Intro To Hospitality chapter 4 Lodging
Based on power points and textbook; "Exploring the Hospitality Industry", 2nd edition, by John R. and Josielyn T Walker
Terms in this set (15)
Hotel development & Ownership the 3 primary types
Real Estate Investment Trust (REIT)
What Hotel company was the 1st to start franchising?
The Ritz-Carlton in NYC was the first hotel to start franchising in 1907. Howard Johnson started in 1927.
What hotel company is the largest franchise?
Wyndham Worldwide is the largest franchise, Choice Hotels International is the 2nd largest. Intercontinental hotel corporation is the 3rd largest franchise, Holiday Inn is apart of this franchise.
Kemmons Wilson began the Holiday inn chain after a poor family vacation experience.
Factors propelling the growth of franchising;
looks/ curb appeal
Expansion - into smaller cities
Foreign Expansion - a move to increase brand awareness
Benefits of franchising for the franchisee
Standard set of plans
central reservation system
Volume discount pricing
lower fees charged by credit card companies
listing in the franchisor`s directory
drawbacks of franchising for the franchisee
High fees; 3% - 4% of gross room revenue
Central reservation system only accounts for 7-25% of reservations
Must maintain franchise standards
Pros & Cons of franchising for the franchisor
PROS; The franchise company benefits from this arrangement by receiving:
Increased market share and recognition
CONS; The franchise company may experience challenges due to:
The careful selection process required when choosing franchise partners
Difficult to maintain standards
Management vs Franchising
Owner responsible for day to day operations
pays only franchising fees
Owner not responsible for day to day operations
pays franchising 3% - 4% + management fees 2% - 5% gross
Ratings of Hotels
Unlike other countries, the United States Government has no formal classification of hotels.
The AAA (American Automobile Association) inspects and rates hotels based on a 1 - 5 diamond rating system.
Mobile Travel Guide has 1 - 5 star program.
Types of hotels
Freeway hotel & motel
Full service hotels
Economy / Budget hotels
Extended Stay hotels
All - Suite Extended Stay hotels
Mixed use hotels
Bed & Breakfast Inns
The "BEST" hotels
The Oriental Hotel in Bankok, Thailand has been rated #1 in the world
also on the list;
The Regent of Hong Kong
The Mandarin Oriental of Hong Kong
The Connaught of London
The "BEST" hotel chains
The Four Seasons; Canadian owned & operated
The largest hotel in the world is the Venetian, in Las Vegas with 6,172 rooms
The politically correct way of saying timeshare
Began in the French Alps in the 1960's
Fastest growing segment of the U.S. travel and tourism industry
Provides owners an opportunity to purchase vacation accommodations
Vacation Ownership Costs
One time purchase price plus annual maintenance fees
Typically financed through consumer loans
Average annual cost is $12,500
Ownership may be for perpetuity or a set number of years
Treetops Hotel in Kenya
Ice Hotel in Lapland
Underwater Hotel in the Great Barrier Reef
Capsule Hotel in Japan
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