In the modern-day globalized universe, creative activity of hotel corporations is an illustration of the most effectual ownership in touristry. This type of direction system contributes to the creative activity of a figure of advantages that allow cordial reception concerns to raise the quality of the realized tourer merchandise, to diversify the services offered within the market section, increase individualisation of client service.

Unifying hotels in the concatenation with the constitution of unvarying service criterions and centralised proviso of a figure of services including engagement, proficient equipment, security, etc. , greatly reduces direction costs and improves profitableness of hotel concern.

Harmonizing to the World Tourism Organization, there are 16 million hotels in the universe, with 20 % of them belong to the hotel webs. Today, there are over 100 international cordial reception corporations, from little with several 10s of objects to the “ heavyweights ” , which include 1000s of hotels ( Gupta, 2008 ) . Further, we ‘ll analyse the research consequences on the influence of globalisation on Marriott ‘s International development and discourse its bing and possible challenges and effects, every bit good as future positions of Marriott in the conditions of Globalization.

Globalization and Marriott, Inc.

There are presently more than 100 hotel ironss, the entire figure of suites in which makes about 2 million. The largest hotel ironss include: Holiday Inn ; Sheraton ; Best Western ; Accor ; Ramada Inn ; Hilton Corporation ; Novotel ; Club Med ; HFS Ink, and certainly Marriott International presented by more than 3500 belongingss placed in 70 states all over the Earth. One expression at the hotel industry statistics is adequate to do certain that today the volume of operations performed by hotel ironss many times exceeds the volume produced by independent hotels ( Table 2.1, 2.3, 3.1. ) .

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Table 3.1. Marriott International Hotel Brands and Property Average Daily Rate

( US, 2009-2010 )

Table 3

To day of the month, 74 % of people prefer to remain at hotels, included in the biggest ironss and every 4th tourer in America corsets in Marriott International ( Jang and Tang, 2009 ) . The concatenation direction systems contribute to the creative activity of competitory advantages in the planetary market. In peculiar for Marriott, these advantages include:

– Possibility to buy big measures of goods and services at sweeping ( discounted ) monetary values ;

– Centralized preparation of hotel specializers, which significantly reduces the outgos of each member of the concatenation individually ;

– Allotment of outgos among the spouses on advertisement and publicity, so that everyone can bask the benefits of national advertisement runs, passing sensible agencies on them ;

– Centralized reserve system allows single members to fall in the concatenation concern ;

– It is easier for a group of hotels to have support instead than for single proprietors ;

– Easier mobilisation of capital ;

– Centralized system of accounting, selling research, building and existent estate operations.

Turning its ain repute into the capital, Marriott International is yearly spread outing its planetary web by 30,000 suites, which is three times larger than the corresponding indexs shown by Hilton and Starwood combined ( Table 2.1 ) ( Marriott International Company Profile, 2010 ) .

Measuring the Impacts of Globalization

In the consequence of spread outing, in 2007, Marriott International increased its quarterly dividend by 20 % up to 7,5 cents per one-fourth, compared to 6.25 cents in 2006. In the old 5 old ages, Marriott International showed a 15 % mean dividend growing rate. 16 % payout ratio in 2007 exceeds the 5-year mean parametric quantity by 2 % ( Table 3.2. , Figure 3.1. , Table 3.3, 3.4. ) .

Table 3.2. Marriott International 2007 Peak Growth Parameters

Table 3

Figure 3.1. Marriott International Payout Ratio Growth 2005-2007

Figure 3

Further, in the planetary crisis conditions, RevPar in 2009 fell by 9 % compared with 2008, with the room burden still at the 2008 degree ( Table 3.1. , 3.3. , 3.4. ) . In the face of uncertainness and terror, Marriott ‘s rivals and hotels of degree “ 5 stars + ” dropped monetary values, and this decrease was non a 10-15 euro. The demand was altering quickly, and prediction was really hard. Suites were booked in a really short clip before colony. Marriott ‘s experts tried to find which companies would last the crisis, and focuses on working with them: meeting more frequently with regular clients to cognize their demands in crisis period and work out the solution for them. The company besides conducted a batch of preparations, puting more clip and money in employees, because Marriott top directors belive that people ever aspire to success whether in a crisis or non, and their end, to acquire a nice wages for good work, remains unchanged.

Table 3.3. Marriott International Occupancy, Average Daily Rate and RevPAR by Brand ( US, 2008 )

Table 3

Table 3.4. Marriott International Occupancy, Average Daily Rate and RevPAR by Region ( US, 2008 )

Table 3

Table 3

Confronting force per unit area from hotel ironss, independent operators are besides sing major alterations. Mugwump operators can accomplish existent advantages utilizing the benefits of hotel direction by the proprietor, which means a great individualism in direction methods and the taking non-standard and speedy determinations. However, in order to vie with the ironss, an independent operator has to do much more attempts, particularly in bettering the cost construction.

Historically, U.S. hotels, particularly little peripheral 1s, have undergone important alterations due to the impact of two factors: force per unit area from hotel ironss and competition with motels. Caught in the crossfire of competition in which endurance of hotels depends on their flexibleness and adaptability to alterations, independent hotels had to alter the nature of their actions on the market. To salvage the concern, many hotels tried to increase the quntity of selled nutrient and drinks, therefore trying to cut fiscal losingss caused by decreased room burden. This scheme did n’t work good everyplace, so many independent hotels had to shut.

Today, big independent hotels of higher class have counterattacked the hotel ironss. Jealous of their independency, every bit good as high repute among the clients for the first-class quality of services, directors of hotel ironss were ready to supply important benefits to such hotels in exchange for their independent position. For illustration, Distinguished Hotels group runs an active policy in this way ( it has created an original construct of development and betterment of high-class hotels, promoted under the name Preferred Hotels ) .

Another illustration is the brotherhood of several independent hotels in the pool under the leading of Robert Warner bureau to transport out activities on publicity, advertisement and connexion to reserve systems. Working in a group, hotels use benefits of centralised services in the above-named classs, keeping their independent position and retaining the right to do independent determinations on the staying issues of their activities in the market, therefore going weighty rivals for webs like Marriott.

Still, the cordial reception industry is presently get downing to bounce. The grounds of the fact is the first clip over the last two old ages May growing of hotel suites rates in Marriott International in North America. Compared to the same period in old old ages, in May 2010, the cost of hotel suites under Marriott direction increased by 1 % , while the gross per a room ( RevPAR ) for the same month rose by 9 % . Compared to the same period in 2009, in the 2nd one-fourth of 2010 ( May 27 – June 18 ) the rates did n’t alter, and the RevPAR index rose by 7.3 points ( Table 3.1. ) .

Hotel industry shows turning optimism in relation to its benchmarks, which do non merely return to the pre-crisis degrees, but go up, significantly transcending the growing rate prognosiss of analysts. For comparing, at the terminal of 2009 RevPAR reached an unprecedented low point holding lost 16.7 % ( Table 3.1 ) . Harmonizing to analysts and direction, the upper section ( elect and luxury objects ) showed an addition of orders, while market leaders, like New York, managed to raise monetary values.

However, one should non anticipate the growing inclination to last from month to month. Among the negative regulators of demand in the touristry sector, which may find its position in certain months, are the instability of European currencies and the current diminution in the stock market.

However, in the following few old ages, Marriott expects to accomplish enormous consequences. Currently, on the New York Stock Exchange, Marriott portions added 3.4 % and are quoted at a monetary value of $ 32.14, making a approximately the same scope as the Dow Jones US Hotels index, which increased by 3.5 % ( Table 3.5. , Figure 3.2. ) .

Table 3.5. Global Hotel Chains Share Prices ( 2010 )

Table 3

Figure 3.2. Global Hotel Chains Share Prices % Change ( 2010 )

Figure 3

Marriott Inc ‘s Positions on Globalization

Under globalisation conditions, Marriott International can keep the undermentioned possibilities for adding new hotels in the hotel corporation: purchasing hotels, leasing, franchising contract decision, contract direction, building of joint ventures, or entry into the pool or an association.

Further care of franchising contract policy will let Marriott to spread out its activities more dynamically. The kernel of this alternate lies in the fact that the franchiser provides a lawfully protected right to prosecute in certain concern activities, every bit good as aid in forming these activities, preparation, execution and direction for fee paid by franchisee. The franchiser ( Marriott ) creates a complete construct of an endeavor and work methods and cuts outgos associated with full ownership, and franchisee buys the right to utilize its bing strengths.

Another position pattern is set uping joint ventures ( Metropol Novotel, Sheraton Palace, etc. ) . In this instance, the hotel concatenation becomes an investor of the undertaking, conveying the capital and know-how into it, and participates in net incomes. The strategy for the formation of joint ventures in the touristry industry comes approximately as follows: there are two or more investor-owners of the hotel, which bear the fiscal hazards of concern object under building as portion of its equity interest in the hotel organisation. Owners of the hotel make a determination about conveying this or that trade name to advance the hotel services in domestic and international markets. The footings on which the hotel takes a certain trade name, are discussed individually. This can be a franchise understanding or other understanding with a company that owns the hallmark. Sometimes a party of the joint venture is a hotel company having the trade name.

By now, Marriott International has succeeded in fall ining Ritz-Carlton into the concatenation, by buying 49 % portions.

Implementation Issues and Problems

Noting the increased market chances and competitory advantages, with the growing of RevPAR rate ( gross per available room ) of Marriott International, Inc. from 5 to 9 % yearly over the following three old ages, diluted net incomes per portion may do about $ 1.90 to $ 2.75 by 2013, which will be the highest index since the extremum of Marriott gross in 2007 ( Table 3.2. , Figure 3.1. , Table 3.3, 3.4. ) .

The company can be able to anticipate the committee income to do $ 1.57 to $ 1.87 billion and managerial fillips can be doubled by 2013 to level set in 2010, and scope from $ 285 to $ 440 million with the above-named growing of RevPAR ( Table 3.1. ) .

Furthermore, Marriott International plans to add another 80.000 to 90.000 suites to its portfolio by the terminal of 2013 ; moreover, 22.000 more suites are expected in the hotels in Europe and Asia that are to be opened during the same period. Marriott besides plans to pull new trade names and spread out bing 1s, such as Courtyard and Fairfield, in order to run into the turning demands of clients worldwide. The company will spread out the new trade names outside the U.S. , including trade name EDITION, whose first hotel Waikiki Beach has been late opened in Hawaii, every bit good as Autograph Collection trade name.

J.W. Marriott, Chairman and CEO, claims that the company is on the brink of rapid growing. Looking three old ages in front, Marriott plans to supply both a important addition of the concluding consequences and a important addition in net incomes for the proprietors and stockholders as Marriott ‘s trade name portfolio, which is an industry leader, is retrieving from the effects of the recent planetary downswing and is deriving impulse.

Contemplations on Globalization in Marriott Inc.

Now the universe is witnessing a planetary economic procedure, separation into monolithic blocks like the European Union ( EU ) , North American Free Trade Agreement concluded between the U.S. and Mexico. Furthermore, Argentina, Brazil, Chile and Venezuela may besides fall in the hypertrophied Union, which will be called trading axis of the Americas. The EU is an economic brotherhood which abolished the national limitations non merely on trade but besides on the motion of labour and capital. With the development of industrial, commercial and touristry ties within the EU, the demand for hotel services grows.

Taking into history the current tendencies in the international trade and touristry, it is easy to foretell the way of development of international hotel corporations. It is expected that the tourer flow into the Pacific will turn at the same graduated table as in recent old ages. In this respect, the development of resort hotels in Indonesia, Malaysia, Thailand, Vietnam and Mexico are being planned. There are besides requirements for the farther development of the cordial reception industry in Eastern Europe, Russia and other former Soviet Union democracies: some hotel companies at that place have changed the scheme from the building of new edifices to the acquisition of old 1s.

In Asia, the rapid development of Hong Kong was stimulated by the flourishing economic systems of neighbouring states and the revenue enhancement system good for providers: 16.5 % corporate revenue enhancement, 15 % income revenue enhancement and no revenue enhancement on capital additions or dividends.

In developing states, as they are accomplishing political stableness, the development of hotel concern is traveling along with the overall economic and societal growing. Examples are the former Eastern European axis states, which one time were included into the Soviet Union, where over the past few old ages first-class chances have been created for hotel companies.

Influence of hotel ironss can be evaluated from either economic or cultural point of position. From an economic point of position, they invest in the development of parts and metropoliss. Foreign investings have a positive consequence on the fiscal state of affairs of the parts: new occupations are being created, revenue enhancements coming into the exchequer. But at the same clip, the ironss are difficult to vie for local endeavors, because of the deficiency of experience and hapless material footing. The cultural facet is that the hotel owned by a concatenation normally becomes an attractive force and centre of concern and cultural life of the metropolis. In add-on, a hotel of a concatenation, runing in India and Saudi Arabia should hold wholly different attacks to the invitees. This is now the way of farther betterments of hotel corporations.


In this paper we have examined the current province and chances of hotel corporations ( webs ) in international graduated table, in peculiar on the illustration of Marriott Intenational, and thereby achieved the aims and intents of the survey. The undermentioned decisions can be now made:

1. The development of hotel corporations, formation of hotel ironss is one of the most of import tendencies in the cordial reception industry.

Harmonizing to the World Tourism Organisation, there are 16 million hotels in the universe with 20 % of them belonging to hotel webs. As a universe pattern shows, web is the most efficient manner of running hotel concern. Using assorted signifiers of brotherhoods ( constructing hotels, purchasing hotels, leasing, franchising, direction contracts, joint ventures edifice, fall ining pool, association ) corporations greatly cut down the costs and receive significant benefits. These direction systems allow touristry concerns to raise the quality of the provided merchandise.

2. Hotel ironss emergence enables advancing high service criterions to the planetary touristry market.

Each hotel concatenation may hold its ain categorization based on the assignment and location ( resort, concern hotel, metropolis hotel ) . Hotel ironss contribute to a important addition in the degree of organisation of production and service, making a certain image of hotel services, which met in another state makes a tourer feel at place in familiar and comfy milieus.

3. Synergy developments between states take parting in international economic understandings has a good consequence on cordial reception concern development.

We are all participants of the planetary economic procedure, in which such monolithic blocks appear like the European Economic Community ( EEC ) and the North American Free Trade Agreement ( NAFTA ) , making a individual clients community of 350 million people. With the development of industrial, commercial and touristry ties, the demand for hotel services is steadily turning. In this connexion, the development of resort hotels in Indonesia, Malaysia, Thailand, Vietnam, Mexico, China, Eastern Europe, and Russia can be planned to spread out the power of such hotel ironss as Marriott International.

4. Further planetary growing by Marriott can be implemented through developing franchising contract policy and set uping joint ventures.

The hereafter of the cordial reception industry is the development of intra-national hotel ironss, which in healthy competition will better service quality and cut down monetary values for these services. Supplying Marriott franchise together with proper pro-national selling can give fruitful consequences.

Recommendations for farther research

Current research considered the hotel ironss under the conditions of globalisation, including the treatment of chief instruments and patterns adopted at a globalized market every bit good as their impacts. However, farther research may affect:

1. Based on decision 1, we suggest that the benefits and losingss of the modern-day meeting procedures should be exhaustively studied.

Current patterns of hotels fusion and merge can be at the same time unsafe and good for the participant of the market – independent hotels and hotel ironss. Possible scenarios of development schemes should be simulated.

2. Based on decision 2, we recommend analyzing cultural images and their influence on hotel services.

Global hotel ironss adopt planetary services, matching to the corporate manner of the company. But it ‘s known that globalisation both homogenized and diversified civilization. So the inquiry should be if the ironss are to follow incorporate service or accommodate it to cultural distinctive features.

3. Based on decision 3, we recommend modulating the possible image of planetary hotel ironss development of the regional markets.

Hotel ironss ‘ influence on the market is strongly expressed and needs really serious attack. Hotel networks obtain more and more districts and the web grows. This tendency, harmonizing to experts, will rule for a long clip, so it is necessary to foretell possible impacts of hotel ironss on regional markets.

4. Based on decision 4, we suggest that farther research should affect analyzing national economic sciences and their distinctive features.

In the age of planetary investings, hotel ironss important catalyze national economic sciences, but the research should besides touch upon rearward procedure, i.e the influence of national economic sciences and civilizations on hotel ironss.


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