Hotel Management Chapter 1
The Tourism Industry
Tourism Industry:
All businesses that cater to the needs of the traveling public
Is one of the top 10 largest industries in 49 of the 50 states
Contributing $2.36 trillion to the US economy last year, the US is the world’s most powerful travel and tourism market
Travel and tourism support 18 million jobs across the country
The economic footprint produced by the tourism and travel industry is $2.8 trillion
The US is the world’s largest domestic travel market, baled at $1 trillion in annual spending
68% of all trips that start in the US remain within its border
The United States recorded a total of 66 million tourists (international) in 2023
International tourists from various countries spend an average of over $4,000 per trip, contributing a total of $155 billion annually to US travel spending
What are the 3 most visitied tourist destinations in the US, for interational travelers?
1. New York
2. Miami
3. LA
Who Stays in Hotels?
Guest (Never a customer)
A person who rents rooms and/or purchases food or beverages at a lodging property
41% travel for business
Sales trips, working in other locations
Conferences/Meeting
Association Meeting, Sales Meeting, Incentive Meeting
59% travel for pleasure (leisure)
Do these numbers make sense to you? Post Covid is this dynamic changing?
Hotel Industry Characteristics
1. Emphasis of safety, cleanliness, and service
2. Perishability
3. Inseparability of Manufacture and Sales
4. Repetitiveness
5. Labor Intense
Hotels in the US
Over 125,000 hotels
Over 5 million hotel rooms
Over 1 billion room nights sold each year
There are many ways to describe hotels…
Location, type of service, room size, etc.
Types of Hotels
Full Service:
Guest rooms, Restaurants and Bars and Function Space
Select (limited) Service:
Guest rooms and very few other services – Usually “grab and go” food and beverage or breakfast only
Bed & Breakfast, Hostel, Inclusive/Conference Center
Location Defined:
City, Urban, or Commercial
Suburban
Airport
Resort
Rate / Amenity Level:
Luxury
Upscale
Midscale
Economy
Budget
Size of Hotels
Small or boutique such as the Wentworth Mansion, Zero George, or The Pinch (generally under 50 rooms)
Midsize such as the Renaissance Charleston or Francis Marion (generally 100-200 rooms)
Large such as Charleston Place or the Marriott Charleston (generally 250-500 rooms)
Mega Hotels (none in Charleston) such as the Marriott Marquis in New York or the MGM Grand in Las Vegas (up to thousands of rooms)
Ownership and Management
The “name” of the hotel is generally only its Brand (or “flag”)
The “owner” of a hotel is the organization that owns the real estate – land and structures
Corporations
Families
REIT’s
A “franchise” (or Affiliation) hotel is one for which the owner is paying to use the name, standards, marketing, and management practices of a recognized hotel company
Franchisor:
A company who owns the right to manage a brand and sells the use of the brand’s name and/or business model
Franchisee:
A person or entity that purchases the right to use a brand name and business model for a fixed period of time and at an agreed-upon price
Hotel Ownership/Management Options:
1. Single-unit property not affiliated with any brand
2. Single-unit properties affiliated with a brand
3. Multiunit properties affiliated with the same brand
4. Multiunit properties affiliated with different brands
5. Multiunit properties operated by the brand or others
6. Multiunit properties owned by the brand
Independent hotels are those not affiliated with a brand
A management company is generally a company that only manages the hotel
Summary:
Affiliation (franchise or not)
Ownership (of the real estate)
Operation (the management of the hotels ops)
Examples:
Wild Dunes Resort is:
Owned by Dart Interests and Lowe
Managed (operated) by Hyatt
Affiliated with Destination Hotels (brand)
The Charleston Place is:
Owned by Beemok Hospitality Collection
Managed by Beemok Hospitality Collection
Has no affiliation – independent
Hotel Careers / Hotel Structures
Hotel Organizational Structures
Small Hotels:
· Manager
· Executive Housekeeper and staff
· Front office manager and staff
· Maintenance chief and staff
· Bookkeeper/Accountant
Large Hotels:
· Administrative Assistant
· GM
· F&B director
· HR manager
· DOSM
· FOM
· Executive Housekeeper
· Chief engineer
· Assistant to the GM
Hotel Departments
Line Departments:
Hotel divisions in the “chain of command” are directly responsible for:
Revenues
Front office
Food and beverage
Property operations
Housekeeping
Maintenance
Staff Departments:
Staff department
Providing technical, supportive assistance to support line departments
Purchasing
Human Resources
Accounting
Revenue Centers:
A hotel department that generates revenue
Front office and food/beverage departments
Additional streams of revenue – telephone services, space rental, and fees from parking garages, vending machines, and golf courses
Cost Centers
A hotel department that incurs costs in support of a revenue center
Marketing, maintenance accounting, human resources, and security departments
Career Path – Starting Point
FOH (Front of House)
Front desk
Server/assistant/host – Food and Beverage
Bell/Valet
Banquet Server or Houseperson
BOH (Back of House)
Accounting
Housekeeping
Human Resources
Sales and Marketing
IT (Information technology)
Career Progression
Supervisor Assistant manager Manager Director General Manager
Higher level / Corporate positions
Regional or Area:
Operations or Sales and Marketing
Corporate: Operations or Sales, Human Resources, Design, Engineering, Accounting, Finance
Corporate: Vice president and President
Ownership: Asset Manager; Owner
Developer: Finance and funding, Proforma Development, Land and Urban Planning, Strategy
