Indian Hospitality Industry 13

During the onslaught of COVID 19 the Hospitality staff was  at the mercy of avaricious owners who were the likes of ‘Shylock’ in famous Shakespeare’s play 'The Merchant of Venice' , for a long span of 18 months the service industry primary asset was subjected to hardships beyond comprehension.

I joined Indian Hospitality Industry in Mid 1974, as a management trainee, since then I have worked or have been associated with about 50 Hotels , including 60/70 catering and food outlets, not taking into account my earlier experience in Lebanon, Cypress, Sweden and United Kingdom. I have worked with thousands of Hospitality workers, managers and have interacted with large number of owners in India. One thing which I will always remember as a Hospitality Manager that, the most important person for me and the owner is not the ‘Guest’, but the staff who serves those Guests , it’s the staff which brings tall the facets of the hospitality to life as they are responsible to provide various  services and  including  food. But surprisingly enough the owners have conveniently ignored their basics when Covid-19 crisis stuck the world. They also forgot that these are the same people who worked hard and earned for them their millions, and unique position in the society.

I dedicate this blog those millions of Indian Hospitality workers, who had suffered during last 18 months of catastrophe of mind-boggling proportions. Although - seemingly we are at the fag-end of the pandemic, but the damage and agony it has caused, will take long time to heal and restore the confidence in the owner/staff relationship – for those who are not familiar with  what happened to the staff of Hotels and restaurants, let me try and recreate their plight;

·         The Hotel Industry started experiencing the Impact of COVID 19 during mid-February 2020, which was the peak of season and Hotels, restaurants were booming with clients and business - just two months short of the ‘off season’.

·         Everyone thought this crisis will be over before end of summer and we will be back in business with bang September /October. But majority of owner found great ‘opportunity in calamity ‘and in addition the 26^th March lockdown came as a boon, as though ‘shylocks’ / owners were waiting for this, majority of the staff was not paid salary till August/ September, when they started opening  the Hotels for domestic / Government business even then staff was not paid full salary. Some Hotels paid 50% of salary and some paid one third. In some cases senior staff including GMs’ were either paid pittance or were offered ‘handshakes’ of the sorts.

·      Management became mean and selfish to a level where the staff was not paid even their ESI, PF and other dues. Consequently the greed of the top management brought about mild to intense exodus of approximately 32 million wage earners involved with the Hospitality Industry, as they helplessly decided to migrate to their villages /small towns for survival and a square meal.

·         I have been in the Indian hospitality industry for over five decades; I have never seen such a cruel joke played by our Industry of which we were so proud. All our lives as young manager, we were told by management pundits that most valuable asset we have is the manpower. They are the real earners; they are responsible for our success and failure and so on. We forgot all about the billions/billions of Rupees we made in last few years was the result of their hard work. We forgot as Hoteliers that  once upon a time we devised many systems of staff welfare e.g. PF health Insurance, welfare funds and so on, but when these poor people needed our support in the most critical times we turn a Nelson’s Eye towards their plight and backed out. Even majority of Management companies chose to keep their eyes closed and let the ownership go ahead and do what they want with the staff. Sadly more International chains were part this ruthless design.

·         I had an opportunity to talk to over a dozen of prominent HR Directors and they all confirmed of this dreadful act. They also confirmed that all the suggestions for these actions were brain child of senior managers’ - who wanted to save their job. Alas! Interestingly enough nearly all of them had to bear the brunt of their own design, as many lost their jobs or their feathers were clipped and those who survived were asked to work on 35% of the wages as a condition.

·         Important question is where was the Tourism Ministry? Labor Officers? Well they were there but totally ineffective and were a liability to the business. What about the so called welfare associations? Unfortunately, in India all association, government bodies are more for their own welfare - not the Industry. Even today the high handedness of individual owners continues, with no relief to those hard working employees. I fear millions of Rupees belonging to hundreds and thousands of employees are not only forgotten by owners but also those welfare agencies as well, whose job is to make sure that the Hotels are taking care of all the aspects of Industry and employees in good faith and due-diligence Being part of glamorous industry we all had to pay the price for total neglect.

·         Most important part of this episode is that ‘what impact will be there on our future’ - if any? Or whether this action will help our Hotels/Restaurants to recover sooner than later.

·         No and not really. If you had read my earlier Blogs on Covid-19, you must have noticed that, I predicted a massive boom in our industry – at that point in time this inference was empirical and today that is happening even when country has not opened  up to  international traffic. Today Hotels are doing well in domestic tourism a reality will hit hotels after 15 November when International travel opens up. At present with only domestic travel open, the hotels are nearly full and F&B is booming. But each Hotel and even restaurants are suffering due to shortage of trained/ skilled manpower. These days – not surprisingly the hotel chains like The Oberoi /Hyatt/ ITC / Taj Mahal / Marriott’s who never entertained walk-in candidates are accepting them willingly with open arms. All brands of Hotels are advertising on LinkedIn, and this is just start of boom time. Just imagine what will happen when Hospitality industry blooms once again and economy prospers.

·         With Industry needing more Hotels, F&B outlets, we all will feel the heat of the dearth of qualified staff. The greed of individual ownership has already created insecurity and unfaithfulness among the staff. In addition this is likely to result in the rise wage  bills and establishment cost under various heads, not ignoring the labor troubles as a domino effect of the strategic ‘faux pas’ by high & mighty.

 

Written By Virat Varma & Anil Chak

Indian Hospitality Industry 12

 I returned to India on the 5th of February 2021, after being stuck  in America for eleven long months due to COVID 19 pandemic, but was sort of relieved with somewhat promising situation here in India. The airport was well organized with equally disciplined atmosphere. Coming to India was also quite motivating because, seemingly, the situation was in control. The excitement of coming home, meeting my sisters and their families, including friends; the whole affair was quite eventful. At that time the COVID-19 numbers were fewer and we saw that Malls were fully functional and were buzzing with activity. The restaurants were doing reasonably good business and I was informed that NCR Hotels were doing nearly 55-60% occupancy. Super Markets were doing good business; even retail stores were picking up the business steadily. I was happy that all was going on as I had expected and that thing we’re really looking up.

Then, as time passed, bit by bit I started noticing carelessness everywhere, both among people and in business premises. Here are some examples of insensitivity and lack of awareness of the dormant COVID 19.

1.      The Super Markets were operating with almost full staff.  When customers pointed out to the managers at the big stores like Big Bazaar, Spencer etc., they were told that these (floor helps) men were provided by suppliers at no cost to them. On closer inquiry it was revealed that they were untrained and unqualified raw young boys who not only knew nothing of COVID 19 protection but were also very casual and nonchalant in their attitude. All these stores had dismal staff as they were trying save some money by hiring cheap representatives to manage the floor. What a mentality

2.      Now let’s talk about our Industry. The Restaurants, especially fast food outlets were boasting of COVID protocol and declared that they were going by the book. Whereas, international chains like McDonald/Burger King/Pizza King outlets had very congested seating arrangement, the outlet in the mall on MG road one could see 45/50 people were seated in an area of not more then 160-70 sq. ft. Indian fast food joints like Haldiram/Bikaner were also squeeze in guests like never before and were running full strength with little or no precautions by their staff or their guests. The situation was quite the same almost everywhere.

3.      Hotels were bursting in their seams. Although they started cautiously, but later on to attract domestic business, they floated cheap Hotel stay packages, which was a good move to increase revenue. Then came the wedding season with full force, and they started flouting all rules with no holds barred. Earlier on, the hotels which used to provide accommodation to International traveler, were now perceived as the safest option by COVID- 19 positive guests looking for hotels and by February/March 2020 as the tourist traffic increased, their new found enthusiasm and confidence made them compromise the COVID 19 safety guidelines.

Thus hotels became one of the biggest catalysts in accelerating the covid-19 virus, additionally the marriage season made it free for all. All hotels in Delhi and NCR were jam packed, their dining halls were over booked for breakfast and dinner which led to crowding and what followed is anybody’s guess.

 We can certainly blame the government policy, but we were the educated lot and were all part of the star class hotels - where was our wisdom.  During this period, the resort hotels were doing well, and so even the city Hotels started modifying their properties to offer resort-like services e.g. Swimming Pools, Health Club and Spa and all were fully packed, even in the lobbies of most of the hotels one could witness large crowds moving freely in their swimming pool attire.

It is important for me to site few definite examples for record;

·          A friend of mine from Hong Kong who moved to USA when the pandemic started, stayed with his family for over eight months in New York, Minneapolis and San Francisco in Hotels, and then moved to Dubai for few months on business. He visited Delhi early March 21, for a meeting and I booked him in Westin, Gurugram. We met for a meeting at 11 am. Sitting in their very large lobby having discussions wearing our double masks, soon I started noticing large crowd, some of them in their swimming costume and towels but no mask. Then we saw some crowd, all properly dressed up gathering in the well of lobby close to us, and majority of them were not wearing masks. As the numbers increased, we got worried and started complaining, and requested the staff to urge them to at least follow the basic  COVID-19 protection guidelines, like mask and social distancing of minimum six feet from each other, but no one listened, which goes to prove that we are educated and obstinate fools. Then I asked for the senior manager, who refused to meet us. One of the lobby mangers finally informed that they will not say anything that may annoy the guests. We were left with no option but to walk out on our own. Even my friend staying there for at least a week checked out immediately and went to a secluded Hotel in Delhi. This was the situation every day, which was later confirmed by one of their staffers.

·    It was clear that for those two/ three months one could not visit any of the Hotels either on weekends or on holidays, because their Restaurants were sold out and all the advisory of social distancing etc. were tossed out of the window. As a regular in few of the Hotels, the staff who knew us well clearly told us that this was as per the instructions of the management. It is difficult to figure out, who is to blame - the brand or the ownership or maybe both.

·       All the hotel restaurants started with Ala Carte menu, but as the numbers increased, they switched to Buffet service for all meals. It is common knowledge that Buffet is considered a major spreader, but in order to control the labor and non-availability of fully trained staff - which could result in complaints - the hotel chains opted for an easy way out and Buffet, was certainly an easy way out. This move could be a secondary factor that that might have contributed to the surge in COVID-19 cases in various cities.

4.     Biggest of all fears - which became reality- was the wedding season or the  ‘Saya Dates’. These dates were total 50 in number. According to the Industry estimates tens of thousands of marriages took place in Delhi & NCR with majority of them in various Hotels and Banquet Hall. Each wedding had over 200 Pax in each function, and all these functions were mostly without mask, leave alone social distancing. Simple arithmetic will confirm that over Fifty to Sixty lakh people only in NCR attended these marriage parties and were exposed to the possibility of catching or spreading the COVID-19 virus and then we blame the pandemic for second wave! Unfortunately quite the same was happening in all major cities across the country.

5.    Above picture gives us a clear view of negligence and nonchalant attitude towards all aspects of the functioning of Hospitality Industry. Even today- when the industry is in trouble - there is no visible introspection for course correction. Let’s consider one aspect i.e. The Man Power;

·        Research tells us that on an average 50 to 60 % of manpower at hotels and food outlets were down with covid-19 at one point in time or another.

·           Our biggest wealth of any hotel is the trained staff that runs the operations. During the first lockdown we got rid of the trained staff, in other word, the staffs with high salaries were eased out and when the market started opening up, we didn’t bring them back but hired untrained and inexperienced low cost staff. When business started picking, they became a liability and a cause of mismanagement. Another thing to note is that almost all hotels, not only dumped the high salaried staff, but also slashed the salaries of remaining staff by half

·    All the hotels participating in COVID-19 quarantine program were trained to take all precaution to protect their guests and themselves from possible infection. They did this job well. But they forgot all the training and COVID-19 precautions when the Hotels started opening for direct business. Important and very basic instructions like social distancing and removal of mask only for eating were not followed plus the banqueting was free for all.

·       We also need to ask ourselves, ‘what efforts have we made to work in new ‘COVID-19’ environment?’ the answer is NONE – period. Businesses worldwide which did not adopt the new COVID-19 centric conduct and/or environment have had to face their doom and that is the reality. It is also true that business houses that made adjustment, changed strategies and aligned themselves to COVID-19 protocol  have not only survived but are the new millionaires. Back home, due to our myopic vision we have neither made any efforts nor have invested our time and/or money to meet the new challenges.

·         Hotels in India have always scored on F&B. On an average every Hotel has minimum of two restaurants plus coffee lounge and a Bar. These outlets used to contribute minimum of 30% of the total revenue which at times went up to even 60%. But today all of these outlets are in serious trouble. Thousands & thousands of employees are out of job. The industry needs to evolve and innovate to make sure their clients get their favorite cuisines at home through, maybe a Drive-Inn or a home delivery system or any other way at a reasonable price. But just the opposite is happening all around.

·           Restaurants are in the worse situation. Some who are doing well they should thank Zomato and Swiggy for their survival. These two companies have done more then all our restaurant industry put together including international fast food chains. Surprisingly enough we do not have even one single Drive-Inn or a Curbside Restaurant. Once again our entrepreneurs missed the bus - quite typical of us. We happily let the likes of Zomato or Swiggy become millionaires as they write their own success story, while we continue to blame the Government or God. Just for our information, the fast food chains like Chic Fillet, McDonald or Burger King outlets in the USA have doubled their revenue during COVID-19 lockdown. They modified the pickup strategy, designed new restaurants and others followed; we saw long queues of cars in nearly all outlets. During COVID-19 even countries like USA saw more job opportunities in food industry. What has happened to us, why are we paralyzed? Why can’t we confront COVID-19 with all our intelligence?

      Furthermore, in the past - more often than not - the standard practice to tide over any business crisis and recover the losses has been to increase the charges. People’s misery has always been en-cashed because it presents an opportunity to rip off the guests, charge whatever at will.  Whereas, common sense tells us to cut down the rates to encourage sales and increase the volume of turnover - especially when the industry was struggling to save on the manpower cost  by reducing salaries, cut air-conditioning bills and so on. Despite all these measures, we still seem to be in trouble – I think the problem is in the mind – As a nation we are petty minded and cunning lot, looking for short term gains.

      Yes! I agree that the administration both local and /or central, our societies and associations also failed us miserably. They completely ignored the blatant flouting of COVID-19 protocol; alongside there was total misuse of authority by hotel and restaurant staff at all levels. Whereas on the contrary under the circumstances, constant monitoring of all sensitive services should have been built-in the daily schedule of events. All said and done there is no justification for all the damage that was done to our industry in the country be it  due to ignorance or attitude – at best it was ‘Hara-Kiri’.

 After what has happened, no one wants to take the blame on behalf of the hospitality industry or country’s fate. The fact remains that after setting the house on fire, we are trying to find a scapegoat. Now as the situation is limping back to normal and seems to be a little under control, we expect some sort of miracle to occur and expect that within few weeks, the businesses will start opening up. Like Navin Berry wrote in Destination India on 17^th May, 21;

   “ As we look ahead to open our industry again, we must be cautious in how we portray ourselves as an industry: we must be seen as caring, sensitive and emerge as the first line of defense against the virus. And, we should not go aggressive in raising tariffs that may look like profiteering!”

Now, as we prepare to open up once again there is a need to critically examine our mistakes in the past, incorporate the strategies which are formulated by the government agencies and various hotel associations to open up/restart the property or a F&B outlet. Furthermore, in order to make sure that we enter the market with redoubled confidence and are better equipped to ensure optimal protection and safety of our guests and staff.

       I am placing below some of my recommendations;

1.      Enhance Safety and protection for staff

a.      Create staff security bubble of protection, by providing in house accommodation.

b.      New staff joining must be subject clearance of COVID-19 test.

      2.      Enhance Safety & protection for Guests

a.      Follow UAE procedure, all guest must be subject to COVID-19 test before they are allowed to move around.

b.      Limit Housekeeping service by request only.

c.       Guest Room occupied by the same guest over multiple days, should not be cleaned daily, unless requested. 

d.      Provide Guest with Guest Safety Checklist for protection.

3.      Evolve a ‘Revenue Generation’ Policy

a.      Promote Sales & Marketing over platforms of digital  Apps’ with e.g. Douyin, WeChat, Taobao, Weibo etc.

b.      To increase conference business, promote Live Streaming of conferences to replace face to face meeting.

4.      Remodel all F&B outlets including Standalone Restaurants.

Plus exploit all other revenue generation areas

a.      Design innovative services, seating, take away system, delivery and pick up orders

b.      New concept, safe surety operation based on social distancing

5.      Incorporate latest COVID-19 Centric technologies

a.      For check-Ins’ and F&B access introduce Face Recognition devices

 with AI temperature displays.

b.      Implementation of new and advance touch less technologies. 

c.       Introduce and device interactive   Corona Protocol Displays.

Written By Virat Varma & Anil Chak

Indian Hospitality Industry 11

 

First time I heard his name was in ITDC Head Quarters in my boss Ms.Psyche Nigam’s office where she was discussing with GM Hotels and preparing a list of top ten ITDC Executives,. His name was on number one slot followed by other outstanding executives of ITDC at that time. My interest in this list was because my name was number ten and I was only a Assistant Manager. I asked Ms. Nigam who is this Anil Bhandari?, she said, “He is one of the finest Operations Manager developed by our management team and he is coming back from abroad after two years training.” Thereafter for next forty five years I was exposed to his excellence and administrative capabilities, I guess I was fortunate. He was always a helping his colleagues. He was technically competent and a thorough professional, who was an inspiration to most of us. Starting his career as a management trainee, he not only became MD of Hotel Corporation owned by Air India, but also the first Hotelier to become Chairman& Managing Director of ITDC.

 There is a long train of memories which safely rests in the inner most chamber of my heart, of  the time I  spent with him- I could write a book. Nonetheless, I would like to tell the world that the real Anil Bhandari was a charmingly great personality, most humble and caring. First time I came in close contact with him was, when he took over as GM of very prestigious Hyderabad House. He used to visit the Head office quite often and would take time out to for a little informal chat with all of us. I could make out that he developed some sort of affinity for me. Then one day he told my boss that he plans to take a holiday for a few weeks and that, he would like me to look after the operation of Hyderabad House- mind you, I was only Assistant Manager then. I was fortunate to work in this tough location. He would visit often and spend long hours discussing his style of planning and other managerial technics. As luck would have it, for months together I was there extremely busy trying to match his level of his excellence and my hard work paid off- there was not a single complaint during that duration; for which he generously rewarded me with an outstanding appraisal. He remembered me and when he was planning to open The Kanishka Hotel he wanted me as Director F&B, unfortunately by that time I was looking after Calcutta Airport Restaurant and Flight Kitchen as Manager.

 He followed my career and always gave me right and timely advice - he was always proud of my achievements. After I left Vijay Mallya’s Pizza King Chain, I approached him for a job; he was then The Managing Director, Hotel Corporation of India. He straight away offered me a job as GM Centaur – Juhu, Mumbai. I was spoiled by him so much, that I turned down the offer and asked for posting to Centaur, Srinagar. He smiled and said OK and then he transferred the GM from there to accommodate me. But he also informed me that the Hotel was in a really bad condition and that I will have to work very hard. I did work hard and did not give him a chance to regret his decision, on contrary I became his favorite GM. Then after three years he transferred me to Hotel Centaur, Delhi, although he was under pressure not to do so by the Minister. Thanks to his support, I became the most successful GM in the history of the company.

 As a professional he had great regards for hard working staff and executives. He had great ability to carry his team with him, along with his bosses and at every step he established himself as a considerate boss, a perfect colleague and a real team player in every sense.

 After leaving ITDC he Joined ITC as MD Travel House and worked there for over ten years. Thereafter he got involved in assisting and developing hotels and helping international chains to set up their businesses in India.

 Anil Bhandari was always a family man. Married to Pamela who was  Income tax Commissioner, he had two lovely kids, daughter and a son both well qualified and well settled. He was indeed a proud father in every sense of the term.

 Finally, I would like to put on record that in Seventies, Eighties and Nineties, the ITDC produced some of the finest hospitality professional in the country. Despite limited opportunities - which existed then because of Government restrictions - the professionals like Anil Bhandari, Ms.Psyche Nigam, P.B.Mathur, K.B.Kachru, Cecil Samuel, Ram Gupta made it big and were outstanding.

 Anil Bhandari was unique because he made it big while working in government because of his meticulous planning skills and sheer hard work. He was always a ‘Complete Hotelier’. I am proud of the fact that I had the opportunity to know him and work with him for good number of years.

 My last salute to my dear friend - RIP God bless you Sir - Always...!

Written by Virat Varma & Anil Chak

 

 

 

 

Indian Hospitality Industry 10

 

"In a country where hospitality is sacred and guest is considered God, at present - ironically enough - the hotel industry in India is totally dependent on their European and American Demi Gods. In the last fifty years, I am a mute witness to the steady decline in standards of our hospitality and even the Indian brands whose thinking and philosophy was based Indian hospitality and culture are steadily but surely losing their sheen to International brands. Today South East Asia has emerged as the leader of excellence among world hotels and are doing better than most  branded hotels because their modernized  services are based on the Asian  principle that ‘Guest is God’. or in Sanskrit -  Atithi Devo Bhava! 

The advent of ‘Quality Hotels’ in India began with the British Raj. Late 18^th century saw conversion of lodges to decent size hotels. Cities like Bombay, Calcutta, Delhi and Lahore were first one to get decent hotels built; they were managed by the Britishers or Europeans. The development of various hill stations also started in locations like Shimla, Ooty and Mussoorie where quite a few resort hotels emerged. But hotels were never considered an industry even after substantial boom till 1990. Indian Government considered hotel and restaurant Industry as luxury and liability on their economy.

My take on hotels and restaurants in India is more linked to realities and circumstances and also the blunders which with tons of luck, we were able develop into rather reputable country as far as hotels and restaurants are concerned. We in India are late starters and lived in the shadow of our pre-independence masters in Europe. Although countries like Nepal, Vietnam, Sri Lanka, Thailand started much later but today they are way ahead in hospitality and tourism than us. Nepal the country – the country we thought was only good to out-source ‘Gorkha Soldiers, Watchman (Bhahadurs’) and Domestic servants and - in 1992 tourism had contribution 40% to their GDP. As for other South Asian countries, we all know how well they are doing.

My conclusions of the Indian hospitality Industry are based on personal experiences, exposure, lot of research and deductions based on opinions of industry personnel and stalwarts. Nevertheless, I will only be too happy to welcome contributions from those involved or engaged in the hospitality sector - both directly and indirectly. I strongly feel that it is rather essential to leave behind a point of reference for the coming generation to ponder;

1.   My growth in the hospitality industry is primarily attributed to the substantial exposure to the restaurant industry. In the sixties, Delhi and Bombay was quite a happening place. The memories of CP (Connaught Place) in Delhi are still fresh as morning dew. CP then was more Happening Place then today’s Cyber Hub in Gurugram. Among the restaurants which I frequented were Gaylords and Kwality Restaurant owned by Lamba and Ghai Family, La Boheme, Guffa and Pastry Shop by Narula’s, Wenger’s Restaurant and Bakery, Standard Coffee House serving Espressos (today’s cappuccino) with chocolate Cookies, Volga, Laguna at Janpath, plus many more. Connaught Place remained an iconic destination in the country till the late Nineties when they decided to bring in Metro Rail, and that was end of CP’s monopoly as India’s most successful restaurant destination.

2.   As for hotels in our country, Maidens Hotel in Delhi was opened in 1894 by Maiden Brothers. In Mumbai, Taj Hotel built by TATA’s in 1903. This was the first Indian owned Hotel. In Calcutta Great Eastern Hotel was opened in 1915.They were top notch hotels of their time. First large Hotel which was planned for international delegates, conferences and conventions was The Ashok Hotel, - New Delhi. Built in Diplomatic Enclave, Chanakyapuri the heart of New Delhi, this prime property is surrounded by major embassies and High Commissions. Planning was so perfect that a committee was formed including one senior officer from each important ministry to work on the future requirement. This is the reason that even today after 65years The Ashoka Hotel is still the perfect Hotel ever built in India. Degradation and destruction of this landmark property today is another story.

3.    In early the seventies when I returned to India, the growth of this Industry was slow but steady. Under the Government of India a corporation called ITDC was formed. It was amalgamation of three government bodies who were managing 2 and 3 star hotels like Janpath, Ranjit and Lodhi Hotels with Ashok Hotel being the flagship property. Although ITDC’s brief was to promote tourism, develop tourist destinations, create the relevant infrastructure and publicize locations of tourist interest. But building and managing hotels suited them better. From 1973 to 1987 they dominated the city and became the largest hotel chain in India. Some of the best managed hotels were run by ITDC they included Akbar and Ashok in Delhi, Ashok Hotel in Bangalore. They had hotels on beach resorts, hill stations, tourist locations and with big expansion plans for new hotels. They were well managed hotels all around, and for many years Akbar Hotel was considered the best hotel in Delhi followed by Oberoi Intercontinental and Ashok Hotel.

4.     At the same time there was little activity among other Indian brands of those times. We had Oberoi Hotels in North and Taj Hotels in Mumbai. Oberoi had two hotels in Delhi - The Maidens and Oberoi Inter Continental and in the West Taj Hotel and Taj Inter Continental. This was the result of a tie-up with Inter Continental Group that gave them the operations system which enabled them to develop their own management system. I will not  be surprised if even today they might be following the same or a modified version of the same operating system with most job specification of the Intercontinental system.

5.    There were many brands which emerged gradually on the Indian horizon, taking a cue from these three large players. We saw a large number of standalone or double property hotels like Lalit Hotels, Clarks Group and Imperial Hotel in the North, Leela Hotels in Bombay, Woodland, Connemara and West End in south, Calcutta can boast of historical heritage hotels like the Great Eastern, Kenilworth and Park Hotel. At the same time hill stations like Shimla with Clarks, Mussoorie with Savoy, Kashmir with Oberoi Palace and Ooty with Savoy Ooty had some of the great hotel resorts, all these were high end hotels built to serve the local elite and visiting tourists.

6.     Talking about the restaurant Industry, I feel rather proud. The restaurant business from fifties to the late seventies was very good. In Connaught Place (CP) - Delhi alone there were over a dozen restaurants, and all of them were doing a booming business. The CP was a perfect example of restaurant Industry - which was then the biggest in Asia. Important thing to note is, that in those days we in CP sold more Cold Coffee, Espresso (Today’s Cappuccino) in one day than the rest of India sold in one month. Gaylord, Volga, Laguna, La Boheme, Standard Restaurant and also Coffee House were all an integral part of the Delhi culture. If you were smart and in-step with the times, then you had to be seen frequenting these places – as it was a status symbol of the sorts. Similarly Bombay and Calcutta had some amazing restaurants and cafes’ like Gaylord, Flury’s Bakery. In south, cities like Bangalore, Madras and Hyderabad had more traditional restaurants, serving Masala Dosa, Idli and Thali, all these places were doing very well. Even today most of the good ones have survived the test of time and change. They have not only survived but have doubled or even tripled their business.Food rates have always been reasonable at such restaurants.

7.      In India, for growth and profitability, food became an important part of hotel’s success. Nearly all good hotels had minimum of three to four restaurants and all were doing well, alongside banqueting business became an integral part of the success story. Thus new hotels resulted in slow decline of the free standing restaurants, because all these hotels provided untroubled parking, a wide variety of high quality authentic food choices, spacious dining areas, luxury seating in air-conditioned comfort, these factors scored over restaurants offering limited menu and so on. Seventy & Eighties witnessed a boom in the F&B business among all the star class hotels. While world trend was 1:0.2 ratios, in India we were looking at the ratio of 1:1 or even more in the successful hotels. Hotels like Ashok Bangalore, Taj Mansingh Hotel and many more, made a genuinely neat profit in the very first year of their operations and all because of F&B contributing a good chunk to their revenue. Meanwhile various studies were also conducted by Ministry of Tourism which projected the demand for hotel industry in major metros.

8.      Late seventies saw the beginnings of the development of Indian Hotel industry. We had new players entering the arena with big muscle i.e. ITC- Welcome Group.This was a rich tobacco company reeking with cigarette funds. They launched first hotel in Chennai   (Madras) named Chola Hotel in 1975, followed by ITC Mughal Hotel Cum Convention Centre in Agra and finally Maurya Sheraton in heart of New Delhi. Starting ITC Hotels was a strategic move by one of the biggest management company headed Mr. Ajit Narain Haksar - the highest paid company head in India that time. He selected Mr. SN Gadhoke, Head of ITDC as his CEO along with few senior Excutives to start the company and to assist him in setting up the ITC Chain of Hotels. At that time ITDC was ruling Northern part of India and had the best team of executives. The management after losing staff occupying top positions got into panic as they didn’t want to lose the best team of highly qualified professionals in the country. Being a Public Sector Undertaking they got orders issued to all new hotels, instructing them not to hire any one from ITDC or else they will face the wrath of the Government. This was a major set back to ITDC professionals and a great opportunity for Oberoi Hotel’s staff and executive. This was a major decision that changed the attitudes, management technique and ethics of Indian Hotels and hospitality industry for ever – but unfortunately not for the better. Although Oberoi’s belief in the extremely efficient management practice but they carried a chip on their shoulder. The staff was groomed to be arrogant and uptight, their approach which was designed to emulate the European style of functioning.  Despite all this, even today we are miles behind in terms of the quality of services and hospitality standards when we compare India with South East Asia.

9.  Next major boost to Indian Hospitality Industry came with Asian Games in 1982-83, when Government approved the construction of three thousand rooms and 14 new hotels, in addition to the existing ones. The ministry also ensured additional accommodation by permitting hotels to add rooms to their existing properties; this initiative almost doubled the existing inventory and gave a boost to the tourist facilities in Jaipur and Agra. Unfortunately, after Asian Games, New Delhi went through the worst period of crisis with many hotels reporting low occupancy.   This was by far the most difficult period for the hotel industry. Most of the hotels till then, were totally dependent on tourism as growth in this sector was limited, as the corporate sector was not very effervescent in terms of patronage. Nearly all new Hotels were on sale either directly/indirectly. As for Bombay, Madras, Bangalore and Hyderabad the hotel development were minimal and Calcutta was almost standing still.

10.  Coming years posted minimal growth of the Industry. Things started moving upwards in the late eighties and early nineties. I remember, in the early nineties, when I was interviewed for the post of Sr. Vice President JP Hotels in Delhi, average ARR for Vasant Continental Hotel was Rs.900/- and for Siddharth Hotel was Rs.750/- and the ownership took a commitment from me that they will rate my performance as ‘Good’ if only I can increase the ARR to Rs. 3000 for Vasant Continental and Rs.2000 for Siddharth within a period of three years’ time. It is comforting to mention that we achieved this target in next five months and even crossed it in three years. Before my joining as Sr.Vice President, the ownership was so pessimistic that JP Hotel Chairman had circulated a letter to staff that if the hotels achieved the GOP of over 35%, he will distribute fifty percent of the additional income between officers and staff. Whereas the GOP in the very first year crossed 55% and to shy away from their commitment they got a back dated letter deceptively signed by me with fake pre-dated circulars – It was a trick – not very smart – A trick none the less.

11.  Hotels were totally dependent on ‘Tour Operators’ who used to enjoy their superior position. I remember my first meeting with the ‘Front Office Manager’ of Vasant Continental Hotel, he showed me the booking of over 300 rooms daily for nearly six months with confirmation letters. I was shocked and I told him that we had only 90 rooms, to which he replied, that by the time season will set in, most of these bookings will not materialize. He further explained that the tour operators’ start advance bargaining with all Hotels of South Delhi before the season starts and finalize the rates. In the end we only get around 35/40 rooms on average. In simple words the hotels were at the mercy of the tour operators-Like it or Not. Business scenario, since then, has been undergoing change-thanks to the opening up of the economy, slowly but steadily the corporate segment started growing and hotel bookings were not influenced by seasons. Corporates were paying better rates and were more loyal and so the hoteliers favored them over ‘Tour Operator’.

12.  1990 onwards demand for more and more hotels became a common cause and a compelling need for the Hotel Industry. Various studies started showing that hotel room tariffs were pinching both corporate clients and tourists alike. Major metros like Delhi, Mumbai, and Bangalore etc. were no more tourist destination, tour operators started to avoid the major cities, thereby compelling second tier tourist destinations to plan and build star class hotels. When I took over as CEO of Rattan Mama/PKF the first professional hospitality Consultation Company in India, we were at peak of the hotel demand. In three years we did over 57 assignments as consultant and majority of these were ‘Techno Feasibility Study’ for new hotels projects. Following years saw major growth of hotels all over India with Delhi and NCR in the lead followed by Mumbai, Madras, Bangalore, Jaipur, Agra and Hyderabad and so on.

13.  India was dominated by four local brands - Oberoi Hotels, ITC Hotels - Welcome group, Indian Hotels (IHCL) and ITDC. As time passed by, we saw few new Indian hotel chains emerge - Park Hotels, Leela Group, Clark Group, Lemon Tree and Sarovar. Till nineties there were very few International brands in India i.e. Intercontinental, Sheraton, Meridian and Holiday Inn. These brands were mostly ‘Franchisee Agreements’. If my memory serves me right the Hyatt Regency in Delhi was the first hotel which started operations with international management company. After Asiad this was one of the hotels which were going through tough times because of huge investments and rumors were then doing rounds that it was up for sale. Then they signed up a ‘Management Contract’ with Hyatt and rest is history. This has become the most successful hotel till date. Even today their turnover is highest in Northern India. Success of this brand opened doors to other Hotel Companies and thereafter started the decline of Indian hotel brands. Even today Hyatt Hotels are the most successful brand in India.

14.  One of the first genuine International brands in India was Radisson Hotels. In 1993 a team of Mr.K.B.Kachru (KBK) and Mr. Rajan Jetly after tremendous efforts were able to get Master Franchisee rights for India. I remember Mr. Kachru walked nearly door to door to introduce Radisson Group, the American Hotel chain owned by Carlson Group. They opened their first Hotel at Delhi Airport in 1996. Today they have nearly 150 Hotels in India, making them largest international chain with large number of Hotels are on management agreement. Although world wide Radisson Hotels is considered as three-star brand including USA. But in India due to efforts of one outstanding professional KBK Radisson is not only considered a Five Star brand but also a bankable and a very successful chain. In the history of Internationalization of Hotel Industry in India, KBK’s contribution will always need a special mention.

15.  When we trace the history of hotels industry in India, it is important to mention the contributions of Oberoi Hotels. It would be in place to give good amount of credit to The Oberoi Group for shaping up the industry. From day one, every hotelier’s yardstick was Oberoi Intercontinental Delhi and Mumbai. In India, there have never been any doubts about their management capabilities, finer skills required to maintain highest standards of hospitality and F&B services. Credit for this goes to one and only Mr.MS Oberoi in making it the most prestigious hotel chain in India. To carry the flag forward his son Biki Oberoi also did a commendable job. In 1997 when he started building first Rajvilas Hotel in Jaipur, we thought he has gone mad. Gold plated bathroom fitting over intricate marble and sandstone design, services par excellence, plus room cost four times as compared to the existing trends and tariff of over $400, when a good five star hotel accommodation in Jaipur  was  for  $40 - 50. It started slow but the success of

Rajvilas prompted them to open another such Hotel Udaivilas in Udaipur followed by Amarvilas in Agra and Vanyavilas in Ranthambhore. They were modern palaces better built and appointed then most of the Palace Hotels in India. For years they have been voted as Best Hotels in the world. It is rather sad to see this wonderful chain has become part of corporate take over battle with one final result - promoters loosing the brand to big shark- all that effort in vain

16.  Year 1999-2000 saw the start of many new developments all over the country, for first time Mumbai took off in big way. In 1999, I commissioned Regent Mumbai; it was the best built hotel in the country followed by Meridian Mumbai, ITC, Hyatt Regency, Renaissance Hotel Cum Convention centre and many more. Chennai, Bangalore saw many new outstanding hotel properties come up, but Hyderabad nearly double even tripled their room inventory. After long long time even Calcutta came up with about four new Hotels including Taj. Delhi was already over populated, but still saw few more hotels come up like Grand Hyatt in Vasant Vihar, Park Royal, Park Hotel, Metropolitan and Marriot in Saket. Few old hotels were reinvented with a complete makeover, renovation and upgradation e.g. Imperial Hotel, Royal Plaza and Shangri-La. But main growth was seen Gurgaon and Noida.  Today Gurgram has more Hotel Rooms than Delhi and Noida is catching up fast.

17.  Fortunately, this trend continued not only in five major Metros but also in cities like Pune, Lucknow, Chandigarh, Amritsar, Agra and Jaipur. Today Jaipur has more hotels than Mumbai, Calcutta, Bangalore or even Chennai. Reason being that it’s not just a tourist destination but also a thriving corporate market. Today every important destination in India not only has Indian brands of hotels but also of international chains of brands like Intercontinental, Radisson, Marriot, Accor and interestingly enough all these hotels are doing well. Recently for the first time we have our first ‘Hotel Village’ at Delhi Airport called Aero city which is a confluence of 12 to 15 hotels with nearly 3000 plus rooms along with Malls, Restaurants and other recreational facilities. Against all negative predictions this experiment became a great success, although it took little time. This concept was suggested by a great visionary Mr. Ashok Pawa, Secretary Ministry of Tourism and the location was Vasant Kunj, but due to political reasons it was blocked. We can expect a repeat of the same around other International Airports in India.

18.  India achieving these levels of growth has been the result of economic boom that has been driving the demand for hotel accommodation. In order to meet and even surpass this demand, big international hotel chains were introduced in country. They not only brought with them better know how, efficient systems but also a worldwide marketing network. Their management practices were very professional and didn’t allow promoters to interfere in day to day operations, thereby generating better profits. Today top brands flourishing in India are Intercontinental, Hyatt, Marriot, Radisson, Hilton and Accor, their main strength is the ability to fill up the rooms. Today these brands are in great demand and important thing to mention at this juncture is that these chains do business only on management contract basis. It would be in order to place on record that today India is fully dominated by ‘International Hotel chains’.

19.  For years together concerted efforts were made by all local players to develop hotels in 3 or 4 star category. But Indian promoters kept on building hotels in 5 star categories. Two very small Indian professional hotel management companies called Sarovar Hotels (owned by Mr. Anil Madoke and Ajay Bakaya) and Lemon Tree (owned by Patu Keyshawn) started managing small hotels in which big brands were not interested. Their professionalism, management skills and hard work finally paid off after years of struggle. It also paved way for this all new segment in the hospitality Industry. Today Sarovar Group of Hotels manages over 75 properties and Lemon Tree would have crossed over 100 properties if COVID-19 Pandemic had not stopped the advance. Unique thing about Lemon Tree is that it not only manages Hotels but also owns quite a large number of hotels. In my book of all the Indian Chains, these two brands have posted best performance in this segment. Reason being they don’t have big companies to support; their team is comparatively lean and is hands on. Surprisingly their marketing base is much stronger then other Indian Hotel Chains.

20.  From early 1970 to 1990 Hotel industry was dominated by four Indian chains i.e. ITDC, The Oberoi, Taj Group and ITC-Welcome Hotels. ITDC’s decline started by 1983/4, due to stagnation and complacent old team, poor management and bureaucratic  interferences, they started believing that there was no competition with other three chains they started selling their properties to private operators. It was a sad end of Industry leader of 1970/80, except for Ashok Hotel, which is still in a bad state because of misuse by the controlling DOT fraternity in power for their personal goals. 

21.  Now that leaves us with Oberoi Hotels, ITC and Taj Group. They use to own and manage mostly their own hotels. In the early nineties when they found that other international chains were adding more and more Hotels and so they decided to go all out for signing new properties to manage or increase the number franchises. Between Taj group and ITC they floated over dozen brands.Today both of them are managing or franchising over 65/70 properties each. Unfortunately, they are failing in delivery and large number properties are losing money. This is true for a majority of their own hotels.

22.  Their grip on the market when compared to international brands is fractional; commitment to the property is poor and the attitude very aggressive. Success international brands were getting is due to strong and lean management team, accountability and their ability to commit to the owner’s business. Although Indian brands are well established but cannot deliver. On other hand, the hotels which they were building were way more expensive for early return (ROI) and their properties were not getting require ARR in view of the investment. Although both these companies have backing of some of the big business groups, that gives them feeling of security and one cannot see their management team making any desperate effort to succeed and excel. Indian promoters are also realizing that all these three brands have strong legal muscles and can curtail their business freedom. Whereas the international brands are concerned, they can be asked to quit even at short notice and the property will be free of all issues, simply because these brand has no reason to create or enter into any dispute of the sorts, whereas Indian brands can create havoc for the ownership.

23.  As for Oberoi’s they are victim of high investment and hostile takeover. Whatever type of support they have, the fact is that most of their Hotels are not posting good returns making it difficult to continue for long time in the present avatar. It really makes you think, where we went wrong! Indian Industry still own some of the finest hotels like, The Oberoi Hotel, Taj Mansingh Hotel, Murya Welcome Hotel in Delhi, The Oberoi & Tower, Taj Mahal Mumbai and ITC Maratha in Mumbai and similar Hotels in Bangalore and Chennai all outstanding  Hotels which are running with highest standards and are great profit earners. Rests of the properties are just liabilities. Was this because of poor planning or excessive planning or Indian the ego got better of our future or maybe we are just a confused lot of Hoteliers who have lost direction.

24.  Every country usually follows a proven and successful trend right from its early stages. In case of India a successful model was hotels with strong Food and Beverage base. Even today the hotels with strong F&B base are doing financially well. Unfortunately this strategy is not as promising as it was in the past. Hotel F&B revenue was destroyed by our tendency to emulate the proven strategies or say ‘Monkey See - Monkey Do’ attitude without analysis or introspection. Only reason the hotels lost their F&B revenue was because they jacked up the rates to a limit till most of the hotels were beyond the reach of the middle class clientele. Across the world, the F&B rates are based on the costing where the formula is simple i.e. the menu prices are based on food cost of 25 to 30 percent plus-minus 10 percent, which was a practice in  India till early seventies and then Oberoi appeared on the scene. I still recall that most of hotels were selling Espresso Coffee at the rate of Rs.2 or Rs.2.50. but then Oberoi Hotels wanted to be rated better and perceived as superior, it decided to sell their coffee at a price of Rs. 5 which became the biggest news of those times. I decide to go and evaluate the quality to decide what was so special about the coffee and saw that it was nothing. Within next one month almost all hotels increased the prices of Espresso Coffee and since then the trend continues. Today a cappuccino which cost no more than Rs.6 is sold in a 5 Star Hotel for Rs.700 plus, in Cafes’between Rs.125 and Rs.175 and in a local bakeries for Rs 6o/-. The same logic is applied in case of food and beverage rates in the hotels, as even today the pricing in the menu of any hotel is not based on the cost, but it remains at par with the selling prices in the menus’ of the best Hotels in the city. The Oberoi Hotel’s reason (although not justified) for higher rates was to establish a status symbol for the city elite thereby create a superior social class in keeping with the principles of capitalism,  as for the followers it was very convenient to match the price and walk away with a neat profit without much to-do. Consequently, majority of hotels became unaffordable and to fill this demand slot more and more new stand alone restaurants started coming up – today most of them are doing well - simply because the dormant demand of this segment has been addressed. Baring few exceptions, there has been little or no effort from hotels or even hotel chains to reinvent the business in this potent slot.

25.  Story of the Indian Hotel Industry will not be complete without a mention of biggest disaster of our times, ‘The COVID- 19 PANDEMIC of 2020. The year 2020 has been the worst year in our life time. Hotel trade in India has never faced these levels of disaster ever. Millions of professionals are still out of job. Most of the hotels not able to even maintain their properties. This is a worldwide phenomenon. Only good news is the vaccine is coming and maybe coming sooner that we think. Question is what it means for us in India? My prediction remains same as mentioned in my earlier blog titled ‘Higher You Fall – Harder You Bounce’ (Refer Link Below); We all must remember that before being pushed into COVID 19’s Dark Age, the economy was picking up, Hotels in India were doing well financially. We were in the middle of a very good season. So my take is, God willing if we start getting the COVID 19 vaccine injections by the first week of January 2021 (as we all hope)  we can also expect that by May /June 2021 we would have achieved at least 60% success in urban India and the remaining western world would be free from the COVID - 19 Pandemic. Starting July /August 2021 we all will be witness to a very enthusiastic start of the biggest boom in our Industry, the likes of which countries may not have seen for a long time. But let us remember we will need to continue our resolve for ethical practices, and also learn from the lessons taught during the COVID 19 Pandemic. I hope that the next ten years of the Indian Hospitality Industry will revolve around Indian values and philosophies and that India will emerge as the leaders of new world order that will truly redefine the future of Indian Hotel Industry. 

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