Hotel and Restaurant Industry in Turkish Economy

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STRUCTURE OF TURKISH ECONOMY
HOTELS AND RESTAURANTS

1. INTRODUCTION
2. Tourism Impact on National Economy
3. Impacts of Hotel and Restaurant Industry on National Economy 4. Hotel and Restaurant Industry
4.1. Hotel Industry
4.2. Historical Background of Hotel Industry
4.3. Investments in Hotel Industry in Turkey
4.4. Evaluation of Hotel Industry
4.5. Restaurant Industry
4.6. Historical Background of Restaurant Industry
4.7. Investments in Restaurant Industry in Turkey
5. S.W.O.T Analysis for Hotel and Restaurant Industry
6. CONCLUSION
7. REFERENCES

1. Introduction

The aim of this research is to provide information about Hotels and Restaurants on tourism industry as well as its contribution to Turkish economy. Historical backgrounds of both sectors were handled and their development processes have been observed while the contribution of Hotels and Restaurants in both international and local economy have been proved by statistics and charts. The hospitality industry is the combination of companies with food services, accommodations, recreation, and entertainment sectors.The industry depends on the availability of peoples’ leisure time and disposable income and worths several billion dollar industry. Thus, the contribution to prosperity creation and financial development for a country cannot be ignored. The hospitality industry covers hotels and restaurants. These service sectors are highly related to each other that increase demand in tourism will lead to development and improvement of hotel and restaurant sector.

2. Tourism Impacts on National Economy

Due to its location and other characteristics, Turkey is one of the most tourism-oriented destination in the world and tourism is considered as one of the most important driver behind Turkey’s economic development. In 2009, including the travel sector, tourism generated 95.3 TL billion of economic activity (approximately 10.2% of Turkey’s GDP) and has the contribution to the employment of approximately 1.7 million people. Thus, the number of tourist arrivals have increased tremendously since 1990 and the contribution to the national economy cannot be ignored.

Table 1 : Tourist Arrivals in Turkey versus World
Source : UNWTO
3. Impact of Hotel and Restaurant Industry on National Economy

As tourism has always been and will be an important contributor for Turkish economy as for other countries, its sub-sectors like hotel and restaurant industry has a significant influence on the economy as well. Touristic facilities and hotels, that are located in Turkey, is owned by Turkish Treasury and they are leased out for 49 year period of times, they also can be renewable at expiry. Most of the international hotel chains have entered Turkish market since the 1950’s and currently, nine of the world’s top 10 hotel chains are operating in Turkey. Existence of fast food restaurants for 20 years has vital effect on the industry and grew at around 50% in the last couple of years. Most of these restaurants are small and Turkish restaurants are making 75-80% of their income from `doner’ and meatball sales. Others are generally American and Turkish foods like pizza and hamburger chains. In 2010, there were 20 international fast food chains which were operating 650 restaurants in Turkey and most of them are still located in major cities like Istanbul, Ankara and Izmir.

Table 2 : The contribution of food and beverage sector in Turkey by years and the percentage of the companies serving in the industry between 2005 and 2009. Source : Undersecretariat of Treasury

4. Hotel and Restaurant Industry

Tourism is the main market for hotel and restaurant industry and the significant increase in visitor number over the past few decades resulted in a relative boom in the hotel and restaurant sector. Over the past few years, the hotel and restaurant industry flourished even as it has difficulties to cope with challenges. New hotels have...
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