Infrastructure, regulations and talent management continue to be a challenge to growth
New Delhi, 11 February, 2012-India’s Hospitality sector is expected to witness high growth over the long-term as per PwC-CII latest survey report titled ‘Hospitality insights: From the Indian CEOs’ desk’. More than 80% of CEOs interviewed believed that India will not be affected by the economic downturn over the long run. The growth in the sector is largely expected from the domestic travel – business or leisure. With consumers being more demanding and price-conscious, the budget and mid-market segments are the possible growth areas as per the CEOs.
The survey report covers the top of the mind issues that CEOs face in the hospitality business – from managing costs to developing synergies across multi-format multi-location functions in the business. It gives insights into the challenges faced by the CEOs while managing talent and the tax and regulatory issues.
Some of the key findings from the survey include:
Commenting on the way forward for the industry, Chandrajit Banerjee, Director General, Confederation of Indian Industry (CII) said, “There has been a huge upsurge in the Indian domestic travel , due to which the budget and the mid –market segments in this sector emerge as strong opportunities especially in view of the recessionary trends in the West ”.
The high costs of real estate and lack of any tax incentives by the Government are acting as hurdles for the hospitality sector. These challenges are further accentuated by overall infrastructure deficit in the country. Rationalisation of the number of tax levies and implementation of single tax regime will benefit the hospitality industry. At present, a hotel needs almost 80-100 licenses before it starts its operations in India. Almost all CEOs interviewed unanimously voiced the need for “effective single window clearance” to make the process smooth and avoid the untimely delays.
Sharing his insights on the trends in the industry Timmy S Kandhari, Leader – Hospitality & Leisure Practice, PwC India said, “The growth potential of the hospitality sector in India is well accepted. However, the realisation of sustainable growth depends on expanding infrastructure, managing costs as well as talent better and providing for tax incentivised development.”
About the survey
With a view to bring out the relevant industry insights, we interviewed 20 eminent CEOs on the following parameters:
A detailed questionnaire was discussed with each of the participants. Their responses form the basis of this survey. All hotel chains (Indian and international) having five or more operational properties in India have been considered for this survey. We hope the findings of the survey will help CEOs to make the right decisions and improvise strategies and developmental plans
About Hospitality and Leisure Practice, PwC India
PwC Hospitality and Leisure Practice has a qualified professional team that works across the breadth of hospitality and leisure segment. We understand how changes in this broader industry are affecting our clients and we work with them as a trusted advisor providing solutions to help improve organisational effectiveness and long term success. We offer industry tailored performance improvement and transactional services as well as crisis support. This makes PwC one of the key advisors to the hospitality and leisure industry.
PwC firms help organisations and individuals create the value they’re looking for. We’re a network of firms in 158 countries with close to 169,000 people who are committed to delivering quality in assurance, tax and advisory services. Tell us what matters to you and find out more by visiting us at www.pwc.com.
In India, PwC (www.pwc.com/India) offers a comprehensive portfolio of Advisory and Tax & Regulatory services; each, in turn, presents a basket of finely defined deliverables. Network firms of PwC in India also provide services in Assurance as per the relevant rules and regulations in India.
Providing organisations with the advice they need, wherever they may be located, our highly qualified, experienced professionals, who have sound knowledge of the Indian business environment, listen to different points of view to help organisations solve their business issues and identify and maximise the opportunities they seek. Our industry specialisation allows us to help co-create solutions with our clients for their sector of interest.
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The Confederation of Indian Industry (CII) works to create and sustain an environment conducive to the growth of industry in India, partnering industry and government alike through advisory and consultative processes.
CII is a non-government, not-for-profit, industry led and industry managed organisation, playing a proactive role in India's development process. Founded over 117 years ago, it is India's premier business association, with a direct membership of over 7000 organisations from the private as well as public sectors, including SMEs and MNCs, and an indirect membership of over 90,000 companies from around 250 national and regional sectoral associations.
CII catalyses change by working closely with government on policy issues, enhancing efficiency, competitiveness and expanding business opportunities for industry through a range of specialised services and global linkages. It also provides a platform for sectoral consensus building and networking. Major emphasis is laid on projecting a positive image of business, assisting industry to identify and execute corporate citizenship programmes. Partnerships with over 120 NGOs across the country carry forward our initiatives in integrated and inclusive development, which include health, education, livelihood, diversity management, skill development and water, to name a few.
CII has taken up the agenda of “Business for Livelihood” for the year 2011-12. This converges the fundamental themes of spreading growth to disadvantaged sections of society, building skills for meeting emerging economic compulsions, and fostering a climate of good governance. In line with this, CII is placing increased focus on Affirmative Action, Skills Development and Governance during the year.
With 63 offices including 10 Centres of Excellence in India, and 7 overseas offices in Australia, China, France, Singapore, South Africa, UK, and USA, as well as institutional partnerships with 223 counterpart organisations in 90 countries, CII serves as a reference point for Indian industry and the international business community.
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