sip hotel industry
TRANSCRIPT
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CHAPTER -1
INTRODUCTION
1.1 INTRODUCTION TO HOTEL INDUSTRY
Hospitality is all about warmth to someone who looks for help at a strange or
unfriendly place. It refers to a process of receiving and entertaining a guest with
goodwill. Hospitality in the commercial context refers to activities of hotels.
According to British laws a hotel is a place where a bonafied traveler
can receive food and shelter provided he is in a position for it and is in a fit condition
to receive. (Bonvin, 2003)The hotel industry is a 3.5 trillion dollar service sector within the globe economy.
The industry is cyclical in nature as dictated by the fluctuation that occurs with an
economy every year. Today hotel industry is one of a fastest growing sector in India.
It is expected to grow at a rate of 8% between year 2007 to year 2016. It is also
estimated that hotel industry and tourism will account for nearly 5.3% of GDP and
5.2% of total employment. The boom in travel and tourism industry has led to the
further development of hotel industry. (hospitality industry, 2009)
According to a report hotel industry in India currently has a supply of
110000 rooms and there is a shortage of 150000 rooms fuelling hotel rooms rates
across India. To overcome this shortage industry is adding 60000 quality room which
should be ready by 2014.
The future scenario of Indian hotel industry looks extremely rosy. It is
expected that the budget and mid-market hotel will witness huge growth and
expansion while the luxury segment will continue to perform extremely well over the
next few year. (Hotel sector analysis report, 2011)
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1.2 History background of the company
This all began in way back 1999 when with the efforts of Mr. Rajesh kumar waliaand their father late Mr. lakshman walia the hotel opened its doors. The iconic hotel
soon became the citys venue of choice for glittering balls, presidential visits and
political gatherings, making the name hotel Paras synonymous with place of
occasion.
The hotel was first to introduced E-conferencing technology in the city in 2005. The
hotel has scene many celebrities, political leaders and people for different
backgrounds. Tourism has always been a priority to the hotel. They introduced wild
life safari, track camping etc and other competitors followed their footsteps.
The hotel completed their 45 rooms construction and to add a lot of transformation in
2009. It altogether changed the image of hotel so as there fortune. Hotel became an
eye of attraction for the tourist and a place of hanging out for local city crowed.
(hotel introduction , 2009)
1.3 Product portfolio and business of the company
Hotel industry is known as the commercial context of hospitality.
The services provided by hotels are very diversified. The product portfolio of Hotel
Paras is also very strong.
List of services offered by the hotel is as follows
45 quality rooms available as according to the budget of customers of al class.
2 restaurants serving food of many types and specializing in Indian (Punjabi)
food.
1 conference hall with a capacity of over 120 person.
A special dine inn with a kitchen garden.
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1.3.1 Major business
The major business that hotel get is from the tourism. The 70% of the total sales
turnover of the firm is from tourists.
The hotel also enjoys a kind of monopoly in serving Indian food in the city as no
other competitor can serve the same quality and taste.
The hotel failed to get much business from the companies and corporate of the
city but looking forward to cover the same by many promotional programs.
1.4 Profitability
The firm has a total sales turnover of over Rs 90 lacs per year with the profit margin
of over Rs 63 lacs as stated by the previous year balance sheet of the firm.
The firms total sales turnover was just Rs 47 lacs in 2007 before the transformation
process.
The hotel has a target of Rs 1.05 cr for the next financial year and hotel is well on itsroad to achieve the target. (Hotel paras, Balance Sheets, 2013)
1.5 Market share and major competitors
The hotel has a privilege of being one of the old names in the market and the easyto access location over their competitors.
As where market share is concerned hotel holds the 2nd major market share after
the hotel Visco resorts. Hotel covers 35% of the total sales turnover of the hotels in
the city.
The major competitors of hotel are
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Visco resorts, mandi.
Hotel River bank
Hotel regent palm
Hotel velly view.
Organization structure
CEO
MR. Rajesh walia
Head manager
MR. raj kumar malhotra
front desk manager
Mr. dhyan singh thakur
supervisor (rooms)
Mr. Desh raj singh
supervisor (restaurant)
MR. sanjay verma
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1.6 SWOT ANAYSIS:
There are some strength too which is still making the hotel work successfully.
1.6.1 STRENGTH:
LOCATION:
According to me the biggest advantage which Paras hotels have is its location on the
running highway and when corporate comes from outside city they prefer to stay in this
hotel because it is easy to reach to the meeting point, or location which would probably
be near the highway and approachable to the tourists too.
HIGHLY SKILLED EMPLOYEES:
Employees working in the firm are person selling meetings and by using their personal
relations, they are doing good job for their hotel.
MORE TYPES OF ROOMS:
Hotel Paras is popular for its types of rooms.Like standard single and double, deluxe
premium and double, deluxe and executive suits. This quality differentiates Hotel Paras
from the other hotels.
EXPERIENCED STAFF:
Staff mostly from the marketing department is highly experienced and they have every
knowledge about the marketing and because they have worked in other hotels or
marketing departments of other companies before so they can understand the situation
very well.
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AFFILIATION:
One more big advantage the Hotel has is its affiliation, especially with the Hotels in
Manali so this helps a lot to transfer their guests in very moderate rates
TARGET MARKET:
Hotel Paras mostly deals with tourist customers as well as business clients.
MODERATE RATES:
Competitors of hotel Paras are Visco resorts, Holiday inn hotel, River Bank hotel, and
Valley View hotel .And compare to them rates of Hotel Paras are more adjustable.
1.6.2 WEEKNESS:
DISCREPANCIES AMONG STAFF:
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Thats what I have noticed that there is some unhealthy professional jealousy among
the people working in the organization. Which is effecting the Hotels performance over
all. And there is a bit less team work among employees
INCOMPETENT EMPLOYEES:
There are some incompetent but old employees which are working because of good
relationship with the owner which is decreasing the our all efficiency of the hotel.They
are now in some powerful positions which can be reason for the hotel decline in the
future hotel position.
SWIMMING POOL:
Mostly good hotels have swimming pools but not in hotel Paras because its location
does not allow them to make it. And there is no place left for building a swimming pool.
Sometimes customer prefers swimming pools.
LACK OF INTERNEES
They are not interested in for internships. They usually prefer full time workers. When I
was doing internship at that time I was the only internee in the whole hotel. Their
performance can improve by giving more opportunities internees.
FAVORITISM:
The promotions and bonuses etc are often powered by seniors favoritism or depends
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upon their wills and decision. This adds to the negative factors, which denominate the
employees thus resulting in affecting their performance negatively.
LACK OF SPACE:
With the growing needs I think the space of the hotel is bit less, they should do
something to solve this problem. Space gives a good open looks to the hotel like other
big hotels. But in thatit is hard to do so.
LACK OF GARDENS:
Gardens give a new and fresh looks to hotel where you can have seasons plants
growing seasons flowers and gives the broader looks to the hotel. And may be
customers like to have some open.
LESS ROOMS FOR A CROWDED SEASON:
In the overcrowded season of April-July hotel has seen the shortage of rooms. As the
demand of rooms increases by 200% and rooms available are far less. This adds to onr
of the limitation as the regular customers need suffer because of it.
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1.6.3 OPPORTUNITIES:
INNOVATION:
For growth everyone has to innovate and find new idea and make new solutions. Its not
easy to make an innovation but just to do anything in a new way is innovation. Hotel has
also planned to employ such plans to get there growth going.
LOW RATES:
Hotel has realized that by reducing the room prices in the off seasons the hotel can
take good business. But all this should be done by person to person basis. Hotel has
planned to give special discounts to regular business clients.
GROWTH OF THE BUSINESS SECTOR:
India is a developing country where business is growing day by day and as the business
grows the need of hotels will increase and there will be the opportunities , and thats the
reason why there are many projects building in the city.
INCREASE OF LINKS AND AFFILIATIONS:
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In the environment of competition a hotel can only grow by increasing its affiliation and
links. For obvious reasons hotel with better links with business customers will have
more guests. Hotel Paras has also increased their links and business over a period of
time and planning to go at a even higher level.
1.6.4 THEREATS:
.
THE DECLINE IN HOTEL INDUSTRY:
The Hotel industry is among the top three constituents of the world economy after oil
and autos and is growing faster than the petroleum and arms. It is larger than
automobile industry in Japan, agriculture in the U.S.A. and banking in Switzerland.
It is unfortunate to know that instead of growing with world trend, the tourism industry n
India has increased but at very slow pace as the revenue generated services. Its
importance can be judged by the fact that it is the only industry that earns the foreign
exchange without exporting anything.
The hotel industry with its charming and lively environment is apparently flourishing but
the reality negates the fact and depicts the other side of the story . Most of the hotels
and motels here, particularly in the far flung areas, hill stations and the tourists spots
and even in the major cities are dependent upon tourism, international business tri
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1.7 CONTEXT OF STUDY:
Aim of the study
To measure the change in sales turnover of the hotel in context of the change in
expenditure on sales promotion program and to recommend the appropriate ways to
achieve the maximum profit out of it.
The report also aims at improving the sales and promotion techniques and suggesting
the firm the limitations of the present promotional program.
Objective of the study
To study the impact of change in promotional programs on the sales turnover.
To analyze the impact of changing sales promotion techniques and to find out the
limitations of the previous planes.
To evaluate the level of business the firm gets from this trade promotion
program.
To recommend the firm about the new areas of enhancement in trade as well as
consumer promotion.
1.7.1 Relevance to the company :
This study can help the firm to understand that whether the expenditure on sales
promotion are worthwhile or not. It will help them to understand the level of such impact.
Company can find out those trade promotion techniques that gives no business to them
and try to minimize effort on such techniques.
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Chapter-2
Task Process
Task Process is the work done by the student and how he went
ahead with the task, and limitations with respect to task
completion related to the company.
ABOUT THE PROJECT
2.1 OBJECTIVE OF THE STUDY:
This report was commissioned to examine how sales turnover of Hotel Paras changes
with the application of promotional techniques.
The objective behind doing this study is to figure out the pattern of change of sales
turnover with the change in level of promotional techniques commenced before there
tourist season.
Change in level of promotional techniques?
From last few year hotel has understood the value of promoting the hotels name and
using trade promotions for attracting new business.
The previous promotional programs adopted by the hotel includes :
Covers references from other hotels in Manali, Shimal and Chandigarh.
Covers taxi unions of Chandigarh, Manali, shimla, and Delhi.
Few travel agents on commission bases from Manali,Delhi and Kolkata
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Change in level of promotion covers the following:
Joined some new big business associates (travel agents) from Delhi like pankire
travels, Swaghatam travels etc.
Attended 2 big trade fairs in Delhi and Kolkata covering a good chunk of localsmall travel agents, providing them catalogs, brochures and visiting card.
Made Online booking available directly on hotels website with exciting offers.
Meetings with the high level corporate managers of the city to introduce them to
the new corporate schemes for the bookings.
Covers more taxi unions in Chandigarh and Delhi providing them catalogs,
brochures and visiting card and introducing them to the new commission
schemes.
The task process I was assigned was to execute the promotional program
designed for the year 2013-14.
The promotional program for 2013-14 covers-
Visit to the taxi Union offices in Delhi, Manali and Chandigarh. Arrange Meetings with the high level corporate managers of the city to introduce
them to the new corporate schemes for the bookings.
Attend trade fairs in Delhi and Kolkata.
Maintain the daily account book, help the manager in evaluating the luxury tax.
Send emails to the clients and responding to their feedback and responses.
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Visit new business associates in Delhi and Chandigarh to convince them to enter
in to a contract for permanent bookings.
Plan to visit corporate offices in other cities in Himachal Pradesh or to arrange
meetings cum lunch parties to introduce them with new corporate planes.
2.2 To execute the same plane a design was made with different schedules and
time tables.
Time period Schedule
May 30 June 1 Tour Delhi to have a meeting with big travel
giants like Panikers, Swaghatam,Haryyson etc.
Cover old business associates and taxi unions.
June 1
June 4 Tour Chandigarh to have meeting new travelagents. Cover old business associates and taxi
unions.
June 5 June 7 Tour Manali to have meeting new travel agents.
Cover old business associates and taxi unions.
June 8 June 15 Planning for the lunch meeting with the
corporate managers of the city. It includes
Invitation to the offices, preparation of the
event and presentation for the event.
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2.3 Limitations while task completion -
I was not able to complete the whole promotion process which
was followed by the tourist season as the time required to
complete the assignment was not enough.
June 15 June 22 Attended trade fair arranged in ITC Morya, New
Delhi.
June 23 June 30 Attended trade fair arranged in Hyatt Regency
hotel, Kolkata.
June30 July15 Accounts handling, sending ebrochures,
compiling data for project.
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Chapter 3Analysis and discussion
3.1 Analysis
The objective of my study was to examine the impact of change in technique and
expenditure on sales promotion process over the sales turnover of the firm. To study the
same impact I have gone through the financial statements of the firm from the financial
year 2012 -13 to 2013-14 (till August 2013) .
The study draws attention to the fact that as according to the sales account and balance
sheet the sales turnover of the firm in 2012- 2013 was around Rs 52 lacs and the
expenditure incurred on the sales and promotion program was around 1.7 -1.9 lacs.
And in the financial year 2013-14 (till august 2013) the sales turnover came out to be
around 42 lacs. And as calculated the overall expenditure on the sales promotion
program was around 3.75 (from april 2013 till june2013).
To make the study more accurate and precise we have decided to take expenditure on
sales and promotion from month April to May and sales turnover from April to July. The
same financial information is presented in the following table.
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Particulars 2012-13(April-August) 2013-14 (April-august)
Sales turnover 35 lacs 42 lacs
Particulars 2012-13(April-June) 2013-14(April-June)
Expenses on sales
promotion program
1.7 lacs 3.75lacs
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To get the exact idea of the impact of the promotional program
and the conversion rate of trade promotion in depth study of the
reservation books and visitors entry book was done for the
months April- August 2012 and April-August 2013 and following
results were found.
Particulars April August (2012) April August (2013)
No of room
booking 1860 Rooms 2640 Rooms
In terms of
Sales (in
rupees)
2232000 3168000
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(Hotelparas, Fiancial statements, 2011-2013)
0
500
1000
1500
2000
2500
3000
2012 2013
No of Rooms
No of Rooms
0
5
10
15
20
25
30
35
2012 2013
sales (in rupees)
sales (in rupees)
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3.2 Discussion
As according to the analysis done on the impact of change in sales promotion
program over the sales turnover following interpretations can be made
Sales turnover has increased by 20% due to change in expenditure
incurred over sales promotion program and enhancement in the
promotional program by adding new business associates and attending
trade fairs in Kolkata.
Only Kolkatas trade fair benefited the firm by over 600 room bookings.
The increase in sales promotion expenditure from the year 2012- 13 is
about 120%, but the firm in the beginning of the project decided to
increase it by just 50%.
Even 120% rise in sales promotion expenditure could only get 20% rise in
sales turnover which is far less. But it should be included that theconversion time of such trade promotion is not limited to 3-4 months.
There benefits can be availed for long.
The main finding that can be considered from the study is that this trade
promotion program has increased the sales by 42%.
Sales turnover converted due to trade promotion was just 22.32 lacs
which increased to 31.68 lacs. And the number of reservation for such
rooms increased by 780 rooms which is quite impressive.
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The results of the promotional program could have been much more
favorable if the Manalis tourist season was not affected due to
natursudden climate change and Uttrakhands natural disaster.
Chapter 4
Summary, Conclusions and Recommendations
4.1 Summary
This report was commissioned to examine how sales turnover of Hotel Paras changes
with the application of changed and enhanced promotional techniques. It covered the
comparison of last year sales with the sales of this year after the promotional program
being commenced to increase the sales volume and to recommend the appropriate
ways to achieve the maximum profit out of it.
The research draws attention to the fact that the sales turnover of the firm in 2012- 2013
(April-August) was around Rs 35 lacs and the expenditure incurred on the sales and
promotion program was around 1.7 -1.9 lacs. But in year 2013-14 (April-August) the
sales were about 42 lacs and the expenditure incurred on the sales and promotion
program was around. The trade promotion program has increased the sales by 42%.
Sales turnover converted due to trade promotion was just 22.32 lacs in 2012-13 which
increased to 31.68 lacs. And the number of reservation for such rooms increased by
780 rooms which is quite impressive. The increase in sales promotion expenditure from
the year 2012- 13 is about 120%, but the firm in the beginning of the project decided to
increase it by just 50%.
Many of the promotional techniques did not contribute to the sales turnover and hence
have no conversion. Such techniques like sending E-broachers can be considered as
waste of effort and should be minimized.
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Conclusion and Recommendations
4.2 Conclusions:
The impact of this sales promotion program can be judged by
the fact that sales turnover for the same time period in 2013
increased by 7 lacs.
But the impact was not enough as the increase expenditure on
sales promotion was 5 fold more than the increase in actual
sales.
While considering the impact of sales promotion on sales it
should be included that the conversion time of such trade
promotion is not limited to 3-4 months. There benefits can be
availed for long.
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It was not possible to complete the whole promotion process
which was followed by the tourist season as the time required
to complete the assignment was not enough.
4.3 Recommendations
The time period selected for the sales promotion program is not
appropriate as it is very close to the tourist season and trade
promotion gets very less time to show results. The best suitable time
for such promotion is from January to April of every year.
The firm should minimize the trade promotion practices that have noconversion in to business like E-broachers, trade fairs in local areas
of Himachal Pradesh.
To attend more and more trade fairs and contact more travel agents
in Kolkata and areas adjoining to it as the response from the agents
was notable.
To plane and enhance the promotional programs in Maharashtra and
Gujrat and Rajesthan because as according to a survey 35% of the
tourist in post- tourist season come from these states.
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To try and execute a program with help of local authorities to promote
tourism in the city by highlighting the beautiful surroundings and
natural side scene.
Bibliography
Bibliography
Bhardwaj, C. R. (2013). balance sheets(2007-2013).
Bonvin, J. L. (2003). Retrieved from hospitalitynet:
http://www.hospitalitynet.org/news/4017990.html
hospitality industry. (2009, 11). Retrieved from wikipedia
hotel introduction . (2009, september). Retrieved from hotelnewparas.com: hotelnewparas.com
Hotel sector analysis report. (2011, november). Retrieved from equitymaster.com :
www.equitymaster.com/research-it/sector-info/Hotel-Sector-Analysis-Report.asp
paras, h. (2011-2013).financial statements. Mandi (HP) : Hotel new Paras .
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