Category: Economics Essay

U.S. Hotel Industry in Early 2005

In the early 2005, the total amount of revenue collected from the U.S hotel industry was $113.7 billion; in addition, there was a pretax that amounted to $ 16.7 billion. From the financial statements that were derived on 31st of December, 2004, it was found out that there was a cumulative total of 4.4 million hotel rooms that were present in the United States. This means that the hotel business had taken route in the early 2005 since most of the regions in the United States had expanded and majority of the businesses were also venturing into the same industry. There was a massive use of the brands in various hotel suites in the United States.

A sample statistic shows that two-thirds of the hotels were associated with a particular brand and the remaining a third was individually owned. Therefore, the characterization and description of the United States hotel industry is that it is highly fragmented with no single company acting as a monopoly. The infiltration by various key players in the industry provides adverse competition with an aim of being the majority control firm. In this particular characterization, the discussion will be broken down into key points that would efficiently bring out the picture of the hotel industry back to 2005.

Hotel Segmentation

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Competition in the hotel industry relies upon the presence of various factors that the hotels offer. These may take the form of amenities, services or prices. It also forms a basis upon which various research firms categorize the different hotels. For instance, a research firm known as Smith Travel uses the service levels and the price to segment the hotels. The price of the various commodities offered in a hotel is representing a function of the service level and the corresponding amenities offered. The hotels that are characterized as being full service are known to offer beverage and food outlets and this consisted of a collection of beverage and food outlets like lounges and restaurants. The package consisted of room service, luggage service while at the same time focusing on amenities such as meeting rooms, banquet, and concierge and convention facilities.

There was also an existence of a class marked with different ranges of hotels from luxury hotels to upper upscale hotels. The available divisions get up to upscale hotels and midscale, which consisted of beverage and food hotels. These types of hotels fell under the category of full-service hotels and they had amerced 1.6 million rooms in the year 2004. In addition, another category of hotels that existed was referred to as Limited Service Hotels. These particular types of hotels were limited in terms of the facilities they offered as compared to the full service hotels. Amenities such as banquet rooms, lounges and restaurants were facilities that this type of restaurant could not accord the customers who frequented them (Ryan & Jones, 2009, p 166).

Astor lodges and Suites Inc current competitive positioning

The current positioning of the company, according to the executives, is that it is viewed as a limited-service hotel. This type of hotel tops as being with part of the features of a full-service hotel and an economy hotel. Therefore, neither Astor Lodge & Suites nor Astor Lode has meeting rooms, concierge, luggage and room service, lounge or a restaurant on this particular type of property. This particular type of positioning does place Astor Lodge & Suites on a boundary between economy hotels such Motel 6 and Red Roof Inn and a midscale hotel with beverage and food, such as Ramada Inn and Holiday Inn. The various executives of this particular hotel company view the company as being positioned against such hotels as Fairfield Inn constituted by Hampton Inn & Suites, Hampton Inn by Hilton, Fairfield Inn by Marriott together with La Quinta Inn and Suites. This analysis comes despite the fact that Astor Lodge and Suites does not compete and is not in the same categories with the stated hotels.

Previewing the companys positioning and service mission, they all point to the fact that Astor longue and Suites Inc. there are various selection decisions considered by the company. The properties of the company are located on premium sites found along major highways, which are relatively close to office complexes and suburban areas, large regional centers for shopping and airports for the most part. There has been a marked avoidance to areas such as downtown urban locations.

Another notable feature is that Astor Lodge & Suites Inc. comprises of 250 hotel property chains, which are located in ten different Rocky Mountain and Western states. The company incorporation dates back to the year 1979 and boosts its market share through the operation of an accumulated amount of Astor Lodge and Suites properties totaling to 50 an