Introduction
Starwood hotels and resorts is an organization that owns, operates, franchises, and manages hotels and resorts worldwide. It started in 1969 but became a corporation in 1980. Parity is a state or condition of two or more organizations having the same power, value or rank. Parity is also the condition of having equality in value at the given ratio between different kinds of commodities. In addition, it is equivalence in the value of a currency when expressed in terms of another currency of a different country. This research paper explains why Starwood hotels and resorts in the hospitality industry experience a parity situation and also why they do not experience any parity.
Starwood hotels and resorts experience parity situation
Most of the hotels and resorts managed by Starwood practice this strategy of having equality in some areas such as offering the same quality of service to their customers. They are under the same management and therefore the qualities of their services are the same because they are guided by the same principles. This helps them to be competent in the hospitality market. In addition, they give discounts for example during some periods they lower their rates either on food prices or they offer discounts on lounges. They also give discounts to those guests who spent five nights or more in their apartments. In addition, they give discounts during some seasons to those guests who book with them first. This form of parity has been very effective in these hotels and resorts.
The other way that the Starwood hotels and resorts experience parity is in offering friend rates. This is where they send an email to their guests after their visit and offer a unique discount which guests are requested to inform their friends about. This offer is indicated when it should be booked. In most cases, a reward or a certain discount is given to the guest who will have a large number of friends booking. However, a discount of about five percent is given to the guest who books through a third party and they are encouraged to book directly at a smaller discount. The other way that star hotels and resorts experience parity are where they offer a free upgrade to corporate guests and their families. This encourages them to book a family room for their next visit.
Most hotels and resorts offer their services at higher prices and then they add some value to these services. For example, they offer a bicycle to a guest to go out n town with it after dinner and hence charge $6.00 per night to include a bicycle. They also offer museum tickets and upgrade rooms for the guests. They also offer tourists buses and drivers who take them to the sites they want to visit. Then for every value added to a service, a certain percentage of money is charged. This form of parity has been widely used and has affected hotels and resorts positively. All the shares of Starwood hotels and resorts are listed and traded on the New York Stock Exchange under the symbol ‘HOT’ and therefore their interests are the same. Moreover, the net proceeds from the sale of securities are used for the general benefit of the corporate.
Starwood hotels and resorts do not experience parity
According to the revenue management of the Starwood hotels and resorts, it is difficult for them to experience any parity. This is because hotels and resorts are located at different locations (different countries).
Therefore, the management has a challenge of having price parity because commissions and booking fees vary with seasons. Price rates hence have to be maintained continuously which is difficult because they cannot be consistent with their rates. In addition, added values offered are charged at different prices. For example, in countries where infrastructures are developed for example roads, offering transport services to the tourists as an added value is cheaper than in those countries where infrastructures are not developed. Therefore, guests visiting the undeveloped countries pay more than those visiting the developed countries because the rates cannot be equal.
However, Starwood hotels and resorts try to offer the same quality of services to their customers in various countries but this is a challenge because technology is not the same in various countries. Some countries are developed technologically than others and hence those that are technologically improved offer better services than those whose technology is low. Therefore, the services and the value-added to these services, differ in quality depending on countries or seasons.
Conclusion
Parity in rates values and prices are experienced in the Starwood hotels and resorts. They also experience parity on the use of net proceeds from the sale of securities because the money is used for the general benefit of the corporate. Hotels and resorts also experience parity on interests from shares and shares because they are traded in the same market under the same symbol. However, these hotels and resorts do not experience parity. This is because developments in various countries are not equal and hence qualities of their services are different as well as the prices of their services.