Sectors Of The Hospitality Industry

The hospitality industry consists of broad category of fields within the service industry that includes lodging, restaurants, event planning, theme parks, transportation, a restaurant, hotel, or even an amusement park. Hospitality industry covers a wide range of organizations offering food service and accommodation. The hospitality industry is a several billion dollar industry that mostly depends on the availability of leisure time and disposable income. A hospitality unit such as consists of multiple groups such as facility maintenance, direct operations, servers, housekeepers, porters, kitchen workers, bartenders, management and marketing. The hospitality industry is divided into sectors according to the skill-sets required for the work involved. Sectors include accommodation, food and beverage, meeting and events, gaming, entertainment and recreation, tourism services, and visitor information.

Premier Inn is the UK’s largest hotel brand, with over 40,000 rooms and more than 590 hotels. It is one of the biggest brand in hospitality industry. Premier Inn’s headquarter located at Luton, England, U.K. Originally opened by “Travel Inn” brand name in 1987. During the hard competition with other hotels, it has been owned by Whitbread. Premier Inn business spread in United Kingdom, United Arab Emirates, Republic of Ireland and India. Company office website is

http://www.premierinn.com

Hotels are found either in city centers or on the outskirts on major A-roads. Unlike its competitor Travelodge, they are rarely found in motorway service areas, concentrating on locations where they are allowed to serve alcohol. Ownership by Whitbread, historically a brewery, but now a pub and hotel chain, ensures that all Premier Inns, with the exception of motor side locations, have a pub/restaurant on-site serving alcohol

Structure of Organization

As per below is an organization structure

A commercial enterprise would have Line, Staff or Matrix organisations, split into departments and specialists. Departments could include Buying, Marketing, Manufacture, Quality, Accountancy, Payroll, Design, Administration, Security, Maintenance, Distribution, Computing, Call centers, Retailing, Customer Care.

History

The company founded in 1987 by Travel Inn, in 2004 Whitbread acquired Premier Lodge for £505 million, and merge an additional 141 hotels to the existing Whitbread hotels, re-branded all hotels as “Premier Travel Inn”, which was soon shortened to “Premier Inn”. March 2006 – Premier Inn, the UK’s largest and fastest growing hotel chain announced today that their ‘Guest Recommend’ customer satisfaction survey has received its one- millionth-guest response since it was launched in March 2006.

Location

Premier Inn started in U.K., but its expansion in U.A.E., Ireland and India. Premier Inn is the UK’s largest and fastest-growing hotel brand with 578 budget hotels and more than 40,000 rooms across the UK and Ireland.

Competition

The branded budget hotel market in the UK continues to be dominated by just two large players, according to new research by TRI Hospitality Consulting. Figures from Budget Hotels 2010 UK show that the biggest brand, Premier Inn, had 41,511 rooms at the end of 2009 which gave it a market share of almost 38%.

The nearest rival to Premier Inn is Travelodge with 27,010 at the year end, giving it a market share of just under 25%. The top two budget hotel brands in the UK thus have more than two thirds of the market.

“The branded budget market in the UK is concentrated in just a few companies. But competition continues to flourish in the overall hotel sector as the branded budget hotels take on mid market hotels and guesthouses,” said Jonathan Langston, managing director of TRI Hospitality Consulting.

Since 1993, the number of branded budget hotel rooms in the UK has grown more than tenfold, increasing from 10,555 rooms to 109,528 rooms at the end of 2009. And while Premier Inn and Travelodge dominate, there have been many new brands entering the growing market.

As above table showing us Premier Inn is on number 1 Position in the market. Behind this reason is hotel chain Premier Inn is using a revenue management system to improve visibility of occupancy levels throughout the year, and steer sales and marketing activities accordingly.

As per above information premier Inn take over 35% of hotel industry in U.K.

Under the new system, Premier Inn expects to improve occupancy, book more guests over less popular nights and reduce marginal costs.

“We wanted a revenue management system that could cope with the unique requirements of our business,” said Warren Mandelbaum, head of revenue management at Premier Inn parent company Whitbread Hotels & Restaurants.

Contemporary issue

In any business, biggest and important person is “customer”, if customer is satisfied then business make profit. Premier Inn fully focuses to satisfy the customer, Premier Inn bedrooms feature en-suite bathroom, TV with Free view, and Wi-Fi internet access. Premier Inn offers customers a money-back ‘Good Night Guarantee’ of a good quality room, comfortable surroundings and friendly service, which is unique amongst Britain’s leading hotel chains.

Recession impact

As a report of produced by HotStats and published by industry newsletter Hotel Analyst, also makes clear that while resilient, the sector has not remained unscathed by the recession. During 2009, revenue per available room fell by 9.1%, with occupancy dropping by 5.9 percentage points to 67.8% and rate holding up better with a fall of 1.1% to £50.97.

“The budget hotel market has truly been the hotel industry’s success story of the last decade. While trading has suffered in the recession, new hotels are continuing to open, reflecting the long term viability of the segment,” said Langston.

The hospitality industry is a measure of the wealth in people’s pockets then the news is very bad indeed. The industry is facing one of its worst times in memory as pubs, clubs and restaurants close at an unprecedented rate.

Insolvencies in the sector have risen by 95% in 2 years as people opt to stay at home and preserve their cash rather than splurging on luxuries like nights out, meals and other entertainment.

A report by consultancy PricewaterhouseCoopers (PwC) showed that there were 281 business failures in the third quarter of this year, up from 175 last year and well ahead of the 220 insolvencies reported in the first quarter and the 212 recorded in the second. It was almost double the number reported – 144 – in the final quarter of 2006.

“As the downturn tightens its grip, it is easy to believe what we have seen so far is just the tip of the iceberg for hotels,” Stephen Broom said.

The report shows the historical development of branded budget hotels in the UK, also the report so gives demand figures by geographical region, by city and by market sector

Hospitality industry is closely related to tourism. By the advent of global crisis, it’s easy to figure out that tourism industry is down. So, relating to that, one can say hospitality industry also suffers. Moreover, those who can still afford to consider the hospitality of the industry are busy with their works too as the crisis has put extra burden in their work life.

Performance report -Year 2009/2010

As per above source UK chain Hotel, Higher staff costs hit profits at provincial hotels in the UK during August, according to the latest HotStats survey from TRI Hospitality Consulting. Revenue per available room rose year-on-year for the month by 1.5% but payroll costs as a percentage of revenue crept up by 0.5 percentage points and this helped cause Gross Operating Profit Per Available Room (GOPPAR) to drop by 1.2%. As a result, UK Provincial hotel performance was left languishing some way behind 2008 levels, following the 13.4% profitability decline during the same period in 2009.

Development

Strategy and progress

Premier Inn clear strategy underpins our aim of building the best large-scale hospitality brands in the world by becoming the most customer-focused organization there is.

2009/10 strategic priorities

Action

Result

Outperform market

Developing detailed action plans to focus on our customers’ needs, and particularly on establishing our value for money credentials.

All our businesses have outperformed in their markets.

Reduce operating costs

Streamlining management, improving the efficiency of back office processes and delivering a series of procurement initiatives.

On track to achieve £25 million of annual savings, with £20 million realised to date.

Achieve cash flow neutrality

Prioritising cash management and working capital together with the sale and leaseback of five properties.

Positive cash flow for the year of £109.7 million, with net debt reducing to £513.4 million.

They growth is also increases, In year 2003/04 they have 18,173 rooms comper to this in year 2009/10 they have 42,799 rooms. So growth is 136%

Predictions

Premier Inn increase there budget for more development.

In year 2009/10 15.0% budget sector value and in year 2018/19 budget sector value increase 22.0%. so as above figures we can get example of premier inn future plan.

(Annual Report 2009/10, Whitbread PLC)

Operational & Management factors

Operational

In the hotel industry where excellent, consistent service is a key factor in success, standard operating procedures, or SOPs, play an important role.

Identification

A hotel’s standard operating procedure sets out the policies and protocols of a hotel in a written format that’s easily accessible to hotel employees. A typical standard operating procedure has three parts: a purpose, or the clearly stated task the SOP details and what its expected results should be; a procedure, or step-by-step guide to tackling the task; and resources, including hotel staff, other employees or management and databases or other references.

Function

A hotel standard operating procedure’s purpose is to improve guest experience. Standard operating procedures do this by educating hotel staff on the best way to deal with a given situation, from fielding guest complaints to handling fire drills. By creating a guest service structure that’s consistent and clearly thought out by top management, hotels can ensure a positive guest experience.

Types

Hotels might use several different types of standard operating procedures.

Tool procedures focus on specific tasks that hotel staffers might have to deal with. Tool procedures may cover tasks that hotel staff is likely to run into every day, such as late check-out or temperature concerns, as well as rare circumstances, such as fire alarms sounding or elevator malfunctions.

Rule procedures help hotel staffer’s deal with potentially tricky situations. Rule procedures may cover acceptable employee conduct, such as whether an employee can accept a cash tip from a hotel guest. Rule procedures also may cover guests in sensitive areas such as signs of smoking in a non-smoking room or a declined credit card.

Job procedures clearly outline an employee’s role and responsibilities within the hotel so that expectations are clear.

Benefits

Management

Financial Savvy

The number one success factor for anyone in the hospitality industry knows how to manage company funds. Maintaining the proper ratios of labour, food costs, beverage costs and expenses is vital in today’s economy. A successful manager will be expected to maintain and keep a strict monetary budget, be computer literate, be knowledgeable of profit and loss statements and labour to sales ratios and be able to keep food and beverage costs in line.

Creativity

Hospitality managers must be able to be creative, to think outside the box and come up with new, trendsetting ideas. They must also have the knowledge to get those ideas out there through word of mouth and advertising. Food specials, room rate reductions, family packages and other details need to be presented to the general public in a new, fresh manner through email, web sites, regular mail, radio or television.

Multi-tasking skills

A manager must know the basics of accounting, the fundamentals of food and service, current market trends, what the competition is doing, licensing procedures and fees, general human resource rules and regulations and much more.

Teamwork

A good manager will understand that he cannot do the work single-handed and will hire the right people to carry out the vision of the company. A strong accounting office, an excellent chef, reliable restaurant managers and supervisors, a loyal core staff with low turnover and trustworthy assistants are all essential in creating a profitable business.

Vision

The ability to foresee trends and capitalize on them is a true gift, as is the foresight to prepare for a slow economy. These abilities come from years of experience and exposure to different hospitality environments. A truly proactive manager will choose the most promising employees of the company and train them properly to keep the vision alive and strong.

Impact on Staff

Hospitality industry is developed largest number of jobs in UK, lots of opportunity comes for people to get jobs. As per below table show us how’s the different hospitality businesses give jobs to people

Hospitality businesses

The industry continues to be dominated by small establishments. The hotel sector has the highest proportion of large establishment while the restaurant sector has most very small establishments. Between 1991 and 1998 the percentage of businesses with over twenty-five employees increased from 3 per cent to 4per cent of all establishments. There is now more employment in larger workplaces with 41 per cent of employment in establishments employing twenty-five or more employees, while 59 per cent of employees. Over the decade all sectors in the hospitality industry continued to grow, with the exception of hotels.

Premier inn has 34,000 people serve over 9 million customers every month. And as the frontline of our business, premier inn are 100% dependent on our people to deliver our brand promises, day in and day out. That’s why premier inn only employs the very best people in the hospitality industry. Time to time staff responsibility change and more focus on customer satisfaction.

Stakeholders

The stakeholders in the hospitality industry include owners, creditors, guests, employees, suppliers, vendors, industry associations, government agencies, and community members.

In starting of business stakeholders view point is Maximizing Shareholder Wealth, after time to time stakeholder’s view point is change and it’s ‘A Wider Range of Objectives’. In recent years, a wider variety of goals have been suggested for a business. These include the traditional objective of profit maximization. However, they also include goals relating to earnings per share, total sales, numbers employed, measures of employee welfare, manager satisfaction, environmental protection and many others.

As per above effect on staff and stakeholders role and view point Premier inn get lots of benefits. That’s the reason Premier inn best brand in hospitality industry in U.K. and one of the best brand in the world. They also try to make same value in abroad like Dubai and India. Positive implications on Premier inn hospitality.

The conclusion

Premier Inn has best customer/key relationship, business continuity, funding, and strategy. So that’s why they are top of the table in whole hotel industry in the U.K.

In 2008 Premier Inn launched in Dubai and will be opening in India later this year. On a domestic front, Premier Inn is set to be the largest provide of budget hotels in London by the 2012 Olympics.