Transcript Chinese tourism - University of Delaware

China: Future Hospitality Opportunities
Peter Lim
Director, International Development
Wyndham Hotel Group International
Shelley Perkins
Vice President, International Human Resources
The Ritz-Carlton Hotel Company L.L.C.
Michael Reilly
Purchasing Director
ARAMARK Olympic Project
Dr Fred J. DeMicco
Professor and ARAMARK Chair
Hotel, Restaurant & Institutional Management
Lerner College of Business and Economics
University of Delaware
China: Present/Future Hospitality
Opportunities for Students
中国: 现在与将来
Presented at the 2008 New York Hotel Show; New York, NY
Dr. Fred J. DeMicco, ARAMARK Chair
& Professor of Global Strategy & Development
Hotel, Restaurant and Institutional Management
Lerner College of Business and Economics
University of Delaware
[email protected]
302.831.6077
2008 Beijing Olympics
One World, One Dream
Pudong, Shanghai
Pudong, Shanghai
Forecast for World Trade and Tourism:
A shift in the “center of gravity”
EUROPE
ASIA
NORTH
AMERICA
“Let China sleep, for when
she wakes, she will shake
the world.”
Napoleon Bonaparte
Urbanization Rate is
10-15 Million People
Cities of 1 million +























































Source: CLSA 2005




China Outbound Departure
2002
16.6 million
2003
20.2 million
2004
28.5 million
2005
31 million
2006
34.5 million
2007
40.9 million
U.S.--an increasingly popular
destination for Chinese travelers

In 2007, China ranked as the 16th largest
international market for the United States.
397,405 Chinese visitors
$2.56 billion with average expenditure of
over $6,000 per person
Likely Trends for Future
The inbound tourism will continue to grow (UNWTO
expects China will be no. 1 inbound destination by
2020).
Hong Kong, Macau & Taiwan will remain as the most
important source markets.
Beijing 2008 Olympics & Shanghai 2010 World Expo
will accelerate the development of inbound tourism.
Top 12 Foreign Source Markets of
China’s Inbound Tourism
The top ten destinations for Chinese
outbound departures 2006
1. Hong
Kong
5. South
Korea
2. Macau
3. Japan
4.
Vietnam
6. Russia
7.
Thailand
8. USA
9.
Singapore
10.
Malaysia
Chinese tourists in the U.S.
A group of Chinese tourists take
pictures on Wall Street outside
the New York Stock Exchange as
New York City Police stand
guard.
World Tourism, 2020
Shanghai, China
Exotic and Authentic
Howard Johnson Plaza Hotel,
Shanghai
The Howard Johnson Plaza
Hotel is an elegant gem
steps away from the
Nanjing East Pedestrian
Mall, a huge Shanghai
Shopping District.
Days Hotel & Suites,
Beijing
China: Future Hospitality Opportunities
Peter Lim
Director, International Development
Wyndham Hotel Group International
Shelley Perkins
Vice President, International Human Resources
The Ritz-Carlton Hotel Company L.L.C.
Michael Reilly
Purchasing Director
ARAMARK Olympic Project
Dr Fred J. DeMicco
Professor and ARAMARK Chair
Hotel, Restaurant & Institutional Management
Lerner College of Business and Economics
University of Delaware
THE RITZ-CARLTON HOTEL
COMPANY
INTERNATIONAL OUTLOOK
CHINA/OPPORTUNITIES
China Hotels
•
•
•
•
•
•
•
The Ritz-Carlton, Shanghai
The Ritz-Carlton, Beijing
The Ritz-Carlton, Beijing Financial
The Ritz-Carlton, Guangzhou
The Ritz-Carlton, Sanya
The Ritz-Carlton, Shenzhen (upcoming)
The Ritz-Carlton, Pudong (upcoming)
China Opportunities
• LIVE leader program
• Valuable experience
• Exciting and dynamic environment and
workforce, eager to learn
• World Class product
• Expertise to train local talent. Expectation
that a foreigner will do so. Number one
retention tool is career development.
Things to consider..
• Language can be a challenge
• Cultural differences, leadership style and
motivational factors. China culture is
unique
• Visa restrictions
• Lifestyle
China Facts
•
•
•
•
1.4 Billion People
GDP 1 Trillion, number 1 by 2050
US 1 billion per week in foreign investment
Abundant labor, untrained talent. Low
cost of labor has been China’s
advantage…
• Salaries increasing 7 – 8.5 % last five
years
• New labor law 2008
“Be not afraid of growing slowly, be
afraid of standing still”
– Ancient Chinese saying
Upcoming Hotels
The Ritz-Carlton, Shenzhen
• Opening Date – Dec
2008
• Number of rooms –
275 guestrooms
• Additional Information
– New CBD area,
across from new
convention center,
outstanding business
location.
The Ritz-Carlton, Pudong Shanghai
• Opening Date – Dec 2009
• Number of rooms – 276
guestrooms
• Additional Information –
Pudong financial area in
Shanghai
The Ritz-Carlton, Kowloon Hong Kong
•
•
•
•
Opening Date – August 2010
Number of rooms – 302 guestrooms
Additional Information – 118 story building, hotel occupied top 16
floors
This will become the tallest hotel in the world!
The Ritz-Carlton Reserve, Krabi
Thailand
• Opening Date – December 2008
• Number of rooms – 54 villas
• Additional information – Great location,
destination resort airlines from Bangkok,
Singapore and Europe.
The Ritz-Carlton, Macau
• Opening Date – 2011
• Number of rooms – 256 guestrooms
THANKYOU!!
China: Future Hospitality Opportunities
Peter Lim
Director, International Development
Wyndham Hotel Group International
Shelley Perkins
Vice President, International Human Resources
The Ritz-Carlton Hotel Company L.L.C.
Michael Reilly
Purchasing Director
ARAMARK Olympic Project
Dr Fred J. DeMicco
Professor and ARAMARK Chair
Hotel, Restaurant & Institutional Management
Lerner College of Business and Economics
University of Delaware
The Five Chinas
The Margins
200 mio people
GDP: USD 110 bn
Heilongjiang
The Rust Belt
110 mio people
GDP: USD 120 bn
Jilin
Xinjiang
Inner Mongolia
Ningxia
Qinghai
Gansu
Xizang
Sichuan
The Hinterland
580 mio people
GDP: USD 400 bn
Henan
Hubei
Chongqing
Jiangsu
Shanghai
Anhui
Guangxi
The Coast
375 mio people
GDP: USD 550 bn
Zhejiang
Hunan Jiangxi
Fujian
Guangdong
Hong
Kong
Hainan
40
Liaoning
Tianjin
Beijing
Shanxi Shandong
Shaanxi
Guizhou
Yunnan
Hebei
The Diaspora
55 mio people
GDP: USD 1000 bn
Asia and Tourism


More than ½ of world’s population
Stage of development of tourism
greatly differs by countries and
regions.
Growth of Inbound Visitors,
1978-2006
China’s Outbound Tourists’
Overseas Spending. USD. bn
2008 Beijing Olympics
One World, One Dream
2008 Beijing Olympics
Questions?
Fred J. DeMicco, PhD
Professor and ARAMARK Chair
Global Strategy & Development HRIM
[email protected]
Forecast for Asia:
Opportunity or Threat?
China as an economy:
 Second-largest economy in the world in terms of
purchasing power
 Share of global trade up from under 1% 20 years
ago to 6% today
 2025: Asia will generate 60% of global economic
output (according to Asian Development Bank)
 Today, China accounts for 24% of the global
economic output
China as a trading partner:
 #1 to Japan, South Korea and Taiwan
 #2 to the EU
 #3 to the USA
GDP Growth: Asia and World’s
Advanced Economies
Travel Explosion
Minting Millionaires
According to the UN World Travel Organization
China is the fastest growing travel market
in the world,
China is estimated to reach 100 million
international travelers by 2020.
China will continue to be the
largest travel market in Asia.
Success of Asian Hospitality Industry
China’s Hotel Industry
In 1978, China had 137 hotels with
15,539 rooms.
In 2006, China had 12,80 hotels with
1,420,000 rooms.
Growth of Hotels by Star Rating
HR Challenges



Developing human resources capacity
1979– two institutions of tourism in China
(one in Shanghai and one in Hong Kong)
2007– close to 2,000 institutions in China
teaching tourism
– Some universities develop tourism as
“flagship” program for the university
– Some universities specialize only in tourism
e.g. Guilin University of Tourism
SHTMs teaching hotel
to open 2010











Faculty offices
Classrooms
Laboratories
Library
290 rooms
3 restaurants
Indoor swimming pool
Spas
Conference center
Ballroom (500 seats)
plus function rooms
Training restaurant
The Way Forward:
Understanding Asian market and
consumers will be critically important
for tourism industry in the U.S. and
Europe.
 Exchanges and collaboration between
U.S. European and Asian institutions and
industries will further enhance value
creation to both parties.

2008 Beijing Olympics
One World, One Dream
2008 Beijing Olympics
One World, One Dream


FACT: A new global middle class is rising up
from poverty in emerging economies
around the world. Coca-Cola's sees this
market as critical to the company's future
and describes the scale of the opportunity
as equivalent to:
“ adding a city the size of New York to the
world every three months”.
Olympics Cube is all ship-shape



The number of Chinese citizens traveling overseas will
hit 100 million a year by 2020 from 34 million in 2006,
(World Tourism Organization)
Chinese visitors to the U.S. have doubled over the last
decade to 397,000 last year, Commerce says. The
number is expected to reach a robust 755,000 by 2017,
according to research firm Tourism Economics.
The China National Tourism Administration estimates
that nearly 30 million Chinese traveled abroad in the
first nine months of 2007, up 17% vs. the year-ago
period. Hong Kong, Macau and Japan were top
destinations. But many are expected to turn their sights
to the U.S.

On December 11, 2007, the U.S. and China
signed a memorandum of understanding
(MOU) to facilitate Chinese group leisure
travel from China to the United States.


About 250 Chinese travelers from Beijing, Shanghai and
Guangzhou ended their four-day tour in Washington D.C.
on Friday, saying that they have received unprecedented
high-level welcome.
Their arrivals at the International airport were awaited by
a U.S. jazz band and senior officials of U.S. Commerce
Department including assistant Secretary William Sutton
with greeting banners.
Welcome!
The first travel group from China
The first Chinese tourist travel group in the U.S.
6/19/2008
comments


The Chinese are no different," "They opt for
bargains. They spend mostly on what they
want to take back home. And they eat food
they're familiar with.“
"The U.S. has always been a place that many
Chinese would like to see and with agreements
like this, we can safely say that many will now
get their wish," said Coley Dale, Ctrip's
Shanghai-based business development
manager, in an e-mail interview.
comments

Reports and anecdotal evidence show they
like visiting famous places in the U.S. in big,
air-conditioned buses and buying brandname goods at upscale shopping malls.
Some Culture differences
1.
2.
3.
4.
Chinese people use chopsticks rather than fork and knife.
Chinese people usually don’t tip.
Chinese people tend to be loud when together, especially
when dining with friends or family.
Chinese people like to bring along cash and other valuable
things such as Digital cameras and Digital Recording
Devices.
http://www.investors.com/editorial/IBDArticles.asp?artsec=16&artnum=1&issue
=20080709




The jump in personal wealth is also creating a growing class of
Chinese who can easily afford to travel to the U.S.
The number of China's millionaires surged 20.3% to 415,000 in
2007, according to a Merrill Lynch and Capgemini report. The
ranks of U.S. millionaires grew by only 3.7%.
"Travel is increasingly viewed as an indicator of status in China.
It's something to tell your friends about when you get home,"
Expedia's Kjellberg said. "China also has a relatively strong
currency, making international destinations more affordable."
Kjellberg says Expedia hopes to open its air, hotel and other
travel inventory to Chinese tourists via its tie-up with Chinese
Web travel firm eLong.
HRIM Strategic Plan
“ To be the Innovative, International leader in HRIM
teaching, research and service…”
Goals: Attract new students to UD,
opportunity for study abroad for our UD
HRIM students, strategic global alliances
for research, scholarship and continuing
education for professionals
Asia---Taiwan 2007-2008
Signed distance learning agreement to offer a 4-course
hotel certificate
with :
Yaun Ze University in Taipei (owned by The Far Eastern
Company- Shangri- La Hotel)
Soochow University in Taipei
Hong Kong Polytechnic University
UD Student Team Visit
China Market Overview
April 3, 2008
Leehun Lee – China Market Executive
Wendy Lo
Annie Zheng
Opportunity in Asia
 As mature markets continue to exhibit slowing growth, investors are looking to Asia as a
source of superior returns
 Asia increasingly becoming the primary choice of investment worldwide
 By 2015, China should join the United States and Japan as the three largest economies
in the world; with expectation of being the largest within 40 years
 It is this disparity in national growth stages – and the associated changes in consumer
behavior -- that gives rise to opportunities for those who seek out global partners
Urbanization Rate is 10-15 Million
People p.a.
Cities of 1 million +























































Source: CLSA 2005




  











Questions?
Fred J. DeMicco, PhD
Professor and ARAMARK Chair
Global Strategy & Development HRIM
[email protected]
Asia---Taiwan 2007-2008
Signed distance learning agreement to offer a 4-course
hotel certificate
with :
Yaun Ze University in Taipei (owned by The Far Eastern
Company- Shangri- La Hotel)
Soochow University in Taipei
Hong Kong Polytechnic University
“Let China sleep, for when
she wakes, she will shake
the world.”
Napoleon Bonaparte
UD Student Team Visit
China Market Overview
April 3, 2008
Leehun Lee – China Market Executive
Wendy Lo
Annie Zheng
Opportunity in Asia
 As mature markets continue to exhibit slowing growth, investors are looking to Asia as a
source of superior returns
 Asia increasingly becoming the primary choice of investment worldwide
 By 2015, China should join the United States and Japan as the three largest economies
in the world; with expectation of being the largest within 40 years
 It is this disparity in national growth stages – and the associated changes in consumer
behavior -- that gives rise to opportunities for those who seek out global partners
The Five Chinas
The Margins
200 mio people
GDP: USD 110 bn
Heilongjiang
The Rust Belt
110 mio people
GDP: USD 120 bn
Jilin
Xinjiang
Inner Mongolia
Ningxia
Qinghai
Gansu
Xizang
Sichuan
The Hinterland
580 mio people
GDP: USD 400 bn
Henan
Hubei
Chongqing
Jiangsu
Shanghai
Anhui
Guangxi
The Coast
375 mio people
GDP: USD 550 bn
Zhejiang
Hunan Jiangxi
Fujian
Guangdong
Hong
Kong
Hainan
85
Liaoning
Tianjin
Beijing
Shanxi Shandong
Shaanxi
Guizhou
Yunnan
Hebei
The Diaspora
55 mio people
GDP: USD 1000 bn
Pudong, Shanghai
2008 Beijing Olympics
One World, One Dream
2008 Beijing Olympics
One World, One Dream
Chinese tourists in Euro