71 Patna 01Bihar 2

72 Solon 01

73 Srinagar 01 Jammu 1

74 Surat 01Gujrat

8

75 Vadodhara 01

76 Baroda 01

77 Surat 01

78 Ahmedabad 04

79 Thekkasdy 03 Kerala

16

80 Varkala 01

81 Munar 01

82 Kovalam 02

83 Kumarakom 04

Uttar Pradesh

43

84 Munar 01

85 Trivanthpuram 03

86 Kumarkom 01

87 Varanashi 06

88 Noida 02Uttar Pradesh

1489 Mussoorie 01

100 Gudgaon 11

101 Allahabad 01 Uttar Pradesh

3102 Luknow 03

47

103 Agra 0524

104 New Delhi 31

105 Vishakhapattanam 01Andhra

Pradesh

10

106 Vijaywada 01

107 Hyderabad 06

108 Vishakhapattanam 02

Total 297

Source: - Indian Hotel Industry Survey 2010-2011 (FH & RA

India)

It is evident from the table no 1.6 that Uttar paradesh has the

maxium number of five stars hotels i.e 60, followed by maharashtra

state 59, Rajasthan 21, Goa 23, Andhra paradesh 10 and Karnataka

15.

The state like goa and rajasthan which attract number of foreign

and domestic tourist should increase the number of five star hotels

in there state as compared to other state in India, in maharashtra

there are few cities like Mumbai and pune which have maxium

number of five star hotels.

What the future holds:

• Despite the global recession, inflation, terrorism and other

factors, the overall outlook for the Indian hospitality market is

optimistic and will remain so says HVS

• India remains the second fastest growing economy in the world

and the economic growth of the country is at 7.1% of the GDP

as declared by Mr. Pranab Mukherjee, Finance Minister, India.

• The Tourism Ministry, Government of India, has set a target of

10 million tourists to India by 2010

• The WTO (World Travel Organization) predicts that India will

receive 25 million tourists by year 2015

48

Facts and Figures of Indian Hospitality industry:

Foreign Tourist Arrivals (FTAs) to India increased from 5.17 million

in FY09 to 5.78 million in FY10, thereby resulting in a increase of

11.8% YoY. It was better than UNWTO’s projected growth rate of 5%

to 6% for the world in 2010. The share of India in international

tourist arrivals in 2010 was 0.61%, which is 0.02% improvement

over 2009. India’s rank improved to 40th in 2010, from 41st in 2009.

The Tourism and the Hospitality sector generated a total of US$

2,468.39 billion (INR 1,094,48.4 billion) in Foreign Direct Investment

(FDI) during April 2000-April 2011, according to the Department of

Industrial Policy and Promotion (DIPP).

The Indian Hospitality industry contributes around 2.2 per cent of

India’s GDP. The industry is expected to reach INR 230 billion (US$

5.2 billion*) by 2015, growing at a robust CAGR of 12.2 per cent.

India will be investing around INR 448 billion (US$ 10.1 billion*) in

the hospitality industry in the next five years, according to a report

‘The Indian Hotel Industry Report - 2011 Edition’ by CYGNUS

Business Consulting & Research Firm.

In the next two years, a total investment of US$ 12.2 billion (INR

545.2 billion*) is expected that will add over 20 new international

brands in the hospitality sector. India's hospitality sector is expected

to see an estimated investment of US$11.41 billion in the next two

years, and around 40 international hotel brands making their

presence in the country by 2011, according to a report by Ma Foi

Management Consultants.

Moreover, the sector is expected to provide over 400,000 jobs.

In India, the industry supports 48 million jobs, directly or indirectly

or 8.27 per cent of total employment and accounts for 5.83 percent

of the GDP, according to Department of Tourism estimates.

49

According to an HVS International report average employee to room

ratio is 1:8 in Indian hotels across all markets and drops to 1:5 for

three star category of hotels. The report also states that the hotel

sector would need a fresh workforce of atleast 94,000 by 2010-11.

India currently has over 200,000 hotel rooms spread across hotel

categories and guest-houses and is still facing a shortfall of over

100,000 rooms (source: FHRAI) The country is witnessing an

unprecedented growth in hotel constructions and will be adding

almost 114,000 hotel guest rooms to its inventory over the next five

years.

In the FHRAI’s memorandum presented to the government recently,

it is said that atleast 1,50,000 additional rooms are required to meet

the target of 5 million foreign tourist arrivals. This entails an

investment to the tune of over Rs.15,000 crore. Currently there are

1,05,000 hotel rooms in the three to five-star category in India. The

annual growth rate of hotel rooms in India is 6%. Nearly 11 per cent

of the hotel demand in the country is from long stay guests.

To set up a 5-star deluxe hotel with 250-300 rooms will cost

approximately Rs.300 crore, excluding the land cost. As per

estimates by hospitality consultancy HVS International, around 150

hotel projects are in the works across the country, which are likely to

add around 53,000 rooms over the next five years.

There are about 1,285 approved budget hotels across the country

with about 51,000 rooms apart from guesthouses, dharamshalas

and devasthans in the unapproved sector. The footprints of the IT

and ITES in Tier 2 cities like Indore, Jaipur, Agra, et al, have played

a role in driving the demand for budget hotels in these cities.

Average Room Rate (ARR) of hotels in India is increasing at the rate

of over 20%- almost equal to that of hotels in developed countries

such as Europe and the US. The growth in ARRs is a direct fallout of

50

the shortage of five-star accomodation in India and high demand

generated by the booming economy. This shortage has stimulated

investments in the hotel industry. Most of the five-sar hotels are

witnessing an average room occupancy rate of over 80%.

For every room constructed, 3-5 jobs are created. The World Travel

and Tourism Council has estimated that by 2010, tourism can

support 25 million jobs ( 1 in every 15 ) in India through 8% annual

growth.

For every rupee that goes into building a hotel, three more are spent

on furnishing it. More than 27000 items go into a hotel including

building material, chandeliers, glassware, furnishings, energy saving

devices etc., and at present 90% of hotel accessories are indigenously

produced in India. So the domestic accessories sector stands a good

chance in the near future. The average duration of stay of a foreign

tourist in India is one of the highest in the world. On an average, it

exceeds 27 days in the case of non-package tourist & is 14 days in

the case of package tourist.

Wedding tourism is growing almost 100% on a year-on-year basis.

Generally, the ratio of foreigners to Indians in an NRI wedding is 7:3.

On an average, an NRI wedding organised in India costs Rs.50 lakh.

On an average, 50-150 rooms are booked in a star category hotel.

Cruise shipping is growing globally at the rate of 12-15% annually.

In India the cruise market is in excess of 1,25,000 guests annually

and will grow at over 10% annually.

22 Institutes of Hotel Management being operated as Centres of

Excellence for providing hospitality manpower. The government

plans to set up four Indian Institutes of Hotel Management in

Uttaranchal, Jharkhand, Chattisgarh and Haryana. To provide

training in the area of tourism, the tourism ministry will also start

400 training programmes. Estimates indicate a need for about

51

15,000 more trained persons in the star category hotels, which

includes about 2,700 managers, 2,500 supervisors and about 1,000

staff.

Online travel industry is growing at a CAGR of 125%. Generating

revenues of around $300-500 million, the size of this industry is

around 2% of the entire travel industry, which is estimated to be $42

billion. Growing at the current rate the online travel industry in India

is expected to become a $2 billion industry by 2008.

International Recognition: India's booming tourism sector has not

only witnessed international investments but also achieved

international accolades with its increasing appeal as the leading

global tourist destination. The government has been instrumental in

making tourism a priority sector. Its efforts have borne fruits with a

series of international recognition and awards.

India has been elected to head the UN World Tourism Organisation

(UNWTO), the highest policy making world tourism body represented

by 150 countries. The world's leading travel and tourism journal,

Conde Nast Traveller, has ranked India as the 'numero uno' travel

destination in the world.

India was adjudged Asia's leading destination at the regional World

Travel Awards (WTA). India's Taj Mahal continues to figure in the

Seven Wonders of the World. Bangalore-based Leela Palace

Kempinski was voted the favourite business hotel in the world in a

Readers' Choice Awards by Conde Nast Traveller in 2007.

India bagged the World's leading Destination Marketing Award for

the Incredible India campaign.

Government Initiatives: To unlock the huge potential in this sector,

the government has taken various initiatives for the development of

this sector. Launch of Incredible India campaign to promote tourism

52

both in domestic and international markets. Guidelines issued for

classification of Apartment Hotels / Timeshare Resorts / Guest

Houses and Bed & Breakfast establishments. Railways have planned

to set up 100 budget hotels at various stations along with private

hospitality players.

Recognition of spare rooms available with various house owners by

classifying these facilities as "Incredible India Bed and Breakfast

Establishments"', under 'Gold' or 'Silver' category.

Other Initiatives by the Ministry of Tourism:- Paradigm shift towards

Rural Tourism / Agri Tourism, Eco-Tourism; Medical Tourism

launched as a new product. The Government has launched a

Scheme of ‘Visa on Arrival’ (VoA) from January 2010 for citizens of

five countries, viz. Finland, Japan, Luxembourg, New Zealand and

Singapore, visiting India for tourism purposes.

The Government has now extended this Scheme for the citizens of six

more countries, namely Cambodia, Indonesia, Vietnam, Philippines,

Laos and Myanmar from January 2011. During the period January-

June 2011, a cumulative figure of 5774 VoAs were issued, with a

total of 865 & 770 VoAs issued in the months of May & June

respectively.

As per the press release by Press Information Bureau (PIB) dated

November 15, 2010, the Union Ministry of Tourism has included

Medical Tourism under the Marketing Development Assistance

(MDA) Scheme. The Ministry of Tourism has sanctioned US$ 27,742

as MDA to 10 Medical Tourism Service Providers during current year.

As per a market research report 'Booming Medical Tourism in India'

by RNCOS, India's share in the global medical tourism industry will

reach around 3 per cent by the end of 2013. Moreover, medical

tourism is expected to generate revenue worth US$ 3 billion by 2013,

growing at a CAGR of around 26 per cent during 2011-2013. The

53

number of medical tourists is anticipated to grow at a CAGR of over

19 per cent during the forecast period to reach 1.3 million by 2013.

Domestic medical tourism in the country has also seen growth in the

recent years. As per the report 'Domestic Tourism in India, 2008-09'

released by the National Sample Survey Office (NSSO), trips for

'health and medical' purposes formed 7 per cent of overnight trips in

the rural population and about 3.5 per cent in the urban population.

'Health and medical' purposes accounted for 17 per cent of same-day

trips in rural India and 8 per cent in urban India. Expenditure on

medical trips accounted for 30 per cent of all overnight trip

expenditure for rural India and 15 per cent for urban According to a

report by FICCI and Ernst & Young, medical tourism industry,

currently pegged at $450m, has the potential to grow into a $2.2bn

(Rs.10,000 crore) industry by 2012.

According to a study by McKinsey and the Confederation of Indian

Industry (CII), medical tourism in India could become a US$ 2 billion

industry by 2012 (from US$ 350 million in 2006). An estimated 1.75

lakh medical tourists visited India in 2005 for cardiac care, cosmetic

surgery, joint replacements and dentistry, about 30% more than

2004. Inbound medical tourism is expected to contribute about 15%

of corporate hospitals total earnings by 2009.

Another initiative in the pipeline is industry body CII’s partnership

with 29 hospitals across 16 states to work out a price band for

speciality services in cardiology, orthopaedics, oncology and

minimally invasive surgery. The healthcare industry is working

closely with the tourism ministry, which will incorporate these

packages under its ‘Incredible India’ campaign tp promote medical

tourism in overseas markets. Currently 5 hospitals in the country

have got National Accreditation Board for Hospitals and Healthcare

Providers (NABH) accreditation. 15 more hospitals are expected to be

accredited in one year. 32 hospitals have applied for the

54

accreditation with the NABH and many are expected to follow.

International Society for Quality in Healthcare (ISQua) - an

international body that certifies quality of healthcare delivery,

recognises the NABH accreditation is of the highest global standards.

A new category of visa, "Medical Visa" ('M'-Visa), has been introduced

which can be given to foreign tourists coming into India for medical

tourism.

Eco-tourism - The government is considering various fiscal and

policy measures to promote ecological and adventure tourism in the

country including formulating uniform ecological guidelines to

conserve nature and waiver of service tax charged on adventure

tours. Ministry of Tourism has tied up with United Nations

Development Programme (UNDP) to promote rural tourism. 15 key

tourist destinations/circuits being developed to world class

standards and identified 50 villages for exposition of handicrafts and

handloom.

A maximum amount of Rs.50 lakh is sanctioned for each rural

tourism project under the Rural Tourism Infrastructure Development

scheme for development of tourism related infrastructure. The

Ministry of Tourism has launched a scheme for development of

nationally and internationally important destinations and circuits

through Mega Projects. As on 4.2.2011, 38 mega projects have been

identified, out of which 26 projects have already been sanctioned.

The United Nations Educational Social and Cultural Organization

have declared 16 centrally protected monuments : Ajanta, Ellora,

Elephanta Caves, Agra Fort, Taj Mahal, Fatehpur Sikri, the Sun

Temple at Konark, the Churches and Convents of Goa, Khajuraho,

the Buddhist monuments of Sanchi, Humayun's Tomb, Qutab

Minar, Hampi monuments, Pattadakal monuments, Brihadisvara

temple and the Mahabalipuram monuments as world heritage sites.

The Ministry of Tourism has sanctioned 781 projects in 34 States /

55

Union Territories (UTs) in the country amounting to US$ 511.82

million during the last three years up to June 2010, as per a press

release dated October 18, 2010.

During the 11th Five Year Plan, (as on 31.12.2010) Ministry of

Tourism has sanctioned, an amount of Rs.3112.71 crore for 991

tourism infrastructure projects, including Rural Tourism and Human

Resource Development projects. 924 Infrastructure projects worth

Rs.1440.86 crore sanctioned during the 10th Plan. The government

has already okayed plans to substantially upgrade 28 regional

airports in smaller towns.

The upgradation of national highways connecting various parts of

India has opened up the way for the development of budget hotels in

India. Focus on Buddist Circuit through infrastructure upgradtion of

Buddist Circuits and "Walk with the Buddha" Campaign.

The Tourism Ministry has identified 62 centres of Buddhist interest

for development. Tourism revival in J&K through a special tourism

package. Focus on North East as India's tourism gateway to the

East.

Tourism ministry has proposed to declare a conditional 10-year tax

holiday for all tourism projects in the country. Companies would

enjoy full tax exemption up to 50% of the profits, but to enjoy tax

benefits for balance amount they would be required to re-invest that

part of the profits in tourism projects. According to the Consolidated

FDI Policy, released by DIPP, Ministry of Commerce and Industry,

Government of India, the government has allowed 100 per cent

foreign investment under the automatic route in the hotel and

tourism related industry. And with the relaxation of FDI restrictions

on the real estate sector the hospitality industry has registered an

increase in investments.

56

Projected investments years 2009-015

• Rooms being built across hotel categories: 114,000., source

HVS

• Investment in rupees: INR 40,463.10 crores.

The growth story of India predict well for the Indian hospitality

sector. The sector is witnessing an all time high tourist arrival from

across the world. What is more encouraging for the industry is spurt

in foreign visitors who have been frequently coming to India for

business and leisure travel. In 2006, as many as 4.5 million tourists

gather Indian hotels from abroad. It’s a historic high. In 2003-04,

this number was around 2.93 million.

That means a growth of more than 53 per cent in three years. The

occupancy rates in Indian hotels fly between 70-80 per cent. Major

cities of the country have been posting record growth in the past

three years. On an average, the occupancy rate on all India basis

increase from 54.8 to 63.6 per cent.

The occupancy rates in Mumbai and Delhi hotels went up from 62.6

and 58.3 per cent of 2002-03 to 74.9 and 76.6 per cent, respectively.

Thus, there exists a considerable room for growth in the industry

while the sector goes organized.

Meanwhile, the industry is undergoing phases of consolidation as it

continues growing at a considerable pace. Established players are

strengthening their roots while foreign majors are also foraying

aggressively into the sector.

Major International Tie-Ups

Most big players in the country, with the exception of IHCL and EIH,

have entered into marketing collaborations with major international

hotel chains. For example, ITC has a tie-up with Sheraton. Leela-

Kempinski and AHL-Hyatt Regency are the other well-established

57

collaborations, in the Indian hotel landscape. BHL, also, has a tie-up

with the Inter-Continental Hotels Corporation

Foreign Players in the sector

The Indian government has already allowed 100 per cent Foreign

Direct Investment (FDI) in the hotel sector. With a view to cash in the

opportunities in the segment of luxury hotels in India, a number of

foreign hotel majors have set themselves up. Besides, Marriott

International, international hotel groups like Golden Tulip, Dawney

Day, Mandarin Oriental, Whitbread, Jumeirah and Istithmar have

plans to launch hotels in India.

US-based Best Western International has plans to establish 100

hotels across India through a master license agreement with Cabana

Hotel Management of India. The company will inject USD 1.2 billion

in various phases.Warburg Pincus recently picked up 27 per cent

stake in Delhi-based Lemon Tree Hotels, at a staggering cost of Rs

280 crore.

Le Meridien group that runs three five-star hotels at Delhi, Bangalore

and Pune has also laid ambitious plans to set up 17 hotels in the

country. The InterContinental Hotel Group has plans for 20

properties under its brands-InterContinental, Holiday Inn and

Crowne Plaza. The company also set up its USD 1-million corporate

offices at Gurgaon to speed up its hotel projects in India.

Indian Hotel Industry - A Sneak Peak

The Tata owned Indian Hotels Company Limited (IHCL), which

operates under the brand name of Taj, is the largest chain of hotels

in the country. The group runs 48 hotels at 34 different locations of

South Asia. The second largest hotel chain of India is the East India

Hotels (EIH), promoted by prestigious Oberoi Group. Other top notch

hotels include the ITC Hotels (ITCH) of the ITC Group, the Asian

58

Hotels Limited (AHL), Bharat Hotels Limited (BHL), Oriental Hotels

and Hotel Leela Venture (HLV). The AHL owns the Hyatt Regency

Hotel in New Delhi. Bharat Hotels Limited (BHL) has a hotel in New

Delhi and another in Srinagar.

Revenues of Hotel and Restaurant:

• (H&R) industry in India during the financial year 2006-07 was

INR604.32 billion , a growth of 21.27% over the year 2005-

2006, primarily driven by foreign tourist arrivals ,which

increased by 14.17%. Currently there are some 1,980 hotels

approved and classified by the Ministry of Tourism,

Government of India, with a total capacity of about 110,000

hotel rooms.

• The hospitality industry is poised to grow at a faster rate and

reach INR826.76 billion by 2010. It is estimated that over the

next two years 70,000-80,000 rooms will be added across

different categories throughout the country.

• In the Indian scenario, the current trends in the Hotel industry

(increase in foreign tourist arrivals, MNC's foraying into India,

demand supply mismatch getting closer, rise in Occupancy

rates and RevPAR and strong recovery of the Indian

economy),its structure (composition of hotels), key consumer

segments (business traveler, leisure traveler, & airline cabin

crew) and value chain.

• As a part of the derisking model the companies in the Indian

hotel industry are also moving up the value chain to

management contracts and co-branding.

Innovations in the Indian Hospitality Industry

Innovations in the Indian hospitality sector can be analysed on many

different levels. This analysis makes the attempt to give a broad

overview on innovations taking place in the industry according to

various categories of hotels as well as relevant functions, concluding

59

with a brief outlook on future directions these innovations might

take. India holds a special place in the international world of

hospitality. Culturally the country might very well be the most

diverse place in the world. It is a vivid kaleidoscope of landscapes,

magnificent historical sites and royal cities, misty mountain retreats,

colourful people, rich cultures, and festivities. Luxurious and

destitute, hot and cold, chaotic and tranquil, ancient and modern -

India's extremes rarely fail to leave a lasting impression.

Hospitality is a long running tradition in India. From the majestic

Himalayas and the stark deserts of Rajasthan, over beautiful

beaches and lush tropical forests, to idyllic villages and bustling

cities, India offers unique opportunities for every individual

preference. However, until fairly recently this was hardly evident

when looking at India's hospitality industry.

By now, accommodation options throughout India have become

extremely diverse, from cosy homestays and tribal huts to stunning

heritage mansions and maharaja palaces. From Kashmir to

Kanyakumari, from Gujarat to Assam, there are different cultures,

languages, life styles, and cuisines. This variety is increasingly

reflected by the many forms of accommodation available in India,

ranging from the simplicity of local guest houses and government

bungalows to the opulent luxury of royal palaces and five star deluxe

hotel suites.

From beach shags along Goa's soothing beaches to British colonial

mansions in the many scenic hill stations, the hospitality industry in

India sells "great experiences". As the experiences sought by

travellers around the world diversify, the global hospitality industry

is adjusting accordingly in order to satisfy these complex demands.

India is no exception here - quite the contrary. Coming from a rather

old-fashioned understanding of hospitality services, India is rapidly

60

catching up and turning into an innovation leader on several key

fronts.

Hospitality and Indian Economy

The contribution of the entire travel and tourism sector in India to

Gross Domestic Product is estimated to rise from 8.6% (USD 117.9

billion) in 2010 to 9.0% (USD 330.1 billion) by 2020. Between 2010

and 2019 the demand for travel and tourism in India is expected to

grow annually by 8.2%, which will place India at the third position in

the world. Travel and tourism in India also accounts for 49,086,000

jobs in 2010 (about 10% of total employment) and is expected to rise

to 58,141,000 jobs (10.4% of total employment) by 2020.

Within the travel and tourism sector, the Indian hospitality industry

is one of the fastest growing and most important segments, revenue-

wise as well as employment-wise. According to an estimate of the

Economic Survey of India and Technopak, the Indian hotel industry

accounts for USD 17 billion, 70% (USD 11.85 billion) of which take

their origin from the unorganised sector and the remaining 30%

(USD 5.08 billion) from the organised sector.

In 2000, India hosted only 2.6 million international visitors. By 2009,

the figure had already increased to 5.13 million arrivals. Compared

to other tourism markets in nearby Asian countries, this is still a

limited success, but one with the potential to develop into a

tremendous success story.

Innovation

Much hope for the Indian economy lies in harnessing innovations in

the hospitality industry. Not only has the Indian hospitality industry

an enormous growth potential, the industry itself reinforces the

diffusion of innovations by attracting foreigners, facilitating the

movement of people, and so on. The hospitality business requires

entrepreneurs to continuously come up with new services, new ways

61

to present existing services, new ways of enhancing the experiences

of their increasingly demanding clientele, and new processes to

economise operations. Without innovation, hospitality service

providers face the threat of becoming ‘obsolete’- ultimately driving

them out of business or forcing them to hand the business over to

more efficient and innovative entrepreneurs.

Innovations According to Particular Hospitality Categories

Major players in the hospitality industry can be categorised into

leading domestic hotel chains, international brands, emerging Indian

brands, market entrants from outside of the industry, and the

remainder of nondescript, largely standalone properties. The leading

Indian hotel chains, such as The Taj Group of Hotels, Oberoi Hotels

& Resorts, and ITC Welcomgroup, and the government-run ITDC

dominated the Indian hotel market for decades, when only a handful

of international brands had a token presence in India.

Of the major international hotel chains Sheraton, Hilton, Hyatt,

Radisson, Marriott, and Le Meridien are already firmly established in

the Indian markets and steadily expanding. With China and India as

leading engines of growth in the global hospitality industry, few of

the globally operating companies want to be left out. Considering the

immense scope of opportunity in India, more and more international

brands follow their footsteps.

By now, about 50 international hotel chains have entered the Indian

marketplace. Rotels, such as the famous Indian luxury trains "Palace

on Wheels" and "Deccan Odyssey", are continuously expanding the

hotels on wheels concept. A growing number of other trains in India

provide a luxurious hotel atmosphere to discerning tourists.

Budget Hotels

The Bed and Breakfast concept has arrived in India. The government

is now classifying home owners providing hospitality facilities as

62

"Incredible India Bed and Breakfast Establishments". Remarkably,

also big hospitality service providers are attracted to this nascent

market. Mahindra Group's Mahindra Homestays already have

hundreds of rooms on a Bed and Breakfast basis in Indian homes

countrywide that can be booked online.

Average room rates hover around INR 2,500 for facilities at par with

three star category hotels. Most bookings are made online and the

brand spreads mostly through media reports and word of mouth due

to the very reasonable rates, which allows the Taj Group to save on

advertising expenses as well.

The concept proves so successful that the company is planning to

open hundreds of Ginger Hotels in India and around the world. Taj's

brand sharpening exercise is bearing fruits. Credit Suisse recognised

IHCL as one of the 27 ‘Great Brands of Tomorrow'.

Luxury Hotels

India also has entered the field of Super Luxury Hotels; some are

located in the big cities, while others are located close to nature.

Mumbai's Sahara Star hotel, for instance, is one of famous the Super

Luxury city hotels in India. It features the 3-floor Sahara Suite,

which might well be India's most expensive suite at INR 400,000 per

night (about USD 8,600).

The price is justified by a private elevator, a personalised spa station

with floatation tank, a glass-roofed lounged with artificial rainfall,

etc. In the same line, Super Luxury resorts such as the Aman Bagh

in Alwar have entered they fray, where the cheapest rooms are priced

at about USD 600 per night.

Authenticity:

Based on the believe that it depends heavily on the type of

accommodation how guests will experience local culture, a rising

amount of hospitality service providers focus on cultural content, for

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example, accommodations that mirror the authentic architecture,

flair, and lifestyle of the respective destinations.

Agricultural Tourism

Agricultural tourism is widely acknowledged as an instrument for

economic development and employment generation particularly in

the remote and backward areas. It creates opportunities to generate

additional revenue, makes for economic diversity, and improves the

understanding of farmers in society.

The Indian government collaborates with the United Nations

Development Program (UNDP) to promote rural tourism and also

sanctioned more than 100 rural tourism infrastructure projects to

spread tourism and socio economic benefits to identified rural sites.

Guests in India can stay on farms ranging from stud farms over

dairy farms up to full-fledged agricultural farms.

They are perfect for urbanites looking to unwind and get back to

nature, but with a bit of comfort and the chance to freely choose the

activities in what the guests want to engage in, whether they want to

milk the cows, wash the buffalos, learn to grind wheat, pick

vegetables, or go fishing. Besides, guests experience the natural,

cultural, and heritage aspects of the region, such as the local

geography, cuisine, and handicrafts.

Unconventional Accommodations

Today's travellers are enthusiastic about travelling in different ways

to widen their experiences. This is also reflected in their choice of

unconventional accommodation options. In India religious centres,

ashrams, and monasteries are among the popular alternatives to

classic choices of accommodation. Given the cleanliness and hygiene

of these accommodations, besides their unique cultural content, this

segment offers huge potential. Organisations such as the

Krishnamurti Foundation, Bharat Sevashram Sangha, Ramakrishna

64

Mission, ISKCON, and Aurobindo Ashram are among the religious

institutions that offer accommodation options across India.

Unique Sales Points

Many higher end hotels in India are realising that their key USP in

international competition is not their high-tech facilities, but rather

their outstanding staff-to-guest ratios and the longstanding tradition

of Indian hospitality as immortalised by "Atithi Devo Bhava".

Hospitality is about serving the guests and to provide them with a

"feel-good-effect". Personalised comprehensive service, such as suites

having their own personal butler, gives guests that extra feel of being

valued by their hosts.

Diversification

Innovative concepts of diversification hold the key to survival in the

hospitality industry in the long run. Fierce competition has led to

innovative ideas by hotel majors, thereby delivering impressive

hospitality products and services. Exotic spas, gorgeous golf courses,

multi-cuisine fine dining, spacious conference and convention

facilities are all among the growing list of facilities found in leading

hotels.

Food and Beverages

With the deeper integration of India in global economic exchange and

the freer flow of goods across borders, the Indian hospitality industry

now has access to better products, such as imported foods and

beverages. Until recently, five star hotel restaurants were considered

the epitome of fine dining experiences in India and even now many of

the best restaurants and bars are still located in India's five star

hotels.

The concept of high-end standalone restaurants remained a rare

exception.

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Foreign versus Domestic Tourists

Earlier foreign tourist arrivals to India were highly lopsided, with a

few countries such as the US and the UK accounting for the bulk of

arrivals in India. In recent years, foreign tourist arrival figures have

been diversifying. More and more people from Afghanistan,

Bangladesh, Sri Lanka, and Nepal visit India now, as are people from

Southeast Asian countries, South America, and Africa.

Reading the Tea Leaves

India is today in the defining stages of the business of hospitality.

Decisions taken today will massively impact the growth trajectory the

industry will take. Reckoning the future of the Indian hospitality

industry is a very difficult task, especially so due to the ever more

rapidly changing market environment. According to World Travel and

Tourism Council, India will be a tourism hotspot from 2009 to 2018,

having the highest 10-year growth potential.

Hotel industries in Maharashtra at a glance

Located on the western coast, Maharashtra is the third largest state

of India.It is bordered by the states of Madhya Pradesh, Gujarat,

Chattisgarh, Andhra Pradesh, Karnataka, Goa and the union

territory of Dadra and Nagar Haveli.

Mumbai, the capital city of Maharashtra is one of the most populous

cities in the world. Dotted with places such as Lonavala, Matheran,

Khandala, Panchgani and UNESCO world heritage sites of Ajanta

and Ellora, Elephanta Caves and Victoria Terminus, Maharashtra

rests as the most sought after tourist destination in India.

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66

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Maharashtra.

Maharashtra, the 3rd largest state in India is speckled with many

places of interest. The state is an assortment of a number of popular

cities like Mumbai, Pune and Aurangabad etc which attracts a large

number of tourists from all over the globe, throughout the year. The

magical city of Mumbai which is the financial and also the film

capital of Maharashtra is always full of life and excitement.

The must visits of this place consists of the Gateway of India, Prince

of Wales Museum, Elephanta Island, Haji Ali's Tomb, Flora Fountain,

Kamla Nehru Park, Kalbadevi Temple, Jama Masjid, Bhuleshwar

Temple, Mumbadevi Temple, Nehru Planetarium, Hanging Gardens,

Marine Drive, Nehru Science Center, ISKCON temple. For

recreational activities you may check out the beaches like Manori,

Madh Island, Versova, Marue, Goral, and Juhu or fun places like

Essel World and Fantasy Land.

The vibrating city of Pune also adds charm to Maharashtra tourism.

The Shanwarawada Palace, Gandhi National Memorial, Raja Kelkar

Museum, Pataleshwar Temple and Samadhi are some of the tourist

destinations that are often visited by tourists from different regions

of India and outside. Yet another wonderful city in Maharashtra is

Aurangabad.

While in the city, as you visit the tomb of Bibi-ka-Makbara on one

hand you can also plan a trip down to Ellora and Ajanta, on the

other. Aurangabad also comes with many shopping options. A chill

out place at Maharashtra is Mahabaleshwar which is a hot favorite

among everyone from nature explorers to peace lovers and also

filmmakers. Lonavala is another beautiful holiday spot and a perfect

stress buster from the daily hassles of life.

67

The state of Maharashtra is very well connected by air rail and road,

which makes it easily accessible from all the major parts of the

world. With so many places of tourist interest, it is obvious that a

large number of hotels in Maharashtra have emerged to cater to

Maharashtra tourism and its tourists.

Be it a business trip or a leisure trip, one would find an array of

hotels to suit all pockets and taste. Be it a five star hotel in

Maharastra or budget hotels, the Maharashtra hotels gives you the

opportunity to drape yourself in this glamorous state of India that

magnetize and mesmerize thousands of visitors with its refreshing

greens, hilly terrains, golden beaches and rich cultural heritage.

Five star hotels in Maharashtra

Some of the five star hotels in Maharashtra are The Oberoi and The

Taj President Hotel.

The Oberoi Hotel

Run by "Oberoi Group", this Maharashtra hotel is conveniently

located in the heart of Mumbai being at a distance of 35kms from the

airport. This dazzling luxury hotel in Maharashtra which stands tall

at Nariman Point with an overview of the Arabian Sea comes with

luxurious stay at the 337 rooms of the hotel.

The hotel caters to the dining needs of its guest through 'Brasserie',

which serves informal dining, "Kandahar", known for Indian

cuisines, 'Rotisserie' & 'Sea Grill' offering Mediterranean food while

the well stocked bar, 'Bayview Bar' serving all kind of drinks. Some of

the other facilities in this Maharashtra hotel are spa, swimming pool,

fitness and recreation centre, business facilities etc.

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The Taj President in Mumbai

Another 5 star Maharashtra hotel is the Taj President situated in

Mumbai which is also a popular business hotel. It is at a distance of

3kms and 35kms from the railway station and the airport

respectively. This star hotel in Mumbai is replete with 300 exclusive

rooms and suites. This Mumbai hotel also comes with an Italian

eatery, Trattoria, Thai pavilion, Konkan Café, poolside Barbeque and

a bar. Other amenities at the Taj President, Mumbai, includes

Banquet rooms, Business Centre, Shopping arcade, Bookshop,

Souvenir shop, Fitness Centre, Swimming pool, Spa etc.

Budget hotels in Maharashtra

The budget hotels in Maharashtra include Hotel Suba Palace,

Gordon House Hotel etc.

Hotel Suba Palace

Ideally in closeness to the Arabian Sea and also the famous Gateway

of India, Hotel Suba Palace is one of the sought after Maharshtra

hotels situated near Nariman Point. It has 50 AC rooms equipped

with modern amenities. The hotel also comes with dining facilities at

its restaurants, coffee shops and the lounge. Conference room,

Laundry, Doctor on call, terrace for programmes are also available at

the hotel.

Gordon House Hotel

Gordon House Hotel located in Mumbai is made in a contemporary,

swish style, which makes it stand apart. There are ample

accommodation options in the form of luxurious rooms. "Tides" and

"All Stir Fry" are the restaurants of the hotel while "Three Flights

Up"" is a bar and a club at the hotel. This Maharashtra hotel also

69

comes with facilities like Conference, Banquet, and terrace for social

gatherings etc.

Table No. 1.7

Detail of the Managerial and Executive level Staff working in the

different Hotels in Maharashtra.

Sr.

No.City Name of the Hotel

Hotel StaffTotal

Managers

Executives

1Aurangaba

d

Hotel Ambassador

Ajanta8 5 13

Hotel Rama

International7 6 13

Hotel Taj Residency 9 8 17

2 Nasik

Jupiter Business &

luxury Hotel4 3 7

Hotel Ginger 5 3 8

Quality Inn Regency 3 3 6

The Gateway Hotel

Ambad2 4 6

3 Nagpur

Hotel Pride 2 4 6

Hotel Vits 2 2 4

4 Pune

The Westin Koregaon

Park6 7 13

Courtyard Pune 7 5 12

The Central Park 5 4 9

70

4 Pune

Vivanta by Taj – Blue

Diamond5 3 8

Le Meridien 11 6 17

The Pride Hotel 9 6 15

The Golden Emerald 7 3 10

Hotel Ibis 4 33 7

The Corinthians

Boutique Hotel5 3 8

The Sagar Plaza, 4 2 6

Hotel Parc Estique, 3 3 6

Hotel Sun - N - Sand 9 6 15

5 Mumbai

Sahara Star Mumbai 13 10 23

Grand Sarovar Premier 15 17 32

Le Royal Meridean 14 12 26

The Oberoi Mumbai 12 20 32

Park Plaza Royal Parm 10 13 23

Vivanta by Taj-

President7 3 10

Marriot Lakeside Chalet 9 12 21

Renaissance Mumbai

Hotel & Convention

Centre

8 13 21

Grand Hyatt, Mumbai 12 8 20

71

5 Mumbai

Holiday Inn Mumbai 15 13 28

Hotel Four Seasons, 9 15 24

Leela Kempinski Hotel 13 15 28

ITC Hotel Grand

Maratha Sheraton &

Towers ,

15 15 30

JW Marriott Hotel,

Mumbai12 6 18

Ramda Plaza Palm

Grove7 9 16

Sun n Sand, Mumbai 9 12 21

Taj Lands End, Mumbai 8 7 15

Taj Mahal Palace &

Tower,7 5 12

Taj Wellington Mews, 9 6 15

The Emerald, Mumbai 7 12 19

The International by

Tunga,6 6 12

The Lalit Mumbai 11 7 18

The Orchid Hotel,

Mumbai13 9 22

The Paradise Tunga, 10 8 18

The Retreat, Mumbai 7 5 13

Trident Nariman Point, 6 4 10

5 Mumbai

Trident, Bandra Kurla, 11 5 16

Four Seasons Hotel 7 9 16

The Westin Mumbai

Garden City Hotel8 12 20

St.Laurn Meditation

Spa7 12 19

Sun N Sand 9 13 22

6 RatnagiriKohinoor Samudra

Beach Resort12 14 26

7 Khandala Hotel La Revival 8 16 24

8 Lonavala

The Upper Deck Resort

& Country Club12 9 21

Fariyas Holiday Resort 9 8 17

Aamby Valley City 7 11 18

9

Maha-

Baleshwar

Hotel Bright land 11 16 27

The Pride Sherwood 9 13 22

Total 491 489 981

Source: Field Survey (2011)

Significance of the Study:

This study particularly deals with “A Study of Problems & Prospectus

of five Star hotels in Maharashtra State” hotel industry playing very

vital role in tourist activities and economic development of the

country. Hotel industry is having very vast area and it is diverse in

73

nature. Therefore, the area of study on this topic has to be decided to

get a valid conclusion.

In order to exploit the full potential of the customer base, every five

star hotel should adopt good policy in services development, which

can help to strengthen the service excellence in Maharashtra

state.The analysis and interpretation of different five star hotels with

regard to service growth from the view of customers and employees

will help in decision making for policy implementations, customers

and related other areas, & in better understanding, the importance

of services and customers desires. The study would help hoteliers to

understand the hotel sectors contribution to the society.

The general tendency of the five star hotels is to earn feedback that is

more satisfactory from the tourists rather than money. The

information will be collected from different sources, the rise and fall

in the position of the sample of five star hotel industries & to

understand the actual position. The present study is designed to find

out differences in hotels. Efforts will be made to understand the

strengths and weaknesses of the five star hotel industries.

OBJECTIVES OF THE STUDY:

Following are the broad objectives of the present study:

• To understand the problems, progress and the present

scenario of the five star hotels in Maharashtra state.

• To appraise the prospectus of the five star hotel industry.

• To explore the potentiality for development of five star hotel

industry.

74

• To assess the consumer satisfaction against services available

in the five star hotels in the state of Maharashtra.

• To ascertain the government policies regarding the five star

hotel industry and forecast the prospectus of five star hotels

development in new millennium.

• To study the collaboration of travel agencies and its impact on

tariff.

• To identify and synchronize the problems of the five star hotel

industry and to suggest the remedies to overcome them.

SCOPE OF THE STUDY:

The geographical area of the study covers star hotels from the

Maharashtra; however the efforts are made to relate the study by

covering whole India.

RESEARCH METHODOLOGY

This descriptive study is purely related to the Problems and

prospectus of five star Hotels in the major cities of Maharashtra

State. The study is the combination of historical and present

scenario of Hotel Industry for the period under study. The study

covers all the aspects i.e. problems, future growth, trends, working

position and satisfaction level of society of the five star hotels

situated in Maharashtra state.

To complete this study following research methodology is adopted

a. Primary Data:

Primary data is collected through personal interviews and the

observations of hotel staffs. The questionnaire was prepared to

75

collect the detail information for the research work. The primary data

is collected from the different respondents i.e. managers and hotel

executives.

The data is collected from the different respondent, from the different

departments of the hotels; hence it is very much needed to study the

various departments’ structure and their operating in the five star

hotels:

b. Secondary Data:

For getting the exact status of the present situation it needs to collect

the secondary data, hence the secondary data is collected through

various sources i. e., Journals, Periodicals, hotel brochures, news

papers, Magazines and Hotel Websites provided by certain hoteliers.

c. Selection of Samples:

Maharashtra falls into six administrative divisions: i.e. Amravati

Division, Aurangabad Division, Konkan Division, Nagpur Division,

Nashik Division and Pune Division, the researcher has selected the

entire administrative divisions for collecting the data.

Though not a single five star hotel situated in Amravati division,

hence that area is not covered by researcher. And there are only 59

five star hotels are situated in whole Maharashtra including all major

cities.

From all these 59 five star hotels and 981 Managers and executives,

10 % (98 Managers and Executive) of the samples have selected by

the help of convenience sampling method for the study purpose.

d. Statistical Tools & Techniques used:

While analyzing the data researcher has used various statistical

tools, techniques and methods, such as classification, tabulation,

graphical presentation and percentage.

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LIMITATION OF STUDY:

Ø Important aspects of the five star hotels are studied in depth;

however, the study is geographically limited to Maharashtra

State only.

Ø The study is limited span of 10 years i.e. 2001 to 2011 only.

Ø There are only 59 five star hotels situated in Maharashtra

state, for the study purpose only, 10% of the sample

representation of five major cities of Maharashtra.

PRESENTATION OF THE STUDY:-

The study runs into seven chapters. The following are the particulars

of the chapter plan.

1) Introduction

The first chapter deals with a brief introduction, background of the

study, research methodology and its limitation. The sources of data

and objectives of the research have been discussed and on the basis

of hypothesis the method used for primary survey, the objectives of

statistical test and different questionnaire have been clearly

mentioned. This chapter also gives the chapter scheme of the study.

2) Review of Literature

The second chapter deals with the overall review of the literature

available on the particular topic. Literature is the most important

part of any research. In this topic, the review is taken near about 49

books and 14 articles regarding the research topic.

This chapter is divided into two parts i.e. Review of Research Articles,

Review of Books, thesis and other related published or unpublished

literature on this particular topic.

77

3) Profile of tourist places in Maharashtra

The third chapter devoted to the presentation of general profile of the

area under study. In this chapter the researcher has covered

geographical, historical, demographical and socio-economical aspects

of the Maharashtra State.

Third chapter linked to the information of all tourist places situated

in Maharashtra state which are the major attraction of tourist.

Maharashtra is one of the most sought after tourist destinations in

India. The chapter included the entire destination where Tourists are

visiting.

4) Performance of five stars hotels in Maharashtra

The fourth chapter deals with the five stars hotels in Maharashtra,

As the main subject theme is related to the problems and prospects

of five star hotels it is needed to explain the detail profile of Five Star

Hotels as there are 59, Five Star hotel are situated in Maharashtra.

Hence brief information related to speciality, services, facilities and

rooms details and different departments have been collected about

hotel and presented in this chapter.

5) Human resource Management in Five star hotels

The fifth chapter deals with Human resource management in five

star hotels the chapter focus on current status of the hotel industry.

The chapter also highlights on the requirement of human resource

management in hospitality sector in Maharashtra state, the purpose

of Human Resource Development is to improve the capacity of the

human resource through learning and performance at the individual,

process and organizational levels.

78

6) Data collection & Analysis

The sixth chapter dedicated to the data collection and analysis,

which is the most important study area of the project. Analyzing

survey data is an important and exciting step in the survey process.

7) Summary, Conclusions and Suggestion’s

This Chapter highlights on the overall summary of the present study,

important conclusions drawn by the researchers and important

suggestions made by the researchers to overcome the problems

which found in this study.

Concluding Remark:-

Hospitality Industry is booming like never before. This thesis shall

discuss the expansion of Industry and need of the strategic

management principles after second world and the developments

that have taken place since then.

The aim of this thesis is to study the extent to which the remedies

are used by Hospitality Industry and to discuss the structure of this

industry. This thesis presents findings of issues, challenges and

trends that hospitality industry might fact in the year ahead

respectively.

Top issues that will influence the global hospitality industry in the

year ahead include sustainable development calls for green

hospitality, labor cost, multicultural issues and higher education.

Challenges that facing hospitality include will include operating

issues, marketing issues, technological issues and economic issues.

Identified key trends that, taken together, we believe will shape the

hospitality sector this year and for years to come include rapid

growth in vacation ownership, integration & globalization, new

management.

79

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