The need to web-enable a Food and Hotel Industry
-- Ramesh B
The theme behind web-enabling a Food and Hotel Industry is to provide
hotel management companies with the tools they need to compete more effectively
and to grow their businesses successfully.
With each business big or small getting their operations online just
to make their presence felt with the rest of the Internet world the hotel
industry is no exception. The analysts rightly say that the Internet world
is rapidly growing and is becoming the lingo of chief resource for many
manufacturers and business owners.
The hotel industry, which is known for its patchy supply chain and bungling
circulation processes, has the latent to improve efficiency, inventory,
audit control and to diminish infrastructure and operation costs by web-enabling
their business online.
Web-enabling their business will consent to the hotel industry to be
better equipped to handle business desires, keeping in mind the buyers,
suppliers, competitors and prospective partners.
Web enabling is quickly becoming a part of business growth. For hotel
management companies typically managing more than one hotel and franchise
the benefits [of going online] could be huge. The need to find ways to
manage the purchasing and brand requirements for each hotel and franchise,
an online system with "smart" catalogs that limit, control and/or
manage the information that the owner can view will ensure that the property
is making purchases within their standards. Experts predict that Web-enabled
businesses will encounter significant cost returns and visibility.
Web enabling empowers the buyer to place all orders online. This not
only gives the buyer the information about the product it gives them time
and also the cost of buying will reduce, creating higher margins for the
supplier too. The warehouses would only need to be staffed with people
in charge of packing and shipping, which would be much cheaper than door-to-door
sales and account management. Overall the cost of doing business will
decrease to a great degree, which is very critical to the hotel industry.
As experts say that within a couple of years, 70 percent of all buying
and selling will take place through the web, and the hotel industry is
among the many that will benefit from its streamlined and cost-effective
Chain of Hotel being very patchy in their decisions processes and being
circulated does not uphold a customary of their own when it come to matters
like towels, pillows, bedding, soaps etc which can lead to anecdotal experiences
for travelers. If purchasing is done online, hotels can advocate brand
customary and get a better product for a lower price because of collective
What will the hotel or food industry gain by web enabling their operations?
- Visibility - Web enabling your operations gives greater presence
as an organization. Establishing an Internet presence transforms the
way a company's brand is perceived. Products, services offered are now
presented over the net and this provides a whole range of opportunities
to the organization. While selling products online and becoming a key
player in the e-marketplace helps target new customers, services offered
over the net make it easier for the same customers to contact you, make
inquiries and establish a personal relationship with you.
- Productivity - Another predominant means of leveraging the
Web for distribution are the online catalogs. Apart from acting as a
sales channel and a procurement and sourcing tool, online ordering helps
integrate an enterprise's order management system with the web storefront.
Back office systems integrated with front-end order entry comprise the
truly enabled e-commerce success store of today.
- Information Availability - Consumers can access the same information
online as most travel agents. In examining Web performance metrics,
46 percent of consumers get their primary information for the Web site
and have used a Web site to gather information on the availability of
rooms during travel and booking online. Consumers feel that prices quoted
on the Internet provide good value.
- Adaptability - Depending on the changing trends in the industry
and consumers surveys, If a company wants to create a new hotel or give
new look, then all it has to do is get onto the web and access a shopping
list of items needed to build, open and operate a hotel. Apart from
preserving the standard of the brand if purchasing is done online, hotels
can advocate brand customary and get a better product for a lower price
because of collective purchasing clout.
- Convenience - Online purchases can be done at any time and
from any place where there is a connection and delivery.
Changing Trends and Analysis
- Travel Leads Online Sales - Travel is the single largest category
of all online purchases. Between January and November 2000, $6.9 billion
airline tickets were bought online, $3.5 billion hotel rooms were booked
online, and $1.8 billion cars were rented online by both business and
leisure travelers, according to a joint survey of the National Retail
Federation and Forrester. In descending order, the biggest online purchases
were airline tickets, computer hardware, hotel rooms, books, apparel,
software, music, consumer electronics, health and beauty aids, toys
and games. Fewer travelers are renting cars online, because fewer people
rent cars when they book air and hotel reservations, and some car rental
Web sites have not been well designed, says Henry Harteveldt, senior
travel analyst with Forrester Research.
When the two travel segments airlines and hotels are combined, their
online revenue is almost 2.5 times larger than the next largest category
of online sales, which is computer hardware at approximately $695 million.
In 2000, airlines saw between seven and eight percent of their bookings
coming over the Internet, up from five percent in 1999. Hotels generally
receive more than two percent of overall bookings online.
Online consumers are described as either "bookers" or "lookers."
Lookers research online and then buy off-line, whereas bookers will research
and buy online. As a result, bookers are a more valued consumer that online
businesses want to attract.
A survey in 2000 by Forrester of bookers shows that:
- 76 percent researched and bought airline tickets on the Web; 16 percent
only researched airline rates;
- 59 percent researched and bought hotel rooms; 24 percent only researched
hotel rates, and
- 38 percent researched and booked rental cars; 22 percent only researched
As more mainstream consumers come online, travel companies will want
to consider the consumers' choice of Internet service providers when
developing online promotions. For example, about 45 percent of Earthlink
subscribers are travel bookers, which means that they research and buy
travel online, and 20 percent are just lookers. In comparison, 30 percent
of AOL subscribers are lookers, and 38 percent are bookers, according
- Hotels Sell Online - Although airline tickets continued to
lead in travel purchases made online in 2000, almost 6 in 10 travel
bookers were reserving hotel rooms, Harteveldt notes. "This is
very important for the lodging industry because many of the hotel companies
have been late in the game in terms of developing really good Web sites,"
he says. Even as online hotel sales start to catch up with airlines,
Forrester estimates that online purchases will account for only 6 percent
of hotel revenue by 2004, which is less than what airlines have already
"What we have found is that consumers' interest has often outpaced
companies' abilities to sell online," Hartveldt says. During the
mid-to-late 1990s, hotel companies "did not expect or react to the
anticipated consumer demand to move to the Internet as rapidly as they
[consumers] did," says Harteveldt. "They [hotels] really missed
the boat because they had not developed easy booking engines or have easily
accessible Web sites," Harteveldt says. For example, Marriott, before
1999, used its Web site primarily for intranet communication, such as
e-mail, and distributing RFPs and corporate contracts.
When a hotel can shift its customers from booking from a traditional
phone reservation center to an online reservation site, it can reduce
its booking costs from more than $20 to under $5 per room, Harteveldt
Harteveldt believes that the hotel industry has opportunities to succeed
in a cooling economy where airlines do not. When consumers cut back on
their leisure travel expenditures, they may vacation closer to home, and
drive instead of fly. They will, however, still stay at a resort or city
The Internet provides hotels with enormous flexibility to attract business
in real time. Hotels won't be able to capitalize upon opportunities without
a vision, a well-designed Web site, and more creativity in their marketing
promotions on the Web site, Harteveldt says. Hotels need to provide as
much information as they can about their products, and they should have
an easy to understand, rigidly enforced security policy for booking. If
hotels harness their customer information to build brand loyalty and site
loyalty, they will generate revenues for their properties, Harteveldt
Since early 1999, hotel corporations, led by Hilton, Marriott, and Holiday
Inn, have recognized how consumers want to buy, and they have enhanced
their Web sites, The combination of web-enablement and high-speed Internet
access will allow the hotel industry to deliver services such as online
reservations, room requests and even a virtual room tour that will create
a better experience for the traveler.
The transformation to online services from more traditional means of
advertising and business operations, say experts, will provide hotel owners
and managers with more streamlined operations, resulting in fewer operational
costs, better service offerings, happier patrons and more productive business
Many Hotel and Food chains have already caught on to the buzz surrounding
the Web. At Stylus, a company specializing in e-business solutions gives
you this power and makes your dreams a reality.
In addition to Web Enabling the Food and Hotel Industry, we also offer
other services like Business Process Engineering, Porting Legacy applications
to the web and Enterprise Application Integration. Please contact us here
for more details.
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