Classification of Hotels on the Basis of Affiliation

The following are the various types of hotels on the basis of affiliation:

  1. Chain Hotels : A chain is defined as any group of three or more hotels, motels, or resorts operated under a common name or one owner or operator. E.g. Taj Group of Hotels, Oberoi Group of Hotels etc. “There are great opportunities for capitalizing group action as a means of increasing business and reducing duplication, inefficiency and waste”. The chain operation became popular due to its efficiency.

The following are the main advantages of chain hotels:- The principle advantage of chain over independent hotel keeping includes:-

 Substantial Discount: The chain hotels enjoy a large economies of scale as by purchasing items for hotel to run in huge volume, a chain will enjoy high discount facility.

 Personnel: A chain can better afford top specialists in every phase of hotel operation- Hotel Accounts, Room Sales, Food Control, Hotel Maintenance, simply by spreading the expense over its many units. Few single hotels can afford such specializations.

 Promotion: All the properties of the chain enjoy the benefit of advertisement and promotion as it is the brand which is being promoted rather than the individual property. National advertising campaigns in magazines and newspapers are generally prohibitive for single hotels: but they can be most profitable when the expense is divided among numerous hotels, each reaping full benefit of national coverage at the fraction of the total cost.

Reservation: Free teletype reservation service permits a chain to channel, if not refer direct, business to the various hotels in the group. As about the one fourth of all room reservations are made through such service, this obviously puts considerable trade out of reach independent hotels.

Financing: A group finds it somewhat easier to raise all important capital for improvement or expansion of the property. Introduction to Tourism and Hotel Industry Introduction to Tourism and Hotel Industry 64 65 b) Independent Hotels :

 The independent hotels are hotels which do not have any recognizable ownership and also do not have any management affiliation like the chain properties e.g. Bristol (Gurgaon).

These hotels do not have to obey the rules and regulations which the properties of a chain have to follow to maintain their affiliation.