Classification of Hotels, STAR Rating & Types of
Hotel Rooms
PRESENTED BY:
ANCHAL GOEL
OVERVIEWOF HOSPITALITY INDUSTRY
•Hospitality is about serving the guests to provide them with "feel-good-effect".
•"Athithi devo bhavha" (Guest is God) has been one of central tenets of Indian culture.
•Today hospitality sector is one of the fastest growing sectors in India
•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.
•India is an ideal destination for tourists. Approximately 4.4 million tourists visit India
every year.
HOTEL
An establishment that provides lodging and usually meals and other services for
travelers and other paying guests.
A hotel is a type of establishment that accommodates visitors for a short stay at a stated
fee
a commercial establishment offering lodging to travelers and sometimes to permanent
residents, and often having restaurants, meeting rooms, stores, etc., that are available to
the general public.
Classification of Hotels
CLASSIFICATION OF HOTELS
TYPES OF
HOTEL
Based on Location
Based on size
Based on Target Market
Based on Level of ServiceBased on Ownership
and Affiliation
Based on Star rating
Based on Length of
Stay
Based on Theme
Based on Location
i. City center/Downtown/Commercial hotels : These
hotels are located in the heart of the city; More
expensive than the suburban hotels; Patronized by
business men and high income tourists; Centrally
located and at a convenient distance from markets,
railway station, airport, etc. & have high traffic on
weekdays and the occupancy is generally high.
Example: Taj Mahal, Mumbai
ii. Suburban hotels: They are located in suburban areas,
it generally have high traffic on weekend. It is ideal for
budget travelers; moderately priced and are of mostly
medium, large or small size; Normally these hotels are
patronized by low budget tourists
iii. Motels/ Motor/ Transit Hotels : They are alongside
the highways; Motels have facilities of proper motor
garage to service a car and a filling station to refill
vehicles, parking area for motor vehicles etc.They also
have road maps, dormitory for drivers. These days
Motels also provide various indoor and outdoor
facilities like Video parlor, Billiards, Table tennis,
Cyber café, Library etc.The length of stay is usually
overnight.
Example: KTDC, kerela
iv. Airport hotels: These hotels are located near by the
airport, especially international airports. Typical target
market includes business clientele, airline passengers
with overnight travel layovers or canceled flights and
airline personnel.
They have transit guest who stay over between flights.
Example: Centaur hotel , New Delhi
v. Resort hotels: They are also termed as health resort or
beach hill resort and so depending on their position and
location. A resort located in the tourist interest places like
hills, forests, beaches, on an island, or in some other
exotic location away from crowded residential areas They
cater a person who wants to relax, enjoy themselves at
hill station. Most resort work to full capacity during peak
season. Sales and revenue fluctuate from season to
season. Many resorts also provide special activities,
indoor and outdoor games for guests such as dancing,
golf, tennis, horse riding, nature hikes, skiing and
swimming, health club, steam sauna bath, spas etc.
Example: Raj Vilas , Jaipur
vi. Rotels: The hotels which rotate on wheels are called
rotels. It is also called motel on wheels. It is a luxurious
train, fully air-conditioned, well-furnished with attached
restaurant and bar. The fare is inclusive of train ticket,
food, alcoholic beverages and sight seeing. The train
starts from Delhi and covers the tourist interest places of
Rajasthan and Uttar Pradesh including Taj Mahal, Agra,
Mathura.
In Japan Rotels are parked in the parking slot in the late
evening. They are normally used by small group of
travelers.
Example: Palace on wheels.
vii. Floatels: The hotels which floats on water are called
Floating hotels. It is located on river, sea or big lakes.
These are luxurious suites consisting of drawing room,
dining room, bed room, sitting room, balcony, kitchen,
bathroom etc.
Example: House boats in Kashmir Dal Lake, Royal
Caribbean cruise ships
viii. Boatels: A house boat/ yachts hotels
is referred as boatels. They offers
luxurious accommodation to travelers.
Example: Shikaras of Kashmir,
kettuvallam of kerala. In Sirhand,
Punjab there is restaurant on boat.
Based on the Level of Service
i. Economy/ Budget hotels: These hotels meet the
basic need of the guest by providing comfortable
and clean room for a comfortable stay.
Example: Central Park , Gwalior
ii. Mid market hotels: It is suite hotel that offers
small living room with appropriate furniture and
small bed room with king sized bed.
Example: Crystal Inn , Agra
iii. Luxury hotels: These offer world class service
providing restaurant and lounges, concierge service,
meeting rooms, dinning facilities. These guest rooms
contains furnishing, artwork etc. prime market for
these hotels are celebrities, business executives and
high ranking political figures.
Example: Hyatt Regency, New Delhi.
Based on the Length of Stay
i. Transit hotels : Motels and transport hotels are the
examples of these hotels. These are the hotel where guest
stays for a day or even less, they are usually five star
hotels. The occupancy rate is usually very high. These
hotels are situated near airport.
Example: Eaton Smart Airport Transit Hotel at T3, IGI
Airport, New Delhi
ii. Transient Hotels: Rest houses, Government guest
houses etc are the best examples of transient hotels.
In these hotels one is not allowed to stay for a very long
time as these hotels are very economical and are patronized
by the employees either on transfer or on tour or on
vacations.
iii. Residential hotels: These are the hotel where guest can
stay for a minimum period of one month and up to a year.
The rent can be paid on monthly or quarterly basis. They
provide sitting room, bed room and kitchenette.
Example: Hare Krishna Orchid Residential Retreat,
Mathura
iv. Semi residential hotels: These hotels incorporate
features of both transit and residential hotel.
Based on Target Market
i. Commercial hotel: They are situated in the heart of
the city in busy commercial areas so as to get good
and high business. They cater mostly businessmen.
ii. Convention hotels: These hotels have large
convention complex and cater to people attending a
convention, conference
Example: Le meridien, cochin
iii. Suite hotels: These hotel offer rooms that may
include compact kitchenette. They cater to people
who are relocating act as like lawyers, executives who
are away from home for a long business stay.
iv. Casino hotels: Hotel with predominantly gambling
facilities comes under this category, they have guest
room and food and operation too. These hotels tend to
cater leisure and vacation travelers. Gambling
activities at some casino hotels operate 24 hours a day
and 365 days a year.
Example: Las Vegas in United State
Based on size
Small – Less than 25 rooms
Medium – 25-99
Large – 100-299
Mega – More than 299 rooms
Based on Star rating
Single Star 1*
Two Star 2*
Three Star 3*
Four Star 4*
Five Star 5*
Seven Star 7*
ONE STAR : Typically smaller hotels managed by the proprietor. The hotel is often has a more
personal atmosphere. It is usually located near affordable attractions, major intersections and
convenient to public transportation. Furnishings and facilities are clean but basic. These are
usually within walking distance to some good low priced dining.
The hotel should have at least 10 lettable bed rooms of which at least 25% should have attached
bathrooms with a bathroom for every four of remaining rooms.
At least 25% of the bathrooms should have the western style WCs.
Receptions counter with a telephone and a telephone for the use of guests.
Example: Hotel Ajanta, Bangalore.
TWO STAR Usually denotes independent and name brand hotel chains with a reputation for
offering consistent quality amenities. The hotel is usually small to medium sized and
conveniently located to moderately priced attractions. The facilities typically include telephones
and TVs in the bed room some hotels offer limited restaurant service. Somehow room service and
bell service are not usually provided.
The hotel should have at least 10 lettable bed rooms of which at least 75% should have attached
bathrooms and showers with a bathroom for every four of the remaining rooms.
25% of the rooms should have AC.
Receptions counter with a telephone
Telephone on each floor if the rooms do not have a telephone each.
Supervisory staff must understand English.
Laundry and dry cleaning services.
Example: woodlands Hotel, Bangalore, Kamath Yatrinivas, Bangalore
STAR CLASSIFICATION
THREE STAR
Typically these hotels offer spacious accommodations that include well appointed rooms,
decorated lobbies. Bell desk services are generally not available. They are often located near
major express ways or business areas, convenient to shopping and moderate to high priced
attractions. The hotels usually feature medium sized restaurants they typically offer breakfast
through dinner. Room service availability may vary. Valet parking, fitness centers, pools are often
provided.
The hotel should have at least 20 lettable bed rooms of which all should have attached bathrooms
and tubs/showers.
At least 50% of the rooms should be AC.
Reception and information counter, book stall, travel agency, safe deposit etc.
Telephone in each room and one for the use of visitors.
Good quality Indian and continental food
Senior staff must possess a good knowledge of English.
Example: Museum Inn, Bangalore, Angsana Oasis Spa & Resort, Bangalore
FOUR STAR
Mostly large formal hotels with reception areas, front desk service, and bell desk service. The
hotels are usually located near shopping, dining, and other major attractions. The level of service
is well above average. And the rooms are well lit and well furnished. Restaurant dining is usually
available and is having more than one choice. Some properties will offer continental breakfast
and /or happy hour delicacies. Room service is usually available during most hours. Valet
parking, concierge service, fitness centers, pools are often provided.
Hotel must have 25 lettable rooms and all with attach bathrooms with shower cubicle/bath tub.
Should have a recognized travel agency, book stall, safe deposit facilities, left luggage etc.
Example: Taj Gateway, Bangalore, Hotel Janpath, New Delhi, St. Marks Hotel, Bangalore.
FIVESTAR
These are hotels that offer only the highest level of accommodations and services. The properties
offer a high degree of personal service. The hotel locations can vary from the exclusive location
of suburban area to heart of the city. The hotel lobbies are sumptuous, the rooms complete with
stylish furnishings, and high quality linen.The hotels feature up to three restaurants with exquisite
menus. Room service is also available 24 hours a day. Fitness centers, valet parking are typically
available. A concierge is also available to assist you.
Architectural features and general construction of the hotel building should be distinctive
Adequate parking space for cars.
Hotel must have at least 25 lettable; rooms with modern shower chambers.
All guest areas should be air-conditioned
Adequate number of efficient lifts.
24 hours reception, cash and information counter
Example: The Oberoi, Bangalore, The Grand Maratha Sheraton, Mumbai,Taj Bengal and The
Park, Kolkota,
Based on Theme
i. Heritage hotel: In this hotel a guest is graciously
welcomed, offered room that have their own history,
serve traditional cuisine and are entertained by folk artist.
These hotels put their best efforts to give the glimpse of
their region.
Example: Jai Mahal palace in Jaipur.
ii. Ecotels : these are environment friendly hotels these
hotel use eco friendly items in the room.
Example: Orchid Mumbai is Asia first and most
popular five star ecotel.
iii. Boutique hotels: This hotel provides exceptional
accommodation, furniture in a themed and stylish
manner and caters to corporate travelers.
Example: In India the park Bangalore is a boutique
hotel
iii. Spas: is a resort which provide therapeutic bath and
massage along with other features of luxury hotels in
India Ananda spa in Himalaya are the most popular Spa.
Based on Ownership and Affiliation
i. Independent Hotels :- Independent hotels do not have
ownership or management affiliation with other properties.
They have no relationship to other hotels regarding policies,
procedures, financial obligations, management, accounting etc.
These may be registered as sole proprietor-ship or a private
limited company.
The owner may decide the standard, type of clientele, the tariff
etc.
He may tie up with travel agencies to sell his property against
commission.
ii. Chain hotels :- Hotel chains account for a large percentage
of the world’s hotel room inventory. Some of the world’s best
hotel rooms are managed by chains.
These kind of ownership usually imposes certain minimum
standards, rules , policies and procedures to restrict affiliate
activities . In general the more centralized the organization their
control over the individual property . Some chain have strong
control over the architecture, management and standards of
affiliate properties . Others concentrate only on marketing ,
advertising and central purchasing .
Example: Taj Group of Hotels, ITC Chain of Hotels.
iii. Management Contract: Management companies are organizations that operate
properties owned by others.
Those other hotels may be owned by individual persons, partnerships or private
limited companies.
The individual hotel, under construction, may contract with a professional hotel
management company to operate the proposed property.
These contracts are normally on a long-term basis.
Some management companies, when feel that they must have a hotel in a particular
location then they approach prospective individuals to build a hotel and operate under
their managements contract.
The management contract can even be signed before the construction starts.
After paying the management fees, operating expenses, the owners keep the balance
cash for paying their debts, taxes etc. and the balance is their net profit.
The Management companies only take over the management of the company,
whereas the franchising companies provide the financial assistance, advertising,
central reservation facilities, marketing etc.
iv. Franchise: Franchise is a system in which the franchise owner
grants another the right or privilege to merchandise a product or
service for a specified return.
Franchise Agreement is an agreement under which the owner operates
as a member of the chain, utilizing the brand image, name, goodwill
and obtaining for a certain fee some services of marketing and
operating nature support from resources of a large organization,
advertising, sales promotion, technical and financial help etc.
The best known franchising companies are Holiday Inn, Choice
International, Quality Hotels & Inns etc.
THANK YOU…

Anchal's presentation

  • 1.
    Classification of Hotels,STAR Rating & Types of Hotel Rooms PRESENTED BY: ANCHAL GOEL
  • 2.
    OVERVIEWOF HOSPITALITY INDUSTRY •Hospitalityis about serving the guests to provide them with "feel-good-effect". •"Athithi devo bhavha" (Guest is God) has been one of central tenets of Indian culture. •Today hospitality sector is one of the fastest growing sectors in India •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. •India is an ideal destination for tourists. Approximately 4.4 million tourists visit India every year.
  • 3.
    HOTEL An establishment thatprovides lodging and usually meals and other services for travelers and other paying guests. A hotel is a type of establishment that accommodates visitors for a short stay at a stated fee a commercial establishment offering lodging to travelers and sometimes to permanent residents, and often having restaurants, meeting rooms, stores, etc., that are available to the general public.
  • 4.
  • 5.
    CLASSIFICATION OF HOTELS TYPESOF HOTEL Based on Location Based on size Based on Target Market Based on Level of ServiceBased on Ownership and Affiliation Based on Star rating Based on Length of Stay Based on Theme
  • 6.
    Based on Location i.City center/Downtown/Commercial hotels : These hotels are located in the heart of the city; More expensive than the suburban hotels; Patronized by business men and high income tourists; Centrally located and at a convenient distance from markets, railway station, airport, etc. & have high traffic on weekdays and the occupancy is generally high. Example: Taj Mahal, Mumbai ii. Suburban hotels: They are located in suburban areas, it generally have high traffic on weekend. It is ideal for budget travelers; moderately priced and are of mostly medium, large or small size; Normally these hotels are patronized by low budget tourists iii. Motels/ Motor/ Transit Hotels : They are alongside the highways; Motels have facilities of proper motor garage to service a car and a filling station to refill vehicles, parking area for motor vehicles etc.They also have road maps, dormitory for drivers. These days Motels also provide various indoor and outdoor facilities like Video parlor, Billiards, Table tennis, Cyber café, Library etc.The length of stay is usually overnight. Example: KTDC, kerela
  • 7.
    iv. Airport hotels:These hotels are located near by the airport, especially international airports. Typical target market includes business clientele, airline passengers with overnight travel layovers or canceled flights and airline personnel. They have transit guest who stay over between flights. Example: Centaur hotel , New Delhi v. Resort hotels: They are also termed as health resort or beach hill resort and so depending on their position and location. A resort located in the tourist interest places like hills, forests, beaches, on an island, or in some other exotic location away from crowded residential areas They cater a person who wants to relax, enjoy themselves at hill station. Most resort work to full capacity during peak season. Sales and revenue fluctuate from season to season. Many resorts also provide special activities, indoor and outdoor games for guests such as dancing, golf, tennis, horse riding, nature hikes, skiing and swimming, health club, steam sauna bath, spas etc. Example: Raj Vilas , Jaipur
  • 8.
    vi. Rotels: Thehotels which rotate on wheels are called rotels. It is also called motel on wheels. It is a luxurious train, fully air-conditioned, well-furnished with attached restaurant and bar. The fare is inclusive of train ticket, food, alcoholic beverages and sight seeing. The train starts from Delhi and covers the tourist interest places of Rajasthan and Uttar Pradesh including Taj Mahal, Agra, Mathura. In Japan Rotels are parked in the parking slot in the late evening. They are normally used by small group of travelers. Example: Palace on wheels. vii. Floatels: The hotels which floats on water are called Floating hotels. It is located on river, sea or big lakes. These are luxurious suites consisting of drawing room, dining room, bed room, sitting room, balcony, kitchen, bathroom etc. Example: House boats in Kashmir Dal Lake, Royal Caribbean cruise ships
  • 9.
    viii. Boatels: Ahouse boat/ yachts hotels is referred as boatels. They offers luxurious accommodation to travelers. Example: Shikaras of Kashmir, kettuvallam of kerala. In Sirhand, Punjab there is restaurant on boat.
  • 10.
    Based on theLevel of Service i. Economy/ Budget hotels: These hotels meet the basic need of the guest by providing comfortable and clean room for a comfortable stay. Example: Central Park , Gwalior ii. Mid market hotels: It is suite hotel that offers small living room with appropriate furniture and small bed room with king sized bed. Example: Crystal Inn , Agra iii. Luxury hotels: These offer world class service providing restaurant and lounges, concierge service, meeting rooms, dinning facilities. These guest rooms contains furnishing, artwork etc. prime market for these hotels are celebrities, business executives and high ranking political figures. Example: Hyatt Regency, New Delhi.
  • 11.
    Based on theLength of Stay i. Transit hotels : Motels and transport hotels are the examples of these hotels. These are the hotel where guest stays for a day or even less, they are usually five star hotels. The occupancy rate is usually very high. These hotels are situated near airport. Example: Eaton Smart Airport Transit Hotel at T3, IGI Airport, New Delhi ii. Transient Hotels: Rest houses, Government guest houses etc are the best examples of transient hotels. In these hotels one is not allowed to stay for a very long time as these hotels are very economical and are patronized by the employees either on transfer or on tour or on vacations. iii. Residential hotels: These are the hotel where guest can stay for a minimum period of one month and up to a year. The rent can be paid on monthly or quarterly basis. They provide sitting room, bed room and kitchenette. Example: Hare Krishna Orchid Residential Retreat, Mathura iv. Semi residential hotels: These hotels incorporate features of both transit and residential hotel.
  • 12.
    Based on TargetMarket i. Commercial hotel: They are situated in the heart of the city in busy commercial areas so as to get good and high business. They cater mostly businessmen. ii. Convention hotels: These hotels have large convention complex and cater to people attending a convention, conference Example: Le meridien, cochin iii. Suite hotels: These hotel offer rooms that may include compact kitchenette. They cater to people who are relocating act as like lawyers, executives who are away from home for a long business stay. iv. Casino hotels: Hotel with predominantly gambling facilities comes under this category, they have guest room and food and operation too. These hotels tend to cater leisure and vacation travelers. Gambling activities at some casino hotels operate 24 hours a day and 365 days a year. Example: Las Vegas in United State
  • 13.
    Based on size Small– Less than 25 rooms Medium – 25-99 Large – 100-299 Mega – More than 299 rooms Based on Star rating Single Star 1* Two Star 2* Three Star 3* Four Star 4* Five Star 5* Seven Star 7*
  • 14.
    ONE STAR :Typically smaller hotels managed by the proprietor. The hotel is often has a more personal atmosphere. It is usually located near affordable attractions, major intersections and convenient to public transportation. Furnishings and facilities are clean but basic. These are usually within walking distance to some good low priced dining. The hotel should have at least 10 lettable bed rooms of which at least 25% should have attached bathrooms with a bathroom for every four of remaining rooms. At least 25% of the bathrooms should have the western style WCs. Receptions counter with a telephone and a telephone for the use of guests. Example: Hotel Ajanta, Bangalore. TWO STAR Usually denotes independent and name brand hotel chains with a reputation for offering consistent quality amenities. The hotel is usually small to medium sized and conveniently located to moderately priced attractions. The facilities typically include telephones and TVs in the bed room some hotels offer limited restaurant service. Somehow room service and bell service are not usually provided. The hotel should have at least 10 lettable bed rooms of which at least 75% should have attached bathrooms and showers with a bathroom for every four of the remaining rooms. 25% of the rooms should have AC. Receptions counter with a telephone Telephone on each floor if the rooms do not have a telephone each. Supervisory staff must understand English. Laundry and dry cleaning services. Example: woodlands Hotel, Bangalore, Kamath Yatrinivas, Bangalore STAR CLASSIFICATION
  • 15.
    THREE STAR Typically thesehotels offer spacious accommodations that include well appointed rooms, decorated lobbies. Bell desk services are generally not available. They are often located near major express ways or business areas, convenient to shopping and moderate to high priced attractions. The hotels usually feature medium sized restaurants they typically offer breakfast through dinner. Room service availability may vary. Valet parking, fitness centers, pools are often provided. The hotel should have at least 20 lettable bed rooms of which all should have attached bathrooms and tubs/showers. At least 50% of the rooms should be AC. Reception and information counter, book stall, travel agency, safe deposit etc. Telephone in each room and one for the use of visitors. Good quality Indian and continental food Senior staff must possess a good knowledge of English. Example: Museum Inn, Bangalore, Angsana Oasis Spa & Resort, Bangalore
  • 16.
    FOUR STAR Mostly largeformal hotels with reception areas, front desk service, and bell desk service. The hotels are usually located near shopping, dining, and other major attractions. The level of service is well above average. And the rooms are well lit and well furnished. Restaurant dining is usually available and is having more than one choice. Some properties will offer continental breakfast and /or happy hour delicacies. Room service is usually available during most hours. Valet parking, concierge service, fitness centers, pools are often provided. Hotel must have 25 lettable rooms and all with attach bathrooms with shower cubicle/bath tub. Should have a recognized travel agency, book stall, safe deposit facilities, left luggage etc. Example: Taj Gateway, Bangalore, Hotel Janpath, New Delhi, St. Marks Hotel, Bangalore.
  • 17.
    FIVESTAR These are hotelsthat offer only the highest level of accommodations and services. The properties offer a high degree of personal service. The hotel locations can vary from the exclusive location of suburban area to heart of the city. The hotel lobbies are sumptuous, the rooms complete with stylish furnishings, and high quality linen.The hotels feature up to three restaurants with exquisite menus. Room service is also available 24 hours a day. Fitness centers, valet parking are typically available. A concierge is also available to assist you. Architectural features and general construction of the hotel building should be distinctive Adequate parking space for cars. Hotel must have at least 25 lettable; rooms with modern shower chambers. All guest areas should be air-conditioned Adequate number of efficient lifts. 24 hours reception, cash and information counter Example: The Oberoi, Bangalore, The Grand Maratha Sheraton, Mumbai,Taj Bengal and The Park, Kolkota,
  • 18.
    Based on Theme i.Heritage hotel: In this hotel a guest is graciously welcomed, offered room that have their own history, serve traditional cuisine and are entertained by folk artist. These hotels put their best efforts to give the glimpse of their region. Example: Jai Mahal palace in Jaipur. ii. Ecotels : these are environment friendly hotels these hotel use eco friendly items in the room. Example: Orchid Mumbai is Asia first and most popular five star ecotel. iii. Boutique hotels: This hotel provides exceptional accommodation, furniture in a themed and stylish manner and caters to corporate travelers. Example: In India the park Bangalore is a boutique hotel iii. Spas: is a resort which provide therapeutic bath and massage along with other features of luxury hotels in India Ananda spa in Himalaya are the most popular Spa.
  • 19.
    Based on Ownershipand Affiliation i. Independent Hotels :- Independent hotels do not have ownership or management affiliation with other properties. They have no relationship to other hotels regarding policies, procedures, financial obligations, management, accounting etc. These may be registered as sole proprietor-ship or a private limited company. The owner may decide the standard, type of clientele, the tariff etc. He may tie up with travel agencies to sell his property against commission. ii. Chain hotels :- Hotel chains account for a large percentage of the world’s hotel room inventory. Some of the world’s best hotel rooms are managed by chains. These kind of ownership usually imposes certain minimum standards, rules , policies and procedures to restrict affiliate activities . In general the more centralized the organization their control over the individual property . Some chain have strong control over the architecture, management and standards of affiliate properties . Others concentrate only on marketing , advertising and central purchasing . Example: Taj Group of Hotels, ITC Chain of Hotels.
  • 20.
    iii. Management Contract:Management companies are organizations that operate properties owned by others. Those other hotels may be owned by individual persons, partnerships or private limited companies. The individual hotel, under construction, may contract with a professional hotel management company to operate the proposed property. These contracts are normally on a long-term basis. Some management companies, when feel that they must have a hotel in a particular location then they approach prospective individuals to build a hotel and operate under their managements contract. The management contract can even be signed before the construction starts. After paying the management fees, operating expenses, the owners keep the balance cash for paying their debts, taxes etc. and the balance is their net profit. The Management companies only take over the management of the company, whereas the franchising companies provide the financial assistance, advertising, central reservation facilities, marketing etc.
  • 21.
    iv. Franchise: Franchiseis a system in which the franchise owner grants another the right or privilege to merchandise a product or service for a specified return. Franchise Agreement is an agreement under which the owner operates as a member of the chain, utilizing the brand image, name, goodwill and obtaining for a certain fee some services of marketing and operating nature support from resources of a large organization, advertising, sales promotion, technical and financial help etc. The best known franchising companies are Holiday Inn, Choice International, Quality Hotels & Inns etc.
  • 22.