24651054 business research presentation declining hotel industry in pakistan

CREDITCREDITSS

This Research Project is a collaborative effort ofThis Research Project is a collaborative effort of

Iqra Khan Sidra Ghazanfar Saad Zafar Zoya Chaudhry Kokab Khalid Mudassir Khalid

MB-08-12MB-08-06MB-07-53MB-08-06MB-08-20MB-08-61

INTRODUCTIONINTRODUCTION The Hotel industry is among the top three

constituents of the world economy after oil and autos. It is larger than automobile industry in Japan, agriculture in the U.S.A. and banking in Switzerland

In Pakistan this industry contributes a large proportion to the country’s economy.

A large percentage of the country’s revenue come from this industry

It is unfortunate to know that instead of growing with world’s trend, this industry in Pakistan has rather taken a back seat in the revenue generating services.

Our hotel industry is declining rapidly.

The major players of hotel industry in Pakistan are, of course, the Pearl Continental, Sheraton, Marriott and Holiday Inn chains and then there is a Serine hotel chain which is at the more prominent tourist spots

The Holiday Inn was taken by the Marriott and the hotel Taj mahal by Holiday inn crown plaza, though sources indicates the later has since broken its chain with the Holiday Inn on account of various reasons. (for e.g. poor management and small investment)

Moreover the recent attack on the Marriot hotel (Islamabad) and Taj Mahal (Mumbai) has seriously damaged this industry

Marriott bombing in Islamabad

Taj hotels bombing in Mumbai

OUR OBJECTIVEOUR OBJECTIVEOur main focus is to root out the real

cause of decline of hotel industry in Pakistan and to find which factor contributes more to this decline

LITERATURE REVIEWLITERATURE REVIEW we conducted a literature review to further

explore and clarify the research on this topic. The literature review includes ten peer reviewed research studies, journals, articles and other scholarly work.

1) Manav Thandani (2008) in his article “Terror Strikes: The Indian Hotel Industry’s 9/11” has discussed the impact of Bombing on Taj Hotels Mumbai on the overall hospitality industry of India . The global economic crisis of the past few years has been difficult enough for hotel sector and the bombing at Taj has compounded the situation further.

2) Ingram & Baum (1997) in their study named “Chain Affiliation and The Failure of Manhattan Hotels” examine the set back of Manhattan Hotels due to chain affiliation.

3) Wind, Green, Shifflet & Scarbrough (1989) presented their research study in “Courtyard by Marriott: Designing a hotel facility with Consumer Based Marketing Model”. In this they have examined why the segment of business travelers was not satisfied with current hotel offerings. Reasons as identified were that some hotels cost too much and offer features not valued by the travelers while others that cost less offer too few of the desirable features.

4) Ann Goodman (2000) in his study “Implementing Sustainability in Service Operations at Scandic Hotels” explored that the factors that caused the just collapse of Scandic Hotels were

the recession in Scotland the Gulf War unfocused strategy No crisis awareness rapid growth Messed management increasing awareness of people regarding

sustainability practices.5) “2009 Industry Outlook: Tourism hospitality

and Leisure” discusses that U.S hospitality industry suffered a great set back due to Economic Crisis in 2008. It resulted in decreased tourist activities that subsequently caused falling hotel occupancy rates

6) Ingram & Baum (1998) in their research study “Survival-enhancing learning in The Manhattan Hotel Industry 1898-1980” examine that organizations enjoy reduced failure with increased survival-enhancing learning from population experience before their founding the organization; but not after. Related organizations provide experience that lowers failure, but it matters whether their experience is local or non-local

7) Robert Kiener in his article “Crisis in Pakistan” examines the critical situation of Pakistan concerning law & order, terrorism and government instability. And how these factors participate in damaging the economy of Pakistan particularly its hospitality industry.

8) Smith Barney in his article “Global hotel industries” explores the aftermath of 9/11 that further recessed hotel’s economy. It was the enormous lay offs and lessened development of hotels’ human resource.

9) Wilder, Gates and Wolfe in their work “Hotel Investment Activity in Canada Witnesses Significant Decline” discusses that the global credit crunch and the recession that followed have hit the Canadian hotel real estate sector, which experienced a 77% decline in investment activity

10) Paul Slattery in his article “Hospitality industry” defines the true services of any hospitality industry. He argues that nowadays hotels are foregoing these services in the best interest of their hotels as a source of business to them.

THE PROBLEM THE PROBLEM STATEMENTSTATEMENT

“ “TO WHAT EXTENT DO TERRORISM, LACK OF TOURISM, CHAIN

AFFILIATION, GOVERNMENT INSTABILITY AND POOR

TECHNOLOGICAL CHANGES CAUSE THE DECLINE OF HOTEL INDUSTRY IN

PAKISTAN?”

THEORETICAL FRAME THEORETICAL FRAME WORKWORK

Technologicalchanges

Lack of tourism

Government Instability

Terrorism

Decline in HotelIndustry Pakistan

Dependent Variable Independent

Variables

TYPE OF STUDYTYPE OF STUDY This is an Exploratory study in

which we tried to explore the various variables which are effecting the

main variable i.e. Decline in hotel industry in Pakistan

UNIT OF ANALYSISUNIT OF ANALYSIS The unit of analysis is Individual,

since we are measuring responses of individuals for our research

DATA DATA &&

METHODOLOGY METHODOLOGY

SAMPLE SIZESAMPLE SIZEWe have a sample size of 100. The sample

was taken from Multan. It includes : Hotel Customers Hotel Management General Public

SOURCES OF VARIABLESOURCES OF VARIABLE Our main source of variable is primary

source ( Interviews and Questionnaires) and the secondary source of literature review.

MEDIUM OF MEDIUM OF COMMUNICATIONCOMMUNICATION

Our medium of communication was personal interviews by which we get

the questionnaire filled

DATA COLLECTION METHODDATA COLLECTION METHOD

The data was collected through questionnaires. We met the respondents personally and got the questionnaires filled.

The only problem was the time constraint. The data was tabulated in the form of a

worksheet using SPSS software. Question numbers were taken vertically and the questionnaire choice numbers were taken horizontally on the table.

METHODOLOGYMETHODOLOGY

In this report we have used Descriptive and Empirical

statistics.

DESCRIPTIVE STATISTICSDESCRIPTIVE STATISTICS

In descriptive statistics we have used frequency distribution in which we

calculated mean, median, variance, and standard deviation. Graphically we have presented the data in the

form of pie charts as follows :-

DeclininDecliningg

Chain Chain AffiliatioAffiliationn

LawLaw&&

OrdeOrderr

Lack Lack of of

touristourismm

Lack Lack of of

TechnologTechnologyy

TerrorisTerrorism m

EffectEffect

N N ValidValidMissingMissing

10010000

10010000

10010000

10010000

10010000

10010000

MeanMean 2.922.92 2.272.27 2.32.300

1.771.77 1.271.27 1.761.76

Median Median 3.003.00 2.002.00 2.02.000

2.002.00 1.001.00 2.002.00

ModeMode 22 22 22 22 11 11S.DS.D 1.121.12 5.6645.664 .95.95

99.723.723 .446.446 .986.986

VarianceVariance 1.2661.266 .442.442 .91.9199

.522.522 .199.199 .972.972

MinMin 11 11 11 11 11 11MaxMax 55 33 55 44 22 55

Hotel Declining

FREQUENCY FREQUENCY TABLESTABLES

Decline of Hotel IndustryDecline of Hotel IndustryFrequencyFrequency PercenPercen

ttValid Valid PercenPercentt

Cumulative Cumulative PercentPercent

Valid Valid StronglyStrongly AgreeAgree

88 8.08.0 8.08.0 8.08.0

AgreeAgree 3535 35.035.0 35.035.0 43.043.0 Don’tDon’t knowknow

2222 22.022.0 22.022.0 65.065.0 DisagreeDisagree 2727 27.027.0 27.027.0 92.092.0

StronglyStrongly DisagreeDisagree TotalTotal

88

100100

8.08.0

100.0100.0

8.08.0

100.0100.0

100100

Chain AffiliationChain Affiliation

FrequencFrequencyy

PercentPercentValid Valid PercentPercent

CumulativCumulative Percente Percent

Valid Valid Very Very muchmuch

1212 12.012.0 12.012.0 12.012.0

SomewhatSomewhat

4949 49.049.0 49.049.0 61.061.0

Don’tDon’t knowknow

3939 39.039.0 39.039.0 100100

TotalTotal 100100 100.0100.0 100.0100.0

Law and OrderLaw and OrderFrequencyFrequency PercenPercen




1919 19.019.0 19.019.0 19.019.0




11

100100

1.01.0

100.0100.0

1.01.0

100.0100.0

100100

Lack of TourismLack of TourismFrequencyFrequency PercentPercent Valid Valid

PercenPercentt



3636 36.036.0 36.036.0 36.036.0




00

100100

0.00.0

100.0100.0

0.00.0

100.0100.0

100100

Terrorism EffectTerrorism EffectFrequencyFrequency PercenPercen




4848 48.048.0 48.048.0 48.048.0




33

100100

3.03.0

100.0100.0

3.03.0

100.0100.0

100100

FrequencyFrequency PercentPercent Valid Valid PercentPercent


Valid YesValid Yes NoNo

7373

2727

73.073.0

27.027.0

73.073.0

27.027.0

73.073.0

100 100 Total Total 100100 100.0100.0 100.0100.0

Technological ChangesTechnological Changes

PIE CHARTSPIE CHARTS

Strongly Agree

Agree

Don't know

Disagree

StronglyDisagree

LAW & ORDER EFFECT

Strongly Agree

Agree

Don't Know

Disagree

StronglyDisagree

LACK OF TOURISM EFFECT

EMPIRICAL STATISTICSEMPIRICAL STATISTICS

In empirical statistics we have done hypothesis testing. The results of it

will be shown later

ESTIMATIONESTIMATION &&

RESULTSRESULTS

REGRESSION ANALYSISREGRESSION ANALYSIS Firstly to Analyze our data by applying Regression on all the independent

Variables (Tech, Lack of Tourism, law and order, Chain affiliation , Promotion, terrorism, Govt. instability) in our Questionnaire .Reducing number of these variables and applying regression on most relevant variables we get best Fitted Estimated Regression Equation

Y = 1.552 + 0.286x1 + 0.66x2 + 0.475x3 – 0.135x4

Y = Hotel Industries Declining (D.V) x1 = Technological Changes (I.V)x2 = Lack of Tourists (I.V)X3 = Government instability (law and order) (I.V)X4 = Terrorism (I.V)

DATA & METHODOLOGYDATA & METHODOLOGY * α = 0.1 ** α = 0.05 *** α = 0.01*, **, *** Represent Significance at 10%, 5% , 1% respectively

YY XX11 XX22 XX33 XX44

(Declining)

*0.286 (0.08)

* 0.66 (0.06)

**0.475 (0.02)

***- 0.135 (0.002)

Overall model result that we found with the ANOVA Table p - value = 0.031 **

It will be significant on 5%

R2 (R-square) = 1.08 Higher

Standard Error (S.E) = 0.72 Least

So overall result shows the significant relationship between dependent and independent variable

RECOMMENDATIONSRECOMMENDATIONS & &

LIMITATIONLIMITATION

RECOMMENDATION RECOMMENDATION In the light of these findings we are able to

recommend some suggestions to hotel managements and Government authorities.

Recommendations for Hotel ManagementsRecommendations for Hotel Managements The quality of food should be improved to

facilitate the hotel accommodators The hotels should follow the new

technological trends of recent times There should be proper marketing and sales

promotion for their hotels.

Hotels should be constructed at convenient and healthy locations.

There should be proper security system to secure the hotel from terror attack.

They should raise their voices and negotiate with government to chalk out sound policies for the improvement in hotel and tourism industry.

Parking facility should be provided proper space.

Room services should be according to the needs of customers.

Attendants should be adequately trained, educated, well behaved and efficient.

Recommendations for Government Recommendations for Government AuthorityAuthority

The Government should reduce / rationalize the number of taxes and their rate for the betterment of customers / guests, as well as, for the hotel management. If the government lowers taxes the hotels will be able to provide better facilities at lower rates having no strain on their margins

There should be effective marketing strategy for the promotion of tourism and hotel industry inside the country, as well as, outside country for which tourism department must be mobilized.

Airport facility should be provided to all big as well as middle sized cities and availability of regular flights from remote locations should be arranged.

Government should provide long term and short term loans on reasonable mark up for the growth of industry .

Government should make efforts to attract tourists from all over the world and make sure their security.

LIMITATIONLIMITATION

The personal interviews we conducted with hotel management was the only limitation we identified. It is because the hotel management don’t communicate the underlying weakness of their hotel truly.

WE REALLY THANK WE REALLY THANK YOU FOR YOUR YOU FOR YOUR KIND PATIENCEKIND PATIENCE

24651054 business research presentation declining hotel industry in pakistan

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