Ch.

1 An Introduction to Hospitality Industry

The hospitality industry is a part of a larger enterprise known as travel and tourism industry. Tourism is a basic & most desirable human activity deserving the praise & encouragement of all people & all governments. It is an industry concerned with attracting people to a destination, transporting them there, housing, feeding and entertaining them upon arrival & returning them to their homes. A quarter of a century ago, travel was the privilege of a few rich, affluent & adventurous people. Today with the rise in standard of living along with fast technological revolution in the transportation industry, overseas holidays are within the reach of middle & working class. Travel today is sold like any normal consumer product through retail outlets, wholesalers & even through departmental stores of many countries. Modern tourism is all about mass travel growth, concords, supersonic flights, cruise ship travel etc. Toll free telephone service males it easy & convenient for potential tourists to call for information reservations. Computerized reservation system facilitates the answering of inquiries & booking of airlines tickets. Tour car rentals, hotels & automatic ticketing machines are facilitating dispensing airline tickets covering each segment of the passengers itinerary at the applicable fare. More and more people are able to travel great distances in comparatively less time. Travel has become relatively inexpensive. TOURISM Definition: The word, tourism is related to tour which is derived from the Latin word Tornos. Tornos means a tool for describing a circle or turners wheel. Tourism comprises the activities of persons travelling to and staying in places outside their usual environment for not more than one consecutive year for leisure, business and other purposes. It is the movement of people from their normal place of residence & work for a period of not less than 24 hours and not more than 1 year. (according to W.T.O.) The sum of phenomenon and relationship arising from the travel as it does not lead to permanent residence and is not connected to any earning activity. (by Henniker & Kroff) Tourism covers the social activity of those who travel for a period of 24 hours or more in a country other than the one the person usually lives in (The league of nations in 1937) Tourism is a temporary, short term movement of people to destinations outside the places where they normally live and work and their activities during their stay at these destinations, including day visit & excursion. (By tourism society of Britain)

A tour represents an attempt be a traveler to discover something about a place he visits.

An excursionist is any person travelling for pleasure for a period of less than 24 hours in outside his normal place of residence and not undertaking any gainful occupation in that place. A transit visitor is any person travelling in a country during a period of less than 24 hours provided that any stops made are of short duration and for other than tourist purposes. A visitor is a broad category of travelers. It is any person visiting a country other than his usual place of residence. THE COMPOSITION OF TOURISM INDUSTRY Primary or major constituents: 1. Transport 2. Accommodation 3. Intermediaries 4. Catering and food Secondary constituents: 1. Shops and emporiums 2. Handicrafts and souvenirs 3. Local transportation 4. Coolie and porters 5. Communication services. 6. Advertisement agencies 7. Publishing industry 8. Artists, musicians and performers 9. Suppliers of goods & services for hotels and caterers and travel related undertakings. 10. Banking & financial institutions 11. Theatre, Cinemas, special festivals & organized sports. TOURISM CONCEPTS International tourism - When the travel is from one country to another. Domestic tourism When the travel is within the country that is trip taken by a tourist within his/her own country or where the origin and destination are in the same country. Inbound - It refers to tourists entering a country. Outbound It refers to tourists leaving their country of origin to another. CHARACTERISTICS OF TOURIST PRODUCT 1) Composite nature: Tourism product is a total experience & that the suppliers of sub-products and services are supplying a portion of the total product. It is the sum total of all the sub-products that equals the tourism product. 2) Service based: Most of the components to the tourism product are service. The service provided by industry personnel is a vital component of the tourism product.

3) Intangibility: Unlike goods, services are intangible i.e. they cannot be seen, heard, smelt, touched, tasted or measured, they can only be experienced. 4) Inseparability: a) A service product cannot be separated from the producer. b) A service is produced and consumed at the same time usually on the producers premises by the consumer. c) The consumer has to go to the producer. d) A service is purchased even before it is produced. 5) Heterogeneity: Both production and consumption is being performed by human beings the service as experienced may vary in quality. This can be overcome by standardization and extensive training. 6) Interdependence of products: While it is important to identify the subproducts, emphasis must be on the fact that the whole is greater than the sum of parts; i.e. sub-products are dependent on each other for success. 7) Perishability: The supply of services cannot be stored. IF the service does not generate revenue by being used over a given period, it perishes. 8) Dominant role of intermediaries: In tourism sales intermediaries like tour operators, travel agents, reservation services play a very dominant role and enjoy superior marketing strength. 9) Diverse motivations: It is possible that people make exactly the same choice of destination for entirely different reasons. 10) Instability of demand: Tourism demand is highly influenced by factors such as seasonality, political unrest, economy, climatic disasters, diseases, wars etc. EVOLUTION & GROWTH OF HOTEL INDUSTRY IN THE WORLD Warriors or traders were the early travelers but they did not have hotels to accommodate them. The warriors used tents but the merchants seeking to trade tools, clothing and livestock, traded merchandise for lodging. The inns offered little more than a cot or a bench in the corner of a room or a stable. Most of them were private residences that offered temporary residence or lodging to strangers. Guests stayed in large communal rooms where sanitation and privacy were non-existent. After the establishment of money in 6th century BC, inn keeping was one of the first commercial enterprises and hospitality was one of the first services for which money was exchanged. In the third century AD, Roman Empire developed an extensive system of brick paved roads throughout Europe and Asia Minor. Small road side lodges were constructed due to increase in the road transport. During the Industrial Revolution in 1700s, the Europeans began to combine food and beverage service with lodging. No attention was given to sanitation and beds as well as rooms had to be shared with other travelers. These early European inns were unsuitable for aristocrats. To accommodate wealthy travelers, luxurious structures were erected. These offered private rooms, individual sanitation and all comforts of a European castle. These elegant new establishments adopted the French name for mansion, hotel. The rates they charged were very high and well beyond the means of common citizens. In colonial America, inns were modeled after European inns. Beds and rooms had to be shared with strangers. Throughout 1800s, American innkeepers improved their services and continued to build larger properties.

Most of these were located in seaport town since sea transport was very widely used mode or travel and transport then. The first American hotel the City Hotel opened in 1794 in the New York City. It was one of the largest buildings in the city and was built exclusively for hotel purpose. It had 73 guest rooms. Adelphi Hotel in New York was the first high-rise structure in the city. In 1829, a large new hotel was constructed in Boston. Tremont House was the earliest first class hotel in America and brought revolution in the hospitality industry. This hotel was the first to offer private rooms with locking doors. Each guest room had a wash basin and a water pitcher and a bar of soap. Other innovations included a full time service staff, a French restaurant which was located in the lobby, etc. These American hotels became important social centers and unlike their European counterparts, welcomed anyone who could afford the reasonable rates. Meanwhile in Europe, sanitary lodging continued to be regarded as a privilege to be enjoyed only by the aristocracy. But in democratic America clean and comfortable accommodation was available to any middle class worker or family. In early 1900s, a new type of traveler entered the picture, the traveling businessman. For him the world class hotels were too expensive and the old style inns too unsanitary. A new type of lodging establishment was opened for these types of guests - the commercial hotels. It was opened by Mr. E. M. Statler, at Buffalo, New York, in Jan. 1908. It was the beginning of the chain hotel concept. This hotel provided private sanitary rooms with private bathroom. The guest received a pitcher of ice water and morning newspaper everyday. A room and a bath for a dollar and a half were well known among American travelers. The great Depression nearly wiped out the hotel industry. But one hotel operator, Conrad Hilton, managed to stay afloat as a result of his oil and gas investments. Around 1940 - 1950, the Hilton Hotel Corporation built or bought numerous luxury hotels around the world and competed with the largest hotel chains of the time Sheraton and Statler. With the end of World War II, the hotel industry unexpectedly entered a new era of prosperity, Americans began traveling as never before. With an automobile in every garage, Americans began touring the country with their families. For this new type of traveler - the vacationing family unit - the formality of a traditional hotel was inappropriate. Families traveling in their cars needed casual lodging that was accessible from major highways and had ample facilities for parking. The early these properties were small and had fewer than 50 rooms. Most of them were owned and operated by a couple and were called Mom and Pop properties. By 1960, the motor hotel or the motel had become a permanent and influential part of the hospitality industry. By this time the motels had over 100 rooms with a separate parking space for each unit. In 1960s, a new type of lodging outlet - the economy, or budget hotel entered the picture. These lodging establishments sold only room space without F & B service. To save on construction cost, the economy hotels were built on inexpensive land and had small lobbies. They also hired minimum staff. By minimizing costs the budget hotels were able to give much lower room rates than their competitors. The

first successful economy hotel, Travelodge, opened in Tacoma, Washington, in 1956 but the chain expanded nationwide by 1966. By early 1970s the idea of low rate motel/s hotels had captured the imagination of investors mini bars are the standard amenities of most budget hotels. These hotels / motels are also called as no-frills hotels. By 1973, the no. of travelers staying in motels surpassed the no. of people staying in full-service hotels. To compete with these low end properties, mid-market hotel chains introduced their own limited service hotels. These hotels combined some of the features of the full service hotels with the cost saving of the budget hotels / motels. e.g. Holiday created the limited service Hampton Inn chain and Marriott created Courtyard hotels. In these hotels all the rooms have separate living and sleeping areas. The lodging trend of the 1990s is towards expanded services made possible through consolidation of responsibilities. Guest services departments are found in hotels of all classes. These departments combine services that traditionally were performed by bell or door attendant, a concierge and an in house travel agent. Two new concepts in the hotel industry are The All Suite Hotels and The Residential Hotels. EVOLUTION & GROWTH OF HOTEL INDUSTRY IN INDIA Although the origin of hotel industry in India cannot be traced to a definite point of time, there is evidence of its presence even during the Indus valley civilization & Vedic era. In olden day, travel was predominantly taken for pilgrimage and trade. The concept of char dham and our country dotted with Hindu temples as well as shrines frequented by people of all faiths is an important indicator of the significance of pilgrimage by our ancestors. Ancient India was well known for its silk, spices, gold and gemstones. Records speak of Indians trading with Greece, Italy, Indonesia, Malaysia, China & Japan among others. The main mode of transport was animals on land and boats & ships in seas and rivers. We find all major ancient trading cities located along banks of rivers and sea ports. The origin and evolution of the hotel industry in the country can be categorized in the following 3 periods: 1) Ancient & Madieval Era (from Indus Vally Civilization to AD 1600) The beginnings of hotel industry in India stand rooted in the Hindu philosophy of atithi devo bhava implying that an unannounced guest is to be accorded the status of God. There is evidence of accommodation facilities in ancient India. The lodging houses during those times were known as dharamshalas (dharama in Sanskrit means religion and shala school). Dharamshalas, the resting places for pilgrims are believed to have originated in village chaupals (meeting place for villagers to discuss social issues) Later with the help of rulers and local Zamindars (landlords) more permanent structures were made. Here they were provided a safe place to rest and spend the night. Other words in literature that are indicative of according facilities to travelers are anna-kshetras (anna-food grains, kshetras-area), bhojnalaya (bhojana-meal, alaya-house), paakshala (paak-cooking, shala-school), panthagar (panth- road or way, agar-house)

Records of many foreign visitors & philosophers who came to India speak highly of the hospitality facilities. Famous Chinese scholars Fa Hien (AD 399-414) & Huein Tsang (AD 629-643) who came during the reigns of Chandragupta Vikramaditya & Harshavardhana respectively have mentioned the existence of shelters for travelers. In the medieval era between the 11th & 13th century many sarais and musafirkhanas were made manly as resting places for messengers of the postal service set up by the Sultans of the Slave and the Mamluk dynasty. The system was refined by Allauddin Khiljee who established dak chowkis. 2) Colonial Era (1601-1947) The early hotels were mostly operated by foreigners to cater to the European colonizers and later the officials of the Raj. Some of the early taverns were Portugese Georges, Paddy Gooses, Racquent Court between 1837 to 1840 but witin the next 10 years most of these disappeared and instead more respectable hotels like the Hope Hall Family Hotel stared appearing. Other famous properties included Victoria Hotel, in 1840, Esplanade Hotel in 1871, Watsons which was exclusively for Europeans, Auckland in Kolkata in 1841. In December 1903 Jamshedji Nusserwanji Tata inaugurated the Taj Mahal Palace and Tower Hotel overlooking the Gateway of India in Mumbai following an incident when he was refused an entry in Watsons hotel for being an Indian. The hotel which is an architectural marvel was the first luxury hotel for Indians by an Indian. In 1923 Shapurji Shorabji opened the Grand hotel in Mumbai. The first Indian style hotel was Sardar Griha in 1900 and Madhavashram in 1908. The Ritz, The Ambassador, Westend etc. which opened between the 2 world wars are fondly referred to as War babies. 3) Modern Era (1947 onwards) Post independence there were big leaps in the hotel trade in the country. The Oberoi Group for Hotels (founded by Rai Bahadur Mohan Singh Oberoi) and Tata group took over several British properties, maintained high standards of service and quality and expanded their business. Later decades saw ITC join hotel industry with properties under ITC Welcomegroup. The 1949 saw the organization of 4 regional hotels and restaurants associations with head offices in Delhi, Mumbai, Kolkata and Chennai. These 4 associations were linked in a federation, the Federation of Hotels and Restaurants Associations of India (FHRAI) in 1955. Realising the importance and potential of tourism and hospitality industry, the government constituted the India Tourism Development Corporation (ITDC) in 1966 which opened many small and large hotels across the country. Over the last few decades, various well known International hotel chains have come to India. These include Hyatt Hotels, Intercontinental Hotels, Marriott International, Hilton Hotels, Best Western International, Four seasons Hotels and Carlson Hotels Worldwide.

The liberalization of the Indian economy has provided a boost to the hotel industry in a big way, leading to a sharp rise in the number of the inbound and domestic tourists in the last 2 decades. The boom in IT industry and other service sectors has placed substantial disposable incomes in the hands of Indian people spurring the travel urge in them. The growth can also be attributed to the countrys Incredible India campaign which showcases the countrys tourism friendly aspects. Indias open skies policies and upgrading of national highways connecting various parts of the country has opened new avenues. HOTEL: DEFINITION & CORE AREAS Definition The word hotel is derived from the French hotel, which refers to a French version of townhouse. Historically in the UK, Ireland and some other countries, a townhouse was the residence of a peer or an aristocrat in the capital or major cities. The word hotel could have also been derived from the word hostel, which means a place to stay for travelers. A hotel or an inn is defined by the British Law as a place where a bonafide traveler can receive food and shelter, provided he is in a position to pay for it and is in a fit condition to be received. Hence a hotel must provide food (and beverage) and lodging to a traveler on payment, but the hotel has the right to refuse if the traveler is not presentable (drunk, disorderly or unkempt) or is not in a position to pay for the services. Alternatively a hotel may be defined as an establishment whose primary business is to provide lodging facilities to a genuine traveler along with food, beverage and sometimes recreational facilities too in a chargeable basis. Core Areas of a Hotel: An Overview The organization of a hotel today is very complex and comprises various departments. The number of departments varies from one establishment to another. All departments have their own managers or head of the departments reporting to the General Manager and the Assistant General Manager. Hotel departments fall under either of the following two categories: 1. Revenue-earning departments: are operational departments that sell services or products to guest thus directly generating revenue for the hotel. These include Front Office, F & B Service and hotel-operated shops. 2. Support departments: are the ones that help generate revenue by playing a supporting role to the hotels revenue-earning departments. These include HR, Maintenance, Purchase, Housekeeping and so on. The various departments are discussed below in brief: Room Division Department: In a large hotel, Front Office and Housekeeping come under this department. These are responsible for maintaining and selling rooms in the hotel. At least 50 % of the total revenue generated by the hotel is attributed to the room division. This department is headed by the rooms division manager to whom the Front Office Manager & the Executive Housekeeper report.

Housekeeping Department: is responsible fore the cleanliness and upkeep of the front of the house as well as the back of the house areas, so that they appear fresh and aesthetically appealing to the guests as well as the staff. This department is headed by the Executive Housekeeper. Front Office: Headed by the Front Office Manager the FO is the operational department that is responsible for welcoming and registering guests, allotting rooms, and helping guests check out. Uniformed services like the concierge, bell desk and Guest Service Center Executives (telephone Operators) are part of the front office department. Food & Beverage Department: The F & B department includes restaurants, bars, coffee shops, banquets, room service, outdoor catering, kitchen and bakery. While all the outlets like the restaurants may be grouped specifically under the F & B Service department headed by the F & B manager, the kitchen and bakery fall under the F & B Production department, headed by the Executive Chef. Human Resource Department: The HR team is headed by the HR Manager. Recruitments, orientation, training, employee welfare, compensation, labour laws and safety norms for the hotel come under the preview of the HR department. The Training department is its ancillary department that looks after orientation and training of the new employees as well as the existing ones. Sales & Marketing Department: This is headed by the Sales & Marketing Manager. Some of the larger hotels may have separate Sales and Marketing Heads. The function of this department is five-fold Sales, personal relations, advertising, getting MICE (meeting, incentive, conference and exhibition) business and market research. All these functions lead to a common goal of selling the product of the hotel i.e. rooms and services by creating customers. Purchase Department: is led by the Purchase Manager who may report to the Financial Controller. The procurement of all departmental inventories is the responsibility of the purchase department Financial Control Department: is headed by the financial controller who is responsible for ratifying all the inventories of the operational departments. Inventory Control procedures are the responsibility of this department. The Financial Controller along with GM finalizes the budget prepared by the heads of the other departments. This department undertakes all the accounting activities such as making payments against invoices, billing, collecting payments, generating statements, handling bank transactions, processing employee payroll data and preparing the hotels financial statements. Maintenance Department: is also called the Engineering department. This is headed by the Chief Engineer or the Chief Maintenance Officer. The department is responsible for all kind of maintenance, repair and engineering work on equipment, machines, fixtures and fittings. Security Department: Headed by the Chief Security Officer, this department is responsible for safeguarding the assets, guests and employees of the hotel. Their functions include conducting fire drills, monitoring surveillance equipment and patrolling the property.

CLASSIFICATION OF HOTELS & OTHER TYPES OF LODGING Each hotel has unique features associated with it. The features may be its location; number of guest rooms; special services such as concierge, travel assistance and valet parking; facilities such as speciality restaurants, bars business meeting venues, swimming pool and so on. The diversity in services and facilities provided by each hotel makes it quite difficult to have any single basis of classification of hotels and if we classify them on different criteria there will be some hotels which will fall into more than one group. In a nutshell hotel classification serves the following purposes: Lends uniformity in services and sets general standards of a hotel. Provides an idea regarding the range and type of hotels available within a geographical location. Acts as a measure of control over hotels with respect to the quality o service s offered in each category.
Classification of Hotels according to different criteria & other types of lodging
Standard ClassificationStar ratings & Heritage (by the Govt. body) One Star Two Star Three Star Four Star Five Star Five StarDeluxe Heritage Heritage Classic Heritage Grand Size Location Clientele Duration of guest stay Commercial Resort SemiResidential Residential Level of services Upmarket MidMarket Budget Ownership Alternative Accommoda tion Sarai Dharamshal a Dak Bungalow Circuit House Lodge Youth Hostel Yatri Niwas Forest Lodge

Small Medium Large V. Large

Downtown Suburban Airport Resort Motel Floatel

Commercial Transient Suite Residential B & B Hotel Time Share Condominium Casino Conference Convention Motel

Propriety Ownership Franchise Management Contract Time-share Condominium

1. Standard Classification The Star classification is among the most widely-accepted rating of hotels worldwide. Ratings of hotels in different countries are done by the government or quasi government sources, independent rating agencies or sometimes the hotel operators themselves. The Indian hotel industry follows the star rating system, which indicates the number and standard of facilities offered by the hotel. The classification of hotels is done by a central government committee called the Hotel Restaurant Approval and Classification Committee (HRACC) which inspects and assesses the hotels based on facilities and services offered. The classification committee includes the Chairman and other members chosen from the government and industry associations such as Federation of Hotel & Restaurant Association of India (FHRAI), Hotel Association of India (HAI), Indian Association of Tour Operators (IATO), Travel Agents Association of India (TAAI) or Institute of Hotel Management Catering Technology and Applied Nutrition (IHMCTAN). In case of the Heritage category, a representative of the Indian Heritage Hotel Association (IHHA) is included in the category. The Committee

visits the hotels and evaluates the facilities and services before the grade is awarded. One Star Hotels: These properties are generally small & independently owned, with a family atmosphere. There may be a limited range of facilities and the meals may be fairly simple. For example lunch may not be served and some bedrooms may not have an en suite bath or shower. However, maintenance, cleanliness and comfort would be an acceptable standard. Two Star Hotels: In this class, hotels will typically be small to medium-sized and offer more extensive facilities than one-star hotels. Guest can expect wellequipped overnight accommodation, usually with an en suite bath or shower. Reception and other staff will aim for a more professional presentation than at the one-star level and will offer a wider range of straightforward service, including food & beverages. Three Star Hotels: At this level, hotels are usually of a size to support higher staffing levels as well as a significantly higher quality and range of facilities than at the lower star classifications. Reception and other public areas will be more spacious and the restaurant will normally also cater to non-residents. All bedrooms will have an en suite bath and shower and will offer a good standard of comfort and equipment such as a direct dial telephone and toiletries in the bathroom. Besides room service, some provisions for business travelers can be expected. Four Star Hotels: Expectations at this level include a degree of luxury as well as quality in the furnishings, dcor and equipment in every area of the hotel. Bedrooms will also usually offer more space than at the lower star levels. They will be well-designed with coordinated furnishings and dcor. The en suite bathrooms will have both a bath and shower. There will be a high staff to guest ratio, with provisions of porter service, 24 hour room service and laundry and dry-cleaning services. The restaurant will demonstrate a serious approach to its cuisine. Five Star Hotels: Five star hotels offer spacious and luxurious accommodations throughout the hotel matching the best international standards. The interior design should impress with its quality and attention to detail, comfort and elegance. The furnishings should be immaculate. The service should be formal, well supervised and flawless in its attention to guests needs without being intrusive. The restaurant will demonstrate a high level of technical skill. The staff will be knowledgeable, helpful and well versed in all aspects of customer care, Combining efficiency with courtesy. Heritage Hotels: A recent addition to the hotel industry in the country, heritage hotels are properties set in small forts, palaces or havelis, the mansions of erstwhile royal and aristocratic families. They have added a new addition to

cultural tourism. In a heritage hotel, a visitor is offered rooms that have their own history, is served traditional cuisine toned down to the requirements of international palates, is entertained by folk artistes, can participate in activities that allow a glimpse into the heritage of the region and can bask in an atmosphere that lives nad breathes of the past. Taj Lake Palace in Udaipur and the Oberoi Cecil in Shimla are examples of heritage hotels. According to the Ministry of Tourism, the heritage hotels are further subdivided as follows:
Heritege This Category covers hotels in residences, havelis, hunting lodges,

castles or forts and palaces built between 1935 and 1950.

Heritage Classic This category covers hotels in residences, havelis, hunting

lodges, castles or forts and palaces built prior to 1935 but after 1950.
Heritage Grand This category covers hotels in residences, havelis, hunting

lodges, castles or forts and palaces built prior to 1920. 2. Classification on the Basis of Size The number of guest rooms in hotels is a criteria to classify hotels. Hotels can be grouped into the following categories on the basis of the number of rooms or the size of the hotel: Small Hotel: In India hotels with 25 rooms or less are classified as small hotels, e.g. The Oberoi Vanyavilas, Ranthambore. However in developed countries of Europe and America, hotels with less than 100 rooms are considered small. These hotels provide clean and comfortable but may not provide up market facilities such as swimming pool, restaurant, bar etc. Medium Hotel: Hotels with 26 to 100 rooms are called medium hotels e.g. Hotel Taj View Agra and Chola Sheraton Hotel Chennai. However, in developed nations hotels with upto 300 rooms are termed medium sized. Large Hotels: In India hotels with 101 to 300 guest rooms are regarded as large hotels e.g. The Imperial New Delhi and The Park Kolkata, whereas the hotels with 400-600 rooms are termed as large hotels in developed world. Very Large Hotels: Hotels with more than 300 guest rooms are known as very large hotels in our countr, example Shangri-la Hotel, New Delhi Hotel and Leela Kempinski, Mumbai. In Developed nations hotels with 600 1000 rooms may be considered very large. 3. Classification on Basis of location: The Location of the hotel is one of the major criteria for a traveler to select and patronize a hotel.

Downtown Hotel: A downtown is located in the centre of the city or within a short distance from the business centre, shopping areas, theatres, public offices etc. The centre of the city may not necessarily be the geographical centre, but it refers to an area that is considered to be the commercial hub of the city. The room rates in this hotel may be higher than similar hotels in other areas, so as to cover the huge investment made on the land. They are generally proffered by business clientele as they find it convenient to stay close to the place of their business activity. Hotel Intercontinental New Delhi and Hotel Le Meridien Pune are examples of Downtown Hotels. Suburban Hotels: As the land costs in the city centre are higher and the space is limited, some entrepreneurs build their hotels near the outskirts of the city. Providing similar facilities as the downtown hotels, these hotels are set in suburban areas and have the advantage of quieter surroundings. Such hotels are ideal for people who prefer to stay away from hustle and bustle of a city. The duration of the stay of guest in these hotels may be longer than at a hotel located in the city. The room rates in such hotels are moderate and may attract the cost conscious travelers. Trident Hotel Gurgaon and Uppals Orchid New Delhi are examples of Suburban Hotels. Resort Hotels: Hotels that are located at tourist destination such as hill stations, sea beaches and county side are referred to resort hotels. These hotels have a very calm and natural ambience. They are mostly away from the cities and are located in pollution free environment. The room rates in these hotels may range from moderate to high, depending on the additional services offered. These hotels combine stay facilities with leisure activities such as golf, summer and winter sports etc. Some of these hotels are projected as dream destinations to guests who wish to enjoy the beauty of nature and have a memorable holiday. The occupancy in resort is normally higher during the vacation time and weekends when the guests want to take a break from their weekly routine. Taj Fort Aguada Beach Resort Goa and Wildflower Hall in the Himalayas, Shimla are example of Resort Hotels. Airport Hotels: Airport Hotels are situated in the vicinity of airports and other ports of entry. Offering all the services of commercial hotel, these hotels are generally patronized by the passengers who need a stopover en route their journey. Hotel Sahara Star Mumbai and Radisson New Delhi are examples of Airport Hotels. Motels: The word motel is formed by merging 2 words motor and hotel. They are located primarily on the highways and provide modest lodging to travelers. The development of roads and other infrastructure in the 20th century gave led to an increase in people travelling by their own vehicle especially in USA and Europe. Such travelers needed a neat and clean accommodation for the

night. The concept of motels came into existence in 1950. Motels provide accommodation, food and drinks, garage facilities, a parking lot and re-fuelling of vehicles. Floatel: Floatels are type of lodging properties that float on the surface of water. This category consists of all lodging properties that are built on the top of rafts or semi submersible platforms and includes cruise liners and houseboats. Some of them provide luxurious accommodation along with food and beverage facilities to the guests. The houseboats of Dal Lake in Srinagar and backwaters in Kerela are some examples of floatels in India. 4. Classification on the Basis of Clientele Being a capital intensive industry, the diversities in guest requirements discourage hotels from catering to all types of travelers. As a result hotels choose to carve out a niche for themselves by catering to the needs of specific guest segments. Hotels can be classified into following categories on the basis of their clientele: Business or Commercial Hotel: Designed to cater to the business traveler commercial hotels are generally located in the city-centre. These hotels provide high standard rooms and amenities along with high speed internet connectivity, business center and conference halls. They also provide in-house secretarial services, typing, fax, photocopy and other office automations. The duration of guest stay is very short. The occupancy is high during weekdays and lower during weekends. The Park in New Delhi and Intercontinental The Lalit in Mumbai are examples of business hotels. Transient Hotel: These hotels cater to the needs of the people who are n the move and need a stopover en route their journey. Located in the close proximity of ports of entry, such as sea port, airport and major railway stations these hotels are normally patronized by transient travelers. They have round-the-clock operational room service and coffee shop, and offer all the facilities of a commercial hotel. Transient hotels are usually 5 star and their target market include business clientele, airline passengers with overnight travel layovers or cancelled flights and airlines personnel. The occupancy rate is usually very high, sometimes more than 100% as rooms can be sold more than once on a given day. Hotel Centaur in New Delhi and ITC Grand Maratha Mumbai are examples of Transient Hotels. Airport hotels fall under this category. Suite Hotel: Suite hotels provide the highest level of personalized services to guests. The guest rooms comprise a living area, a compact kitchenette, complete wit ha refrigerator and a microwave, a bedroom attached with a bathroom and sometimes even a dance floor. The facilities are highly customized and may include valet service, personalized guest stationary, high-

speed internet connection and in-room safety locker facility. These hotels are patronized by affluent people and tourist who are fond of luxury. Burj Al Arab, Dubai and Intercontinental The Lalit Goa Resort are examples of all Suite Hotels. Residential Hotel: Residential Hotels provide accommodation for a longer duration. These hotels are generally patronized by people who are on a temporary official deputation to a city where they do not have their own residential accommodation. Guests stay for a period of minimum one month upto 2 years. Guest rooms include a sitting room, bedroom and a small kitchenette. These hotels could have a fully operational restaurant or a dining room and may provide services such as daily housekeeping, telephone, front desk and uniformed services. Bed & Breakfast Hotel: These hotels are generally operated in large family residences. These range from houses with few rooms converted into overnight facilities to small commercial buildings with 20 to 30 guest rooms. The owner usually lives on the premises and is responsible for serving breakfast to the guests. The bathrooms may be attached or may be on sharing basis. The tariff is lower than a full service hotel and hence suite the budget traveler. Casino Hotel: These hotels attract its clients by promoting gambling, arranging extravagant shows, and charter flights. They have state-of-the-art gambling facilities along with specialty restaurants, bars, round the clock room service, well appointed and furnished rooms for its guests. The casinos of Las Vegas USA are among the most famous casinos in the world. Conference Centres: A conference centre is a hotel which caters to the needs of a conference delegation. These hotels provide rooms to the delegates of conference, a conference hall with desired seating arrangements, special F & B requirements during and after the conference. They also require conference specific gadgets like the overhead projector, LCD projector, large size screen, computers and public address systems. These are large hotels having more than 400 rooms, with a large number of rooms having twin beds. Normally conferences are charged as packages which include accommodation and meeting facilities. Intercontinental The Lalit Mumbai and The Ashok at New Delhi would be good examples. Convention Hotels: Conventions are meetings that involve a large number of participants. The hotels catering to the needs of this segment are known as convention hotels. These hotels have more than 2,000 rooms to accommodate the large number of delegates. They are equipped with state-of-the-art convention centre with all the required facilities, such as seating configuration (T-Shaped, Classroom-type, workshop-style and theatre-style), audio-visual equipments and public address system to meet the demands of a convention. A

convention hotel has a greater number of rooms to host the large number of attendees as compared to conference centers. 5. Classification on the Basis of Duration of Guest Stay Commercial Hotel: The duration of guest stay in these hotels is short, ranging from a few days to a week. Transient Hotel: Mostly occupied by travelers as stopovers en route their journey, the duration of stay at transient is very short, a day or even less. Semi-residential Hotel: These hotels are generally patronized by people who are staying at a location while in transit to another place. The duration of stay may range from few weeks to some months. They incorporate the features of both transient and residential hotels. Residential / Apartment Hotel: As the name suggests, residential hotels provide accommodation for long duration and are patronized by people who stay for a long time. The duration of stay may range from months to few years. Extended Stay Hotel: In todays age of downsizing, outsourcing and mobility business executives are often away from their hometowns for extended periods of time and require more than a hotel room. These hotels are for those guests who wish to stay for a long period and cater to their long-term needs with special services, amenities and facilities such as full-fledged kitchens with dishes and kitchenware, refrigerator and separate area to wash clothes, housekeeping services, grocery shopping services and recreational facilities. 6. Classification on the Basis of Level of Services Upmarket/Luxury/World Class Services Hotels: Targeting the affluent segment of society, hotels in the up-market category offer world class products with personalized services of the highest standard. The emphasis is on excellence & class. These hotels provide upscale restaurants and lounges, exquisite dcor, concierge service, opulent rooms and abundant amenities. These hotels have many speciality restaurants with well-assisted service. Topend recreational facilities such as golf course, tennis courts, designer swimming pools with trained life guards and other sports facilities, shopping arcades, beauty salons, health spas with saunas and Jacuzzi are a regular feature. These hotels also offer the facility of health clubs with trainers and dieticians. The shopping arcade may have international brands of books, gifts, souvenirs, jewellery and handicrafts. These hotels are patronized by affluent people who care for quality and include business executives, celebrities and high ranking political figures.

Mid-market/Mid-range Services Hotels: These hotels offer modest services without the frills and personalized attention of luxury hotels and appeal to the largest segment of travelers. They may offer services such as room service, round-the-clock coffee shop, airport/railway transfers and multi-cuisine restaurant with bar. A typical hotel offering mid-range service would be medium sized having roughly 150 to 300 rooms. The room rent is much lower than the upmarket hotels. These hotels are patronized by business travelers, individual travelers and groups. Budget/Economy Hotels: Budget hotels focus on meeting the most basic needs of guests by providing clean, comfortable and inexpensive rooms. Also known as economy or limited services hotels they appeal primarily to budgetminded travelers, families, bus tour groups, traveling business people, vacationers, retired persons and other groups. These hotels have clean and comfortable guest rooms, a coffee shop, a multi-cuisine restaurant, in-room telephone and channeled music and movies. They may also have a swimming pool, a shopping arcade and a beauty parlor. 7. Classification on the Basis of Ownership Proprietary Ownership: This is the direct ownership of one or more properties by a person or company. Small lodging properties that are owned and operated by a couple or family are common examples or proprietary ownership. Large properties that are owned by international hotel companies such as Marriott or Hilton also belong to this category. A group of hotels that are owned or managed by one company is called a chain. In general 3 or more units constitute a chain. A proprietary chain is owned entirely by one company. In India the Taj Hotels Resorts and Palaces and the Oberoi Hotels and Resorsts fall unr\der this category. Franchise: A continuing relationship in which the franchisor provides a licensed privilege to do the business, plus assistance in organizing, training, merchandizing and management in return for a consideration from the franchisee. It is the authorization given by a company to another company or individual to sell its unique products/services and use its trademark according to the guidelines given by the former, for a specified time and at a specified time and at a specified place. In the hospitality industry, we often come across many big chains that are operating on a franchise basis. In this kind of contract, which is mutually beneficial to both parties, the franchisor allows the franchisee to use the

companys ideas, methods, trademarks as well as the brand logo to do the business. A private investor or franchisee can obtain the trademark license, architectural plans, blueprints, interior designs, training and operating methods of the franchisor by paying a fee. The franchisee is generally responsible for financing the construction of the hotel, although some franchisors offer construction loans or may lease real estate to franchisees. The franchisee must abide by the franchisors quality standards and product specifications, but is the legal owner of the business. Thus many hotels that are using the logo of Holiday Inn, Sheraton or Hilton may actually be owned by local, independent investors. Management Contract: Managing a hotel requires professional expertise. A new entrepreneur with little or no experience in the business may safely choose to become the franchisee of any well-established hotel chain. There could still be a problem in operating the business because the franchisor provides the well established image, a tested and successful operating system, training programme, marketing, advertisement and reservation system but does not provide the cadre or experienced managers and employees necessary to run the business on the day-to-day basis. To bridge this gap, management contract companies came into existence. These companies have the required expertise to manage hotels. They operate on the basis of management fee and sometimes on a percentage of he gross revenue. Management Contract is a contract between the owner of the property and a hotel operator (management contractor) by which the owner employs the operator as an agent to assume the full responsibility for operating and managing the hotel. Time-share Hotels: Time-share hotels also referred to as vacation-interval hotels are a new concept in the hospitality industry. As the name suggests, it entails purchasing a tourist accommodation at a popular destination for a particular time slot in a year. The buyers can then occupy the property for the appointed time or rent the unit to other vacationers if they can not avail the facility. They have to make a one-time payment for the time slot. Club Mahindra holiday resorts are a popular example of time share properties in India. Condominium Hotels: Condominium hotels are similar to time-share hotels, except that condominium hotels have a single owner instead of multiple owners sharing the hotel. In a condominium hotel, the owner informs the management company when they would occupy the unit. The management company is free to rent the unit for the remainder of the year, and this revenue goes to the owner. Owner generally pays a monthly or annually maintenance fee to the

management company that takes care of the premises, including landscaping, cleaning of common areas, water and power supply etc. Alternative Accommodation Alternative accommodation can be simply defined as all those types of accommodation that are available outside the formal or organized accommodation sector. An alternative accommodation, thus, provides sleeping space and modest food to its users. There are certain properties that cater to the needs of a large group. Sarai/Dharamshala: These lodging properties are mostly found at popular pilgrimage places. They are generally constructed by welfare trusts, social organizations or even the state and provide basic security and sleeping facilities for a nominal fee. Dak Bunglow/Circuit House/ Inspection Bunglow/Forest Lodge: A legacy of the British Raj these were built as rest houses for colonial officials across the country as well as in remote areas and scenic locales. All these properties have an ageless charm and an old world style of hospitality as well as special cuisine, which forms a part of the attraction, apart from the low tariff. These are owned by the various state governments and can be accessed through the local district administration. Often these are the only lodging properties in remote areas. Lodge/Boarding House: Lodges are modest hotels situation away from the center of the city or located at a remote destination. These are self-sufficient establishments that offer standard facilities, such as clean and comfortable rooms, food and beverage (F&B) services (bar facility may also feature sometime). Boarding houses are establishments that usually provide accommodation and meals at a specified period of time such as weekends or for a specified time of stay. Youth Hostel: The youth from rural as well as urban areas travel for various reasons such a education, adventure, sports and recreation. Youth hostels were established to cater to the youth on the move, who couldnt afford steep hotel rents. A youth hostel generally provides low-cost dormitory accommodation with common bathing and cafeteria facilities. They may also provide kitchens for selfcatering. Camping Grounds/Tourist Camps: Camping grounds are normally located within cities in open spaces. They provide parking spaces along with water, electricity and toilets. Camps must follow certain regulations regarding the quality of services and cost and are set up by municipalities. Railway/Airport Retiring Rooms: A retiring room is for the convenience of the transit travelers. These are situated at major railway stations and domestic and

international airports. They provide a resting place to passengers with confirmed and current tickets. These retiring rooms are available at reasonable rates and are often air conditioned. Booking for the same is made through the stations superintendent or the airport manager. They are equipped with clean sanitation facilities and may include F&B facilities at a cost. Paying Guest Accommodation: A Paying Guest (PG) accommodation is a noninstitutional accommodation offered by individual households at various destinations. Besides tourists havens like Goa, this kind of accommodation is becoming popular in large metropolitan cities among outstation students and the employed youth migrants from other towns. Guests normally pay fro accommodation, while the rules for F&B Services may differ from host to host.