Hospitality industry
Upcoming SlideShare
Loading in...5
×
 

Like this? Share it with your network

Share

Hospitality industry

on

  • 8,020 views

 

Statistics

Views

Total Views
8,020
Views on SlideShare
8,020
Embed Views
0

Actions

Likes
7
Downloads
409
Comments
0

0 Embeds 0

No embeds

Accessibility

Categories

Upload Details

Uploaded via as Microsoft Word

Usage Rights

© All Rights Reserved

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Processing…
Post Comment
Edit your comment

Hospitality industry Document Transcript

  • 1. UNIVERSITY OF MUMBAI PROJECT REPORT ON HOSPITALITY INDUSTRY IN PARTIAL FULLFILMENT FOR BACHELORS OF MANAGEMENT STUDIES 2013-14 PROJECT GUIDE PROF.NITHYA VARGHESE SUBMITTED BY: GANERI RANJIT KUMAR .P SEAT NO: DATE OF SUBMISSION: 21st OCTOBER SPCIALISATION IN: OTHERS MAHTMA EDUCATION SOCIETY‘S PILLAI‘S COLLEGE OF ARTS, COMMERCE & SCIENCE 1
  • 2. NEW PANVEL MAHTMA EDUCATION SOCIETY‘S PILLAI‘S COLLEGE OF ARTS, COMMERCE & SCIENCE NEW PANVEL CERTIFICATE To whomsoever it may concern This is to certify that the work entered in this journal is the work of GANERI RANJIT KUMAR .P T.Y.BMS, has successfully completed a project report on the HOSPITALITY INDUSTRY topic terms of the year 2013-2014, in the college as laid down by the college authority _____________ _________________ Internal Guide BMS Co-coordinator _______________ _________________ Principal External Examiner Date: 2
  • 3. DECLARATION I,GANERI RANJIT KUMAR.Pstudent of T.Y.BMS, MAHTAMA EDUCATION SOCIETY‟S PILLAI‟S COLLEGE OF ARTS, COMMERCE & SCIENCE, hereby declare that I have completed the project report on HOSPITALITY INDUSTRYin the academic year 2013-2014. The information submitted by me is true & original to the best of my knowledge. _______________ Signature 3
  • 4. INDEX sr.no Particular Page.No executive summary 7 1 introduction & evolution 8 1.1 Hospitality industry overview 12 2 Research methodology 16 3 Conceptual framework 3.1 Hotel concept 17 3.2 Motel concept 21 3.3 Hotel marketing concept 23 3.4 Classification on basis of star 26 4 company profile 4.1 Taj group of hotel 38 4.2 growth of industry 79 4.3 innovation 85 4.4 technology of production and distribution 87 4.5 strategies & competition in industry 93 4.6 business environment 99 4.7 critical success factor 103 4.8 Organization structure of Taj 107 4.9 Service triangle of hotel industry 109 4.10 After Mumbai attack security position in hotel 111 5 Analysis of hotel industry 113 Questionnaire 120 6 limitation of study 130 7 Conclusion 131 8 Interpretations & recommendation 132 bibliography &vibliography Annexure 4
  • 5. ACKNOWLEDGEMENT First and foremost, I would like to thanks our guide prof. Nithya Varghese for her guidance, encouragement and support for all the work on this project. I thank our guide for the project “hospitality industry” for the time she spent in analyzing my work and providing the necessary feedback always on time, in spite of her busy schedule. I would like to thanks my family for all the support they had given me in many ways to encourage me to work on this project. 5
  • 6. EXECUTIVE SUMMARY The hospitality industry is a 3.5 trillion dollar service sector within the global economy. It is an umbrella term for a broad variety of service industries including, but not limited to, hotels, food service, casinos, and tourism. The hospitality industry is very diverse and global. The industry is cyclical; dictated by the fluctuations that occur with an economy every year. Today hospitality sector is one of the fastest growing sectors in India. It is expected to grow at the rate of 8% between 2007 and 2016. Many international hotels including Sheraton, Hyatt, Radisson, Meridian, Four Seasons Regent, and Marriott International are already established in the Indian markets and are still expanding. Nowadays the travel and tourism industry is also included in hospitality sector. The boom in travel and tourism has led to the further development of hospitality . 6
  • 7. CHAPTER 1. INTRODUCTION& EVOLUTION Significant developments in the field of transportation, sophistication in communications, growing importance of sophisticated information technologies in the business world, engineering of a strong foundation for industrialization and urbanization, increasing domination of corporate sector on the national and international economies, emerging corporate culture and changing lifestyles paved copious avenues for the development of hotel industry the world over. The officials on deputation, the business magnets on trade promotion mission, the foreign representative on peace mission, the domestic or foreign tourists interested in visiting a place for pleasure or for enriching the knowledge bank, the international events etc. are some of the important reasons for the development of hotel industry. Restaurants, cafeterias and hotels offer food and lodging services to him/her, person/persons who develop the habit of eating and staying out of home. This principle necessitated application of management principles in the hotel industry and the hotel professionals realised the instrumentality of marketing principles in managing the hotel industry. The growing significance of managerial proficiency in the hotel industry made possible innovation in the marketing decisions . Today, the services are planned, controlled, automated, audited for maintaining and controlling the quality. The concept of total quality management is 7
  • 8. found getting an important place in the marketing management of hotels. The inclusion of modem amenities and facilities in the hotel services is made possible by the leading hotel chains which has been opening new doors for innovation and competition. It is against this background that the hotel companies, of late, need world class professional excellence. The emerging positive trends in the tourism industry indicate that hotel industry is like a reservoir from where the foreign exchange flows. This naturally draws our attention on hotel management. In addition, the domestic tourism also indicates a positive sign of development. Thus the emerging new developments in the socio-economic- environment open new vistas for the development of hotel industry. Of late, the organizations engaged in the hotel business are required to conceptualize modern marketing principles. This makes it essential that they formulate a sound marketing mix that makes possible an optimal development of the marketing resources and makes the process of development cost effective. Like other industries, the hotel industry also needs to explore avenues for innovation, so that a fair blending of core and peripheral services is made possible. It is not to be forgotten that the leading hotel companies of the world have been intensifying research to enrich their peripheral services with the motto of adding additional attractions to their service mix. It is against this background that we find the service mix more flexible in nature- The latest developments in the field of promotion have paved avenues for the introduction of innovative and aggressive promotional measures: The advertising, publicity, sales promotion, word-of-mouth promotion, personal selling and even telemarketing have been found used in the process of promoting the hotel business. The hotel tariff is found drawing due attention of the policy makers. All of them have been found attempting for making the pricing decisions motivational. The front- line-staff, receptionists, 8
  • 9. waiters, housekeepers, sales executives are found responsible for offering the promised services to the guests... The gap between the service-promised and services-offered is required to be bridged over that draws our attention on the management of hotel personnel. EVOLUTION 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 'AtithiDevoBhavah' (ADB) campaign have also helped in the growth of domestic and international tourism and consequently the hotel industry. According to a report, Hotel Industry in India currently has supply of 110,000 rooms and there is a shortage of 150,000 rooms fuelling hotel room rates across India. According to estimates 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 rates in India are likely to rise by 25% annually and occupancy by 80%, over the next two years. This will affect the competitiveness of India as a cost-effective tourist destination. To overcome, this shortage Indian hotel industry is adding about 60,000 quality rooms, currently in different stages of planning and development, which should be ready by 2012. Hotel Industry 9
  • 10. in India is also set to get a fillip with Delhi hosting 2010 Commonwealth Games. The future scenario of Indian hotel industry looks extremely rosy. It is expected that the budget and midmarket hotel segment will witness huge growth and expansion while the luxury segment willcontinue to perform extremely well over the next few years. 10
  • 11. 1.1 HOSPITALITY INDUSTRY – AN OVERVIEW Hospitality is all about offering warmth to someone who looks for help at a strange or unfriendly place. It refers to the process of receiving and entertaining a guest with goodwill. Hospitality in the commercial context refers to the activity of hotels, restaurants, catering, inn, resorts or clubs who make a vocation of treating tourists. Helped With unique efforts by government and all other stakeholders, including hotel owners, resort managers, tour and travel operators and employees who work in the sector , Indian hospitality industry has gained a level of acceptance world over. It has yet to go miles for recognition as a world leader of hospitality. Many take Indian hospitality service not for its quality of service but India being a cheap destination for leisure tourism. With unlimited tourism and untapped business prospects, in the coming years Indian hospitality is seeing green pastures of growth. Availability of qualified human resources and untapped geographical resources give great prospects to the hospitality industry. The number of tourists coming to India is growing year after year. Likewise, internal tourism is another area with great potentials. The hospitality industry is a 3.5 trillion dollar service sector within the global economy. It is an umbrella term for a broad variety of service industries including, but not limited to, hotels, food service, casinos, and tourism. The hospitality industry is very diverse and global. The industry is cyclical; dictated by the fluctuations that occur with an economy every year. Today hospitality 11
  • 12. sector is one of the fastest growing sectors in India. It is expected to grow at the rate of 8% between 2007 and 2016. Many international hotels including Sheraton, Hyatt, Radisson, Meridien, Four Seasons Regent, and Marriott International are already established in the Indian markets and are still expanding. Nowadays the travel and tourism industry is also included in hospitality sector. The boom in travel and tourism has led to the further development of hospitality industry. In 2003-04 the hospitality industry contributed only 2% of the GDP. However, it is projected to grow at a rate of 8.8% between 2007-16, which would place India as the second-fastest growing tourism market in the world. This year the number of tourists visiting India is estimated to have touched the figure of 4.4 million. With this huge figure, India is becoming the hottest tourist destination. The arrival of foreign tourists has shown a compounded annual growth of 6 per cent over the past 10 years. Besides, travel and tourism is the second highest foreign exchange earner for India. Moreover, it is also estimated that the tourism sector will account for nearly 5.3 per cent of GDP and 5.4 per cent of total employment. Significant developments in the field of transportation, sophistication in communications, growing importance of sophisticated information technologies in the business world, engineering of a strong foundation for industrialization and urbanization, increasing domination of corporate sector on the national and international economies, emerging corporate culture and changing lifestyles paved copious avenues for the development of hotel industry the world over. The officials on deputation, the business magnets on trade promotion mission, the foreign representative on peace mission, the domestic or foreign tourists interested in visiting a place for pleasure or for enriching the knowledge bank, the international events etc. are some of the 12
  • 13. important reasons for the development of hotel industry. Restaurants, cafeterias and hotels offer food and lodging services to him/her, person/persons who develop the habit of eating and staying out of home. This principle necessitated application of management principles in the hotel industry and the hotel professionals realised the instrumentality of marketing principles in managing the hotel industry. The growing significance of managerial proficiency in the hotel industry made possible innovation in the marketing decisions . Today, the services are planned, controlled, automated, audited for maintaining and controlling the quality. The concept of total quality management is found getting an important place in the marketing management of hotels. The inclusion of modem amenities and facilities in the hotel services is made possible by the leading hotel chains which has been opening new doors for innovation and competition. It is against this background that the hotel companies, of late, need world class professional excellence. The emerging positive trends in the tourism industry indicate that hotel industry is like a reservoir from where the foreign exchange flows. This naturally draws our attention on hotel management. In addition, the domestic tourism also indicates a positive sign of development. Thus the emerging new developments in the socio-economic- environment open new vistas for the development of hotel industry. Of late, the organizations engaged in the hotel business are required to conceptualize modern marketing principles. This makes it essential that they formulate a sound marketing mix that makes possible an optimal development of the marketing resources and makes the process of development cost effective. Like other industries, the hotel industry also needs to explore avenues for innovation, so that a fair blending of core and 13
  • 14. peripheral services ismade possible. It is not to be forgotten that the leading hotel companies of the world have been intensifying research to enrich their peripheral services with the motto of adding additional attractions to their service mix. It is against this background that we find the service mix more flexible in nature- The latest developments in the field of promotion have paved avenues for the introduction of innovative and aggressive promotional measures: The advertising, publicity, sales promotion, word-of-mouth promotion, personal selling and even telemarketing have been found used in the process of promoting the hotel business. The hotel tariff is found drawing due attention of the policy makers. All of them have been found attempting for making the pricing decisions motivational. The front- line-staff, receptionists, waiters, housekeepers, sales executives are found responsible for offering the promised services to the guests... The gap between the service-promised and services-offered is required to be bridged over that draws our attention on the management of hotel personnel. 14
  • 15. Chapter 2.Research Methodology Primary data as well as secondary data is used for the present study Primary Datais collected through the Questionnaire, Observation, Interviews and feedback, from General Managers, HR Managers, Line manager , Employees (at all levels), Trainers ( Internal and External), observation of training programs. Secondary Data is collected through previous records, data and Feedback forms, HR Manual, Policies, Library resources: Newspapers. Business ,Magazines, Internet. 15
  • 16. Chapter3. Conceptual frame work 3.1 HOTEL — THE CONCEPT At the outset, we go through the concept of hotel. The common law says that, Hotel is a place where all who conduct, themselves properly and who being able and ready to pay for their entertainment, accommodation and other services including the boarding like a temporary home. It is home away from home where all the modern amenities and facilities are available on a payment basis. The aforesaid viewpoints regarding the hotel clarify that hotel is a public place where all possible facilities are made available to a person or persons who stay. The facilities like entertainment, food, accommodation etc- thus become the core services of a hotel. The definition presented by Stuart McNamara says, “Primarily and fundamentally, a hotel is an establishment which supplies boarding and lodging not engaged in inter-state commerces or in any intra-state commerce, competitive with or affecting inter-state commerce for so related that the regulation of one involves the control of other. It is a quasi-domestic institution retaining from its ancient and origin certain traditions and acquiring in its modern development, certain statutory rights and obligations to the public where all persons not qualified by conditions or conduct are prepared to pay for their accommodation are to be received and furnished with a room or place to sleep or occupy if such accommodations are available with such services and attention as are incident to their use with or without contract as to duration of visit and which conducts within the confines of its physical locations the business of supplying personal services of individuals for profit- Incidental to such fundamental and principal business. 16
  • 17. The hotel may furnish quarters and facilities for assemblage of people for social business or entertainment purposes and may engage in retaining portion of its premises for shops and businesses whose continuity (i.e., proximity) is deemed appropriate to a hotel.” HOTEL AND ITS TYPOLOGY Since time irremovable, there have been frequent changes in the concept and perception of hotel. There are a number of hotels offering different types of services. The variation in architectural facilities, the size, the facade, the facilities and amenities can't be overlooked. This necessitates a study of its typology.  Residential Hotel  Commercial Hotel  Resort Hotel  International Hotel  Floating Hotel Types of Hotels: 1. Residential Hotel: The residential hotels work as apartment house, often we call them apartment hotels. The hotels charge rent on monthly, half yearly, or yearly basis. The hotels are generally found located in big cities and towns where no meals are served to the customers L 17
  • 18. Initially, the residential hotels were developed in the LISA. The services offered in the residential hotels are comparable to an average well managed home. 2. Commercial Hotel: The commercial hotels are meant for the people who visit a place of trade and commerce or business purposes and therefore these hotels are found located at the commercial or industrial centers. These hotels focus their attention on individual travelers and are generally run by the owners. 3. Resort Hotel: The resort hotel's are meant for the holiday makers, tourists and for those who need a change in the atmosphere mainly on health ground. These hotels are found located near the sea, mountain and other areas having an attractive landscape and healthy climatic condition . The tourists visit hotels mainly to relax. The entertainment and recreation facilities like swimming pool, tennis courts, boating, golf course, self-riding and other indoor sports in addition to restaurant and cafeteria, conference room, lounge, shopping arcade, entertainment etc., become significant in the resort hotels. 4. International Hotel: The international hotels are modern luxurious hotels, classified on the basis of international guidelines. These hotels are placed in various star categories e.g., Five-stardeluxe, five-star, four-star, three-star, two-star, one-star. The international hotels are mostly owned by the public companies where a board of directors is constituted for its control. The overall management is found in the hands of senior executives. 18
  • 19. 5. Floating Hotel: The floating hotels are located on the water surface. The place are sea, river, lake. These hotels provide all the facilities and services made available in a good hotel. In the leading tourist generating countries of the world we find the practice of using old luxury ships as floating hotels. 19
  • 20. 3.2 MOTEL — THE CONCEPT Initially the term motel was meant for local motorists and foreign tourists travelling by road- Basically motels serve the needs and requirements of these travelers and meeting the demand for transit accommodation. We cant also call motel a transit overnight stay. Some of the important services offered by motels are parking, garage facilities, accommodation, restaurant facilities- Motels are found equipped with filling stations, accessories, service of elevator to the automobile entrance restaurants etc. Motels are found located outside the city, preferably by the side of high ways and important road junctions. The accommodation available in a motel is more in the category of a 'chalet facility'- Which has a dining hall with fixed menu. Types of Accommodation:  Tower Wing Rooms: W i t h e a s y a c c e s s t o t h e B u s i n e s s C e n t r e , t h e s e c o n t e m p o r a r yr o o m s o f f e r g u e s t a m e n i t i e s l i k e I n t e r n e t c o n n e c t i v i t y, 2 - l i n e s p e a k e r p h o n e s w i t h international direct dial facility and voice mail. Mini bar, personal safe, channel music and television with satellite programmes.  Heritage Wing Rooms: These rooms are renowned for their architecture and exude an aura of old-world elegance. Each corridor in this Wing resembles an art gallery, and the design, décor and 20
  • 21. furnishing ensure that no two rooms are alike. Guests have a choice of rooms that overlook the city or pool or face the Gateway of India and the Arabian Sea.  T Club: aj Located on the top floors of the Heritage Wing, Taj Club is designed for the discerning business travel. Guest amenities and services include complimentary airportl i m o u s i n e t r a n s f e r s , p r i v a t e c h e c k - i n a t t h e C l u b d e s k , i n - r o o m f a x , personal safe, acomplimentary bottle of wine, valet service and c o m p l i m e n t a r y d e l u x e C o n t i n e n t a l breakfast .Taj Club also offers guests exclusive Meeting Rooms and a Business Service Unit on the Club Floor. Suites: Choose from elegantly appointed Junior Suites, Execut ive Suites, t a s t e f u l l y decorated Large Suites, newly renovated Luxury Suites or spacious, plush Grand LuxeSuites. The finest suites at The TajMahal are the luxuriously appointed PresidentialS u i t e s . E a c h o f t h e s e s u i t e s i s d e c o r a t e d w i t h o r i g i n a l p a i n t i n g s a n d a n t i q u e s t h a t transport guests into a world of regal luxury and grandeur 21
  • 22. 3.3 HOTEL MARKETING — THE CONCEPT The key points of difference in the hotel marketing as against other consumer products are that once customer has spent money in hotels, he/ she has nothing substantial to show for his/her money except the bills, as compared with buying a television or a refrigerator. Effective marketing and dynamic selling become significant in the context of hotel marketing because once you have not sold a seat in a restaurant or a room in a hotel, the income is lost and lost for ever. A hotel bedroom or a restaurant seat has no shelf life, Generally, the hoteliers explain their marketing by showing their computer booking service or the advertising campaigns for the coming season. There is no doubt in it that these things are part and parcel of hotel marketing, but only one aspect of the continuous circle of marketing. For marketing hotel services, it is essential that marketing be understood fully by the executive at the top of a hotel group with total commitment on his part to the continuous need to market, A number of experts have gone through the concept of hotel marketing as summarised below: Gerry Draper -"Ascertaining consumer needs, tailoring the product as closely as possible to meet those needs, persuading the customers to satisfy his needs and finally ensuring that the product is easily accessible when the customer wishes to purchase it." Melvyn Greene -"The ultimate in marketing is to establish brand loyalty so that eventually the consumer does not purchase the goods/services once, but continuously. This is achieved only by the product following the complete process of marketing." 22
  • 23. Tools of Sales Promotion The following tools of sales promotion are used for all the three heads instrumental in promoting the hotel business. 1. Brochure: It is a device to stimulate customers and motivate them to visit a hotel and avail of the benefits offered by the management of the hotel It is a detailed publication helping hotel companies in promoting their business. The guests, clients get detailed information from the brochure. 2. Folder: We find folder the most commonly used sales promotion tool. In this respect, it is essential that folders have an impressive appearance in totality. The particulars are required to be in brief but clear. The hotels can use folders for promoting the business. 3. Packaging: We call packaging an attractive wrapper of product. When we talk about packaging in the hotel industry, our emphasis is on the outer cover and internal layout of brochures and leaflets. 4. Attraction leaflets: This is exclusively meant for presenting a view of the different theme parks, museums, amusement parks, outstanding points of attraction in the hotels or so. 23
  • 24. 5. Merchandising: It is found helpful in promoting mass-market- This tool is found significant to restaurants and bars. The merchandising involves displaying of food stuffs and drinks in the right location. 6. Direct Mail Materials: The sales letters are found to be a direct mail material which can either be used alone or in combination with brochures and folders. 7. Display Materials: In the materials to be displayed at sensitive points are posters, dispensers, exhibits etc. We can use these materials in the offices of the travel agents, tour operators or at the places where tourists come, such as tourists spots, resorts, airports, railway and bus stations. 8. Competition and Exhibition: We find organisation of competition and exhibition for promoting the business. 9. Special Officer: We also find a provision for special offer for all, such as users, travel agents, tour operators, hotel personnel. The aforesaid tools of sales promotion help hotels and hotel companies in increasing the business. 3.4 Classification on the Basis of Star On the basis of standard and control, we classify hotels into two parts, such as Approved and Unapproved. The approved hotels are found of international standards where the 24
  • 25. accommodations are made available as per the criteria laid down by the Ministry of Tourism Since they have the stamp of official recognition, the customers trust on them. The unapproved hotels may also offer quality services but they lack official recognition and therefore, the customers or prospects don't believe offering of service-promised without making any distortion. 25
  • 26. GENERAL CLASSIFICATION OF HOTEL INDUSTRY Classifications of hotels  On the basis of standards: Like most of the countries in world, India also has hotels divided indifferent categories depending on their location, facilities, infrastructure and amenities provided. All the star hotels in India are government approved with continuous control on the quality of services offered.  One Star Hotels The hotels with most basic facilities, small number of room‟s :locations in the far-flung areas are grouped under One Star Hotel category. These hotels are best when customer is looking for cheapest available accommodation option.  Two Star Hotels:- These hotels are most available in the small cities and in particular areas of larger cities. Catering to the backpacker tourist traffic, these hotels provide all the basic facilities needed for general accommodation and offers lowest prices. 26
  • 27. One Star & Two Star: These are located in major cities as well as in small city and other tourist destinations. Their customers include usually the domestic tourists. Services provided by one star & two star hotel. Facility Free Parking Doctor on call Tour Planner Facility Accepts Credit Cards Travel Desk Money Exchange A/C and Non A/C Rooms Conference Hall Restaurant Bar/Lounge In house laundry / dry cleaning Complimentary newspaper in lobby  Three Star Hotels - These are mainly economy class hotels located in the bigger : and smaller cities and catering to the needs of budget travelers. Lesser in amenities and facilities, these hotels are value for money and gives good accommodation and related services on the reduced price. Services would be stripped down version of higher categories of hotels but sufficient to fulfil customer basic needs. 27
  • 28. Four Star Hotels: - A rung below five star hotels are Four Star Hotels, these hotels provide all the modern amenities to the travelers with a limited budget. Quality of services is almost as high as the five stars and above categories. These kinds of hotels are there for the travelers with limited budget or for the places which might not get the tourist traffic associated with larger cities. Three Star & Four Star: These are located in all major cities as well as tourist destinations. Their customer group ranges from middle level business executives to leisure travelers Services provided by three star& four star hotel Facility Facility 24 Hours Front Desk Air Condition Bar Coffee / Tea Making Facilities Telephone / Direct Dial Business Centre Currency Exchange Conference Facilities Doctor Front Desk Safe Deposit Box Gymnasium Laundry Cleaning Service Restaurant(s) Security Tour Desk Wakeup Service 28
  • 29.  Five Star Hotels:- The most luxurious and conveniently located hotels in India are grouped under Five Star Deluxe Hotel categories. Five Star Deluxe in India are globally competitive in the quality of service provided, facilities offered and accommodation option. These are top of the line hotels located mostly in big cities. These hotels provide all the modern facilities for accommodation and recreation matching international standards in hospitality. These are restricted to the four metros and some major cities like Mumbai, Bangalore , Hyderabad etc. The customers of these hotels are mostly foreign business and leisure travellers, senior business executives and top government officials. services provided by five star hotel Facility facility Parking facilities 24 Hours Front Desk Gymnasium Baby Sitting Laundry Cleaning Service Bar Swimming Pool Business Centre Parking - Coach/Bus Car Rental / Car Hire Parking / Car Park Cocktail Lounge Restaurant(s) Conference Facilities Tour Desk Currency Exchange Wakeup Service Doctor Gymnasium Laundry Cleaning Service 29
  • 30. Swimming Pool Parking - Coach/Bus Parking / Car Park Restaurant(s) Tour Desk Wakeup Service How star is given to the hotel The most popular hotel ratings are based on two companies Mobil which rates properties in Stars, and AAA which rates properties in Diamonds. Both of these companies publish travel guides and use their annual ratings of properties across the world to help members distinguish between low and high end properties. 1) One diamond These establishments typically appeal to the budget-minded traveller. They provide essential, nofrills accommodations. They meet the basic requirements pertaining to comfort, cleanliness, and hospitality. 2) Two diamond These establishments appeal to the traveller seeking more than the basic accommodations. There are modest enhancements to the overall physical attributes, design elements, and amenities of the facility typically at a moderate price. 3) Three diamond 30
  • 31. These establishments appeal to the traveller with comprehensive needs. Properties are multifaceted with a distinguished style, including marked upgrades in the quality of physical attributes, amenities, and level of comfort provided. 4) Four diamond These establishments are upscale in all areas. Accommodations are progressively more refined and stylish. The physical attributes reflect an obvious enhanced level of quality throughout. The fundamental hallmarks at this level include an extensive array of amenities combined with a high degree of hospitality, service, and attention to detail. 5) Five diamond These establishments reflect the characteristics of the ultimate in luxury and sophistication. Accommodations are first class. The physical attributes are extraordinary in every manner. The fundamental hallmarks at this level are to meticulously serve and exceed all guest expectations while maintaining an impeccable standard of excellence. Many personalized services and amenities enhance an unmatched level of comfort. The following is based on personal experience: One thing to keep in mind is that a hotel can have everything it needs to be a 5 star or 5 diamond property but unless it has great customer service then it will never get past a 3 star rating! The hotels and properties that get a four star or 4 diamonds rating (or higher) excel in customer service. 31
  • 32. Now, the highest level of a rating is either 5 stars or 5 diamonds. The difference between a four diamond or star and a 5 rated hotel is AGAIN the level of customer service. At a 5 star/diamond property you are pretty much treated like royalty and well taken care of. For instance, things I remember from the AAA guidelines are that at a five star property you personally taken to your room by a host, they leave a gift (like chocolate or?) on your pillow, and you receive a personal note from management thanking you for your stay. Of course there is a lot more. There thing that based on the high level of customer service that is required of 5 star/diamond properties, the sizes of the hotels are generally small around 200 rooms or less. You want to put all of this into context lets use Las Vegas as an example. For the longest time (long before hotel ratings i.e. customer service became a factor) Caesars Palace and the Golden Nugget downtown were the most consistent 4 star AND 4 diamond properties. Their level of customer service was top notch. The only thing preventing them from getting a 5 star rating was that they were limited by their sheer size and numerous rooms. For a long time, other properties found it very hard to go from a 3 rating to a 4 rating. Remember, the 3 to 4 rating is the division where customer service comes in. Properties such as the MGM Grand found this out. They got a 4 star rating one year by Mobil but were still rated by AAA as a three diamond property. The following year, Mobil ranked them back to a 3 star propert  Heritage Hotels These are characterized by lesser capital expenditure and affordability and include hotels running in palaces, castles, forts, hunting lodges etc. The heritage hotels are further classified as: Heritage classic 32
  • 33. A Heritage grand B Heritage Heritage Classic: These include hotels built between 1920 and 1935. Heritage Grand: These include hotels built prior to 1920. Heritage: These include hotels built between 1935 and 1950. (3) Budget Hotels: Budget hotels especially cater to domestic travellers who favour reasonably priced accommodations with limited luxury. These are characterized by special seasonal offers, low and good services. 33
  • 34. Services of budget hotel Facility Facility Aircodition&nonairconditionfacilites Refrigerator Railway picking facilities Currency Exchange Laundry Cleaning Service Newsstand Parking / Car Park Restaurant(s) Wakeup Service Medical help Unclassified: These are low-priced hotels spread throughout the country. A low-pricing policy is their only selling point. It accounts for about 19 % of the industry. RESTAURANTS These typically include fast food chains, ethnic restaurants, fine dining and coffee bars. The major players include Barista, Mc Donald‟s, Ruby Tuesday, bercos, etc. CONTRACT CATERING This includes any catering business unit that is formally not a part of the hotel industry but is closely allied to it. Some of the major players in this category include Sodexho, Compass Group, 34
  • 35. On the basis of Nature  Beach Resorts Hotels Peninsular India bounded by Arabian Sea, Bay of Bengal, Indian Ocean and the two emerald archipelagos of Lakshwadeep and Andaman and Nicobar have a long coast line of around 7500 km, offering an amazing array of beaches, some popular, some not so well known. Thus location of resort is the basic point of attraction for tourists.  Wild Resorts Hotels A wildlife tour is incomplete if one does not actually live in a forest for a few days. It means living in a rest house or a tent the midst of the dense wilderness and waking up to the twittering of birds.  Government Approved Hotels These are the hotels, which might not have applied for star categorization or small enough to find them in the list. Many of the wildlife resorts, lodges and hostels are government approved providing a minimum level of accommodation facilities at far off places.  Residential Hotels The residential hotels work as apartment house. Often we call them apartment hotels. The hotels charge rent on monthly, half – yearly, or yearly basis. They are generally located in big cities and towns where no meals are served to the customers. Initially, the residential hotels were developed in the USA. The services offered here are comparable to an average well managed home. 35
  • 36. Standard and Control On the basis of standard and control, we classify hotels into two parts, such as Approved and Unapproved. The approved hotels are found of international standards where the accommodations are made available as per the criteria laid down by the Ministry of Tourism and Civil Aviation- Since they have the stamp of official recognition, the customers trust on them. The unapproved hotels may also offer quality services but they lack official recognition and therefore, the customers or prospects don't believe offering of service-promised without making any distortion. Classification on the Basis of Official Stamp We find a number of unapproved hotels where world class services are made available to the tourists and even the foreign tourists prefer to stay in these hotels. Hence the point of difference between the classified and unclassified hotels or approved or unapproved hotels is the official stamp and recognition. We find realities in the comment, 'the unapproved hotels are clean and those who spend money from their own pockets prefer to stay in the unapproved hotels because economy in operation is given due weightage. It is against this background that in the unapproved hotels the customers get inexpensive accommodation, 4 Thus it is not right to say that the unapproved hotels don't offer quality services. The differences are in the group of users or guests attending the hotels. The foreign tourists in a majority of the cases prefer to stay in the approved hotels whereas the domestic tourists in a majority of the cases prefer to stay in the unapproved hotels. 36
  • 37. Chapter4.COMPANY PROFILE: 4.1 TAJ GROUP OF HOTELS 1.Taj history The TajMahal Palace and Tower, built in 1903, stands on the shores of the Arabian Sea, a resplendent tribute to the vision of Jamsetji N Tata, founder of the Tata group, who wished to build the finest hotel that India had ever seen. With a tradition of commitment to excellence, personal attention and guest delight, the Taj brand succeeds in making guests feel completely at home. There is a strong focus on exceeding customer expectations, reinventing service concepts and upgrading physical products. By benchmarking. Itself constantly against the best in its class, this brand, the oldest in the Tata group, has built a solid reputation in the hospitality industry. The Taj brand, deeply rooted in traditional Indian values of hospitality and graciousness, and committed to acquainting guests with India‟s living heritage, has evolved with time, assuming a more contemporary avatar. Its appeal therefore cuts across all generations.With a total of 57 properties in 40 locations across India and 18 international hotels, the Taj family of hotels encompasses iconic city hotels, grand palaces, modern business hotels, beach resorts and rustic safari lodges. Taj Hotels is justifiably proud to belong to the Tata group, an association that automatically elicits trust and esteem from its customers and stakeholders. The brand is a crowning achievement in the Tata group‟s array of brands. 37
  • 38. Ratan Tata became the Chairman of the Tata Group in 1981 after serving as Chairman in charge of the Nelco division of the group. Tata is India's largest conglomerate and includes the brands Tata Motors, Tata Steel, Tata Power, Indian Hotels, as well as other brands labeled under the Tata name. Ratan Tata was born on December 28, 1937 in Mumbai, India in one of the richest families in the country. His great grandfather, Jamsedji Tata, was the founder of the Tata group and passed the power and inheritance down to his family. Tata was a good student and studied hard at the Campion School in Mumbai followed by studies in architecture and structural engineering at Cornell University. He graduated with his bachelors degree in 1962 and joined the Tata Group in December of that same year. Tata's first job with the Group involved working with the Tata Steel division where he worked with the blue-collar employees shoveling stone and working with the furnaces. With Tata Industries, Ratan Tata was able to transform the management and vision of the division and bring in significantly larger dividends. This renewed financial success helped bring the Tata Group to the New York Stock Exchange and gave the company even more international power and prestige. Ratan Tata continued to acquire different industries for the Tata Group, eventually purchasing the steel an aluminium producer, Corus Group as well as Jaguar and Land Rover brands from the Ford Company. Ratan Tata lives a very private life in Mumbai, India. 38
  • 39. 2. Product profile – market analysis Taj Hotels, Resorts and Palaces covers a wider market in the hotel industry than the other luxury hotels in the race. They have a better product profile than the rest: i.e. They have great management, hospitality and facilities provided by them to their customers. Some of them are: Launch of Knowledge Management Site Systems and Technology Electronic Signage Guest Wireless Internet access In Room Guest Entertainment Systems The Taj Contact Centre Project Orion, the Integrated Back Office System Self service Kiosks Taj Website Outlook Global Reach and 24 x 7 x 365 Access for our customers across the world 39
  • 40. 3. Clint profile Taj Hotels have a client profile consultation service provided wherein they diagnose the clientele needs and thus, with that information they try and provide the required facilities to their customers. Generally, Taj concentrates on the Upper class of the society who can spend lavishly on the luxury provided. Vision The Taj Group of Hotels commits itself to the overall improvement of the ecological environment, which we are all a part of. We recognize that we are not owners but caretakers of the Planet and owe it to our children and future generations of humankind. It is our endeavor not only to conserve and protect but also to renew and regenerate the environment in which we live and operate. Our commitment encompasses all actions related to our products, services, associates, partners, vendors and communities. We will partner and engage with our environment through EARTH: Environmental Awareness and Renewal at TajHotels.For us EARTH is not a program, nor a process; it is a way of life. 40
  • 41. EARTH Taj Hotels Resorts and Palaces presents EARTH ~ Environment Awareness& Renewal atTaj Hotels gets Green Globe Certification ~ In an endeavour to reinstate its vision and efforts to boost sustainable tourism and integrate environment management in all business areas, Taj Hotels Resorts and Palaces presentsEARTH (Environment Awareness & Renewal at Taj Hotels), a project which reiterates the conscious effort of one of Asia‟s largest and finest group of hotels to commit to energy conservation and environmental management. EARTH has received certification from Green Globe, the only worldwide environmental certification program for travel and tourism. 41
  • 42. 4. Taj Values PEOPLE DIVERSITY, INTEGRITY & RESPECT PASSION FOR EXCELLENCE EXCEED EXPECTATIONS INNOVATION SENSE OF URGENCY & ACCOUNTABILITY SOCIAL RESPONSIBILITY JOY AT WORK People are our greatest asset and the key to our success. We respect diversity of people, ideas, cultures and honour the value of individuals in a team. We believe in perfection to achieve excellence. 42
  • 43. We continuously improveprocesses to surpass global benchmarks. We succeed by exceeding expectations of all stakeholders and protecting the interest of our shareholders and playing by the rules. We encourage innovation, embrace change and support growth through knowledge and learning. We accept responsibility and deliver on promises with a sense of urgency and agility. We commit to improve the quality of life of the communities we serve and our concern for the environment by returning to society what we earn We recognize and respect each other in all interactions and set the example for our guests, business associates and colleagues. We encourage a fair environment that supports equal opportunity to attract, develop and retain the best talent and endeavor to have fun too. 43
  • 44. 5. Taj promises At the Taj Group, our commitment to service excellence is rooted in our two guiding principles called the Four Steps of Service and the Taj People Philosophy. One of our key priorities is to empower our people to deliver on our legacy of impeccable service. 6. Four Steps of Service: 1. A warm and sincere welcome. Use the guest name, whenever possible. 2. Fulfill guest needs and provide anticipatory service. 3. Defect free products and services. 4. Fond farewell using the guest name, whenever possible. The following philosophy is a summary of our beliefs and values towards our employees. Taj People Philosophy The Taj People Philosophy displays our commitment to and belief in our people. We see Talent Management as the most important sustainable competitive advantage in the future.You are an important member of the Taj family. We endeavor to select, retain and compensate the best talent in the industry. We reward and recognize quality customer care based upon individual and team performance. We commit to providing you with opportunities for continuous learning and development. We abide by fair and just policies that ensure your well-being and that of your family, the 44
  • 45. community and the environment. We commit to regular and formal channels of communication, which nurture openness and transparency. We strongly believe that you are the Taj. 7. Organizational Structure OfTaj Ratan Tata (Chairman) Raymond Bickson (CEO & MD) Ajoy misra(Sales & marketing) Prakah Shukla(Technolo gy & chief info officer) Anil Goel Abhijeet mukherji (Executive dir.Finance) (Executive dir.-hotel operations) Sumit guha(Developmen t & projects) Sankar parmeswaram(le gal & company secretary) HN Srinivas(Hum an resource) 45
  • 46. 8. Present market value Market Share(Approx) 0.6 0.5 2.5 Taj Hotels 1.1 Oberoi Hotels ITC Welcomgroup Hotel Leela 1.7 Others 9. Future of Taj Urban Sanctuaries – Luxury Weekends from the Taj City Escapes Island Escapes Rejuvenate with Jiva Christmas and New Year breaks 46
  • 47. Some more developments in progress are: o TAJ opens its 5th hotel in Bangalore o Taj Coromandel presents „ANISE‟ o „No Room for the Ordinary‟ advertising campaign o Taj Residency Bangalore unveils „Jiva‟ Spa o „Heritage & Nature Walk‟ At The Taj West End, Bangalore o Bhairo‟,The Stunning New Rooftop Restaurant At Taj Lake Palace, Udaipur o Intoxicating Bhutanese Bath‟ At TajTashi, Thimphu, Bhutan o Two More Taj Safari Lodges Will Open In 2009 o Many more developments and strategies have been introduced but sufficient information is not available. 47
  • 48. 10. Financial information 48
  • 49. 49
  • 50. 50
  • 51. 51
  • 52. 11. Awards & Accolades Global Awards Sep-2008 Taj Hotels Resorts and Palaces is proud to receive the 2008 GOLD Magellan Award for its Brand Campaign - 'No Room for the Ordinary' in the Advertising / Marketing Campaign Category and Print advertising Category. Sep-2008 Taj Hotels Resorts and Palaces is proud to receive the award for „The Best Business Hotel Chain in India‟ by the readers in UK at the 2008 Business Traveller Awards. Sep-2008 Taj Hotels Resorts and Palaces tops the ranking in hotels segment in 'Asia Pacific's Top 1,000 Brands' survey for 2008. National (Indian) Awards Apr-2009 Jiva Spa is nominated for the award of „Best Spa Treatment – Ventoz‟ Asia Spa India Awards held on 8th April 2009 held at Delhi. Jan-2008 Dun & Bradstreet - American Express Corporate Awards 2007 - India's Top 500 Companies 2007 - in the "Hotels" category - The Indian Hotels Company Ltd. Jan-2008 Taj Hotels Resorts & Palaces - Avaya GlobalConnect Customer 52
  • 53. Responsiveness Awards 2007- “ India‟s Most Customer Responsive Hotel “ – Category Hotels. Regional Awards Sep-2004 TTG Travel Awards 2004 at the Sofitel Central Plaza, Bangkok–for the Best Local Hotel Chain. 2003 Pacific Asia Travel Writers Association (PATWA)– ITB, Berlin 2002 – Lifetime contribution for promoting the Hospitality Industry. 2003 PATA Gold Awards 2003 (Pacific Asia Travel Association) Corporate Environmental Programme - ECOTAJ Environmental Initiatives. 12. Categories OfTaj Hotel TajHotels,resorts and Palacesis an international hospitality group with strong roots in India. For over 100 years, we have built our reputation on legendary properties, unparalleled facilities and impeccable service. We operate in the luxury, premium, mid-market and value segments of the market through our following brands: Taj (luxury full-service hotels, resorts and palaces) is our flagship brand for the world‟s most discerning travelers seeking authentic experiences given that luxury is a way of life to which they are accustomed. Spanning world-renowned landmarks, modern business hotels, idyllic beach resorts, authentic Rajput palaces and rustic safari lodges, each Taj hotel reinterprets 53
  • 54. the tradition of hospitality in a refreshingly modern way to create unique experiences and lifelong memories. Taj also encompasses a unique set of iconic properties rooted in history and tradition that deliver truly unforgettable experiences. A collection of outstanding properties with strong heritage as hotels or palaces which offer something more than great physical product and exceptional service. This group is defined by the emotional and unique equity of its iconic properties that are authentic, non- replicable with great potential to create memories and stories. Taj Exotica is our resort and spa brand found in the most exotic and relaxing locales of the world. The properties are defined by the privacy and intimacy they provide. The hotels are clearly differentiated by their product philosophy and service design. They are centeredaround high end accommodation, intimacy and an environment that allows its guest unrivalled comfort and privacy. They are defined by aa sensibility of intimate design and by their varied and eclectic culinary experiences, impeccable service and authentic Indian Spa sanctuaries. Taj Safaris are wildlife lodges that allow travelers to experience the unparalleled beauty of the Indian jungle amidst luxurious surroundings. They offer India‟s first and only wildlife luxury lodge circuit. Taj Safaris provide guests with the ultimate, interpretive, wild life experience based on a proven sustainable ecotourism model. 54
  • 55. Premium Hotels (premium full-service hotels and resorts) provide a new generation of travelers a contemporary and creative hospitality experience that matches their work-hard play-hard lifestyles. Stylish interiors, innovative cuisine, hip bars, and a focus on technology set these properties apart. The Gateway Hotel (upscale/mid-market full service hotels and resorts) is a panIndia network of hotels and resorts that offers business and leisure travelers a hotel designed, keeping the modern nomad in mind. At the Gateway Hotel, we believe in keeping things simple. This is why, our hotels are divided into 7 simple zones- Stay, Hangout, Meet, Work, Workout, Unwind and Explore. As travel often means more hassle than harmony, more stress than satisfaction, modern travelers are looking for smarter choices. Driven by our passion for perfection, we welcome our customers to a refreshingly enjoyable and hassle-free experience, anytime, everywhere. Offering the highest consistency in quality, service and style we set new standards and take the unwanted surprises out of traveling. Our warm welcomes make our guests feel at home, away from home and our crisp and courteous service empowers them to get more done with greater effectiveness and control. And through our unrivalled network we provide service that is effortless, simple, never overwhelming, always warm. Ginger (economy hotels) is their revolutionary concept in hospitality for the value segment. Intelligently designed facilities, consistency and affordability are hallmarks of this brand targeted at travelers who value simplicity and self-service. 55
  • 56. 13. Corporate Information Domestic Subsidiaries 1. Tifco Holdings Limited 2. KTC Hotels Limited 3. United Hotels Limited 4. Taj SATS Air Catering Limited 5. Roots Corporation Limited 6. Residency Foods & Beverages Limited 7. Innovative Foods Limited 1. International Subsidiaries International Hotel Management Services Inc. 2. Taj International Hotels (H.K.) Limited 3. St. James Court Hotel Limited 4. Chieftain Corporation NV 5. IHOCO BV 6. Taj International Hotels Limited 56
  • 57. 7. Samsara Properties Limited 8. IHMS (Australia) Pty Limited 9. IHMS (Restaurants) Pty Limited 10. Apex Hotel Management Services Pte. Ltd. 11. IHMS (HK) Limited Joint VenturesDomestic 1. Taj Madras Flight Kitchen Pvt. Ltd. 2. Taj Karnataka Hotels & Resorts Ltd. 3. Taj Kerala Hotels & Resorts Ltd. 4. Taj GVK Hotels & Resorts Limited 57
  • 58. 5. Taj Safaris Ltd. International 1. Taj Asia Limited 2. Taj International Hotels (South Africa) (Pty) Ltd. 3. Taj Asia (Thailand) Ltd. 58
  • 59. 14. Key initiative Ginger Hotels IHCL is in the process of rolling out its Smart Basics hotels, under the brand name “Ginger”. The first prototype has been launched in June 2004 in Bangalore, with roll out being planned in a number of cities and towns subsequently. These hotels will cater to the economy or „value for money‟ segment and being predominantly domestic clientele based, are far less prone to fluctuations than the luxury and upscale segments. In the long run, this segment will help in derricking the current revenue stream of the company. Brand Architecture IHCL is in the process of clearly defining the product and service standards in order to have consistency across properties under each brand. This will help in further enhancingthe brand value of Taj. Product Upgradation IHCL continues to invest in renovation and relaunch of key / brand defining properties. In the last financial year IHCL upgraded rooms at the TajMahal Palace & Tower, Mumbaiand Taj West End, Bangalore The lobby and public areas of Taj Lake Palace, Udaipur and Rambagh Palace, Jaipur were also renovated to provide a luxurious sense of 59
  • 60. arrival. The Sea Lounge and Harbour Bar at TajMahal Palace & Tower, Mumbai was relaunched, while a new Vietnamese restaurant 'Blue Ginger' was opened in Taj West End, BangaloreThe renovated products and the new outlets were very well received in the market. The renovated rooms at TajMahal Palace & Tower, Mumbai and Taj West End, Bangalore have emerged as the price leaders in the respective cities. In the coming year IHCL intends to open a number of F&B outlets by celebrity Chefs with international cuisine. In the upscale segment, the properties are being relaunched to be at par with international level upscale hotels. The rooms at Taj President, Mumbai, Taj Residency, Bangalore, Jai Mahal Palace, Jaipur and Taj Holiday Village, Goa are being renovated and relaunched. Service Excellence In the last few years IHCL has undertaken a number of steps to significantly enhance service levels to be in line with the best in class. IHCL has constantly benchmarked itself with the key international luxury chains and strived to raise the bar. IHCL‟s service excellence philosophy, has at its core, delivery through our people, processes and culture. IHCL has taken a number of steps to provide highly personalized service to the discerning customer, including butler services in its luxury properties. In order to take care of the entire stay experience, IHCL has also completely revamped its Concierge services. The Centers of Excellence have been strengthened considerably to train staff to meet the exacting standards of a truly luxury hotel. Tata Business Excellence Model 60
  • 61. (TBEM) will play a significant role in raising the bar of service provided. The TBEM has been rolled out in all the three hotel divisions and will be rolled out to the international properties also. Tata Business Excellence Model (TBEM) In order to intensify the drive for Business Excellence, IHCL conducted Internal Assessments based on the Tata Business Excellence Model for Luxury, Leisure, Business SBUs as well as for Taj SATS Air Catering Limited. The Luxury Division has also applied for External Assessment, which is to be facilitated by Tata Quality Management Services. Based on the External Assessment (2003) feedback report and the feedback from the Internal Assessment, action plans to improve processes which finally impact the overall organizational effectiveness, have been drawn out and worked upon. Some of the key initiatives deployed across key hotels of the Taj group in the year 2003-04 are: Rollout of the Customer Feedback System (CFS) The CFS was launched in November 2003 and has taken root in 30 hotels across Taj group. It is the primary and sole customer feedback system of the group. Till date, the system has clocked around 12,000 pieces of customer feedback. The feedback from all sources gets recorded and 61
  • 62. aggregated and analyzed to improve the service quality in areas of concern at each of the hotels. Feedback is not restricted to only guest difficulties (complaints) but also consists of compliments and suggestions. The feedback would ultimately be used for product planning as well. IT initiatives From a situation in 1999 where there was limited IT application, Taj group has today achieved domestic leadership in deploying IT to leverage its competencies and is rapidly approaching benchmarks set by international highly regarded chains. The first three phases of implementation of the IT strategy included putting in place the physical infrastructure across the Taj Group and getting customer relationship applications to ride on this physical infrastructure, with a view to enhancing customer services through customer information and recognition systems and better inventory management. Some of the key IT initiatives being under taken by IHCL are Orion, a comprehensive back office system, implementing Revenue Management system, Interactive TV Systems and National Call Center. 62
  • 63. 15. competition A Tata company shall fully strive for the establishment and support of a competitive, open market economy in India and abroad, and shall cooperate in efforts to promote the progressive and judicious liberalization of trade and investment by a country. Specifically, a Tata company shall not engage in activities that generate or support the formation of monopolies, dominant market positions, cartels and similar unfair trade practices. A Tata company shall market its products and services on its own merits and shall not make unfair and misleading statements about competitors' products and services. Any collection of competitive information shall be made only in the normal course of business and shall be obtained only through legally permitted sources and means. Direct Competitors: 1. Oberoi Hotels 2. Oriental Hotels 3. ITC Welcomgroup 4. Hotel Leela etc. Potential Target market : The upper class of the society is targeted. i.e. the richer people in the society. Their fares or tariffs are high as the luxuries provided by them are also standard and 5star. Thus, this is in context to the Indian branches of Taj Hotels. 63
  • 64. 16. MARKETING STRATEGIES BY TAJ Intensive Growth:- 1>Market Penetration Strategy Taj hotels have three type of hotels: 1) Luxury Hotels 2) Business Hotels 3) Leisure Hotels So for different need of peoples different range of hotels is there. So it increases the Market Penetration. 2>Product Development Strategy It launched the Ginger Hotel for current market with new product to cover the middle class family. And right now they have 11 Ginger hotels through the country. 64
  • 65. And right now they are also going to open Ginger hotel in Jamshedpur, Mangalore, panji, Ludhiyana, Tirupur etc. IHCL has successfully opened the “Taj Spa” in their Mumbai located “TajMahal Palace & Tower”. And also they are going to open their Spas in several hotels of their group. 3>Market Development Strategy “Taj GVK Hotels & Resorts Limited” and their associates hotels group “Oriental Hotels Limited” are planning for operating their business in Bangalore and Chandigarh so they are going to set up properties. And right now they are also going to open Ginger hotel in Jamshedpur , Mangalore ,panji, Ludhiyana ,Tirupuretc 4>Diversification Strategy Taj Hotels Resorts and Palaces has taken luxury and hospitality to the skies with TajAir.They provide the private chartered aircraft to the business need. And they have 2000 aircraft. TajSats is right now offering the flight catering and related services .It is operating on four metro city in India..Taj SATS caters to over 26 international and domestic airlines, and is the leader in the Indian flight catering market. 65
  • 66. ITHC has formed Inditravel in 2002, and then post acquisition of 18 year old agency Stallion Travel Services Pvt. Ltd. It has management institution. Integrative Growth Strategy:- “Taj Hotels Resorts and Places” has done the agreement for acquirement of the Boston based hotels and resorts RITZCARLTON. They have also entered in the Strategic partnership in Doha with Qatar Sports for manage the “Taj Exotica Golf Resort and Spa”. They have also done the marketing alliance with “Shilla” that will provide portfolio of nineteen hotels. And among these 19 hotels 17 hotels will operate under the “Taj Luxury Hotels portfolio” and two hotels will operate under Shilla group. They have also done the partnership with the “Raffles” so with help of these alliances the company will operate 29 hotels with that Raffles. So among these 29 hotels 14 Hotels will operate under the “Luxury Taj Portfolio” and 15 hotels will operate under the “Rafles Hotels & Resort”. They have done the Strategic alliance with Abu-Dhabi based properties “ALDAR properties” .So they will operate some hotels and resorts .So for that they have already taken a first step that 66
  • 67. they are making a Resort in the “Yes Island”. Taj Hotels Resorts and Palaces has involved alliance with Okura Hotels & Resorts. Alliance with silversearcruise,aeuropian cruise company. Taj has taken the 10 percent stake in “Orient Express Hotels”which is well known hotel and also it is listed in NYSE list. And for this stake they have paid 850 crores”. Positioning The Taj marked out three separate entities for the Taj Group: Business, Leisure and Luxury.Though the concept of these sub-brands had come into existence earlier, in the mid nineties, itwas in 1999-2000, that the hotels became operationally different. Which meant that though theheads of these three divisions sat at head office, their „territory‟ is scattered geographically, according to which type of hotel they look after. Segmentation Strategy A higher emphasis was placed on the business segment as the profits are higher (this market being less price-sensitive as compared to the luxury segment) .The group also kept looking at new opportunities. „The action plan is more opportunities, addingto and complementing the brand,‟ says Krishnakumar. 67
  • 68. More changes There were other changes. Consolidation. Unprofitable ventures were hived of. The sales andmarketing functions were separated. The HRD department modernized, with an emphasis on performance and career and succession planning. The organisation was made to flatter and morecompact. Moreover, a continual benchmarking against international standards was made part and parcel of the culture of the Taj. Advertising It was only when the product was ready, was a major advertising campaign developed. Earlier,advertising had been restricted to the major feeder markets: the US, UK, Germany, Singaporeand Hong Kong. And the advertising emphasised the hardware aspect of the hotel. The new campaign developed a specific brand identity for the hotel.Though the Taj had high unaided recall, it launched a corporate campaign to reinforce this newi d e n t i t y. T h e a d ( m a d e b y R e d i f f u s i o n ) s h o w s t h e e n i g m a t i c w o m a n w h o s t a n d s f o r b o t h hospitality and efficiency. The identity was developed after extensive research on the consumer‟sattitudes towards the Taj. Over 60 in-depth interviews were conducted by client and agency. The parameters? Not quantity, but quality. The things done right. The quality of check-in, the smile,the greeting or the welcome drink. The insights gathered were analysed and a clear slot, which t h e T a j c o u l d o c c u p y w h e n g l o b a l c o m p e t i t i o n a r r i v e d , e m e r g e d . T h i s w a s t r a n s l a t e d i n t o creatinga 68
  • 69. distinct personality of the Taj as caring, efficient and enigmatic. The line went: „She istheTaj,‟ The base line was „Nobody cares as much.‟ MARKETING MIX: THE TAJ BRAND The brand “Taj Hotels Resorts and Palaces” comprises 58 hotels across India and 17 hotelsglobally. The hotels are grouped into 3 categories - Luxury, Leisure and Business.TheTaj Luxury Hotels offer lavish accommodation, gourmet specialty restaurants and bars,fitness centres and spas and well-equipped business and banquet facilities. Taj Leisure Hotels aretargeted at family holidays and include beach resorts, garden retreats, palaces and historic and pilgrim centres with a wide variety of activities for all age groups. Taj Business Hotels offer contemporary business facilities and modern conveniences and are located in the heart of India‟skey commercial cities and towns. 17. Market Segmentation Hotels in India are broadly classified into 7 categories (five star deluxe, five-star, four star, three star, two star, and one-star and heritage hotels) by the Ministry of Tourism, Government of India, based on the general features and facilities offered. The ratings are reviewed every five years. As of December 2005 (latest available figure) there are following number and category of hotels. 69
  • 70. Star Category No. of Hotels No. of Rooms 5-star Deluxe 82 18764 5-star 92 11332 4-star 132 9401 3-star 704 31039 2-star 587 19031 1-star 212 695 Heritage 83 2216 To be 50 5127 Total 1934 103973 Source: Ministry of Tourism, Government of India The table excludes hotels in the unorganized sector that have a significant presence across the country and cater primarily to economy tourists. Premium and Luxury Segment this segment comprises the high-end 5-star deluxe and 5-star hotels, which mainly cater to the business and up market foreign leisure travelers and offer a high quality and range of services. The segment accounted for 29per cent of the total hotel rooms in the country in December 2005. Mid-Market Segment This segment comprises 3 and 4 star hotels, which cater to the average foreign and domestic leisure travelers. This segment also caters to the middle level business 70
  • 71. travelers since it offers most of the essential services of luxury hotels without the high costs since the tax component of this segment is lower compared with the premium segment. Budget Segment These comprise 1 and 2 star hotels referred to as ‗Budget Hotels‘. These categories do not offer as many facilities as the other segments but provide inexpensive accommodation to the highly price-conscious segment of the domestic and foreign leisure travelers. Heritage Hotels In the past four decades, certain architecturally distinctive properties such as palaces and Forts, built prior to 1950, have been converted into hotels. The Ministry of Tourism has classified these hotels as heritage hotels. Others At any point in time, applications for classification are usually pending with the Ministry of Tourism because of which such properties remain unclassified. The number of hotel rooms pending classification has declined from historical 15-20per cent to 5per cent of the total rooms available in the recent past. 71
  • 72. 2 Market Strategies Branding During the 1980s, the hotel industry saw an explosion of new brands, , Market segmentation has served as one of the most powerful drivers in the creation of more and more branded products a trend that became a popular marketing concept in the 198Os and remains so today. Seen as a vehicle for growth by a number of hotel companies that tapped a virtually limitless supply of capital in those years. Large hotel chains assumed that they could create new markets by establishing niche products in a variety of segments. With the benefit of hindsight, however, some hotel chains that started out in a mid-market segment have tried to move up-market by creating new brand concepts to do so. As hotel companies fine-tune their identities, reposition their products and promote growth through aggressive franchising programs. Technology In the hospitality industry, as in all arenas of commerce, technology represents one of the strongest forces for change, while having had a significant impact on brand marketing. Hotel reservation systems have been shifting from voice to electronic Global Distribution Systems and are now on the verge of consumer access via the Internet. The increasing role played by the Internet should slowly affect booking patterns in the future as inexpensive 72
  • 73. consumer access to hotel product becomes available. This, of course, has potential implications for the benefits associated with the branding of hospitality products.. 3 Market practices PRICING STRATEGIES One of the single greatest challenges facing independent hotels today is pricing. Pricing the inventory effectively can lead to profitability and helps lay the foundation for long term success. But, pricing the inventory ineffectively can lead to disaster. During the last decade; two simultaneous factors impacted the market place and customer buying practices: (1) the dramatic drop in demand (2) and the widespread use of the Internet for booking rooms. Capitalizing on this situation, third party Internet companies seized the opportunity to grow their businesses. Hotels were eager to work with them, and customers were eager to use them as confidence and security in buying goods and services on-line increased. Rack Rates: Without any affiliations to warrant discounts, the Rack Rated customer paid the published rate, which was the highest rate. Consortia Rates:This was the same customer who booked through a travel agent using the GDS and received a 5%-10% discount off Rack Rates. Corporate Rates: Having met the hotel‘s qualifying criteria, such as volume, businesses were guaranteed discounted rates. 73
  • 74. Group Rates: With a block of rooms, rates varied based on time of year and the nature of the group. Weekend Rates: Individual leisure travelers, usually within a drive distance to the hotel. Promotional rates:These rates were originally used sparingly and used as a means to stimulate business by using discounted rates to anyone, regardless of affiliation. 18. SWOT Analysis Strength The group has enormous power and strengths, which makes it the best and competitive, some of them are:  It consists of 57 properties in 40 locations across India and 18 international hotels.  Its stylish variety of hotels like; Taj exotica, Taj safari, The gateway hotels, Ginger hotels, Jivas spa etc.  Its effective and efficient management techniques and staff.  Its brand name.  The presence of Taj Hotels, Resorts and Palaces in various countries like United Kingdom, France, Germany, Italy, Dubai, Singapore, Australia, Japan, Russia and the United States of America. 74
  • 75.  Securing management contracts at Palm Island, Jumeirah in Dubai, Saraya Islands in Ras Al Khaimah, Aldar Group in Abu Dhabi, UAE Langkawi in Malaysia and Thimpu in Bhutan.  The various initiatives taken like; rollout of Customer Feedback System, Tata Business Excellence Model, IT initiatives, Ginger hotels etc. Weakness Taj hotels being such a big brand, has a lot of advantages but every big company faces some odds and so does Taj. Some of its weakness;  Its hard to maintain such a huge chain of subsidiaries and there are more chances of mishaps in management.  Its huge competitors like Oberoi, Leela, Oriental, ITC etc are also providing same facilities and thus it becomes a weakness for Taj hotels.  Its very costly for the Indians to afford the tariffs and service charges set by Taj hotels. Thus, they loose a major part of their market share.  They need a lot of investment. 75
  • 76.  As Taj hotels is a popular group, it is always in the eyes of the terrorists, as taj has already faced such an incident. Therefore, it proves to be a weakness some times, to be so popular. Opportunities The Group is poised strategically to take advantage of the following situation:  In the backdrop of a healthy economy having its positive fallouts on the Tourism Sector leading to rapid growth in markets in India, South Asia and key gateway cities in sourcemarket destinations.  Rapid expansion in both International and Domestic destinations, with top-of-the-line Luxury, Leisure and Business properties.  Meeting growing demand in the budget and mid-market segments.  Extending the product portfolio into related offerings viz. luxury residences, wildlife lodges and health spas. 76
  • 77. Threats The threats identified by the Group are related mainly to the markets in which the Group operates and general factors related to the tourism industry. Significant among these are:  Cheaper international airfares, increasing affordability of travel to International destinations, especially South East Asia, Europe and Australia.  Growing presence of international hospitality chains competing in the Luxury and Business segments, to meet excess demand situation.  Appreciating Indian Rupee vis-à-vis the US Dollar, resulting in lower realisation on foreign exchange earnings.  Slowdown of international demand resulting in reduction of revenues. 77
  • 78. 4.2GROWTH OF THE INDUSTRY 1 Rate of Growth According to a report, Hotel Industry in India currently has supply of 10,000 rooms and there is a shortage of 150,000 rooms fuelling hotel room rates across India. According to estimates 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 rates in India are likely to rise by 25% annually and occupancy by 80%, over the next two years. This will affect the competitiveness of India as a cost-effective tourist destination. To overcome, this shortage Indian hotel industry is adding about 60,000 quality rooms, currently in different stages of planning and development, which should be ready by 2012. Hotel Industry in India is also set to get a fillip with Delhi hosting 2010 Commonwealth Games. The future scenario of Indian hotel industry looks extremely rosy. It is expected that the budget and mid-market hotel segment will witness huge growth and expansion while the luxury segment will continue to perform extremely well over the next few years. The hotel industry in India is going through an interesting phase. One of the major reasons for the increase in demand for hotel rooms in the country is the boom in 78
  • 79. the overall economy and high growth in sectors like information technology, telecom, retail and real estate. Rising stock market and new business opportunities are also attracting hordes of foreign investors and international corporate travelers to look for business opportunities in the country. The arrival of low cost airlines and the associated price wars have given domestic tourists a host of options. The opening up of the aviation industry in India has led the way for exciting opportunities for the hotel industry as it relies on airlines to transport 80% of international arrivals. Moreover, the government‘s decision to substantially upgrade 28 regional airports in smaller towns and privatization and expansion of Delhi and Mumbai airport will improve the business prospects of hotel industry in India. Substantial investment in tourism infrastructure is essential for Indian hotel industry to achieve its potential. The upgrading of national highway connecting various parts of India has opened new avenues for the development of budget hotels here. The Government of India‘s Incredible India destination campaign and the AtithiDevoBhavah campaign have also helped the growth of domestic and international tourism and consequently the hotel industry. In order to increase the stock of hotel rooms, the Federation of Hotel and Restaurant Associations of India suggested to the government that the floor area ration of the existing hotels should be increased. This was a couple of years before and will help create additional rooms in the existing properties and ease the burden of shortage of hotel rooms in the country. The proposal is yet to be implemented. 2 Pattern of Growth (Seasonal & cyclic) 79
  • 80. Pattern of growth in hotel industry is both seasonal and cyclical as hotel industry is inter related and based on the tourism industry. As the industry is related and run on the demand based on the location in some regions like historical places and business centers (ex: Delhi, Hyderabad, Tirupathi, etc) the demand for the hotels are cyclical and for few places the demand is seasonal. Seasonal demand is depend on the climate and location (ex: beaches in India are mostly visited in summer because of climate and vacations) 3 Growth Determinants Location Location is a critical consideration because if affects hotels ability to draw customers. It is important that hotel location be visible, accessible, convenient and attractive to market. Surrounding land uses are important for all types of lodging operations. Aesthetics of the area, noise, safety and other factors should be considered. Commercial Locations By location along major highways or in business or industrial districts, hotels and motels benefit from high visibility and proximity to generators of room night demand. Local colleges, hospitals, attractions, services and entertainment are examples of ―room night‖ demand generators. Resort Locations 80
  • 81. Hotels and motels in resort areas generate most of their business form leisure travelers who see the lodging facility and surrounds area as their ―destination.‖ Access and visibility, while important, are secondary to the quality of the facility, services, amenities, and nearby attractions. Local Market Area A lodging facility must be located in a market area that attracts overnight visitors. Business Climate Hotels and motels that primarily serve business travelers usually rely on the strength of the local business community. Tourism Activity Hotels and motels in resort areas typically rely on local attractions to bring in customers. Attractions can include both natural and man-made places of interest. Business Travelers: 81
  • 82. Business travelers represent a large portion of lodging demand in many market areas. They include people traveling on business representing commercial, industrial and governmental organizations. Peak business demand is usually experienced Monday through Thursday nights. Leisure Travelers: Leisure travelers may visit an area for a vacation, to attend sporting or social events, to shop, or to visit friends and relatives. They might be staying over simply because they are traveling to other destinations. Leisure travelers may be individuals, couples, families, or small groups. Travelers visiting hospitals and universities are typically included in this market segment. Leisure room demand is often seasonal. In larger, more urban market areas, leisure room demand may be limited to weekends, summer months and holiday periods. Other Travelers: Various lodging customers cannot be classified under the categories of business, leisure, or group. These travelers may include construction workers, truckers, utility crews and others. IMPACT OF RECESSION ON INDUSTRY 82
  • 83.  The state of turmoil in global financial markets has generated new concerns for the hospitality industry.  Existing hotels in India are also likely to benefit from the improved performance of the non-room sources of income, namely Food & Beverage (including banquet operations), Spa, Corporate Club memberships and other ancillary services.  India is expected to see Asia's biggest drop in corporate travel spending, falling 25% this year compared to 2008. 83
  • 84. 4.3 INNOVATION Service Innovation Hotel industry is continuously using the concept of technology to develop its image and occupancy ratio. Though the hotel industry is a service industry it is continuously innovating the way the services are provided. Many hotels have a category of rooms which are different in the space and facilities each one having their own specialties and range of price. Hoteliers are now running their business according to the taste and preferences of the customers continuous feedback from the customers are helping the management to innovate in the services provided by the. Few hotels are providing an services in their unique way to get into moonlight. Offering special services respecting the customer’s traditions and customs and providing the service in their way is new innovation to attract the customers. Technological Innovation The advent of the Internet has opened up many avenues for the hotel industry, most importantly the ability to book clients. Most if not all of the hotel chains offer some sort of online reservation enabling the hotel management and staff to focus their efforts in a variety of different places. It is reported that 25 percent of all reservations are made online making it a key tool in room occupancy fullfilment. In addition to room booking, most hotel chains today utilize the Internet by offering online deals and major advertising campaigns. Electronic advertisement accompanied with the ability to make reservations online has made the Internet tremendously valuable. Adapting to e-commerce transitions such as the 84
  • 85. implementation multi-purpose computer software are necessary to cater to the clientele of the next generation. A higher understanding of market needs will ensure a larger portion of it. Information processing management is another key element that has contributed to hotel industry success. Understanding and acting on the needs of clientele will lure travellers away from competitors. Again, most if not all hotel chains today are utilizing some sort of customer pattern tracking. Complete client pleasure is dependent upon what you can offer differently from the other guy. The colour of the sheets, the position of an ice machine, the softness of toilet paper; targeting the very core needs of clientele means they will return to what they are comfortable with. 85
  • 86. 4.4 TECHNOLOGY OF PRODUCTION AND DISTRIBUTION 1 Cost structure SOURCE OF FINANCE The source of finance available to a hotel development is similar to those available to real estate developers of others kind of project. The following are usual method of rising finance for the hotel Industries:1. Share capital 2. Preference share capital 3. Equity share capital 4. Borrowed capital 5. Debenture 6. Mortgage 7. Loan from commercial bank 8. Loan from financial institution 9. Trade debt- credit guaranteed by supplier 10. Inter company loans 11. Provision for taxation 12. Public fixed deposit 13. IPO 86
  • 87. Hotel industries displays an investment characteristic with Distinguishes it for other industries. The industry can be classified as one among those which are highly capital intensive. Most of the Hotel represented by land, building, furniture furnishing and Equipment. A study of the balance sheet of the leading hotel companies shows that bulk capital is 90%. A hotel project requires money under the following heads: 1. Cost of land and building 2. Cost of civil works 3. Cost of electrics installation and fixtures 4. Cost of sanitary work and fixtures 5. Cost of furniture fixture and fitting 6. Cost of carpet 7. Cost of providing facilities like air-conditioning, boilers, water treatment plant, filtration plant, water pump, drainage system. 8. Cost of providing swimming pool, land scaping, land development, 9. Shopping arcade. 10. Cost of kitchen ware. 11. Cost of manpower 12. Misllinious cost 87
  • 88. 2 Economies of Scale The hotel industry enjoys the economies of scale based on the occupancy rate. When the occupancy rate is high the hotels enjoy the economies of labour and fixed cost is distributed over large number of rooms effecting in the increase of the revenue and the various other costs like maintenance will remain same whatever the occupancy, if the occupancy is high the expenses are distributed occupied rooms resulting in the increase of revenue. Other than the savings in cost many hotels charge 24hours rent on rooms used for night halts (i.e. is for 8 to 10 hours) thus enjoying the chance to rent same room to other customers for 24 hours. 3 Economies of Scope Opportunities for the Indian hotel sector continue to be in the budget and midmarket segment. Anticipation for huge growth and expansion, in the next year or two. The luxury segment is set to perform extremely well over the next few years until the supplydemand gap is bridged. New opportunities lie in the extended stay segment, which many potential developers are currently shying away from. . Agra, while having seen highest improvement, has still a long way to go (citywide occupancy 47%). There also some unfinished hotel projects in 88
  • 89. Agra, which will continue to put pressure on the city‘s performance. As regards Jaipur, the recent announcement by a major IT company to set up a base outside Jaipur, as well as the state government‘s initiative to promote IT-related activity in the city, means that Jaipur can look forward to some additional room night demand from the business segment. These developments in the leisure segment including the strong performance in Goa leads to believe that the leisure segment is clearly benefiting from the increase in foreign tourist arrivals and growth in domestic travel. Hotels in metro cities, with an average rate of Rs 2,600-3,000, and hotels in nonmetro cities, with an average rate of Rs 1,800-2,400, are likely to experience rapid growth in demand in the next year or two. Cities to watch out for, in terms of development opportunity, are Pune, Goa, and certain pockets in major cities like Delhi (west) and Mumbai (mill lands). 4 Labour Department of Hotels that are available for guest 24 X 7:- Hotel Industry Kitchen/ Food Production: Kitchen & food production is a department of hotel that responsible for food . Even hotels having Coffee Shop provides 24 hour services to the guest. 89
  • 90. Hotel Industry Engineering:- If any problems come in room, bulb fuse, A/C not working , then need to contact Hotel Engineers, they are also available 24 hours. Hotel Industry Front desk:- Front desk is 1st impression on guest, if guest like this section then only he will go for other option like restaurant, laundry, etc. Front desk consists of young and energetic staff who is always (24 x 7) be there to help guest, they are also responsible for Business Centre, Internet Access. Front office desk responsible for making C-Form for Foreigner Clients, providing safety lockers to the guest.Taking Reservation by Telephone, E-Mails, and Fax from the guest. Also providing guest Money Exchange Services. Hotel Industry Housekeeping:- Housekeeping are available 24 X 7 for guest, making their bedroom, bathroom, etc. Providing guest Laundry services also do day to day room cleaning for guests. Hotel Industry Food & Beverage Service:- They include providing guest the services whether in rooms, Restaurants or Banquets, or in Conference rooms. 90
  • 91. Hotel Industry Travel Desk:- They are responsible for arranging day to day travels for the guest. They also do the ticket confirmation work, and also provides the information for sightseeing to the guests. Gym/ Health Club/ Sports:- Medium and large hotels are providing Gyms, Swimming Pool, Health Club, Beauty Parlor, Saloon, games like Billiards, Pool, etc facilities to their guests. Most of the Hotels are providing these facilities complimentary with the rooms. Parking/ Shops: - Few Star hotels providing big parking space, shops in the restaurant itself for the guest conveyance, so that they can get the things in hotel itself. 91
  • 92. 4.5 STRATEGIES AND COMPETITION IN THE INDUSTRY 1 Internal Rivalry The degrees of internal rivalry consist of competitors in the hotel industry that differentiates their strengths, cost, product offering, and positioning within the industry. In the hotel industry there is a lot of competition that takes place between different providers. Each company finds their strengths and does everything in their power to be acknowledged by the customer. Once they uncover how they can serve their consumers better than leading competitors they position themselves in the industry that better serves the consumers. 2 Porters Five Forces Model BARGAINING POWER Of SUPPLIERS The term 'suppliers' comprises all sources for inputs that are needed in order to provide goods or services. The high class hotels are operating by few hotel chains like-TAJ,EIH,ITC&THE LEELA PALACE so they have a control over the industry. There are no substitutes for spas and five star hotels. 92
  • 93. The hotels customers are fragmented, so they have to reduce their bargaining power to attract the customers. The Taj, ITC&Oberoi are having various rates and tariffs. Because they are having their own brand image. The hotel chains are operating different services like Spas, Boatels, Resorts, City Centers, Heritage HOTELS, etc. BARGAINING POWER OF CUSTOMERS Similarly, the bargaining power of customers determines how much customers can impose pressure on margins and volumes. The hotel industry is one of the most invested in its fixed assets. So they are trying to recover their amount quickly. The suppliers are providing better information about them to attract the customers‘ .Here the buyers are highly informed. If the hotel price changes are moderate, the Customers have low margins and are price-sensitive. Some unseasoned timings the hotels are offering discounts and incentives to reduce the bargaining power of buyers. 93
  • 94. THREAT OF NEW ENTRANTS The competition in an industry will be the higher; the easier it is for other companies to enter this industry. In such a situation, new entrants could change major determinants of the market environment (e.g. market shares, prices, customer loyalty) at any time. There is always a latent pressure for reaction and adjustment for existing players in this industry. The foreign hotel chains are tied up with Indian hotels to reduce the initial cost and using the latter‘s brand name. Brand loyalty of customers like TAJ, ITC, and LEELA PALACE affects the new entrants. Access to raw materials and Distribution channels are controlled by Existing players like TAJ, ITC, and LEELA PALACE. The cost of land in India is high at 50% of total project cost as against 15% abroad. This acts as a major deterrent to the Indian hotel industry. In India the expenditure tax, luxury tax and sales tax inflate the hotel bill by over 30%. Effective tax in the South East Asian countries works out to only 4-5%. THREAT OF SUBSTITUTES A threat from substitutes exists if there are alternative products with lower prices of better performance parameters for the same purpose. They could potentially attract a 94
  • 95. significant proportion of market volume and hence reduce the potential sales volume for existing players. This category also relates to complementary products. Brand loyalty of customers (TAJ, ITC, LEELA PALACE, etc,) is dominating the substitutes. The hotel relationship with customer and costs also the reasons to switching to substitutes. The price variation of same class hotel services from various brands is one of the reasons to choose a substitute. The present demand and supply of hotel rooms is one of the reasons to choose a substitute. More fixed cost and switching costs affects the business. COMPETATIVE POWER OF RIVALRY PLAYERS This force describes the intensity of competition between existing players (companies) in an industry. High competitive pressure results in pressure on prices, margins, and hence, on profitability for every single company in the industry. The top competitors in hotel industry are having the same services like five star, spas, boatels and motels, heritage hotels and palaces. The healthy competition among the all players is helping to increase the industry growth. Intense in metro cities, slowly picking up in secondary cities 95
  • 96. challenges to hotel industry 1. Shortage of skilled employees: One of the greatest challenges plaguing the hospitality industry is the unavailability of quality workforce in different skill levels. The hospitality industry has failed to retain good professionals. 2.Retaining quality workforce: Retention of the workforce through training and development in the hotel industry is a problem and attrition levels are too high. One of the reasons for this is unattractive wage packages. Though there is boom in the service sector, most of the hotel management graduates are joining. Other sector like retail and aviation. 3. Shortage of rooms: The hotel industry is facing heavy shortage of rooms. It is estimated that the current requirement is of 1, 50,000 rooms. Though the new investment plan would add 53,000 rooms by 2011, the shortage will still persist. 4. Intense competition and image of India: The industry is witnessing heightened competition with the arrival of new players, new products and new systems. The competition from neighboring countries and negative perceptions about 96
  • 97. Indian tourism product constrains the growth of tourism. The image of India as a country overrun by poverty, political instability, safety concerns and diseases also harms the tourism industry. 5. Customer expectations: As India is emerging as a destination on the global travel map, expectations of customers are rising. The companies have to focus on Customer loyalty and repeat purchase. 6. Manual back-end: Though most reputed chains have IT enabled systems for property management, reservations, etc., almost all the data which actually make the company work are filled in manual log books or are Simply not tracked. 7. Human resource development: Some of the services required in the tourism and hotel industries are highly personalized, and no amount of automation can substitute for personal service providers. India is focusing more on white collar jobs than blue collar jobs. The shortage of blue collar employees will pose various threats to the industry. 97
  • 98. 4.6 BUSINESS ENVIRONMENT PESTAL Model Political factors Rules and laws are apart of citizens everyday life. We have to abide by certain rules and regulations in order to remain in society. This goes for corporations as well. All corporations have to face some sort of rules and regulations. Although each corporation has to face rules and regulations, each industry faces different rules and regulations. Of course, it would only make sense to believe that all regulations are negative for corporations because it takes away from the bottom line. However, there can be positive affects of the regulations. For example, a ruling in favor of anti-trust laws will take away from the monopolistic company, but at the same time, the barriers of entry will become easy leaving opportunity for other companies to increase their bottom line. An analysis of the hotel industry has revealed that there are environmental, labor, and food & safety regulations as well as regulations for merging, which must be looked at before entering into the industry. Environment is one aspect the government will always have their eye on, and they will introduce laws that will protect the environment. Such laws will need to be looked at as a player in the hotel industry. Hotels are could be liable for clean up of contamination and other corrective action under various laws, ordinances and regulations relating to environmental matters. Such laws referring to keeping the environment in good shape can be quite costly to hotels in the industry. In Europe, North America, Australia and New 98
  • 99. Zealand, such prosecutions can now result in heavy financial penalties, considerable cleanup costs or in worst instances, jail sentences Another political factor that can impose a concern for a member in the hotel industry is the laws regarding labor. For instance, there are laws that govern minimum wage. Although this might not seem to be a concern, but anytime you are forced to pay a wage not in plans, which are taking away bottom line. Another law that can be quite costly is treatment of employees. For example, there are laws that prevent discrimination, and sexual harassment. If a hotel company violates these laws, it can lead to severe lawsuits, and at the same time the hotel will be slicing their revenues. The labor laws are pretty strait forward, but must be obeyed in order to keep on going profits. Social Cultural Factors Social cultural factors are a big issue to look into for hotel industry because it deals with a lot of consumers who have different demographic, ethnic, cultural backgrounds. By satisfying each consumers or generalizing the way to hospitalize, hotel industry can have chance to expand more. Technological factors In order for a hotel to prevent obsolescence and remain technologically advanced, the hotel must be up to date with all the latest technological changes that are taking place that might have an impact on the industry. As it moves through the twenty-first century, it is evident, that there is a strong focus on technology. 99
  • 100. Today, the Internet is increasingly being used. Consumers are shopping on the Internet, from music to travel and anything one can think of. For the hotel industry, they need to take this into consideration. The reason is that if hotels don‘t have a well developed website, they will possibly loose potential consumers. Not only do they need to alternate their distribution channels of information, they also need to advertise aggressively on the Internet. Discussing in further detail of what the computer has brought is using it for organizing the hotel operation. The day of having everything on paper is obsolete. So, in order for a hotel to have a competitive advantage, they need to have a very high tech information system. While the computer is changing the way hotels in the industry can offer information to their potential consumers and the way a hotel organizes their operations, materials supplied to the hotel are starting to become obsolete. For example, in most hotels, you will still find stereos, VCRs, and regular televisions. However, things have changed in the way people access music, movies, and of course T.V. Today‘s society, individuals have moved away from those big boxes and adopted the use of digital technology. So, for a hotel to prevent obsolescence the must change from the suppliers that are supplying them with stereos, VCRs, and regular TVs and look for suppliers that will offer them ipods, DVDs, and digital HDTV for room use. Moving in this direction will make the hotel much more attractive, thus the revenues will increase. The final technological factor that needs to be looked at is the rising costs of energy. These are uncontrollable costs, thus the only thing that can be done to limit the impact of these increasing costs is for hotels to manage the use of energy efficiently. A strategy of how to manage it would be one thing; however, a hotel must also look at the alternatives of 100
  • 101. energy that are coming into the world. For example, with high-energy costs some businesses are thinking innovation. Solar Cities will be the successes of the 21st century. Ecological factors Environment is something we as human beings come in contact with everyday. The condition of the environment will often guide decisions. For instance, if it is really smoggy outside, the chances of going for a hike or to an amusement park are very small. So, it would only make sense as a member of an industry that is looking to increase the demand of consumers to fully understand what environmental factors for their industry might impose an impact on the customer‘s decision. For example, during hurricane season, the customer decision to stay in a hotel on the east coast is not as likely as it was before these natural disasters. Global warming is another ecological factor calls for concern. The ozone is slowly being exhausted by human actions while leaving the earth degrees warmer. The uncertain climate can have a direct impact on hotels that are in areas of ski resorts. However, even though this is a definite concern, it should be a concern for long term planning the time frame for such effects is more likely to happen in the future. A way that could allow this not to be an impact for other hotels is to build a strong image in the consumers mind. Such image would come from being ecoefficient by improving resources to prevent pollution. 101
  • 102. 4.7 CRITICAL SUCCESS FACTORS 1 Factors influencing Success in the Industry Demand Drivers. The hotel and restaurant industry of India was Rs. 658.89 billion during 2007-08. Travel & Tourism Industry of India was valued at US$35.73 billion in 2007, contributing 3.56% to India‘s GDP. The number of foreign tourists arriving to India reached 5.08 million compared with 4.45 million in the year 2006, showing growth of 14.16%. India‘s share in international tourist arrivals at global level gradually improved from 0.46% in 2004 to 0.49% in 2005 and further to 0.52% in 2006 and 0.56% in 2007. The number of domestic tourists in India was 526.57 million compared with 461.76 million in 2006, showing growth of 14.03%. There are 1,437 hotels approved and classified by the Ministry of Tourism, Government of India, with a total capacity of 84,327 hotel rooms as on December 31, 2007. Indian hotel industry is currently adding about 60,000 quality rooms, which are expected to be ready by 2012. 102
  • 103. International Tourist Traffic The foreign tourist arrivals in India increased at CAGR of 5.5per cent from 2.29 Million in 1996 to 3.92 million in 2005. Significantly, the bulk of international arrivals into India, both in 2004 and 2005, have been business travelers. Main reason for this increase has been following fundamental factors: •India‘s strong GDP growth. •Opening of sectors of the economy to private sector/ foreign investment. •Strengthening of ties with the developed world. Also, introduction of low cost airlines also contributed to the demand. The increase in international flights, seat capacity and frequency into the country and the decision to allow private airlines like Jet Airways and Air Sahara to fly overseas has had a positive impact on tourist and business arrivals into India, by way of providing additional seats to: Key destinations. •Development of infrastructure by the Government •India‘s emergence as an outsourcing hub. •Success of ―Incredible India‖ campaign and other tourism promotion measures. 103
  • 104. •India‘s growing recognition as an exciting place to visit (‗The Readers Travel Awards 2006‘, conducted by Condé Nast Travelers has recently placed India at number four among the world‘s must-see countries, up from number nine in 2003) has helped boost its image as a leisure destination. Identifying Critical Success Factors (CSF) For the Industry The market for the hotel industry can be divided into the following key consumer segments based on purpose of visit: The Business Traveler The Business Traveler is a businessman or a corporate executive traveling for business purposes. This segment includes corporate, both domestic and foreign, who open offices in the hotel premises during start-ups, corporate executives who make extended stay either for long duration projects or while waiting for permanent accommodation (primarily expatriates) and convention arrivals. While the senior executives usually stay in 5 star hotels, the middle level executives, who are much larger in number, stay in the budget hotels. This segment offers better realizations, as they demand relatively smaller discounts on room rents (about 10per cent-15per cent), use more of facilities such as PCs, fax multi-media, conference halls. Also, the Food & Beverage (F&B) revenues are better as they usually eat in the hotel itself due to their busy schedules. 104
  • 105. The Leisure Traveler The Leisure Traveler could either be a foreigner or a domestic traveler whose Primary purpose of visit is holiday or site seeing. Among non-business foreign tourists the primary motivation for visiting India is largely cultural attraction followed by conferences and conventions, tourist attractions like beaches, wild life, hill resorts etc. Usually, leisure travelers are part of a package run by a tour operator. The margins offered by leisure travelers tend to be lower because of two reasons. Firstly, they seek higher discounts and also provide less F&B revenues as they usually eat out. The business offered by this segment is highly seasonal and tends to peak in the September to March period. Airline Cabin Crew Airline Cabin Crew forms another important segment because of the repetitive and guaranteed nature of the business that they provide. Usually, these are a part of an annual contract whereby, in return for a fixed rate, a certain number of rooms are provided on demand for cabin crews. With discount rates in the range of 40per cent and 50per cent, this represents a low-yield segment for hotels in general. Premium and Luxury Segment This segment comprises the high-end 5-star deluxe and 5-star hotels, which mainly cater to the business and up market foreign leisure travelers and offer a high quality and range of services. The segment accounted for 29per cent of the total hotel rooms in the country in December 2005. 105
  • 106. 4.8ORGANIZATION STRUCTURE OF TAJ HOTELS LTD 106
  • 107. One more basis for making a classification is the availability of star. The Department of Tourism is found responsible for fixing the criteria for everything from the size of the room to the qualifications of staff. On this basis, there are two important types-classified and unclassified." The star group of hotels are included in the classified group. Hotels having no star are deemed unclassified. The aforesaid classification makes it clear that different types of hotels are used by the different categories of users who make decisions on the basis of tariffs charged and services offered by the hotels. 107
  • 108. 4.9 SERVICE TRIANGLE OF HOTEL INDUSTRY IN INDIA. Hotel Owners/Admn HQ. External Marketing (Making promises) Employees/Waiters/ Internal Marketing (Enablingpromises) Consumers Managers Interactive Mktg. (Keeping promises) According to the Product- Service Continuum – ―Hotel industry is a mix of Goods & Services‖ . Goods – Food & BeveragesServices – Catering Services, Accommodation services, Entertainment, Communication & Transport etc. 108
  • 109. Gaps model of service quality Word of mouth communication Personal need Past experience ds Expected service Consumer part dsGap- 5 Perceived service dsGap- 4 Gap- 1 External Service delivery Communication Gap- 3 To customer. Marketer part Transition of Perception into Service quality Specification Gap- 2 Mgt. perception of consumer Expectation 109
  • 110. 4.10 After Mumbai attack security position in hotels. Taj residency ummed Security is very tight. Armed anti-terrorist squad (ATS) police personnel in addition to private security guard deployed. No one can enter without identity proof . Le-meridien Car are checking trolley at the main entrance with inverted mirror trolleys. A physical check of dickey and bonnet is also carried out but bags are not checking and people entering the hotel. They have CCTV camera to monitor movement inside the premises. General manager have given strict instruction to their staff keep an eye on people carrying any suspicious-looking bulky bags. Fortune landmark Bags are checking at the gate, but there are no physical frisking. There are no lady cops to check female guest. 110
  • 111. The pride Cars are checking at the main gate. They are strict at time of frisking physically but they are not checking bags of the customer. No female security guard to check female guest. They have purchase certain security measures. They are going to install CCTVs, mirror trolleys and door metal detectors soon. The Grand bhagvati. One armed security guard and a metal detector is deployed at the entrance. Bags are checking thoroughly before allowing guest inside. They already have CCTVs in place and have tight security. If somebody refuse to check we explain that it‟s for their own security, being vigilant is the only way to stay safe. The Metro pole Zero security, though they have two watchman at the entrance, but not bother to check the guest. They are not even checking bulky bag of the guest. They are planning to install metal detector at the entrance. 111
  • 112. Chapter 5.Analysis of hotel industry&Questionnaire (1) Threats of new entry:Hotel industry the growing industry so growing industry often faces the threats of new entry. Many new hotels are coming in the near future so there are very tough competitions in this industry. Govt. policy:In many cases govt. policy & regulation are important for entry barriers. Govt. policy is liberal to wards the hotel industry few years ago govt. restricted for foreign companies to enter into a India but now a days the govt. become so liberal towards the entry of foreign companies. Govt. has also give the appointment to unitech lines up to develop 35 hotels in next 7 years. So it is the good news towards the hotel industry. Cost disadvantages independent of scale:It means that whatever cost advantage is enjoying by already established hotel that cost advantage can not enjoy by the next coming hotels. For example: - already establish hotel have learning or experience, favorable raw materials, advertisement expenses, favorable location etc. In hotel industry cost of capital is so high& the return is law so it is the negative point towards the hotel industry. 112
  • 113. Product differentiation:It means that how your service is differing by brand image, customer loyalty & product attributes etc. For example:Taj is having good brand image in the mind of customer & also tata have new introduced a ginger hotel so that ginger hotel not face so much problem to enter in the market but some other new brand hotel want to come than they have to spend lots of cost to attract customer in to this competitive world. Monopoly element:Monopoly in terms of product, technology, effective control over raw materiel supplier, distribution channels etc. in hotel industry now a days there are no monopoly power enjoyed by any hotels because there are so many hotel in Mumbai, some howtaj hotel have some monopoly in 5 star segment in Mumbai but there are also other 5 star hotel in Ahmedabad like holyday inn hotel so now a days there are no monopoly in hotel industry. Capital requirement:To open the hotel lots of capital is required & in hotel there are high risk & law return situation so that is why to a new hotel is very difficult task. 113
  • 114. (2) Rivalry among existing firm:State of growth of technology:Hotel industry is growing round about 8% growth so growth of hotel industry is high. Fixed & storage cost:In terms of hotel industry the fixed cost is very high like cost of buildings, salary of regular employee & executives. But in case of storage cost in service industry service can not be stored except like grain etc but vegetable can not be stored long time so in case of hotel industry there are less storage cost. Product or service standardization & switching cost:In hotel service if service is standard & qualitative than customer Go to that kind of hotel for example:Ginger &neelkanth is the 3 star hotels but only difference is that ginger is only targeting business client people & hotel neelkanth is targeting both business & normal customer. Service is almost same in both hotels in neelkanth hotel gym. Is not there but in ginger hotel gym. Is there but room rate of ginger is high than the hotel neelkanth so because of high price customer can divert to the neelkanth hotel. 114
  • 115. Diverse competitors:Rivalry becomes more complex & unpredictable when competitors are very diverse in there strategy, origins, personalities, relationship to their parents etc. For example:There are many competitors in the market there are many hotels in Ahmedabad so to know the strategy of the hotels is very difficult because every hotel have different-different strategy to attract the customer. For example: - taj hotels parent company is „TATA‟ and it has a good brand image in the mind of customer so it is very difficult to fight against taj for other hotel. Switching cost:In some cases a barrier to entry is created key switching cost. It means that customer is not loyal to wards only one hotel there are many hotel. And also taste & preferences of the customer will change now & than for example :-in Sarovar portico hotel swimming pool facility is not there & customer go to the Sarovar and he want swimming pool but swimming pool is not there than customer next time go to the taj hotel so Sarovar portico hotel lost the customer. And for Sarovar hotel cost of new ancillary equipment is very high. 115
  • 116. (3) Threats of substitutes:Threats of substitute means there are also some other small hotel than the star rated hotel like Resorts Low price Dharmshalas Short term paying guest house In short term paying guest house hear some customer don‟t want to stay for the longer time period so customer go to this kind of guest house at very cheapest price. But in star rated hotel customer have to pay rate of full day even he want to stay for an hour so this guest house is best option for the customer so this is a threats for star rated hotel. (4) Bargaining power of buyers:In star rated hotel customer can not bargain for price but they shows the same rated hotel price like hotel ginger & hotel neelkanth in hotel ginger rate is high compare to neelkanth& facility are also mostly same so customer more prefer to the hotel neelkanth. Important determinants of the buyer power are following 116
  • 117. The extent of standardization or differentiation of the product:- Now a day customer are so literate & more aware about price & quality of the service it means that customer shows both standard service at less price so it shows the high bargaining power of customer. Switching cost:- Switching cost means customer can switch to go the hotel in which he can not get standard service so it also shows the high bargaining power of customer. Extent of buyer‘s information:- Now a days customer is became so much aware about information given in the internet & newspapers so they go in that hotel which charge less price and good service. So in this also customers bargaining power is high. (5) Bargaining power of suppliers:Importance of concentration & domination in the supplier industry:- It means that that in hotel industry suppose there are only one supplier than bargaining power of supplier is high. For example :- In vegetable there are lots of farmer in the market so hotel can purchase from any one, in grain also there are many supplier of grains so again there are bargain power of the supplier is low. In milk there are only Amul is selling the milk so hotel have to purchase from Amul only. 117
  • 118. Importance of buyer to the supplier:- It means that in eye of supplier the hotel is very important. Suppose one hotel purchase the 30 to 40% of selling of the supplier & if hotel switch to purchase from that supplier than that supplier lost very important buyers because 30 to 40% selling is go to that hotel at that time bargaining power of the supplier is low. Importance of product to the buyer: It means that hear product of supplier is important for hotel if hotel switch to purchase that product from that supplier than hotel will loss heavily because only that suppliers product customer want. For example:- For taj hotel havemore ice-cream company is very important because at one time when Bill Clinton came to the taj at that time he demand the havemore ice-cream so have more is very important for the taj hotel so hear bargaining power of buyer is low & bargain power of supplier is high. Substitutability of product:- If there is substitute product of havemore at same quality & at fewer prices than taj can stop to purchase havemore so hear bargain power of supplier will be low & bargain power of buyers will be high. 118
  • 119. Questionnaire This survey is part of the research for master thesis on the Service quality and customer satisfaction in the hotel industry. Through this survey I wish to analyzatn these determinants from a customer’s perspective and expectation. 1. On which occasions do you need to stay in a hotel? A) On a business trip B) In daily life C) For temporary living place D) Other Occasions Business trip 60% Daily life 10% Temporary place 20% Other 10 % 119
  • 120. 2. Which type of hotels do you most likely stay in? A) Five star hotels B) Four & three star hotels C) Two & one star hotel D) Budget hotels/hostels Type of Hotels 5 Star hotel 40 % 4 & # star hotels 30 % 2 & 1 star hotels 10% Budget hotels 20% 120
  • 121. 3 .How do u advertise your hotel A) Press B) T.V C) Internet D) Other Advertisement PRESS 30% T.V 20% INTERNATE 40% OTHERS 10% 121
  • 122. 4. Which source help you to choose a hotel A) T.V B) Newspaper C) Word of mouth D) Other Sources TV 20% NEWSPAPER 20% WORD OF MOUTH 50% OTHERS 10% 122
  • 123. 5. Which factor do u consider when u choose a hotel A) Price B) Hotel rating C) Infrastructure D) Other Consideration Factors Price 20% Hotel rating 20% Infrastructure 50% Other 10% 123
  • 124. 6. Choose one of the best offers of your interest A) Discount price B) Hotel staying package C) Bring a friend for free D) Reduced service for lower rate Offers of Interest Discount price 20% Hotel stay package 30% Bring a friend for free 10% Reduced service for lower rate 40% 124
  • 125. 7. Which other properties in a hotel are you also interested in? A) Restaurant & bar B) Casino C) Gym D) Other Other Properties Restro & bar 60% Casino 30% Gym 10% Other 20% 125
  • 126. 8. Which kinds of issues that have you encountered in terms of hotel services? A) Responsiveness of hotel employees B) Cleaning service C) Room facilities D) Other Issues Encountered Employees responsiveness 20% Cleaning service 30 % Room facilities 40% Other 10% 126
  • 127. 9. When a problem happened, you perceived A) Efforts of hotel staffs in solving the problem B) That hotel staffs ignore the problem C) That you cannot connect to hotel staffs to solve the problem D) Other Perception Efforts of staff 10% Ignorance of staff 30% No connection to staff 40% Other 20% 127
  • 128. 10. How long did you have to wait for the responses from the hotel about your problem? A) Immediately B) Within 24 hours C) More than 24 hours D) No responses Time to Solve Problems Immediately 40% Within 24 hrs 30 % more than 24 hrs 20% No response 10% 128
  • 129. Chapter 6. Limitation of study 1. Time: Time frame for study was tight. Schedule had to be maintained. 2. Finance: Restrictions on expenses. 3. Access to data: Internet, Books, Magazines, Newsletters, Word-of-mouth information etc. 129
  • 130. Chapter 7. INDIAN HOTEL INDUSTRY: CONCLUSION The hotel industry in India having a tremendous opportunity in the future because of increasing trends in the tourism industry and government promoting the “Incredible India” campaign and other tourism promotion measures. The hotel industry in India is mix of many brand internationally established hotels having the scope to attract shares in the brand hotels which will help to expand the industry and the innovations in the industry is helping the hotels to retain the customers with them. Though the industry is having opportunities in future it is suffering with the cost of land which is costing 50% of the total cost and the taxes are main drawbacks for the industry. Industry is opening gates for the foreign investment which is a good sign for the industry and industry is working toward the fulfillment of the demand and supply gap. 130
  • 131. CHAPTER 8. INTERPRETATIONS AND RECOMMENDATIONS Taj hotels is good in each area of service, moreover its overall interpretation can be done withthe help of following table: Taj is serving its customers to its best and it is able to achieve 5-star ratings from a long period. But in this era all have to appl y marketing strategies to attract customers o t h e r w i s e t h e competitors will not leave a single chance to grab market share. The strategies used by taj as explained above are successful in attracting customers as well as positioning it as a high class service delivering brand with luxury. Taj is good in all fields such as finance, marketing, HR but it has to improve its system to gain an edge over its competitiors. Recommendations: Taj can improve in the area of system as system of an o r g a n i z a t i o n c a n a l s o b e i t s c o r e competency and it can also serve better if the internal system is good. Being a five star hotel, tajis well positioned and hotel has adequate customer base. Marketing strategies are also hotel has to improve a lot and regain its customers after the Mumbai attacks. 131
  • 132. · They have right now hotels in only for 5 star segments so they should Venture into other segments in the hotel sectors like 3-star or 4 -star. Because our most of the population are belong to the middle classfamilies so there is a huge market for that segment .And so for this they should deeply think over it. Else another big player can use this segment for their strategic plan. · Due to Expand on international acquisitions-last quarter net profit was up 46.22 crores revenues could be used to expand further. (Business line November 1,2006).So they should give more attention for their strategic growth to international alliances and merger for international hotel market. · Right now they have only 11 Ginger hotels so they should open Ginger hotel to more location for people. In India, Ginger type hotel have more demand. That‟s why our small hotels industry player are getting very much profit. · In India .Medical tourism is not very popular but in western nation it is hugly popular So Taj should also give importance to this medical tourism. Taj has hotels in 42 locations in India. But India is a big country so they should set up more hotels in our country .It will give advantage to Taj as well as it increases the employments also. They should discover and open new properties, which are not ventured into by other large players. 132
  • 133. BIBLIOGRAPHY India Today magazines News paper VIBLIOGRAPHY The information provided in this project is collected from various sources like; Google website Taj website(www.tajhotels .org) www.yahoo.com www.slideshare.com www.Scribd.com www.Wikipedia.org Help from Parents, Teachers & Friends too. 133
  • 134. Annexure 1. On which occasions do you need to stay in a hotel? A) On a business trip B) In daily life C) For temporary living place D) Other 2. Which type of hotels do you most likely stay in? A) Five star hotels B) Four & three star hotels C) Two & one star hotel D) Budget hotels/hostels 3 .How do u advertise your hotel A) Press B) T.V C) Internet D) Other 134
  • 135. 4. Which source help you to choose a hotel A) T.V B) Newspaper C) Word of mouth D) Other 5. Which factor do u consider when u choose a hotel A) Price B) Hotel rating C) Infrastructure D) Other 6. Choose one of the best offers of your interest A) Discount price B) Hotel staying package C) Bring a friend for free D) Reduced service for lower rate 135
  • 136. 7. Which other properties in a hotel are you also interested in? A) Restaurant & bar B) Casino C) Gym D) Other 8. Which kinds of issues that have you encountered in terms of hotel services? A) Responsiveness of hotel employees B) Cleaning service C) Room facilities D) Other 9. When a problem happened, you perceived A) Efforts of hotel staffs in solving the problem B) That hotel staffs ignore the problem C) That you cannot connect to hotel staffs to solve the problem D) Other 136
  • 137. 10. How long did you have to wait for the responses from the hotel about your problem? A) Immediately B) Within 24 hours C) More than 24 hours D) No responses 137