LECTURE NOTES 6

ACCOMMODATIONS AND HOSPITALITY SERVICES

Introduction
Hospitality is the term generally associated with hotels and restaurants.
The accommodations industry (also referred to as the lodging or hotel industry) and
the food and beverage industry (also referred to as the catering industry) encompass
a variety of facilities and are a dynamic part of the global travel and tourism
industry.
- The accommodations industry is central to international tourism. Tourism
flows are directly influenced by the size of this sector, by the way it adapts to
demand and by the quality of the accommodation on offer. Three characteristics are
associated with accommodation.
Seasonality its economic activities are seasonal, which implies a great
flexibility in the use of its structures
Manpower planning the industry is labor-intensive, which further
compounds the problems caused by seasonality. It requires accurate forward
planning of temporary employment.
Perishability accommodation production cannot be stocked and non-
utilization is expensive
The wide array of lodging facilities, from luxurious resorts to modest bed and
breakfast establishments reflects the different needs and preferences of travelers
and market dynamics. Worldwide, the number of available hotel rooms has
increased rapidly to keep pace with the growth in international and domestic
tourism.
- The food and beverage industry has also expanded as tourism has boomed.
Much like the accommodations industry, the food and beverage industry is emerging
in the global tourism economy through worldwide chains, providing new
opportunities for the hospitality industrys growth and expansion.
1. Historical Development
Travelers have sought rest and refreshment at public houses and hostels throughout
history.
At the height of the Roman Empire, inns flourished along major highways, primarily
for government officials and persons of importance (Gee, 1994, p. 27).
In Asia, small shelters were placed at stops along caravan routes. Pilgrims looked to
religious houses to give sanctuary, rest, and refreshment along the way.
The term hospitality is derived from hospice, a medieval house of rest for travelers.
Interestingly, even to this day some Alpine hospices in Europe continue the tradition
of offering food and rest to weary travelers (Lattin, 1985, p. 15).
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Food service also can be traced back in history, perhaps as far back as 4000 B.C.
when establishments began selling food and wine. Such establishments continued
and flourished during the Greek, Roman, and Byzantine periods.
It was not until the 15
th
century that commercial hospitality ventures made their
appearance in Europe. The forerunner of the bed and breakfast type of
accommodation was the spare bed in private homes offered to travelers for a small
price. At the same time, freestanding inns appeared, often built by affluent
landowners and named after them.
In the 16
th
century, some inns and taverns in England began serving meals at set
prices at regular meal times (Mill, 1990, p. 321). During this era, road development
and coach travel spurred the growth of travelers and the number of inns to serve
them.
By the end of the 17
th
and the dawn of the 18
th
centuries, lodging facilities which
could be called the early versions of hotels made their appearance.
In 1774 the first hotel was opened in London; later in 1794 the City Hotel opened in
New York City. In the late 18
th
century, the term restaurant was first used in
Paris referring to a dining room, and in the United States, Delmonicos opened in
1834 offering meals in the English fashion of fine dining (Coltman, 1989, pp. 326-
327).
In the United States, the first hotel equipped with modern amenities resembling
todays facilities is believed to be the Tremont House which was built in 1892 in
Boston, Massachusetts. The Tremont House established a number of precedents
with a lobby, indoor plumbing, private guest rooms with locking doors, and a
complimentary cake of bath soap (Mill, 1990, p. 15). Elsewhere, hotels like the Ritz
in Paris, France, the Savoy in London, England, and the Raffles in Singapore set
standards for service and quality.
In the 20
th
century, many of the innovations in the accommodations sector
continued to take place in the United States. American hotelier E.M. Statler was
among the first to upgrade the guest experience by offering larger guest rooms with
private baths, running water, light switches, telephones, room service, in-room
radios, and hotel-to-hotel reservations systems. Further innovations in American
hotels included central heating, air conditioning, passenger elevators, electric
lighting, and sewage disposal systems. These innovations were quickly adopted by
international hotels (Gee, 1994, p. 28).
2. Accommodations Classification
Since the advent of mass tourism, many forms of accommodation have been
developed. These can be classified according to different criteria:
Built accommodation or alternative accommodation: hotels, resort properties,
destination property, national heritage accommodation, second homes, cruise
liners and holiday centers, campsites.
Individual or collective accommodation: rented accommodation or holiday
villages
Profit and non-profit making accommodation: hotels or holiday camps for
children or social accommodation
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Accommodations can be classified into various categories, illustrating the diversity
of the industry. The wide array of available room types and amenities is a reflection
of an industry that must respond to various consumer needs.
Any attempt to establish a uniform classification system faces problems of differing
types of accommodations around the world. It might be unlikely to find a pousada
(Portugal), an auberge (France), or a ryokan (Japan) in the United States, yet such
accommodations are common in their own countries.
As early as 1962, the International Union of Official Travel Organizations, a
forerunner of the World Tourism Organization, attempted to establish a globally
uniform hotel classification system. Various attempts have been made since then,
but the obstacles to a uniform classification system include variations in definitions,
facilities, service standards, management, and cultural influences on service which
can differ dramatically from country to country (Gee, 1994, p. 391).
What has emerged are different systems developed by countries and regions around
the world, through the efforts of the private sector as well as governments. Nations
which embark upon tourism usually as an economic activity to attract international
travelers have recognized the advantages of a classification system that tourists will
understand. Many have official, government-initiated classification systems which
have been developed and widely used in the European Union countries based on
both physical and qualitative criteria. In other countries, classification systems have
been established through private sector efforts especially through commercial
services such as Guide Michelin, AA Britain, and the American Automobile
Association (AAA).
The private sector classification systems have the support of the hotel industry
largely because the industry often views the classifications and ratings as more of a
promotional feature, which can be used in marketing campaigns. While many of the
definitions used are similar in a global tourism market place, there are differences
among countries between commercial and official classifications.
2.1. Hotels
The term hotel has assumed a generic meaning around the world, applying to a
wide range of property types. There is no one way to classify the different types of
hotels that exist.
In the United States, the key to the propertys type is based on its amenities
identified by the descriptor preceding hotel. In general these descriptors identify
the target markets that the property aims to attract such as airport hotel,
convention hotel, commercial hotel, luxury hotel, budget or economy hotel, casino or
resort hotel.
Some subgroups within hotels include:
Airport hotels: located within ten miles of an airport with amenities for the air
traveler including facilities for business meetings.
Convention hotel: located in major cities, often near a municipal convention center.
Major space dedication to meetings and exhibition area. Amenities for meetings and
business travel.
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Commercial hotels: located in urban areas with business travelers as the primary
target market, usually upscale or midscale.
Suite hotels: apartment-style hotel rooms, generally offering more space and
upscale amenities.
Motor hotels: located close to a highway for automobile travelers with provisions
for parking and amenities which may include swimming pool, coffee shops, and
other family-oriented facilities.
Hotels differ by amenities and the levels of service offered. At the lowest level,
budget motels tend to focus on cost-conscious travelers as their target market. The
overall goal of these establishments is to keep costs down and pass the operational
savings on to the customer. The limited amenities offered vary from chain to chain,
each attempting to establish a price-value relationship in the consumers minds.
2.2. Resort Properties
Resorts are found worldwide, wherever people gather for activities as diverse as
golf, tennis, spas, skiing, or a combination of similar recreational activities.
Because the resort guest is typically a longer stay client, resort properties generally
offer more activities and extended amenities than urban hotels. Although many
resort properties are surf-and-sun destinations, resorts today are becoming more
specialized. Theme parks, such as Disney World in the U.S., have capitalized on the
resort concept by making these facilities a part of the entire Disney experience
(Berkowitz, 1980, p. 114).
The one-stop destination pioneered by Disney continues to expand around the globe.
(Singapores Sentosa Island, for example, is a popular attraction featuring a resort
hotel and rides and attractions).
Although the accommodations element is a core facility, restaurants, shops, and
attractions are all part of one operation. Expansion into these ventures may be done
more along the lines of alliances and partnerships than ownership, but destination
resorts will continue to grow as the industry increasingly views itself as part of
broader industries, namely recreation and entertainment.
2.3. The Casino/Destination Property
No single city has had a greater impact on the casino lodging industry as Las Vegas,
Nevada in the United States. The casino has long been recognized as a specialized
property with gaming as the central activity, but in the past decade Las Vegas
has spawned a new type of lodging which is a combination casino and destination
property, not to be compared with the casino hotels of Monte Carlo wherein Monte
Carlo, rather than the hotel, is the destination. This hybrid is often considered a
variation of the theme resorts developed by the Disney Corporation. The concept has
been used successfully elsewhere as in Sun City in South Africa, which is a well-
known international destination which offers casinos, golf courses, a jungle theme
park, and other entertainment attractions as part of the large resort complex. These
properties function to a large degree as self-contained destinations which attempt to
keep the guest, including family members, at the property as much as possible. To
accomplish this, the resorts include extensive amenities and generally some type of
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theme park which is part of the property. Although gaming remains central, the
extended amenities serve to capture more of the tourist expenditures from all
members of the family unit.
2.4. National Heritage Accommodations
In many countries, historic buildings and structures such as palaces, castles,
chateaus, monasteries, and convents have been converted to hotels. Some are
privately run but others are part of a government-run chain such as the Parador
hotels in Spain which are popular with both international visitors and Spaniards.
Paradors are usually four- and five-star accommodations which have been
modernized within but maintain their historical exteriors.
They are often furnished with art treasures, antiques, or reproductions, and have
reputations for good service and meals.
2.5. Bed and Breakfasts
This segment of the accommodations industry has grown steadily over the years and
is now made up of thousands of privately owned homes and inns around the globe.
Bed and breakfasts (B and Bs) run the gamut from luxury to economy-type
accommodations. Today, the business of B&Bs has become more highly organized
with many of the properties joining international reservations systems. Other
modest establishments which offer breakfast and sometimes light meals include
hostels and pensions which are often family-run operations.
2.6. Second homes
Second homes include:
- homes wholly owned by tourists lodgings in addition to their main
residence they use for tourism purposes. Secondary homes maintain and
sometimes boost economic activities of different industrial sectors, bring in
currency, increase general accommodation capacity in the region
- homes with shared collective services (condominiums) serviced by a
management company (maintenance of the apartments, laundry and linen
hire, management of common equipment). Owners usually use the
apartments for themselves or put it in the hands of the management
company for rental, thus receiving a proportion of the rent. The system was
developed in the US, Spain and France, mainly in the mountain resorts and
in some seaside resorts.
- Time shares, like resorts, tend to be located in popular tourist destinations.
Time shares basically are individually owned room/apartment intervals
which allow the owner to access generally upscale accommodations for a
usually fixed period of time each year. The attraction of time share
accommodations is that they tend to be more apartment style and may be a
part of a hotel, resort, or condominium.
The arrangement is a permanent one unless the ownership share in the property is
disposed of. Increasingly, the properties are managed by specialized management
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companies including several major international hotel management organizations
such as Marriott, Hilton Hotels Corporation, and Disney.
The US is the largest timeshare area, both in terms of the number of resorts and
number of owners. The biggest timeshare market in Europe is UK.
2.7. Furnished rented accommodation
Furnished accommodation rented on a seasonal basis has become an important type
of tourism lodging particularly in countries where B&B is common, like the UK. The
sector brings the advantage of elasticity to the tourism supply, by not bearing the
high fixed costs of the hotel trade.
- seasonally rented furnished accommodation self-catering apartments, studios
and villas rented to tourists. The rapid development of this sector has persuaded
tour operators to develop new tourism products (transport + accommodation) at a
lower cost than those using hotels. The most buoyant markets are in the
Mediterranean resorts.
- cottages and farmhouse accommodation rural cottages (gites) divert tourist flows
towards rural areas by providing new and inexpensive accommodation. They have
seen rapid growth recently particularly in France.
- guest lodging this form of lodging is particularly developed in Great Britain,
Austria, Ireland, Portugal (estalagem), Italy (pensione) and Greece. Rooms are
rented in private houses with breakfast provided. Quality is difficult to control in
this type of accommodation.
2.8. Social accommodation
Social accommodation includes holiday centers, family holiday camps, youth hostels
and accommodation provided by associations and staff clubs in firms. The
accommodation is provided on a non-profit basis.
3. Food and Beverage Establishment Classification
Like the accommodations sector, food and beverage establishments can be
subdivided into many segments.
However, unlike the accommodations sector, a large part of the food and beverage
sector is not related to the travel industry. These include major sectors such as
institutional food service in schools, colleges, and hospitals, military food service,
and other establishments.
The segments which are interrelated with the travel industry are commercial
establishments which are primarily or partially tourism dependent based on their
location, clientele, and seasonal traffic (Gee, Makens, & Choy, 1989, p. 324).
In terms of total tourist expenditures, money spent on food and beverages is second
only to airline transportation in terms of vacation costs. Food away from home is
conservatively estimated at 18 to 20% of all tourist expenditures. However, it would
be difficult to determine the percentage of sales attributable to the travel industry
since food and beverage revenues are usually generated in restaurant
establishments by both visitors and residents in the community.
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Food and beverage outlets are more sensitive to economic cycles than most other
types of retail businesses and typically have high failure rates. A restaurants profit
margin is based on its ability to control food and labor costs, which may run as high
as 60 to 65% of revenues while the ratio of profit to sales is very low.
3.1. Hotel-Related Food Establishments
Establishments which are tourism dependent are often owned and operated by a
hotel, or located in space leased out to independent restaurant operators by hotels.
Hotels may offer a variety of outlets including restaurants, dining rooms, coffee
shops, room service, catering, and banquets. They also offer a variety of meal plans.
Although the percentage of hotel income from food and beverage sales has gradually
declined in the U.S. owing to changes in customer preferences and eating and
drinking habits, full-service international hotels averaged approximately 30% of
their revenues from food and beverage sales. In some locales such as Singapore and
Hong Kong, food and beverage sales are as high as 50% of hotel revenues.
3.2. Independent Food Service Establishments
Many independent food service establishments rely on tourism business as well as
local trade. These establishments may be individually owned and operated, part of a
corporate chain, or a franchise.
The vast majority of franchisees are fast-food outlets. Franchised restaurants are
expanding worldwide such as the U.S.-based McDonalds and Mvenpick in Europe.
Mvenpick began in Zurich, Switzerland in 1948 and expanded into international
activities in 1968. Since then it has expanded its operations to include packaged food
products as well as hotels in countries in Europe, the Middle East, and Asia.
Another major food service segment within the travel industry is transportation-
related. Airlines, for example, spend billions of dollars each year on food and
beverage purchases for inflight service (Marriott In-flight). Some carriers have their
own ground commissaries with secured and bonded areas for duty-free liquor; others
contract out their food service with commercial caterers. In the U.S., the latter has
become the more common practice while in Europe and Asia, carriers prefer to
operate their own kitchens in order to emphasize the importance of onboard dining.
Onboard food and beverage service is also a hallmark of sea cruises, which typically
offer meal service around-the-clock, constituting one of the highlights of the cruise
experience (Sodexho The Seiler Corp., Boatel)
With the revival of the legendary Orient Express in Europe and the Orient Express
on the E & O lines traversing Singapore, Malaysia and Thailand, the glamour of
luxury train travel during the 1920s and 1930s has been restored, a major part of
which is based on outstanding dining cars and impeccable service.
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