Hotel occupancy in India

Mukul M.

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Hotel occupancy in India

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Abstract

Tourism in India contributes to around 6.23 percent of India's GDP (Sanjeev, Kanika & Rumki, 163-173).Yearly, India receives over 6million tourists, ranking India as the largest source of foreign tourists to the United Arab Emirates. In 2011, foreign tourist arrivals in India totaled to 6.29 million, and domestic travelers at 740 million.

India is estimated to have an extra 70,000 hotel rooms, 60,000 of which are branded (international journal for hospitality management, 54). This has led to the expansion of the hotel industry, especially in Delhi, Rajasthan, Uttar Pradesh, Kerala and Tamil Nadu. According to Tourism Minister, Subodh Kant Sahai India's government is planning to double the number of tourists per year by 2016. This would be through intensive marketing and the promotion of wellness as well as medical tourism.

India's government is, therefore urged to instigate measures to develop transport networks around India. Investors, on the other hand continue to invest in the hotels industry whose potential is eminent (Wood, 19-21). Global hotels around India have put up expansion plans. Intercontinental hotels group, which currently has, 12 hotels has plans to increase 150 mid market hotels by 2020. Wyndham Hotels, which has, 8 hotels has proposed to put up 60 to 70 hotels by the year 2017. Marriott International, which currently holds, 18 hotels proposed to establish 80 to 100 hotels by the year 2015.

Introduction
Occupancy rate in India
Measures to expand occupancy rate
Occupancy rate versus economic growth
Data analysis
Strategies for improvement
Future prospects and conclusion

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[...] India, in the past, has seen to experience a lag in occupancy performance in a year, due to average rates. To evidence this, in the consequent year, average rates dropped with 1.4 percent. In the same period, nationwide RevPAR increased by a marginal 0.3 percent (international journal for hospitality management, 54). This was indicative of the industry's potential to thrive and flourish. During 2011, all hotels were seen to experience improvement in their occupancy levels with the exception for the five star deluxe sectors, whose occupancy dropped by 1.6 percent. [...]

[...] To cater to business travelers, most hotels have incorporated packages, such as, relaxing activities including spas. Additionally, the industry has taken a shift to incorporating health programs in their hotels. Most hotels have doctors and physicians catering to hotel clients. The increasing number of India's middle class has facilitated the increase in middle class establishments to cater to these groups. Although many companies have experienced diverse problems in setting up establishments, ranging from overheads to economic factors, expansion of the hotel industry has been as a necessary move. [...]

[...] However, if a convention center was to be established close to the airport in Devenahali, it could cause a boom in occupancy rates in Bengalaru. The city has proposed the supply of rooms by the next 5 years. The Chandigarh tri city (inclusive of Mohali and Panchkula) increased in 20 percent after establishing its new supply in 2010/11. The city's demand on hotels is inclined towards quality hotels with convention centers. This would especially be critical to cover the commercial market. [...]

[...] Since the festive season is yet to arrive, hotels are still hopeful that there will be a balance in the supply and demand. The minister for tourism is also working towards extensive marketing for India as well as identifying other opportunities by collaborating with various unions. Works Cited Kapur, Amit, and Kakoli Sen. "Key issues in setting up a hotel in India–A practitioner Perspective." Worldwide Hospitality and Tourism Themes 4.5 (2012): 4-4. Israeli, Aviad A., Asad Mohsin, and Bhupesh Kumar. [...]

[...] Occupancy rate in India During the first half of 2012, the top six cities in India witnessed an average occupancy rate of 58 percent. The average room rate during this time was averaged at Rs 5,400. These figures indicate a decline as compared to other periods such as 68 percent in the year ended 2010/2011. The decline can be attributed to a slowdown in global economies, which may have, resulted to various corporations limiting travels. According to HVS research, the demand for luxury or first class hotels is higher than the demand for mid market hotels (Jauhari, 118-130). [...]

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