1. Graduate School of Tourism Management International Hotel Company Market Entry Choice Dr. Jeffrey M. Wachtel

2. company name organization Sole Ownership Method: Acquisition of An Existing Hotel or Entire Company Examples: Marriott purchasing New World Hotels & Renaissance or Building the new Hyatt Hotel in Hua Hin, or Conrad in Bangkok Advantage: Highest Possible Financial Reward Disadvantage: Most Economic Risk if Political Crisis Develops in Host Country. Example: Havana Hilton Take Over By Cuba

3. company name organization Joint Venture A Partnership of Domestic and Foreign Company 51%/49% Split Required by Some Companies Commonly Used in Most Developing Countries Local Partners Have Local Host Country Knowledge Advantages: Technology Transfer, Global Exposure Examples: Jingao Hotel in Beijing

4. company name organization Franchising Very Popular with Restaurants (McDonalds, Sizzler) Sheraton Corporation (No in Europe), Best Western. Advantages: Reduces Start-up Costs, Minimal Risk to Franchiser. Disadvantages: Global Legal Disputes, Quality Control Difficulties.

5. company name organization Management Contract Companies Local Owners Hire Professional Management Co. Popular in Asia. Advantages: Low Risk International Expansion with Limited Investment, Possible Good Return (e.g. 2% Revenue, 10% GOP) Advantages to Host Country: Management Technology Transfer Two Major Types of Management Companies: 1. Brand Name: Accor, Sheraton and 2. Independent Management Companies: Carnival Hotels and Resorts Expansion in Bahamas, Puerto Rico, Venezuela, and Argentina.

6. company name organization Strategic Alliance A Cooperative Agreement Between 2 or More Hotel Companies Example: Dusit Hotels Recently Created Alliance With Other Hotel Companies in Other Asian Nations Example: Four Seasons of Toronto and Hong Kong’s Regent International became World’s Largest 5 Star Chain with Alliance. Advantage: Instant Exposure to a Foreign Market. Capitalize on Each Companies Strengths, Shares Operational Costs, Reservation Systems etc. etc.

7. company name organization Consortia Membership Affiliations Offering Global Marketing and Reservation Services to Independent Hotels and Chains. Differ from Franchises in that Members Do Not Have to Follow Standard Procedures and Have Standard Products. Initiation Fee and Annual Dues Paid. Examples: REZsolutions Inc., Golden Toulip Worldwide Hotels Appeals to Independent and Small Property Owners Who Want to Keep their Autonomy but Have Global Services.