Naga College Foundation, Inc.

M.T Villanueva Ave., Naga City

College of Business and Management

Chapter 2: The Tourism and Hospitality Industry:

Implications on the
Management of Service-
Oriented Business

HPC 3: APPLIED BUSINESS TOOLS AND TECHNOLOGIES

 OBJECTIVES:
Describe the characteristics of the tourism industry and
hospitality:
❑ Provide overview of the Philippine tourism industry
❑ Explain the differences between product and service
offerings in the hospitality industry; and
❑Identify the different types of customers in the
hospitality industry.

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Overview of the Philippine Tourism
• Before the COVID-19 Pandemic was declared a crisis in
2020, tourism was a force that shaped societies and
landscapes.
• Tourism activities created businesses that prospered
economies.

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Overview of the Philippine Tourism
Before the Pandemic (2019):
• In 2019, the Philippines recorded 8.26 million foreign
tourist arrivals, marking an all-time high.
• Major tourist markets included South Korea, China, the
United States, Japan, and Australia.

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Overview of the Philippine Tourism

During the Pandemic (2020-2021):

• In 2020, international arrivals dropped drastically due to
travel restrictions, lockdowns, and border closures.
• The total number of foreign tourists was about 1.48 million,
an 82% decline compared to 2019.
• In 2021, the numbers were even lower, with only around
163,879 international visitors due to prolonged restrictions
and the slow reopening of borders.

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Overview of the Philippine Tourism
After the Pandemic (2022 onward):
• By 2022, with the easing of
restrictions and the gradual reopening
of international travel, foreign arrivals
increased again but were still far
below pre-pandemic levels.
• The Philippines recorded about 2.65
million international tourists in 2022.
• The government and tourism
stakeholders lured tourists through
promotions and safety measures, but
the numbers remain in recovery
mode.
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Overview of the Philippine Tourism
After the Pandemic (2022 onward):
• In 2023, the Philippines recorded 5.45 million international
tourist arrivals, surpassing its initial target of 4.8 million.
• The top visitors in 2023 came from South Korea, the United
States, Japan, Australia, and China.
• For 2024, the Department of Tourism (DOT) aims to target
7.7 million visitors​

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Overview of the Philippine Tourism
Summary:
• 2019 (before the pandemic): 8.26 million tourists
• 2020 (start of pandemic): 1.48 million tourists.
• 2021 (during the pandemic): 163,879 tourists.
• 2022 (post-pandemic recovery): 2.65 million tourists.
• 2023: 5.45 million tourists
• 2024: 7.7 million tourists (*target)

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Contribution of Tourism in the Economy
• In 2019, tourism contributed around 12.7% of the Philippines'
Gross Domestic Product (GDP)
• The GDP) was approximately ₱19.52 trillion, according to
official government data.
• This means that the tourism sector contributed approximately
₱2.48 trillion to the Philippine economy in 2019 before the
pandemic.
• In 2020, the share of tourism to GDP fell to about 5.4%
• In that year, the GDP fell to ₱18.05 trillion
• The tourism sector's contribution to the GDP in 2020 was
approximately ₱974.7 billion

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Tourism and its
Sectors

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 Tourism and its Sectors
❑ Tourism is generally associated with individuals
who travel to a place and return after the trip.
❑ This movement suggests three (3) zones:
1. The tourist-generating region
2. The tourism destination region
3. Transit region/transit route region

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 Tourism-generating region
❑ The geographical area or region where tourists originate
or come from.
❑ These regions supply or "generate" tourists who travel
to various destinations, either domestically or
internationally.
❑ Example: Countries or areas like South Korea, China,
and the United States are major tourist-generating
regions for the Philippines.

This Photo by Unknown

Author is licensed under
CC BY-SA-NC
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 Tourist Destination Region

❑ The geographical area or location where

tourists travel for leisure, recreation, or
other purposes.
❑ These regions are the receivers or hosts
of tourists.
❑ They offer attractions, accommodations,
activities, and services that cater to
tourists.
❑ Example: The Philippines is a tourism
destination region for many international
visitors.

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Transit region/transit route region

❑ A geographical area or corridor that serves as a

passageway for travelers moving from one
destination to another.
❑ These regions are characterized by the presence of
key transportation networks, such as roads, railways,
airports, and seaports, facilitating the flow of tourists
or travelers.

This Photo by Unknown Author is licensed under CC BY-NC

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 Tourism and its Sectors
❑ There are five (5) general categories of organizations
that constitute the supply side of the tourism industry.
These categories also comprise the businesses that
deal with specific tourism resources. These groups are:
• Attraction
• Access
• Services
• Information
• Promotion

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 Tourism and its Sectors
1. Attraction
❑ Tourism resources that pull tourists to an area.
❑ They may include natural landscape features,
structures, activities, events, or personalities.

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 Tourism and its Sectors
2. Access
❑ This sector includes all forms of transportation that can
be availed by the guests, and
❑ the networks of pathways, roads, and infrastructure.

This Photo by Unknown Author is licensed under CC BY

This PhotoTOOLS
HPC 3: APPLIED BUSINESS by Unknown Author is licensed under
AND TECHNOLOGIES 17
 Tourism and its Sectors
3. Services
❑ The services sector is composed of
businesses and organizations that
meet the needs of tourists.
❑ They include amenities availed by
guest from the accommodation,
retail stores, and food and
beverages establishments.
❑ The services sector also includes
enabling infrastructure that
provides comfort to guests.

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 Tourism and its Sectors
4. Information
❑ A crucial resource comprised of local community
members and organizations that facilitate appreciation
of attractions and other features of the destination.
❑ They play a crucial role in bridging the understanding
between tourists and residents and weaving local
culture into the tourism offering.

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 Tourism and its Sectors
5. Promotions
❑ This sector involves organizations that make the place
known to potential guests.
❑ They typically operate in a tourist-generating region
and help potential tourists decide where to go.
❑ This sector includes travel management companies,
tours, and tour organizers who plan large groups
visiting the destination.

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 Promotion
Tourist-
Generating
Region
Potential
Access
Tourists

Access Transit
Region

Potential
Tourists
Tourist
Information Attractions Destination
Region

Access Services

Figure 1. Sectors and Regions of the Tourism Industry

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 The
Hospitality
Industry
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The Hospitality Industry
 Hospitality is at the core of tourism, especially among
leisure travelers.
 Hospitality businesses are part of the tourism services
sector.
 They primarily provide meals and lodging to tourists and
other traveling customers.
 They can be classified into two types:
• Food Service Industry
• Lodging Industry

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Food Service Industry
The food industry covers a wide variety of businesses that
serve food and drinks.

• Full-service restaurants
• Fast-food establishments
• Cafes
• Canteens
• Take-away food bar
• Contract caterers

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Lodging Industry
The businesses in the lodging industry provide the
base to host guest and provide amenities for tourists to rest.
They also offer services for meetings and special functions.

❑ Hotels
❑ Resorts
❑ Motels
❑ Short-stay accommodation
facilities
❑ Camping sites

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Customers of
the
Hospitality
Industry
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 Customers of the Hospitality Industry
❑ Tourists are the usual customers of the
hospitality industry.
❑ According to the UN WTO, a tourist is a visitor who
stays overnight for various purposes and returns home
after they fulfill their purpose.
❑ When individuals visit destinations, they require meals
when they are hungry and sometimes places to stay
overnight before they go home.
❑ However, tourists do not arrive year-round in many
tourist destinations. Because of this seasonality, the
hospitality industry also caters to residents.
❑ Residents include individual residing in a location or
those with economic interest in each territory.
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 Customers of the Hospitality Industry
❑ Tourists are not always from abroad.
❑ They may come from other countries (International
tourist) or are citizens who do not typically reside in
an area (domestic tourists).
❑ Identifying where tourists come from can affect the
menu of offerings of hospitality businesses.
❑ It can be assumed that domestic tourists are likely to
be familiar with the cuisine served in the food
establishments because of the shared culture in the
country.

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 Questions?

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Thank You Tigers!

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