Pestel: Hotel Industry

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PESTEL/ PESTLE/ PEST Analysis of hospitality industry

 Traditionally PESTEL analysis was known as the PEST analysis and only in the modern times did the use of the word PESTLE came into being. Social part of the PEST is split into environmental factors too as those have a significant role in the strategic management these days. Along with that economic factors are split into legal factors for the same previously mentioned reason. Political Environment

“These refer to government policy such as the degree of intervention in the economy.” The Times of India by Rachna Singh, Jaipur, in a bid to attract international tourists is gearing up with a host of new properties across differentsegments. [Hospitality Biz India: Dec. 2009]Hotel industry as well as tourism industry has a basic backbone of the government support without which it won’t be able to sustain the competitive world. Government charges huge amount of tax from the star and luxury category of hotels and thus has a huge impact with thepolitical changes that occur. Any small step taken by the government bychanging some law it would seriously affect hotel industry. The hotelindustry is getting huge incentives and the state governments aresupporting the development of the hotels and their growth. This infactanswers the question how are Indian Hotels are planning to expand in theeconomic crunch time. The Terror attack on the city’s [ Mumbai ] renowned hotels Taj and theOberoi’s had brought a concern on the faces of the hoteliers with asubstantial drop in foreign travellers to India taking the terror threat intoaccount. Economic

“These include interest rates, taxation changes, economic growth,inflation and exchange rates. As you will see throughout the "Foundationsof Economics" book economic change can have a major impact on a firm'sbehaviour.” [Online:2010]Mumbai being the financial capital of India has many foreign touristsarriving with the whole and sole purpose of meetings, conferences etc.thus Hotels in Mumbai try to capitalise on the foreign travellers who areseen to bring more money to spend along with increasing amount of expectations from the hotels. As seen in the recent past the guests arewilling to pay for the services they get and the more the guests pay themore would the hotel and the industry would prosper. With the increase inthe paying power of the guests the need for the good and luxurious hotelsbecome massive. The per capita income in India also has rose to a newextent enabling the common man to goto luxurious hotels to have a lunchor a dinner.Economy of India faced one of the most minimal drop in the whole worldbecause of the controlled and sound financial system in the country. Thishelped hotels to only concentrate on the foreign travellers which hadreduced and the local market being stable was much of a relief to theIndian Hotel Industry. Social

“Changes in social trends can impact on the demand for a firm's productsand the availability and willingness of individuals to work.”Vits being situated near the airport sees the maximum amount of guestswho are in for the business meetings and conferences. There are very fewFIT guests seen in the hotel as compared to the BTC guests [ Bill toCompany Guests ] and the business travellers. This explains the reason why the hotel could be seen having single roomguests or a twin bedroom guests more than the double bedroom guests.Being the Business hotel it has maximum males arrivals compared tofemale arrivals. The Vits could also be seen having layover guests many a times whichbecomes the revenue generator for the hotel in the slack period of time.Seeing the ratio of the various classes of guests of VITS it could be easilysaid that the Hotel must strive for the FIT and the group checkins bylinking the VITS to the travel agencies in and outside India. This couldprobably balance the demographic ratio of the arriving guests. Technological

As said before the technology used in VITS is way below the standardswhen it...
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