The World of Hospitality
Chapter 1
Introduction
 Hospitality: mean meeting the needs of guests with kindness
and goodwill.
 Hospitality Industry: provides services to people away from
home
 Food, lodging (place to sleep), recreation, and travel
 Hospitality industry is sometimes called the travel & tourism
industry
 Travel industry or tourism industry
 Service is at the heart of the hospitality indsutry
Size & Economic Impact
 Travel & Tourism is the world’s largest industry
 Expected to group by 4% each year through 2019
 Has a major impact on national economies around the world
 More than 18 million people in the US work in the
hospitality industry
 It is the second largest employer (health care is 1st)
Size & Economic Impact
 Hospitality generates more than $1 trillion each year in the
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US
Whenever people travel, they spend money
International visitors to the US place over $100 BILLION
into our economy
Federal, state, and local government collect taxes on many
hospitality purchases
Major impact on countries
Diversity
 Diverse: made of elements that are different from each other
 Many businesses in the hospitality industry are different from
other businesses
 Think about when you used the hospitality industry
 People who work in the industry are also different
Complexity
 Term used to describe the hospitality industry
 Complex: made of 2 or more parts
 Some of the parts are complex in that they cannot be
separated from one another
Food & Beverage
 Food & Beverage Industry: businesses that prepare food for
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customers – also known as the foodservice industry
Known as F & B
Range from casual to fancy, fine dining
Food and beverage provide nearly 76% of all meals eaten in
the US today
American food & beverage is the largest and most varied part
of the hospitality industry (employs over 11 million people)
 The number of people in the foodservice industry is expected
to double in by 2015
Lodging
 Lodging: place to sleep for one or more nights
 Accommodation: another word often used to mean a place to sleep
 Lodging Industry: consists of businesses that prove overnight
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accommodations.
Lodging Property: business that provides overnight accommodations
Lodging businesses vary from expensive resort hotels to budget motels
Accommodations can be found to fit any price range and level of service
There are more than 4 MILLION guest rooms in approximately 60,000
different facilities throughout the US
There are about 13 MILLION rooms worldwide
What are some examples of lodging properties?
Recreation
 Recreation: any activity that people do for rest, relaxation,
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and enjoyment
The goal of recreation is to refresh a person’s body and mind
Different people enjoy different types of recreation
Recreation industry: consists of businesses that provide
activities for rest, relaxation, and enjoyment
Four types of recreation:
 Entertainment, attractions, spectators sports, and participatory
sports
Recreation Industry
 Entertainment business: provides a show for you to watch
(movies, live theater, concerts)
 Attractions: places of special interest to visit (natural scenery,
museums, zoos, historical sites)
 Spectator Sports: sports that you watch others play (football
game)
 Participatory Sports: sports that you take part in yourself
(skiing, snowboarding, etc.)
Travel & Tourism
 Travel industry: consist of businesses that physically move people
from one place to another. (Also known as the transportation
industry)
 Taxi services, car rentals, bus services, train services, airlines
 Tourism industry: consists of businesses that that organize and
promote travel and vacations
 Travel agencies, tour operators, cruise companies, meeting &
convention planners, convention & visitors bureaus, and local and
national tourism bureaus
 One of the main functions is to plan vacations & tours
 Vacation may involve several different hospitality businesses
 Package: Trip that includes several segments of the hospitality
industry such as transportation, lodging, meals, and entertainment
Travel & Tourism (continued)
 Tourism industry promotes and encourages travel
Role of Travel
 Travel is the basis for much of the hospitality industry
 Two main types of travel:
 Business & Pleasure
 Pleasure travel: travel that is done rest & relaxation
 Paid for by discretionary income (money that you have left over
after all your expenses/bills are paid)
 Vacation: period of time during which a person rests and is free
from daily obligations (school, work)
 346 MILLION trips a year are taken for pleasure
 Average 3.7 nights per trip
Business Travel
 Business travel: travel that people do as part of their jobs
 Employer decides where you and when you go
 210 MILLION trips a year are taken
Working Together
 All of the segments of the hospitality industry work together
to successfully meet customer needs
 On a typical trip, guests use businesses from all four
segments
 If a worker in any segment makes a bad impression, the guest
may go away with a bad impression of the whole city, state,
country
Business Structures
 You need to know about business structures in hospitality
 Two basic structures
 Single Unit
 Multiple Units
Single Unit
 Single unit business: business that only has one location and
one unit (Also called an independent business)
 Not part of any other business
 Owner is responsible for all the business decisions
 Make decisions about décor, recipes, staff, how much to
charge, etc.
Multiple Unit
 Multiple Unit Business: business that consists of more than
one unit or more than one location
 2 Structures
 Chain
 Franchise
Chain
 Chain: business that has more than one location under the
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same name and ownership
Example: Olive Garden (owned by Darden Restaurants, Inc.)
Darden decides on décor, menu items, prices, and even what
servers will wear
Most important aspect of a chain is the brand
Brand: name, logo, tagline, or any combination of these that
distinguishes a product from its competitors (association)
Franchise
 Franchise: the right to do business using the brand and products of
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another business
Franchise is actually part of a chain
Chain owner can give the outside person the right to use the
chain’s name and sell the chain’s products
Franchise Agreement: legal document that sets up a franchise. It
includes the rules and standards that the outside person must
follow in running the franchise
Franchise Fee: Amount of money the outside person pays the chain
owner
Franchisor: The person who owns the chain
Franchisee: The person who busy the rights to use the brand
Professional Associations
 Professional Association: group of people who have organized
themselves to work to improve themselves, their profession,
and their industry (aka professional organizations)
 AH&LA (American Hotel & Lodging Association)
 NRA (National Restaurant Association)
 Work in 5 areas:
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Professional development
Standards & ethics
Networking
Public relations
Government relations
Professional Development
 Professional development: process of continuing your
education in your profession after you leave school
(continuing professional education)
 Present educational workshops, seminars, and lectures on the
latest developments
 Take place at conventions, trade shows
Standards & Ethics
 Organizations also develop standards for the practice of their
profession
 Certificate Programs
 Code of Ethics: statement of proper, professional behavior
for members of the profession
Networking
 Networking: process of meeting people in your profession
 Social gatherings
 Provides opportunity to meet others to problem solve, learn
new ideas, and to learn about career opportunities
 FUN
Public Relations
 Public Relations: providing information about the industry to
the general public
 Two purposes:
 Inform the public about the profession to attract new
professionals
 Build a positive image of the profession and industry
Government Relations
 Government relations: informing local, state, or national
governments about the issues that are important to the
profession
 Staff members who speak with legislators about issues
affecting the industry and profession
Value of Involvement
 Many advantages
 Scholarships to students
 More up to date on current issues/training
 Stay informed and do a better job
 Employers appreciate
 Give you the opportunity to grow
Career and Technical Student
Organizations
 Career and Technical Student Organization (CTSO):
organization for students with an interest in a career area,
such as hospitality or business. The purpose is to give
students the opportunity to develop interpersonal leadership,
career, and technical skills
 Usually a chapter in the schools