This PESTEL Analysis of Hotel Industry examines the political, economic, social, technological, environmental, and legal factors that impact the Industry. By analyzing these factors, businesses can make informed decisions about their operations and strategies
Hotels provide great and important services to not only tourists but also to the travelers of a particular country. Obviously, there are many factors which directly affects the hotel industry. It is true that hotel industry has a primary role and affects some tourists. The hotel industry is also referred as hospitality industry. This includes lots of features such as theme parks, additional fields, transportation, restaurants, lodging and event planning services. All of the hotel industries earn a great revenue.
The hotel industry covers a significant number of organizations with a variety of services such as food services, assistance, and accommodation facilities. The industry is divided into many sectors, and much work will be involved in it. Sectors like recreation, tourism, food, meeting, events, entertainment, gaming, food and variety beverage, and visitor details. So that is why researchers have created PESTEL analysis helping to know the external factors which affect hotel industry.
PESTEL Analysis
Analysis for hotel industry is the best and modern way to find factors which affect it. Social and environmental part play a significant role equally in strategic management. However, economic factors are divided into legal factors. The political factor refers to Government policy which helps in the economy of hotel industry. So read the PESTEL analysis now.
Political Factors
The political factors play a major role especially in the economy of the country. The main target of hotel industry is to attract international tourism which will host a variety of different properties. Remember that hotel industry has a backbone of Government and it is the government support helps to sustain in a competitive world. The government charges great amount of tax on the luxury and star category of hotels. Political changes have a direct impact because of Government, especially on hotel industry. Any small step taken by Government will inevitably affect hotel industry. The state Government has to take huge decisions which will support the growth of industry. Take an example of Taj and Oberoi hotel Terror attack; it has substantially dropped the tourism rate.
Economic Factors
Economic factors include many factors such as taxation changes, inflation, economic growth, interest rates and exchange rates. It is best to know that economic change does leave a significant impact on the behavior of the firm. All the capital states or province of every country, own wide number of tourists arriving for the purpose of conferences, workshops, business dealing and another sole purpose. However, hotels worldwide try to capitalize the travelers because they bring great amount of money with them accompanied with huge expectations from five-star hotels.
In last years, many guests also pay for the extra services they demand. More guests accommodate in hotel, more services they demand and obviously they pay more which means industry will grow. With the increasing number of guests, services provided also needs to be luxurious and good.
The economy of India has faced minimal drop because of financial system and controlled status in country. This will enable the hotels to concentrate on foreign travelers allowing the local market to get relief to Indian Hotel industry.
Social Factors
Changes in social factors impact the demand for firm services and products. The willingness and availability of individual to work. Being a business hotel, there needs to be a variety of options which can be availed.The room for single guests and twin bedroom proves to be perfect for males. However, individual or single bedrooms are preferred by females. Every hotel welcomes at least 10% different classes of guests and availability for every kind of room is plus point.
Technological Factors
The technology used must be beyond standards especially when it comes to hotel management. The software’s used by Hotels helps to meet all needs of staff members and customers. Many new hotels have started embedding and using more defined technology. Even guests prefer the hotels which are embedded with technology. They are considered more safe and secure. Technology helps to reduce the work effort and enhances the results. It would be a boon to humanity which will help to show progress of property and advances in hotel industry.
There are many hotels which do not provide Wi-Fi facility or security purposes, but people and apparently guests prefer accommodation in places which are embedded with Wi-Fi. Many customers and business people utilize technologically integrated hotels because it is a way of achieving customer satisfaction quickly. So technology is a great external factor which would affect hotel industry.
Environmental Factors
Environmental and weather changes have a direct impact on many hotel industries. In serious or severe weather conditions, taxes are applied to avail more friendly and environment-related products. The hotel industry does not demand or create any factors which would affect their credibility.
Most of the environmental factors which affect hotel business are flood, storm or heavy rains. These factors play a vital role, especially in monsoon season. Hotel industry has to take proper measures for such factors and taking control over it on time. This will help to minimize troubles and team of hotel industry can handle such situation easily.
Natural factors such as an earth quake, or natural factor directly affect the hotel sales. The hotel management teaches proper measures to their employees who need to be taken especially during emergency cases.
Legal factors
The legal environment is essential for the growth of hotel industry. Last year, there have been many changes made which affected behavior of firm. The factor does include safety and health laws. In every country, hotel has to follow age law. However, discrimination law has been eliminated. The possible impacts of legal legislative law do affect hotel industry. Only people get attracted to leisure based hotels which are legal and provide secure services.
The current situations and war conditions do affect law of hotel industry. It may lead to serious changes in law. The Government also becomes flexible during this time and allows to think about society. So it might be possible that external factors may leave a negative impact on hotel industry.
References
https://www.theseus.fi/bitstream/handle/10024/51408/Bardis_Penelope.pdf?sequence=1
http://www.studymode.com/subjects/pest-analysis-of-hotel-industry-in-pakistan-page1.html
https://www.academia.edu/10122060/How_has_PESTLE_factors_affected_Hospitality_Industry
http://businessays.net/pestle-analysis-of-hospitality-industry/