In the hospitality industry, hotels are often described as two distinct businesses. One is the operating business, which involves the renting of the guest rooms and the provision of food and beverage. The other is the real estate business, owning the land and building which house the hotel property and operations. Those two distinct attributes, the fact that hotels are both an operating business and a real estate business, have been the cause of many of the major changes in the hotel industry over the past 30 years.

Going back to the 1990s, Marriott split into two companies, an operating company and a real estate company. The reason it did so was because investors felt that those two businesses were distinct and that the skill sets necessary to maximize both were different. There was inefficiency from having both under the same ownership structure. Due to increased online hospitality education on what works best, the hotel industry has largely moved in that direction of separating asset ownership from day to day operations.

One of the key concerns of hospitality and hotel investors is making sure the relationship with the manager of the property is on an even keel. Hotels often have a tension in that managers are compensated primarily on the basis of top line revenues while owners are compensated on the basis of bottom line profitability. Those two different attributes, as to how they are compensated, can lead to challenging relationships, especially as the business gets weaker during a economic downturn.

There is a whole field, in fact, of advisors and counselors that provide hospitality education and help hotel owners and managers work through these relationship issues. This affects everything from approving annual budgets to capital renovation plans as well as the day to day attributes that go into the hotel business.

Let’s take a look at how a successful last can be modified and changed in footwear and the footwear business to increase sales and reach a new audience.
We love the last. We had success with its sales, but we can’t make the same shoe we made last spring. So to continue using this last, we have to take and modify certain things about the footwear we’re producing on the last.

We know we have a successful last, we know that it sells well, we know it looks great. So we can change any number of design features. We can do something as simple as changing the top-line cut of the shoe. If it’s athletic, we can put a collar and change the shape of the collar, the height of the collar, the Achilles pen, so on and so forth.

If it’s a dress shoe, we can change the top line cut by putting a dip on one, an asymmetrical dip somewhere on the top line, or put some sort of embellishment on a top line that wasn’t used in the previous spring season.

We’re also going to be changing our materials and colors for the new season. Those are simple changes that help to make the same last we used last spring, look, have the shoe look completely different next spring, just by its color, it’s cut.

We can also do other things. We can take and change the component tree or the structure of the footwear. The structure is the way the bottoming is done: the heels and the soles.

Last spring we used just the very thin, a ladies shoe and we used a very thin sole and just a simple high heel, like a spike kick. Next spring, if we wanted to, we could do a platform. We could do a full platform, we could do a partial platform under the ball and a higher heel, which we may have marketed as a 10-centimeter heel last spring.

We put a two-centimeter platform under the front, we add two centimeters to the heel to maintain the balance, which is part of the last itself. Now we can market the thing next spring as a 12-centimeter heel. Same last, completely different footwear.

This is a way of taking a successful last and amortizing it out over time without looking like you’re repeating yourself.

In the restaurant industry, the customer-facing employees that greet you when you walk in the door are referred to as “front-of-house.” The host, front-of-house manager, or dining room manager are all important and frequently assist guests.

Yet, there are many front-of-house positions. These are the employees who closely interact with guests. Their roles include:
* Maintaining a consistent pace within the dining room
* Ensuring fast and efficient service
* Correctly charge guests
* Processing checks

The restaurant manager, host, and reservationist are the first to interact with the guest and show hospitality. They ensure that the dining room runs smoothly and that guests who arrive with a reservation are seated promptly. Our front-of-house team also includes servers and bussers because it encompasses everyone who has direct contact with our guests.

Sales and Service Sectors
Front-of-house employees work in the sales and service segments. They sell catering orders, take reservations, and assist with wine selections. They ensure food is ready for pickup and that tables are available. These employees also assist individuals who may need help with the menu. The service segment as a whole participates in the guest’s service. Waiters, bussers, sommeliers, and bartenders all fall within this category.

The Impact of Food Ordering and Delivery Systems on the Hospitality Industry
Many restaurants are adopting what I call commissary models. It’s where you buy food and beverages through a delivery service (e.g., Grubhub, Seamless, Uber Eats) and have it delivered to your home.

In this scenario, front-of-house employees take the reservation and deliver the food. The front-of-house manager, or owner, is in charge of the entire operation. They make sure that everyone is on the same page. Guests continue to receive the level of service they expect from the restaurant.

Catering is a real benefit to restaurants. It can take a lot of forms. I can cater by having you pick up food at my restaurant. So, it could be as simple as a deli catering out a sandwich platter that Mr. or Mrs. Customer is going to pick up. That’s easy.
It could be that I’m delivering that sandwich platter. That’s still easy. It could also be that I’m delivering that sandwich platter and providing a service staff member to serve it for you at your home or your party. So, catering increases what we call same-store sales.
If I have 20 seats in my restaurant and, on average, I get two turns at lunch and two turns at dinner, that means that 80 people are going to be able to dine in my restaurant.
If my average check is $10, that means that I have made $800 that day by people eating at tables in my restaurant. But, I can also prepare food for 80 people at a catered event that will not be in my restaurant.
The consumer would pick it up or I would deliver it. I would still get $10 a person, maybe even more, because I’m supplying all of these disposables.
Now, I made $800 in my restaurant that day from people who came in and sat at tables, and at least $800, if not more, by catering one event for 80 people. So, I’ve increased my same-store sales — meaning, my same four walls, my same hours of operation — just by sending out catering.
Catering can typically be prepared when I’m not in the lunch or dinner rush. When I’m doing garde manger in the morning, prepping food for lunch, I could be cooking the catering food and putting it in the refrigerator to be delivered or picked up later. Catering is an extremely positive and profitable benefit for restaurants.

Now, that is catering that doesn’t happen at my restaurant. Many restaurants may have a banquet room where they offer catering. That is a place mostly for celebratory events. I guarantee it’s dark most of the week and they’re perhaps using it on the weekends. But they can use that room at any time. It does increase same-store sales as well. But you’re paying rent on that.
I’m a proponent of catering. My favorite kind is preparing food, getting it out the door, and letting people eat it elsewhere because I’m getting paid that revenue. I’m not cleaning it up; I’m not worried about China plates and flatware disappearing, and I’m not worried about someone taking up a seat in my restaurant while they’re on their smartphone for 45 minutes. I’m just getting it out the door and getting paid for it.
So, catering, again, can be very profitable. However, from an operations perspective, you need to prepare a good catering program. It can’t be haphazard, because then you will wind up spending more money than you’re making. Maybe you’re not buying or packaging properly.
You need to make sure that it’s well-packaged so that, when it gets to the guest, it looks great. Maybe they’re going to heat it at home. That’s all well and good, but it still has to look and taste great. Therefore, the way you package food makes a big difference.

The back of house of a restaurant operation is like a manufacturing section. This is where culinarians perform. In the back of house you have several roles that make the kitchen hum, including:
* Executive chef
* Sous-chef
* Line cooks
* Grill cooks
* Utility team

Everyone likes to be romantic when they talk about their food, but the back of house is like a manufacturer. It might seem unromantic but the stark reality is that raw materials come in the back door of a restaurant.

From vegetables, meats, to fish, everything comes in a raw state. It is butchered, sliced, and diced by the team in the kitchen. Then just like you take raw materials to build a car, the materials are manufactured into a wonderful meal that leaves the kitchen. Ideally, it’s beautifully plated and at the right temperature, ready to impress the guest receiving the meal at their table.

The kitchen, or the manufacturing team, is the back of house. These are the people who we call culinarians – ones who are preparing all the food.

There are also a lot of utility jobs in a restaurant. There is someone to clean the restrooms and someone to make sure that the plates, flatware, and glasses are sanitized and clean. These types of jobs are also part of the back of house function.

Hidden in between back of house and front of house, there are lots of jobs in the restaurant industry. It might be easier to say front of house and back of house, but there are lots of professional jobs in between as well.

Many professional jobs that are also now part of the restaurant industry. Restaurateurs need to make sure they have a good attorney and good accountants. They may even need consultants who help them navigate city codes and health departments, to make sure that they can get their certificates in a timely way.

Restaurant operations are complex, and there are many back of house functions that help bring the food and beverage operations to life.

There are many ways to get into the restaurant industry. The quickest and simplest is to get a job at a restaurant. Become a server, cook, or manager. The easiest way to get into the business is to get a job at a food establishment.

There are more complicated ways because you may want to have more ownership in the restaurant. Franchising would be another way to get into the restaurant business very quickly. We see franchises every day-Dunkin’ Donuts, McDonanld’s, Chopped, and Burger King. They’re all around us. These franchises provide you with all the rules, regulations, and instructions.

You rent all of this from the franchisor, and the franchisor helps you establish your business. It is a quick way to get into the business. Quick meaning three to four months- especially if you’re buying a franchise that was already in existence and the restaurant was already open. If you choose to build a new franchise, it may still take only four months, but it’s going to be a lot more difficult because you’re dealing with the construction of a restaurant.

If you don’t want to become a franchisee and buy into somebody else’s product, you can always buy a restaurant that is closed. It has a kitchen, there are tables and chairs, and it has lighting fixtures, equipment. The kitchen is equipped, but it hasn’t been open for months. You’re going to buy it, clean it up, buy food, and start a new restaurant there.

That’s another fairly simple way to get into the restaurant business fairly quickly. More complicated ways to get into the restaurant business include developing a concept of your own brand-new restaurant and then find a bare space to design a kitchen and dining room. Now you may be 18 months away from opening your business because there are permits, licenses, fees, and training.

You need to establish how you’re going to buy food and test your menu. It’s a lot more complicated. That’s the most difficult way to get into the restaurant business. The speediest way is to work for someone in the restaurant business. If you want to be an owner, a quick way if you have the capital is to buy an existing restaurant that’s already open. When you buy it, it will continue to be open and operate.

A lot of research must be done to make sure that it is a restaurant that is profitable and will continue to be profitable. If it is not, then you could be buying someone else’s albatross, and you could be out of business quickly. If it’s not, but you have a great vision of how to reinvigorate energy into the menu and the concept and know that you can market it and build an entirely new crop of consumer for it, is a quick way to get into the restaurant business and be successful fairly fast.

Shirley Lu, Revenue Analyst for The Standard Hotel explains what makes The Standard different and how they generate their revenue.

“As a revenue analyst, what we do is optimize the revenues that come into the hotels to make sure that we are performing the best and reaping in the most revenues that we can,” explains Shirley Lu. “A lot of that has to do with research and pushing our sales team to prospect new clients or continue their relationship with their current clients.”

Some of the job is managing distribution channels, making sure that we’re restricting what segments we need, to enable the highest-producing segments to come in. Overall, Shirley explains that it’s a mix of distribution channel management, analyzing data, and researching what new business we can potentially get for the two properties.

Starting with the Standard High Line building, it’s a book shape elevated on top of the High Line. “With the book shape and the floor-to-ceiling windows, I think it is those elevated floor-to-ceiling windows that add value to our product,” explains Shirley. “When people are staying in the property itself, it feels much more spacious with those window features. And having the views of the river and the city, also lets the natural sunlight in, definitely adding to the experience of the Standard High Line.”

As part of that, we are very keen on trying to contribute back to the community. “With every reservation, we give guests the option to donate $2 to the High Line to help maintain and preserve what it gives to the community and tourism. I think that’s a great initiative that we continue to do daily,” says Shirley.

Now, moving upwards into our top of the Standard venue and our Le Bain venue, Shirley explains that they are two very different venues. Top of the Standard is an elegant space for people who enjoy cocktails in a less party scene environment. We also offer sunset service to our guests, where they can watch the sun go down across the Hudson River and enjoy a cocktail up there as well. It is a much calmer, more elevated, and elegant scene.

Then, you move over to Le Bain, and you’ll hear the pumping music, the beat of the bass from our DJs, and just a wild time. So definitely, the two venues are managed differently and we try to keep them separate. But that allows for us as a hotel company to allow different clientele to come and join us all under one roof but under different venues.

So for our Le Bain, we often have guest DJs coming in. And we like the crowd to be diverse. That’s something we strive to do, is to allow as many different people to come in as possible, explains Shirley. We have the rooftops as well, where it is, again, very much a different scene from Le Bain on the 18th floor, where you have the pool, the whirlpool, that is now open for the season. Then, on the top floor, you have the open-air rooftop and views of the city all over both venues. It’s a very unique space. It continues to be the center of attention for a lot of nightlife in the city.

Then moving down to our ground floor venues, we have the beer garden, which has a lot of different activities. I think of it as an adult playground. You have giant Connect Four, ping-pong, foosball, and you have your beer. It is a very cool space as well. And then we have our highly acclaimed restaurants like the Standard Grill. We just have our chef, Rocco Forte, spearing that and bringing us to get the recognition that we strive to have.

The Plaza is the outdoor space leading into the lobby and that venue we couple internally with our Living Room, which is the indoor area where we often have a guest DJ come in, just to liven up the scene as well. Shirley mentions those two spaces, the Living Room and the Plaza work together in terms of staffing and as a venue itself.

The Plaza is a multi-purposeful space. And that is the space that we use for our art installations and different installations because it has an outdoor component. That is a space we like to allow guests to still experience the joys of the outdoor weather while still being under the High Line and in the shade of the High Line. It’s a very unique space, and we’ve been able to do so much with it already.

Speaking generally to food and beverage and how it relates to our hotel rooms aspect of the industry-so food and beverage is often separate from our hotel operations. Shirley explains most hotels outsource food and beverage because there’s more experience to be had from those who’ve already done food and beverage in the restaurant industry versus having the hotel operate both hotel rooms and food and beverage. Food and beverage generally don’t do well to bring in revenues for a hotel property. That influences the decision for a hotel to outsource food and beverage.

For us, we are completely operated, both food and beverage and hotels, under one company, The Standard. So we don’t outsource. “We are strong in the food and beverage industry for a hotel company. And we take pride in that,” explains Shirley. “So, while most hotels are losing money on the food and beverage side, we tend to generate revenues on that side.”

Shirly says she doesn’t do much with the food and beverage. Her role is specific to selling the rooms of the hotel. However, sometimes they will package rooms’ specials with food and beverage credits or food and beverage experiences to sell both components together. That’s how she interacts with the food and beverage departments. Otherwise, it is pretty separate within our property and most of the hotel properties.

New York City competes against Paris and London. These are all known cities.
But if you want to start a tourism destination, there are six things that need to happen. I have developed this framework called the Six As.

The first is awareness. You need to build it. How do you do that? You may want to have some world-class events taking place in your destination. For instance, Finland organizes crazy competitions like marsh football. Teams play football in a marsh and then in a swamp. They also organize a wife-carrying competition. You carry your wife, and you have to be legally wedded.

In addition, they organize throwing cell phones and rubber boards, which gets the country publicity — global publicity. So, that would be one of many ways to create buzz and awareness.

Then, you need attractions. New York City has an amazing set of attractions, from Central Park to museums.

Then, you need activities. In New York, you have a fashion week, a lot of trade shows, and the New York City Marathon. So these are world-class activities, that also bring awareness to the destination. More often than not, they’re the reason to visit New York City.

Out of those attractions and activities, you can form associations or consumer forums associations, which is basically their perception of the destination. When you hear the word New York City, what comes to mind? It could be the New York City Marathon; it could be some of the movies (e.g., When Harry Met Sally).

So, New York City is a place for movie making, which helps put the destination on the map. And there are actual tours; people go around New York City to hunt down the places where the movies were made. That’s a great way to create associations.

Then, you need access. Access is, especially for international tourists, the flights. How many direct flights from your home country come to JFK or Newark? And then how do you get to the hotel? How is ground transportation organized? In this case, airports — like LaGuardia — are behind the many international airports. But they are investing in this. So, we need to have very good access from the airport to the city and back.

Finally, it’s affordability. That’s the A number six. How much does it cost?

I benchmarked places like Arctic destinations in Finland, Sweden, Norway, Iceland, Greenland, and Alaska. I measured all these items, including affordability. Of course, you take a perspective. In my case, I studied a tourist from New York City who wants to go on an arctic holiday.

The most competitive was Iceland. Alaska was the most known. But when it came to activities and attractions, Finland offered the best. So, this is the way to do it.
You can calculate the actual cost using search engines like Kayak, which gives you the airfares and four-star hotel rates.

I did one about jazz festivals around the world. You have to factor in how much it costs for five days to attend a jazz festival in Havana, Montreal.

These are the necessary things. In summary, the six A’s you need are awareness, attractions, activities, associations, access, and affordability.

How do you know what makes a great hotel? Well, consumers can use TripAdvisor. They can look at consumer reports. And they can find out what the most preferred brands are. If you look at the JD Power list, you’ll see all the best hotel companies. These comparison companies use specific criteria to rank hotels. Often it is based on the service, location, loyalty program, and facilities provided. But there could also be other criteria considered.

Think about restaurant ranking lists. For instance, the Zagat survey is a respected publication that ranks and rates restaurants. They look at the food service and decor. And they use a zero-to-five-point scale. Bernardin and other New York restaurants usually top global restaurant rankings. So, these are just some of the ways to set a benchmark and make your restaurant or hotel successful. Similarly, you can use a list like the 6A to help make your destination successful globally.

To understand what makes a hotel successful, you need to follow and understand your customer’s journey. Firstly, they dream about staying in a destination and hotel. Then they do their research. Following this, they choose the hotel, make the reservation, travel to the hotel, check-in, stay and check out. Finally, the hotel keeps in touch with them by asking them to review their stay and persuade them to sign up for their loyalty program.

During their stay, the room experience is essential. Rooms don’t have to be big to be good. A small room can have efficient service. If you are in a luxury hotel, the room has more amenities. So, again, the room is important. As is the food and beverage service. What services does the hotel provide? Remember, overall service quality is also critical.

Administrative processes are also vital to making your hotel successful. The check-in process, the check-out process, and overall customer satisfaction. Not to mention the cost and the fees. How much do you pay for a hotel? Because above all else, it’s always about value for money.
Yes, people in New York City pay over $1,000 for a room at the Mandarin Oriental, Four Seasons, Ritz Carlton, St. Regis, or Peninsula. And that’s because they offer value for the price, and they feel it’s a reasonable, fair rate.

However, in comparison, at independent hotels like Moxy and Lifestyle hotels, people may pay $200-300 for a night’s stay. So you’re likely not expecting as much. However, it is still good value for money as although what you get in those hotels is less than the more expensive hotels above, it’s relatively competitive for the rate you pay.

When you consider all the criteria above, you will understand precisely what it takes to have a successful hotel that people want to stay at.

Dr. Jukka Laitamaki is a clinical professor at New York University SBS Jonathan M. Tisch Center for Hospitality. His background is management consulting and he holds a doctorate from Cornell Hotel School. His expertise is in strategy, branding, and business development.

With his background in management consulting, Dr. Laitamaki was with McKinsey and Company and Service Management Group, and worked in the hospitality industry in several sectors in Europe and the United States. As a professor, he has taught in all six continents in executive programs.

An avid world explorer, Dr. Laitamaki has traveled to a total of 63 countries. He has also spoken at the United Nations. His most recent research is on sustainable tourism and the United Nations Educational, Scientific and Cultural Organization (UNESCO) World Heritage sites. He has focused on Cuba which has 11 sites and four historic city centers.

Sustainable development, especially in tourism hospitality, is very important to Dr. Laitamaki. The principle that we should leave this planet in a better condition than we received it for the future generation is important. UNESCO does wonderful work in preserving many historic, cultural, and natural sites.

Sustainability in the hotel sector is also important because it saves energy. More consumers, especially millennials, are looking for environmentally conscious companies. Companies like Marriott, for instance, has a brand called Element, which is an extended stay brand. Element is very energy efficient and uses recycled materials for their buildings from floor to ceiling.

With this online hospitality education course you will learn about the tourism industry. You will learn about global destinations as well as a lot about New York City. Why do consumers come here? You will learn about hotels and how consumers choose hotels, cruises, and car rental services. You will learn about this growing industry and how it’s transforming.