Growth Of Hotel Business In Australia – Factors And Trends

Problem Statement

Discuss about the Growth of Hotel Business in Australia.

The hotel industry in Australia is growing in such a fast pace that the major players in this industry is looking to expand their businesses to take the opportunity of this growth. One of the major reasons of this growth in the hotel industry is the increasing number of tourists from Asia along with the increasing number of business meetings and conferences (Assaf, Josiassen and Agbola 2015). As per a recent research of CRBE, it can be observed that the growth in the hotel sector of Australia will remain same in spite of a recent strengthening in the Australian dollar. Looking at this impressive pace of growth, many international hotel groups are planning to make an entry in the hotel market of Australia (Breakey, Robinson and Brenner 2014). As per a later report, it has been said that the average occupancy level of hotels in Sydney is about to reach 88.8 percent by the end of the year 2020. It is evident that the revenue of the hotel industry in Australia increased by almost 60 percent between the yeas of 2009 to 2013; and looking at the current trend, it can be said that this growing revenue trend will remain same up to the year 2020 (Liu et al. 2014).

The problem statement in this research work is to analyze the growth of hotel business in Australia over the years and the factors that affects the growth.

The main aim of the research work is to determine the growth of the hotel business in Australia and the factors behind such growth. The objective of the research is to analyze the growth of hotel business in Australia.

Australia is a large country surrounded by water bodies on all its sides. The country is a tourist spot and is visited by people all over the world. The growth of tourism industry is one of the main causes of growth of hotel business in Australia (Li et al. 2015). The tourism has shown a rapid growth due to international tourist arrival from the countries of Asia Pacific. The arrival of international tourists from countries such as China has led to the growth of the hotel and resort industry in Australia over the last five years (McManus 2013). The country also receives domestic customers from all over the country. The hotel business however has seen a weak growth during a five year period from 2011-12 (Sanliöz Özgen and Kozak 2015).

Research Aim and Objective

The hotel and resort business however requires a huge amount of capital at the initiation. It has been calculated that for every 1 dollar required for the capital about $6.5 has to be spend for the wages of the workers in the hotel (Su, Hall and Ozanne 2013). There are a lot of laborers required in a hotel for management, front house operations and others. In the present years, the tourism industry has grown three times. The growth rate has shown an increasing trend over the years (Tan 2015).

The hotels are developing all over the country due to increased number of travelers from the countries of India, China and other Asian countries. In the current year it is very profitable to get into this business. The arrival of tourist has increased over the last nine years. The hotel business in Sydney is going to occupy 88.8 % of the total population by the end of 2016. This is the highest growth rate over the years. There are 75 mooted projects over the ten major places in Australia. The hotels has almost 16 374 rooms in all total. The country lies among the top hotel development countries all over the world (Manoharan, Gross and Sardeshmukh 2014).

There is also an organization that guides the growth of this hotel business in Australia. The AHA or Australian hotel Association guides some rules for the development of hotel business in Australia. There are about 5000 members under Australian Hotel Association. There are about 6807 hotels in Australia and there are more than 180000 people employed in that hotel industry. There are also many casinos and gaming machines in the hotels that attracts the customers (Zhou et al. 2014). The prices of food and beverages in the hotels are also reasonable. The prices are however high in the hotels that has gaming machines and casinos. Moreover majority of the hotels in Australia alls under small and medium sized business employing less than 30 people. The major source f income in these hotels is the food and beverages. A lot of revenue is also generated from gambling in these hotels. The hotels arrange activities and events for the tourists like trivia nights, sporting group meetings and others. Most of the hotels are accompanied with gaming machines, pool tables, conference meeting facilities and others. It has been estimated that the hotels serve 1000 meals per week (Turner and Guilding 2014).

Literature Review

However a current report says that the hotel business has shrunk by 10 [percent over the past few years. The employment in these hotels are however the same over the years. The income from the poker machines is also decreasing. The major causes for this have been cited as the decline is the removal of ATM and other facilities from the hotels (Ndivo and Manyara, 2016).

The main variables in this research work are the number of hotels in the country, number of employees in those hotels, salary of the employees, the revenue earned from the hotel and others. The main focus of the study is to determine the growth of hotel industry. The growth can be studied from the number of hotels in the country. The number of hotels in the country is taken as a dependent variable and the revenue earned from these hotels, the salary of the employees, number of employees in the hotel and others as the independent variables.

The main hypothesis for the research work is given below:

H0: The hotel industry in Australia has not shown any growth over the years.

H1: The hotel industry in Australia has shown a major growth over the years.

The variables concerned in this research work are the revenue generated from the hotels which are measured in Australia dollars. The salary of the workers is also measured in Australian dollars. The other variables like the number of hotels, number of workers in the hotels are all numeric variables. These variables are measured in numbers. There are also some categorical variables like the opinion of the employees regarding their salary in this industry. Since the figures are for the whole country, a 5% error in the figures is tolerable. There are no constraints involved in doing the research work.

The methodologies for the research and the data collection methods are being discussed in this section. The research methodology employed for doing this research work is both qualitative and quantitative research methodology. The research involves collection of both primary as well as secondary data. The secondary data about the number of hotels, average revenue generated from the hotels are collected from the official sites and other online sources. The data about the number of workers in the hotels, the average salary of the workers and the opinion of the workers regarding their job are collected with the help of questionnaire. The primary data has been collected for this part of the research.

Variables and Hypothesis

The primary data has been collected by the method of sampling. The probability sampling has been performed for this research work. The cluster sampling method has been employed for this research work. Each of the state of the country is taken as each cluster. Then from each of this cluster, a sample of 10 hotels has been chosen. The questionnaire is then distributed among the workers of the hotels.

The data so collected will be analyzed using various descriptive statistics tools like the mean, median, standard deviation, correlation and others. A comparison of the previous and the past year values will help to understand about the progress of the hotel business in Australia. A regression analysis will be done by taking the number of hotels as the dependent variable and the other variables like revenue earned, salary of workers as the independent variables.

The research process describes the methods by which the entire research has to be undertaken. The first step in the research is the identification of the research problem. The research problem has to be identified in the first week of the research. The next problem is to conduct an extensive literature review. This will be completed within the fourth week of the research. The data collection process starts after that. The questionnaire will be developed and the data will be collected after that. This will be completed within the tenth week of the research. The next step involves the analysis of the data. This will be completed within the twelfth week of the research. The final project will be completed within the 14th week of the research.

It is expected that research will have a positive outcome. The null hypothesis of the research will be rejected. This indicates that the hotel business will show a growth over the years.

Conclusion:

The research will be conducted to know about the growth of hotel business in Australia. The past records show that the hotel business has shown a rapid growth due the increased number of tourists from Asia Pacific region. The proposal gives an idea about the data collection methods and the analysis of such data. The expected outcome from this research is also given in this proposal.

References:

Assaf, A.G., Josiassen, A. and Agbola, F.W., 2015. Attracting international hotels: locational factors that matter most. Tourism Management, 47, pp.329-340.

Breakey, N.M., Robinson, R.N. and Brenner, M.L., 2014. Approaches in the Design and Delivery of Hotel/Hospitality Management Undergraduate Degree Programmes within Australia. The Routledge Handbook of Tourism and Hospitality Education, pp.305-320.

Li, G., Law, R., Vu, H.Q., Rong, J. and Zhao, X.R., 2015. Identifying emerging hotel preferences using Emerging Pattern Mining technique. Tourism management, 46, pp.311-321.

Liu, W., Guillet, B.D., Xiao, Q. and Law, R., 2014. Globalization or localization of consumer preferences: The case of hotel room booking. Tourism Management, 41, pp.148-157.

Manoharan, A., Gross, M.J. and Sardeshmukh, S.R., 2014. Identity-conscious vs identity-blind: Hotel managers’ use of formal and informal diversity management practices. International Journal of Hospitality Management, 41, pp.1-9.

McManus, L., 2013. Customer accounting and marketing performance measures in the hotel industry: Evidence from Australia. International Journal of Hospitality Management, 33, pp.140-152.

Ndivo, R.M. and Manyara, G., 2016. Appraising the role of public sector in Kenya’s competitiveness as a tourism investment destination: Hotel investors’ perspectives. Tourism and Hospitality Research, p.1467358416663818.

Sanliöz Özgen, H.K. and Kozak, M., 2015. Social media practices applied by city hotels: a comparative case study from Turkey. Worldwide Hospitality and Tourism Themes, 7(3), pp.229-241.

Su, Y.P., Hall, C.M. and Ozanne, L., 2013. Hospitality industry responses to climate change: A benchmark study of Taiwanese tourist hotels. Asia Pacific Journal of Tourism Research, 18(1-2), pp.92-107

Tan, J., 2015. Impacts of service innovation in the Australian luxury hotel sector. CAUTHE 2015: Rising Tides and Sea Changes: Adaptation and Innovation in Tourism and Hospitality, p.726.

Turner, M.J. and Guilding, C., 2014. An investigation of Australian and New Zealand hotel ownership. Journal of Hospitality and Tourism Management, 21, pp.76-89.

Zhou, L., Ye, S., Pearce, P.L. and Wu, M.Y., 2014. Refreshing hotel satisfaction studies by reconfiguring customer review data. International Journal of Hospitality Management, 38, pp.1-10.