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Unit 12 Hospitality Provision in TT Sector Sample Solution
Diploma in Travel and Tourism
Unit Number and Title
Unit 12 Hospitality Provision in TT Sector
Among the leading service industries in the world is that of hospitality and travel and tour industry. Both these industries are contributing significantly to the economy of countries. The two industries are interrelated as the tourists travelling to a tour location need to take services from hospitality provision. The integration of the two industries would be advantageous for both the sectors as they can easily share resources and optimise the use of resources. In the present report, the relationship between a travel organisation TUI and the hospitality organisation Savoy hotel will be reviewed. The study would identify the integration which could be adopted by the two organisations. The last section of the report will present a rational for a project and would present a detailed plan for the implementation.
1.1 Interrelationship and role between Hospitality and Tour, Travel industry
A customer while planning a tour has several areas to focus upon like the travel arrangements, accommodation arrangements etc. The tour operators are now providing customers with custom and standards packages as per the need of customer. The customer like these packages as they do not have to get involved in the planning and the tour operators arranges all. The tour operator needs to make sure that there is no compromise in service delivery either by travel or by hospitality organisations (Barrows, 2011). The two industries are interrelated to each other as both have to perform well to make the customer happy. Among the leading organisations from United Kingdom are Hotel Savoy and TUI. Hotel Savoy is a 5 star hotel situated in London. The hotel provides its customers with excellent accommodation and food facilities. The hotel provides its customers with facilities like bar, lounge, cafe, gym etc to its customers to satisfy their needs.
TUI is leading travel and tour organisation from United Kingdom. TUI has its offices across the globe and is offering different type of packages to the customers on the basis of their needs, Organisation also has seven carriers.
Figure 1: Hotel Savoy
The Tour organisations like TUI are offering attractive tour packages to their customers. The packages are formed considering the needs of the customers as well as the buying power of customers. Tour organisations like TUI are covering all activities in their tour package like local sightseeing, travel arrangements; accommodation arrangements etc and hence need partners who can provide quality services to their customers (Medlik, 2012). For this reason, TUI is tying up with accommodation providers like Savoy hotel who are providing quality services to the customers. For instance, TUI is offering UK tour packages to its customers in South Asia. TUI arranges transportation facilities for customers while accommodation and food arrangement are looked after by Hotel Savoy.
Along these lines, TUI needs the support of Hotel Savoy for offering tour packages to its customers from around the globe. TUI is a global organisation and it has its offices across the globe. Organisation is already having partnership with several travel organizations and hotels and also has seven carriers. For Savoy hotel the integration with TUI is beneficial as it will give Savoy access to the customer base of TUI and the hotel would be able to increase its customer base both internationally as well as domestically.
Figure 2: TUI Tourism
To serve their customer better, it is important for Savoy and TUI to share the information like number of bookings expected, service quality required etc. Savoy and TUI are joint venturing and hence the services provide by Savoy are reaching to the customers of TUI. In case the information is not properly shared by TUI about the customers, Savoy may not be able to offer the number of rooms as desired by TUI. The interrelationship between TUI and Savoy would be beneficial both for the organisation as well as the customers. The customers would be able to get both the travel and accommodation and food facility under one umbrella and that too without compromising the quality (Hassanien.et.al, 2010). Thus the tour planning for the customers have become easier. Likewise for the organisation the business opportunity have increased immensely. This would increase the profits as well as service quality.
The interrelationship between the hospitality and travel and tour business provides immense opportunity of growth to the small business (Middleton.et.al, 2009). For e.g. there may be a small hotel in a hilly region which may not be known much. However the hotel can enter in partnership with TUI which will ensure quality services for TUI customers as well as growth for small business.
With business perspective the interrelationship amongst Savoy and TUI is very beneficial as it increases the customer base of both the organisation. The interrelationship has helped both the organisation in increasing business which has been seen in the increasing profits of both the organisation. In this interrelationship both Savoy and TUI are dependent on each other. For e.g. TUI provides its customers excellent accommodation and food services through Hotel Savoy. This has helped in building repute for TUI. Likewise, Hotel Savoy provides its customers transportation services to its customers through TUI. The quality service delivery by TUI helps Savoy in building their brand image. Thus both the organisations are benefitted from the relationship in terms of profits and increasing customer base.
The interrelationship between the two organisations has helped them in catering to the need of customers in services which they do not provide. Non performance of one organisation would be bringing ill repute to the other organisation and the results would be seen in terms of sales and profits (Middleton.et.al, 2009). For interrelationship TUI and Savoy needs to decide upon the quality of services they need to offer to the customers. This is important as one organisation is aware about the service quality the other organisation will offer. This helps further in dealing with customers. For e.g. TUI must be aware about the quality of the service (3, 5, 7 star) which Savoy will offer to its customers; this will further help them in negotiating with customers.
2.1 Analyse the implications of integration to the hospitality industry
Integration is the blend of assets and data sharing to accomplish the business goals. It is typically done when the organisation decides to lessen its working expense and coming to the size of economies. In the present situation, an organisation is utilizing distinctive sorts of integration like vertical and horizontal integration to meet the business goals by ideal uses of assets and resources (Barrows, 2011). For extension of business and benefits the Savoy hotel needs to identify integration approaches which could benefit the business. Integration technique is ideal technique by which hospitality and the tour organisation decides on common goals and target customer group focusing on meeting their needs. TUI is an organisation which has already entered in integration with several hospitality organisations which has benefited both TUI as well as hospitality organisation. The integration approaches which could be explored by Savoy hotel are as follows:
Vertical integration is the procedure by which the business organisations buy their service providers or different organisation in the business chain. This sort of integration helps association to diminish their working expense with most optimal utilization of accessible assets. The real ramifications in the hospitality business are to have a similar level of services at all the business location (Barrows, 2011). For instance, by vertical integration organisation can ensure that the customers are provided with the similar kind of services with optimal quality. As a result of vertical integration the resources could be utilised optimally and the service quality delivered to the customers could be improved which helps in building the image of the brand.
Figure 3: Horizontal Integration
This sort of integration occur when two diverse organisation join together to offer a wide range of services that are required in meeting the consumer loyalty and expanding the benefit. For worldwide expansion horizontal integration is valuable that keeps up to maintain the standard to continue at global level. The real effect of horizontal integration is on the smaller business unit as it has to mould itself according to the bigger organisation in the partnership. As a result of this there are chances that some of the employees from the smaller business unit are unemployed (Zhang.et.al, 2010). Also there can be a scenario when the there may be a conflict of interest among the two parties over the operational procedures, strategy, goals and vision. However the advantage of this integration is that the overall business would increase leading to the increase in revenues as well as increased global participation. For instance, to provide better services to the customer, TUI has combined with First Choice Airways to provide better transportation facilities to the customers. TUI has also combined with Savoy hotel so that it can provide its customers with better lodging capacity.
Figure 4: Horizontal Integration
Business would be benefitted from both horizontal as well as vertical integration. With vertical integration, organisation can use the resources optimally while with horizontal integration, two business join hands which helps in business expansion and utilises the business advantages of both the businesses to accomplish the proficiency and higher benefits.
2.2 Effect of integration on hospitality business
As a result of integration, the operational skills of the two organisations namely, Savoy and TUI would combine which would help the two in meeting the customer expectation in a better way. With the integration of incorporation these association can accomplish upper hand in their market. Every one of the assets of the organisations can be used to its maximum capacity and the organisations can set prices which are competitive and able to attract the customers. The impact of integration on the two organisations can be classified as below:
Innovation: Through coordination between TUI and Savoy hotel, the innovation of both the organizations will improve. Coordination helps in innovating and accepting technological advantage of each other. With the assistance of most recent innovation all operations of business can get support. Integration provides a platform through which association like TUI and Savoy hotel can specifically reach towards their clients furthermore give simple approach to interface with clients
Information: There exists both horizontal as well as vertical integration between Savoy hotel and TUI. It might make troubles the workers working in these organisations. There will be change in the working procedures as a result of which the workers of both the organisation will be impacted and need to get converse with them. The two organisation needs to share information for the development of new packages which would help the organisation capture more business. The two organisations need to identify the information elements which the two organisation needs to share for better integration.
Impact on Quality: With integration there is impact on the services offered by the organisation. The quality of the services can either get better or can get poorer. There is no surety that the quality of the services will improve as it is dependent on the human resources, operational procedure and the working environment. The key factor in improving the quality of services is to develop bonding and understand the culture of both organisations.
Increased Revenue and better service delivery: The interrelationship between the two organisations has helped both TUI and Savoy cater to the need of global customer base. The two organisation needs to collaborate and develop packages which are as per the need and desired of the customer expectation. The two organisations should work in close coordination and define a service level agreement which will help them in providing good services to the consumers. Signing service level agreement between the two parties would also help in avoiding any kind of conflict over service delivery.
3.1 Develop a rationale for a selected project clearly justifying decisions linked to target market
The growth in the hospitality sector has been immense in past few years and looking into the profitability of the sector it has been decided that a hotel would be opened in the capital of United Kingdom i.e. London. With the increase in the buying power of the people, the sector has seen profitability. Once the brand name for the hotel establishes, it would be giving regular income for the organisation (Brotherton and Wood, 2008). The hotel needs to ensure that it serves quality to its customers and meets the requirement of the customers. The other important reason for opening of hotel is that the human resources required for the business is easily available in London. Also the flow of tourists remains good throughout the year and hence the business would be a profitable venture.
Location of the hotel
The location of the hotel would be London as the city has been attracting travellers and tourists from all across the globe. Also being a business location, there are frequent business travellers who are visiting the city. The hotel would be targeting people from middle-upper class segment. The location would be apt for the hotel as the flow of tourists remains consistent over the year.
Before opening the restaurant it is important to know about the taste of customers and what they expect from a new hotel (Chon and Yu, 1999). For gathering the customer view, a survey was conducted where the customers were asked to fill a questionnaire. Separate questionnaire was designed for domestic and foreign tourists. The sample size for the research was 500. The large sample size was selected to gain better understanding of the customer expectation.
The hotel would be providing various kind of services like accommodation, food and beverages, bar, pub, gymnasium, banquet halls, space for meetings etc. Offering these services would be helpful in maintaining the regular flow of customers. The hotel would provide online bookings and would be having takeaways where the customer can order food and get home delivery or collect personally.
For the development of the project, it is expected that a fund of £ 6,000,000 would be required. This budget would be used for the construction, interior development, licensing etc. The organisation would be taking bank loans as well as take funds from the investors.
3.2 Business plan
Stage 2: Design
The second stage is that of design where the organisation would be focusing on the layout of the hotel like how the hotel would look like from exterior and interior. This is a crucial stage as the outcome of the stage would determine the attractiveness of the hotel to the customers. Some of the key points which would be considered will be:
Ambience is important for a hotel as it impacts the customer once he enters in a hotel (Chon and Yu, 1999). The lightning for the hotel would be multi coloured. The interior of the hotel would also be having paintings and sculptures. The sculptures would be both of modern as well as ancient style. Glass paintings would also be used. The garden of the hotel would be having different type of flowers and fountains which would add to the ambience of the hotel. Room fresheners would be used so that the customers feel freshened up.
Figure 5: Ambience of the Hotel
The hotel would aim to attract tourists coming different culture, hence multi ethnic theme would be used where themes from different cultures would be used in rooms, pubs etc. The focus would also be on the behaviour of the staffs. The behaviour of staff should be decent with customers as well as be helpful. The staff would also be having a unique dress for a day.
Interiors and exteriors
For attracting the customers, interior and exterior of the hotel are very important as it has the first impression on the customer. If the interior and exterior of the hotel are good and attractive, it would help in attracting the repeat business for the hotel (Cook.et.al, 2013). The interior of the hotel is focussed on two aspects. The interior of the common area would be using paintings and sculptures. The wall of the common area would be painted in light colour while the colours of the room would vary. Each room would be based on a theme like Indian, Chinese, Italian and other cultures which would provide hotel with unique selling propositions. The exterior of the hotel would be using lighting of different colours. Light show would be conducted on the exterior of the hotel which would help in attracting customers.
Figure 6: Interior of the Hotel
To attract the customers to hotel, the management would provide different kind of services to the customers. The hotel would provide services like accommodation, food, spa, gym, and pub and bar etc. The hotel would also provide recreational services for the children and youth. The front office would be given special trainings so that there is no delay in providing services to customers (Cook.et.al, 2013)
For keeping the sustainability of the business, hotel would be providing accommodation as well as be host to business meetings. The hotel would be organising events like food festivals which will attract customers to the hotels. The hotel also plans to organise cultural festivals which would be bringing customers from different cultures, thus popularising the hotel.
For the success of the organisation, it is important that the brand image for the hotel is to be built. For this the hotel would be promoted on internet. A website for the hotel would be designed which gives all the details about the hotel. The local media channels would also be used for promotion and branding.
STAGE 3: OPERATION
For a hotel, operation is an important part which is to be performed daily and it is important that operation planning is carefully done. The operational planning is aimed to achieve the objectives of the organisation.
Figure 7: Structure of the Hotel
For the success of the hotel, it is important the organisation is able to recruit capable candidates who are capable of delivering quality services. For the recruitment, HR team will recruit experience candidates for the food and beverage department, front office and management. Freshers would be recruited in the house keeping and catering department
Staffing in the hotel would be done on the basis of human resource planning conducted by the HR team of the hotel; the hotel would be having permanent as well as temporary staffs. The temporary staff would be hired during the period when the influx of the tourist will be high (Enz, 2010). The staffs would be delivered with trainings which would contribute to the efficiency of the staff.
The hotel aims to customers from different countries and culture. It is important for the hotel to have staff different countries and culture as it will give hotel the linguistic capabilities and will help the hotel serve better.
The hotel needs to follow the laws applicable to the hotel industry. Some of the key laws which the hotel needs to follow are non discrimination law and the equality act. The hotel also needs to make sure that the license is obtained for the bar and the hotel follows the green policy of the government. Hotel also needs to pay its tax liabilities on time.
In the present situation, it has been identified that the travel and tour industry and the hospitality industry are closely associated to each other in terms of their functions. The current study has analysed the association of two industries by considering the examples of TUI and Savoy hotel. The study has identified the integration of both the organisations would be helpful for meeting the business objectives and increasing the profits of both the organisation. The study has presented a detailed plan for opening of a hotel.
Barrows, C. W. (2011). Introduction to Hospitality Industry. New York: Wiley & Sons.
Brotherton, B. & Wood, R.C. (2008). The SAGE handbook of Hospitality Management. Los Angeles: Sage Publishing.
Chon, K. & Yu, L (1999). The International Hospitality Business: Management and Operations. London: Routledge.
Cook, R., Hsu, C. &Marqua, J. (2013). Tourism: The Business of Hospitality and Travel. London: Prentice Hall.
Enz, C. (2010). Hospitality Strategic Management: Concepts and Cases. Hoboken, NJ: Wiley.
Hassanien, A., Dale, C., Clarke, A. and Herriott, M.W., (2010). Hospitality business development. Routledge.
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