An alternative to help economic growth in developing countries
Reasons why developing countries use tourism and hospitality for economic growth:
The OECD has concluded that tourism and hospitality provide a major opportunity for growth to countries that are at the intermediate stage of economic development and require more foreign exchange earnings
Tourism and hospitality
Acts as an export by bringing in revenues from outside sources when travelers outside the destination area spend on goods and services within the destination
Direct and secondary effects
Important to measure the economic impact of tourism and hospitality on the destination area
Tourism multiplier
Describes the total effect, both direct and secondary, of an external source of income introduced into the economy
Multiplier effect
Tourist makes an initial expenditure into the destination, which is received as income by local businesses, then spent again
Cost-benefit ratio
Helps determine the extent of potential benefits and their costs for developing the tourism and hospitality industry
Some undesirable economic aspects of tourism and hospitality are higher prices and economic instability
Theories to maximize the economic effect of tourism and hospitality
Theory of balanced growth - tourism and hospitality should be viewed as an important part of a broad-based economy and needs the support of other industries
Theory of unbalanced growth - tourism and hospitality is the spark to economic growth, emphasizing the need to expand demand rather than just supply
Import substitution
Imposes quotas or tariffs on imported goods that can be developed locally, and grants subsidies/loans to encourage use of local materials
Incentives
Can encourage the influx of local and foreign capital necessary to develop tourism and hospitality supply
Many countries have placed restrictions on spending in order to maximize foreign exchange earnings
Travel industry
The composite of organizations, both private and public, involved in the development, production, and marketing of products and services to serve the needs of travelers
Tourism and hospitality supply components
Natural resources
Infrastructure
Superstructure
Transportation and transportation equipment
Hospitality resources
Natural resources
Elements in an area for the use and enjoyment of visitors such as climate, landforms, terrain, flora, fauna, bodies of water, beaches, natural beauty, and water supply
Infrastructure
Underground and surface developmental construction such as water, sewage, gas, electrical, communications, drainage, highways, airports, railroads, roads, parks, lighting, marinas, and tourist service installations
Superstructure
Above ground facility services such as airport buildings, passenger terminals, hotels, motels, resorts, restaurants, shopping centers, places of entertainment, museums, and stores
Transportation and transportation equipment
Ships, airplanes, trains, buses, limousines, taxis, automobiles, cog railways, aerial tramway, and similar passenger transportation facilities
Hospitality resources
The cultural wealth of an area which makes possible the successful hosting of tourists
Hospitality training
Aims to motivate service providers to be hospitable in dealing with tourists
Attitude toward self
If an individual's self-esteem or attitude toward self is low, they will tend to behave in a way that confirms the low opinion of themselves
Attitude toward others
Service providers should be assisted in developing positive feelings toward fellow employees and tourists that will result in positive behavior
Attitude toward the tourism and hospitality industry
Service providers should be made aware of how important tourism and hospitality is to their country, city, and community
Community awareness program
Enhances or detracts from the vacation experience by affecting the overall feeling of being welcomed within a community
Transportation
Convenient access and quality service are of paramount importance in developing tourism and hospitality
Forms of transportation
Land travel (road & rail)
Taxi & limousine service
Bus service
Rail services
Air travel
Sea travel
Taxi & limousine service
Adequate service is important, with courteous and helpful drivers trained in foreign languages
Bus service
Tour buses should have large windows, comfortable seats, air conditioning, restrooms, and multilingual services with properly trained and educated tour guides and interpreters
Rail services
Examples include MRT, LRT, and PNR
Air travel
Important services include porter service, comfortable waiting areas, and information details at large airports
Sea travel
A major factor in tourism and hospitality, with developed cruise ships and increasing demand
Types of accommodations
Hotels
Condominiums
Campgrounds
Homes of relatives and friends
Factors affecting demand for accommodations
Price
Services required
Competition
Market segmentation for accommodations
Expensive hotel accommodations for high-end market
Cheap facilities for budget-conscious market
Planning accommodations
Environment
Destination
Expected markets
Mode of transportation
Type of activities engaged in at the destinations
Types of accommodations
Hotels
Condominiums
Motels or motor hotels
Inns
Apartments
Paradores
Pensions
Bed-and-breakfast accommodations
Hostels
Compounds
Health spas
Private homes
Hotel classification
By location
By type of guests
By price
Stars rating system (deluxe, first-class, standard, economy)
More of the tourist dollar is spent on food and beverage than on any other service, and countries highest in per capita eating place sales are also top tourist countries
Restaurants
Establishments offering refreshments and/or meals to the public, classified as part of the superstructure