Topic 1: Introduction to Medical Tourism

1. Objective

At the end of this chapter the student will be able to:

 Define the nature and purpose of medical tourism.

 Explain the origin and evolution of medical tourism.
 Describe the medical travel industry in Asia.

Origin & Evolution Of MT

Introduction

Travel for health purposes is not a new phenomenon. Ancient

stories, legends and fables contain many stories of journeys taken
by heroes seeking potions and cures for another, often their kings or
queens. There were quests in search for the ‘fountain of youth’ or
for other equivalent rewards to seek immortality or perpetual
beauty. These ambitious activities are not confined to one culture
and stories for the search for the mysterious and supernatural span
all cultures. Similarly these quests also include a search of wealth
and riches that can guarantee or purchase a comfortable lifestyle
and wellbeing.

Origin and Evolution of Medical Tourism

Medical tourism is actually thousands of years old. In ancient

Greece, pilgrims and patients came from all over the Mediterranean
to the sanctuary of the healing god, Asklepios, at Epidaurus. In
Roman Britain, patients took the waters at a shrine at Bath, a
practice that continued for 2,000 years. From the 18th century
wealthy Europeans travelled to spas from Germany to the Nile.
Since the early nineteenth century, when there were no restrictions
on travel in Europe, people visited neighboring countries in order to
improve their health. At first, mere traveling was considered to be a
good therapy for mental and physical well being. In the 21st
century, relatively low-cost jet travel has taken the industry beyond
the wealthy and desperate. Later, mostly wealthy people began
traveling to tourist destinations like the Swiss lakes, the Alps and
special tuberculosis sanatoriums, where professional and often
specialised medical care was offered. In this century, however,
medical tourism expanded to a much larger scale. Thailand,
followed by India, Puerto-Rico, Argentina, Cuba and others quickly
became the most popular destinations for medical tourists.
Complicated surgeries and dental works, kidney dialysis, organ
transplantation and sex changes, topped the list of the most popular
procedures. It was estimated that in 2002, six hundred thousand
medical tourists came to Bangkok and Phuket medical centers in
Thailand, while approximately one hundred and fifty thousand
foreign patients visited India during that time. From Neolithic and
Bronze age wherein people used to visit neighboring countries for
Minerals and Hot Springs. Today we have reached the era where
hospitals are more like Spas and Spas more like hospitals.

Over time, things have not changed much except that this idea or
concept has evolved to become more acceptable to the new
generation. People still travel for health reasons and to seek cures
for their ailments and take measures to preserve their wellbeing. For
example, people travel to health spas especially to bathe in the
special mineral waters to alleviate the symptoms of arthiritis (eg.
Rotorua, New Zealand), travel to warmer climates to escape the
winter months (eg. Monte Carlo) and to avoid the winter illnesses
such as colds and flus. Pilgrims continue to travel for religious
purposes, some in search of miracle healing from certain blessed
locations such as in Lourdes where there is a history of miracles that
have occurred in the past. Hence, those organisations and
businesses that capitalise and cater for such markets can prosper
and grow as the demands for their products and services continue
to increase. This paper briefly explores the concept of medical
tourism, mainly referring to procedures that require some medical
or surgical interventions. It analyses aspects of the demand and
supply of these products in the modern global environment.
What Is Medical Tourism
There is no one definition for medical tourism. However, it is
generally accepted that this term is used to refer to travel activity
that involves a medical procedure or activities that promote the
wellbeing of the tourist. For example, the term ‘healthcare’ tourism
has been used to cover traveland tourism that are related to
medical procedures, health and wellbeing purposes. The scope of
healthcare tourism is illustrated in Figure 1 below.

Using the framework in Figure 2, the medical procedures that are

classified under ‘illness’ include medical check-ups, health
screening, dental treatment, joint replacements, heart surgery,
cancer treatment, neurosurgery, transplants and other procedures
that require qualified medical intervention. ‘Enhancement’
procedures also require qualified medical personnel but much of this
work is non-disease related (unless disfigurement is caused by
disease) and done mainly for aesthetic purposes. Examples of such
procedures include all cosmetic surgery, breast surgery, facelifts,
liposuction and cosmetic dental work. The ‘wellness’ segment of
medical and healthcare tourism promotes healthier lifestyles
(Bennett, King and Milner, 2004). Therefore, these products can
include spas, thermal and water treatments, acupuncture,
aromatherapy, beauty care, facials, exercise and diet, herbal
healing, homeotherapy, massage, spa treatment, yoga and other
similar products.

Under ‘reproduction’ tourism, these patients seek fertility related

treatments such as in vitro and in vivo fertilisation and other similar
procedures. Birth tourism is also classified under this segment
(TRAM 2006). This involves a pregnant mother who travels to
another country to give birth to her baby in order to utilise the
services, which are often free or obtain an advantage from having
an offspring gaining citizenship of another country.

The Emerging Market for Medical Tourism

Medical tourism is growing and diversifying. Estimates vary, but

McKinsey & Company and the Confederation of Indian Industry put
gross medical tourism revenues at more than $40 billion worldwide
in 2004. Others estimate the worldwide revenue at about $60 billion
in 2006. McKinsey & Company projects the total will rise to $100
billion by 2012.

Worldwide Medical Tourism Industry

(billions of U.S. dollars)

Source: McKinsey & Company and the

Confedaration of Indian Industry
Figure 3
Internationally-known hospitals, such as Bumrungrad in Thailand
and Apollo in India, report revenue growth of about 20 percent to 25
percent annually. McKinsey & Company estimates that Indian
medical tourism alone will grow to $2.3 billion by 2012. Singapore
hopes to treat 1 million foreign patients that year. Reports on the
number of patients traveling abroad for health care over the past
few years are scattered, but all tell the same story. In 2005:
Approximately 250,000 foreign patients sought care in Singapore,
and 500,000 traveled to India for medical care. Thailand treated as
many as 1 million foreign patients. The foreign patients treated in
these countries included some of the 500,000 Americans who
traveled abroad for medical treatment that year.

Why Tourists And MT?

When referring to tourists, there are numerous definitions for this
group of people depending on the purpose for the definition
(Theobald, 1998). Generally, it is accepted that tourist are travelers
who have travelled and stayed away from their home environment
for 24 hours or more, and hence, often utilising some form of
accommodation facility. Therefore, for those travelers who do not
meet this 24 hour criteria are generally referred to as ‘visitors’. For
travellers that travel overseas for medical purposes, conceptually,
they would meet the definition for that of a tourist. Since medical
tourists are travelers whose main motivation for travel is for a
specific purpose, medical tourism is a form of special interest
tourism (Douglas, Douglas, and Derrett, 2001). International travel
is not without restrictions. Governments have a range of different
visas that they grant for different purposes to visitors to their
countries (Immigration, 2006). For example, international students
who intend to study in a foreign country and migrant workers who
work in a foreign country for income purposes are not usually given
free entry into a country without assessing their applications. Travel
for healthcare purposes also has its restrictions. For example, the
United Kingdom that provides free treatment under the National
Health Scheme restricts entry of foreign nationals who travel to seek
medical treatment or are in need of foreseeable medical inventions
such as pregnancy (TRAM, 2006). However, in the case of medical
tourism, the service providers are often private organisations relying
on non-government sources of income and often are catered for the
international patient or tourist. Therefore, in these situations, the
restriction of the movement of such travelers is often minimised.
Since tourist visas are often the easiest and least restrictive to
obtain for entry into most countries, by offering medical tourism
services that target tourists, these ‘tourists’ can enter a country
more easily for medical treatment without much government (at
visa level) intervention. The governments are often aware of the
occurrence of medical tourism and many countries in the world
support and encourage medical tourists to visit because, like other
recreational and leisure tourists, these medical tourists pay for the
healthcare treatment that they receive. As the market for medical
tourism continues to grow and the medical procedures become
more complicated, this increases the recovery time beyond those of
a normal tourist visa, and therefore, the duration of these visas will
need to be revised.

The Medical Tourist

The medical tourist would be a traveler travelling for the primary

purpose of receiving a healthcare service. For those travelling for
the purpose of undergoing a medical procedure such as heart
surgery, cancer treatment or other surgical procedures,
the traveler may travel alone of with one or more support person
who may be the spouse, parent or friend. Therefore, the destination
will benefit from the visitation of several people who would stay and
spend their ‘tourist’ dollars during their trip. As the focus on medical
tourism grows, more is done for this category of tourists. It is not
unusual for luxury hotels to be in close proximity to private medical
centers or facilities that provide medical tourism services. In
catering for certain medical tourists, packages are put together to
make it easier for the tourist who need not spend much time in
researching their travel and accommodation requirements (Medical
tourism, 2005a; 2005b). It is especially helpful for the tourist who is
seeking medical treatment, because, quite often, the person is ill
and impaired due to the condition and so the stress of organizing
the travel and accommodation alongside the medical procedure, can
be reduced. At the opposite end of the spectrum, traveling overseas
to a different country to undergo a medical procedure can be risky
and dangerous (Menck, 2004). In a possible worse case scenario,
the post operation recovery does not go well and the patient needs
to prolong their stay at the destination and therefore incur
additional costs, or, if the patient has returned home, they would
have to seek further medical care and treatment in their home
country. This would increase the cost of the overall treatment for
their condition (Connell, 2006). This type of complication is not
uncommon in cosmetic surgery where not all procedures go
according to plan.

The tourist traveling for wellness purposes to health resorts or spas

are usually less at risk of medical misadventure. This type of leisure
and recreational tourism has always been popular to enable the
tourist to revitalize and rejuvenate themselves before retuning to
their normal routine in their home country (Bennett, King, and
Milner, 2004). Unlike surgeons performing operations who have to
be qualified and registered doctors, the level of accreditation and
certification of the staff administering natural therapies at health
resort can vary from country to country. Although it is believed that
natural therapists can do little harm, some of the herbal remedies
that are used can be just as potent and harmful as orthodox
pharmaceutical products.

The Increasing Popularity Of Medical Tourism

Although there are no verifiable statistics regarding the magnitude
of medical tourism, the available information suggests that a
substantial number of patients travel to developing nations for
healthcare. In 2004, 1.2 million patients traveled to India for
healthcare and 1.1 million medical tourists traveled to Thailand. One
source projects that 750,000 Americans will go offshore for medical
services in 2007, with this number increasing to 6 million in 2010. It
is estimated that medical tourism to Asia could generate as much as
$4.4 billion by 2012, with approximately half of this revenue going
to India. It has been estimated that the global medical tourism
industry currently generates annual revenues up to $60 billion, with
20% annual growth. However, another valuation suggests that the
industry is somewhat smaller, with growth to $40 billion projected
by 2013.

At the same time, the medical travel industry is increasingly

grounded in tourism. Although exact statistics are not available, it is
generally estimated that the present global medical tourism market
is estimated to be approximately US$ 40 billion with an annual
growth rate of 20 per cent. The International Trade Commission in
Geneva says that medical tourism could grow into a US$ 188 billion
global business by 2013. Medical travel, in particular in combination
with tourism, is turning out to be an immense business opportunity
for nations that are positioning themselves appropriately. In 2005,
India, Malaysia, Singapore and Thailand attracted over 2.5 million
medical travelers (see Figure 4). Hong Kong, China, Lithuania and
South Africa are now emerging as major health-care destinations.
Many other nations, including Croatia, Greece, the Philippines and
the Republic of Korea are also in the process of making themselves
attractive healthcare destinations. The most recent trend is the
expansion of medical tourism from specialised treatment to include
a broader form of “wellness tourism”.

There are several reasons for the increase in medical travel. First of
all, the demographics of the developed nations are causing a
significant increase in demand for health care. In Japan, the United
States of America, the United Kingdom and many other European
nations, the proportion of the population older than 60 years, in
relation to the total population, is increasing rapidly. Similar trends
are being seen in many countries across the world. At the same
time, life expectancy in most countries has also increased steadily
over the years; the combined result is significant strain on national
health-care systems. The inability of many health-care systems to
deal with the increase in demand does, in many cases, lead to
compromised levels of service and decreased access through long
waiting lists and high costs. This drives many individuals to seek
alternatives to domestic health care.

Such alternatives can be found in the economically stratified global

health-care marketplace, which offers everything from cutting-edge
surgical procedures such as organ transplants to cosmetic
procedures and wellness packages at a wide range of prices. As is
the case in many economic sectors, outsourcing to more affordable
health service provision abroad is increasing. Private health-care
facilities in countries such as India, Malaysia, Philippines, Singapore
and Thailand are utilizing the prevailing cost differentials, relative to
countries such as Canada, the United Kingdom and the United
States of America, to attract international customers who have the
financial means to access medical care abroad.
International accreditation and name recognition linked to quality
care provision are laying to rest many of the concerns individuals
may have regarding professional competence, patient safety and
quality in low-cost health care abroad. Combined with inexpensive
air travel, low-cost telecommunications, digitized patient records,
widespread access to information through the internet, and an
increasingly sophisticated medical travel industry to manage all
these processes on the patient’s behalf, traveling abroad for medical
treatment is an appealing alternative for uninsured or underinsured
individuals.

The alternatives available through medical travel are not only within
reach of individuals in developed countries but also to people from
developing and least developed countries who have the financial
means to find sophisticated and affordable medical care in
neighboring countries.

It is possible to categorize present-day medical travelers into 4 main

groups. The first group includes patients from developed countries
who do not have, or have inadequate, health insurance coverage.
Many of these individuals come from Australia, Europe and Japan,
with the majority coming from the United States of America. For
example, in 2003, the number of people without health insurance
coverage in the United States of America was 45 million, which
translates to 15.6 per cent of the total population, and in 2005 the
number of individuals without dental coverage in the United States
of America was estimated at 120 million.

The second group includes individuals, also primarily from

developed countries such as Canada and the United Kingdom , who
face long waiting lists for non-elective surgery and other critical
procedures. In the United Kingdom, many individuals choose to pay
for medical treatment abroad to avoid long waiting lists even though
the national health-care system, in spite of being overstretched,
ensures free treatment to all its citizens.

The third group includes individuals looking for affordable cosmetic

procedures. Many of these individuals come from Australia, Europe
and Japan, with a significant number again coming from the United
States of America. For example, most health insurance in the United
States of America covers critical care, not cosmetic care and beauty
treatments. The increased demand for surgical procedures such as
facelifts, hair transplants, dental treatment and liposuction, as well
as non-surgical procedures such as botox and hair removal, and the
relatively high cost of these procedures is driving many individuals
to find more affordable alternatives abroad.

The fourth and final group of medical travelers includes individuals

seeking quality assured, often specialised, care that is unavailable
or in short supply in their own countries. A significant number comes
from the Middle East. An agency in Saudi Arabia estimated that
every year, more than 500,000 people from the Middle East travel
seeking medical treatment for everything from open heart surgery
to infertility treatment. Destinations range from neighbouring
countries such as Bahrain, Jordan, and Saudi Arabia to more distant
countries like India, Malaysia, Thailand and the United States of
America.

This last group also includes an increasing number of medical

travelers from developing and least developed countries seeking
better health-care infrastructure at affordable prices in their own
neighborhood. A significant majority of the medical travelers
to Jordan come from neighbouring countries with poor medical
infrastructure facilities. Many people from Bangladesh and Nepal go
to India for medical treatment. Medical travel from Indonesia to
Malaysia, Singapore and Thailand is also increasing. Of interesting
note is the report of Nigerians spending an estimated US$ 1 billion a
year on health care outside of their country. Whereas ten years ago,
most of this money was spent in Europe and America, it is now
increasingly directed to developing countries with advanced
facilities at reasonable prices.

Medical Travel And Trade

Medical travel takes place within the overarching framework of
international trade rules. The World health Organisation (WHO)
recognised the linkages with trade in the early 1990s following the
success of Cuba. They commissioned a study to see whether the
English speaking Caribbean Islands could become a significant health-
care destination for travellers from Canada, the United Kingdom and
the United States of America. The HO’s interest was simple; it realised
that medical travel could help improve the medical economies in
developing countries while also taking care of some of the supply
problems that developed nations were facing.

The World Trade Organisation (WTO), established in 1995, aims to

reduce trade barriers, including in the field of health. The main WTO
agreements related to health include the Agreements on Technical
Barriers to Trade, the Agreement on Sanitary and Phytosanitary
Measures, the Agreement on Trade-Related Intellectual Property
Rights (TRIPS) and the General Agreement on Trade in Services
(GATS).

Of 12 service sectors included in GATS, at least five are directly

related to health-care systems. The professional services under the
business service sector deal with services of health professionals.
The distribution service sector relates to services in pharmaceutical
retailing. The education service sector involves the training and
education of health professionals. The financial sector deals with
health insurance and flows of foreign capital for investment in
private hospitals. The health and social services sector includes
hospital services, medical and dental services, diagnostic services
and management of health service facilities.

Medical travel is covered under mode 2 of GATS. Mode 2 is one of

the four modes related to trade in health-care services worldwide
(see Box 2, below). So far, medical travel is the most visible face of
the increasing global trade in health-care services, but the other
three modes are expected to increase in significance in the coming
years.

The four main modes of international trade in health

services

Mode 1: Cross-border supply (CB): everything from shipment of

laboratory samples, diagnosis and clinical consultation via
traditional channels to telemedicine, teleconferencing,
teleconsultation, tele-education, and subscription to journals and
databases on the internet. This has been greatly facilitated through
rapid expansion of information and communication technologies
(ICT).
Mode 2: Consumption abroad (CA): travelling abroad, including via
health tours, to seek high-technology treatments or cheaper health
services.

Mode 3: Commercial presence (CP): foreign investment in hospital

operation, medical and dental services and management of health
care.

Mode 4: Temporary movement of natural persons (NP): temporary

emigration of health personnel-physicians, specialists, nurses,
paramedics and other health professionals from one country to
another.

There are various kinds of barriers to trade in health services. The

main barrier is the nonportability of health insurance under mode 2.
Others include entry visas, work permits, professional and premises
licenses, investment permits and insurance reimbursement.
Commitment to trade agreements for services can reduce some or
all of these barriers. A key element in GATS is that countries,
although not obliged to do so, are encouraged to open sectors to
trade. Although, a number of countries have already done so for
health services, the impact of GATS in driving the privatization of
health services has so far remained limited. However, this is
expected to change. The WTO is increasing the sanctions for not
offering to open sectors, by insisting that states must prove they are
not using anti-competitive policies to protect a sector. This has the
potential to contribute to the development of medical travel as there
will be increased opportunities for investment abroad by health-care
service providers, but at the same time it poses significant
challenges for national health systems.

Medical Travel Industry in Asia

Well-developed health-care systems and advances in technology

have supported medical travel among Western countries for many
years. However, medical travel in Asia is relatively new, mostly
emerging in the aftermath of the Asian financial crisis in 1997. With
the middle-class clientele in many countries affected by the
economic downturn, private hospitals were faced with a significant
drop in local business. Hospitals needed to be creative in identifying
alternative sources of revenue. Their first steps into the
international patient market were facilitated by their devalued
currencies, providing an attractive combination of modern facilities
and low prices. Thailand’s Bumrungrad Hospital was among the first
in the region to focus on attracting foreign patients, enticing
hospitals in other countries to follow suit.

Although primarily driven by the private sector, including hospitals

and intermediary organisations such as specialised travel agencies
utilizing competitive marketing initiatives, governments are
increasingly contributing to the development of this industry in
South-East and East Asia. For example, the Malaysian Government
has exerted its leadership to facilitate and encourage industry
development, with the formation of the National Committee for the
Promotion of Health Tourism. The Government of Hong Kong, China
is starting to consider the possibility of marketing its traditional
Chinese medicine

capabilities to the region. Concerted efforts have also been launched

by government agencies in Singapore to market the world-class
medical facilities available there.

In 2003, India, Malaysia, Singapore and Thailand attracted over 1.4

million medical travelers and earned over US$ 1 billion in treatment
costs alone. In 2005, the number of international patients visiting
these countries surpassed the 2.5 million mark (see figure 4).
Governments in the region expect that medical travel will continue
to boost economic growth with medical travel revenue in some
countries growing in excess of 20 per cent per year.

Thailand wants to attract two million foreign patients by 2010, up

from 1.25 million in 2005; while the Philippines is hoping for 700,000
patients, up from 250,000 in 2006. India’s medical travel business is
growing at 30 per cent per year and is forecast to generate at least
US$ 1 billion a year by 2012. Singapore is targeting to attract one
million foreign patients annually and push the GDP contribution from
this sector above US$ 1.5 billion, while Malaysia expects medical
travel receipts to be in the region of US$ 590 million in five years
time. These projections indicate that the medical travel industry in
Asia can surpass the US$ 4 billion mark by 2012.
 An estimated 1.32 million medical travelers in 2006 came to Asia
from all corners of the world, including Europe and the United States
of America. However, the Middle East is increasingly becoming a key
market for medical travel in Asia. In part due to the current global
political climate, many individuals from the Middle East are choosing
to

Source: Adapted from information referenced throughout this paper.

Figure 4: Estimated international patients treated, 2003-2005

travel to South-East Asia instead of Europe and the United States of

America. At the same time, much of the medical travel in Asia takes
place within the region. In particular, there is an increase in medical
travel originating from developing countries such as Indonesia.

India

India is a recent entrant into medical travel but is quickly catching up

with the leaders. Recent estimates indicate that the number of foreign
patients coming to India has been increasing by 30 per cent each year.

Table1: Medical travel overview

Country Arriving from Estimated earnings Strengths

India Middle East, US$ 480 million Cardiac Surgery, Joint

United Kingdom, (2005) Replacements, Eye Surgery

Canada,

Developing

Countries

Malaysia Indonesia, US$ 40 million Cardiology, Cardio-Thoracic

United States, (2004) Surgery, Cosmetic Surgery

Japan

Singapore Indinesia, US$ 560 Million Liver Transplants, Joint

Malaysia, Middle (2004) Replacements, Cardiac Surgery

Thailand United States, US$ 1 billion Cosmetic Surgery, Organ

United Kingdom, (2006) Transplants, Dental Treatment

Middle East, Joint Replacements

China, Japan
In 2004, approximately half a million foreign patients travelled to
India for medical care, whereas in 2002, the number was only
150,000. India has a number of health-care institutions which are of
high standard. The major Indian health destinations include
Bangalore, Chennai, Delhi, Mumbai and Thiruvantapuram. The south
Indian city of Chennai has been declared India's Health Capital, and
is estimated to receive 45 per cent of health travellers from abroad
and 30-40 per cent of domestic health travellers. India is particularly
well known for its low-cost advanced medical procedures, ranging
from heart surgery, joint replacements and hip resurfacing to
cataract operations, cosmetic surgery, dentistry and gallstone
removal. Most estimates claim that treatment costs in India start at
around a tenth of the price of comparable treatment and can go up
to a sixteenth of the cost in Europe and the United States of
America.

Open-heart surgery could cost up to US$ 70,000 in the United

Kingdom and up to US$ 150,000 in the United States of America; in
India’s best hospitals it could cost between US$ 3,000 and US$
10,000. Knee surgery (on both knees) costs US$ 7,700 in India; in
the United Kingdom this costs more than twice as much. Dental, eye
and cosmetic surgeries in Western countries cost three to four times
as much as in India. In addition to the attraction of affordable
advanced medical procedures, tourists from abroad also visit India
for alternative treatments like Ayurveda, Yoga, and Kairali. The
health travel focus has seen the state of Kerala participate in
various trade shows and expos to showcase the advantages of this
traditional form of medicine. The large Indian community living
abroad makes up a significant part of the medical travel market in
India. Wealthy expatriate Indians are becoming increasingly aware
of India's high-quality and low-cost hospitals. It is becoming more
attractive to combine regular visits to India and save time and
money by undergoing non-emergency procedures such as eye
operations, dental work, cosmetic surgery and knee surgery.

To some extent, the large Indian expatriate market overlaps with

the Middle East and South Asian markets that make up the bulk of
medical travelers to India. However, in recent years there has also
been a steady increase in medical tourists from European counties,
in particular the United Kingdom. At present, India is being
promoted as a health-care destination in countries around the world.
The Government of India has indicated its commitment to the goal
of making India a world leader in the industry. Merging medical
expertise and travel became government policy when the then
finance minister Jaswant Singh, in the 2003-2004 budget, called for
India to become a global health destination as one of the three
principal objectives on health. As part of government commitment
on this, the 2003-2004 budget offered several incentives to promote
the medical travel industry. For example, in order to encourage
private hospitals to either establish new or to expand existing
medical facilities, it was proposed to make long-term capital more
easily available to private hospitals with 100 beds or more. To
ensure hospitals use the most advanced technology available, it was
further proposed to increase the depreciation rate to allow old
equipment to be replaced sooner. It was also proposed to reduce
the customs duty on specified life saving equipment from 25 per
cent to 5 per cent, and also exempt such equipment from additional
customs duty.

The Government, in partnership with private hospital groups, is also

taking steps to address medical travel deterrents such as concerns
regarding treatment and care standards, insurance coverage and
general infrastructure. This has resulted in increased international
accreditation of its hospitals. Insurance coverage for treatment in
Indian hospitals is also increasing. For example, patients treated at
some hospitals in India are insured by United States of America
private health insurers Blue Cross and Blue Shield. The United
Kingdom health insurer BUPA also insures the costs of treatment at
some hospitals.

India is also putting in place other policies to support medical travel.

India’s National Health policy 2002, for example, says:

“To capitalize on the comparative cost advantage enjoyed by

domestic health facilities in the secondary and tertiary sector, the
policy will encourage the supply of services to patients of foreign
origin on payment. The rendering of such services on payment in
foreign exchange will be treated as ‘deemed exports’ and will be
made eligible for all fiscal incentives extended to export earnings”.

Future projections for the medical travel industry in India vary but
are without exception positive. Medical travel in India, which
reached an estimated US$ 480 million in 2005, provides ample
opportunity for growth as the Indian health-care industry commands
only a 1.2 per cent share of the US$ 40 billion global medical travel
market.

Projections show that India’s multi-billion dollar health-care industry

could grow from anywhere between 13 and 25 per cent in each of
the next six years, boosted by medical travel. According to a study
by McKinsey and the Confederation of Indian Industry, medical
travel alone could become a US$ 2 billion industry in India by 2012.
The report predicts that: “By 2012, if medical tourism were to reach
25 per cent of revenues of private up-market players, up to Rs
10,000 crore will be added to the revenues of these players”.

Quality And Safety In MT

Faced with the choice of many medical institutions in diverse
countries, medical tourists may find it very difficult to identify well-
trained physicians and modern hospitals that consistently provide
high-quality care. Some medical tourism agents, particularly those
with backgrounds in healthcare, may be a helpful resource for
patients in making appropriate choices. Accreditation by the Joint
Commission International, which has accredited more than 125
facilities in 24 countries, and/or the International Organisation of
Standardisation may provide a useful point of reference for patients
selecting offshore medical facilities.

Concerns have been voiced regarding the risk of complications

resulting from travel and vacation activities in the postoperative
period. The management of postoperative complications that occur
after a patient returns from an offshore medical facility, and the
consequent costs of this care, are difficult issues that remain
unresolved.

The Response to Medical Tourism

The medical community in developed countries has started to

recognise medical tourism as a real phenomenon that involves the
profession, practitioners, and patients. Peer-reviewed medical and
health journals began publishing papers on this topic in 2006.
Medical organisations have addressed medical tourism in articles
and other documents posted on their Web sites. The United States
Senate Special Committee on Aging held hearings on the issue of
medical tourism in June 2006 and called for a task force of experts
to explore the impact and safety of lower-cost healthcare abroad.

The insurance industry has become an active participant in medical

tourism. In several states, Blue Cross Blue Shield sells insurance
policies that enable or encourage patients to have expensive
surgical procedures at low-cost offshore medical facilities. In an
effort to reduce the financial burden of employee healthcare,
several fortune 500 corporations are evaluating the feasibility of
outsourcing expensive medical procedures to offshore healthcare
destinations. Insurance provider networks are currently being
expanded to include physicians around the globe, and it is
anticipated that within a decade a majority of large employers'
health plans will include offshore medical centers.

Insurance companies are able to use a portion of their substantial

savings to offer incentives to beneficiaries willing to have care in
medical tourism destinations, including waiving deductible and out-
of-pocket health expenses and paying for travel for the patient and
even a family member. A particularly interesting response to the
migration of patients to offshore healthcare destinations is that
some US medical facilities are now accepting referrals from medical
tourism agencies and providing highly discounted services to
American patients.

In nations that have long waiting lists for certain procedures,

medical tourism provides a mechanism to clear backlogs by sending
patients to foreign countries without expanding local capacity.
Currently, the British National Health System is sending patients to
nearby countries for this purpose, and more distant medical tourism
destinations may be used in the future. Although this idea has not
been explored, there may be novel opportunities to use low-cost
offshore medical destinations to provide care for unfunded low-
income patients while simultaneously relieving the burden on
domestic healthcare facilities and philanthropic organisations.

The Continuing Evolution Of MT

The medical tourism industry is fueled and driven by patients who
feel disenfranchised by the healthcare system in their home
country. These informed patients shop outside the organised
medical system to find services that are affordable, timely, or simply
available. Millstein and Smith emphasise that the flight of American
patients to foreign destinations for lifesaving operations is a
symptom of an affordability problem that is symbolically important
and must be addressed by physician leaders. These leaders must
recognise that patients, like all consumers, will search for providers
who offer them maximal value, and medical tourism is an explicit
declaration about what patients value most. Physicians and
hospitals in medical tourism destinations recognise that they must
provide high-quality care to develop a sustainable competitive
advantage in the international marketplace. In an article on medical
tourism in Time, Princeton University healthcare economist Uwe
Reinhardt stated: "This has the potential of doing to the US health-
care system what the Japanese auto industry did to American
carmakers." It is increasingly apparent that medical tourism is
changing the healthcare landscape in industrialised and developing
countries around the world, and there is every reason to believe that
this trend will continue to evolve.

Conclusion
With globalisation, medical tourism is becoming a new and emerging
international business that is gradually increasing in importance. Much
of the travel and services in the tourism infrastructure supports this
industry and so promotes the growth. As hospital queues increase and
the cost of medical procedures increase in western society, the
demand for medical tourism increases alongside this development. Not
too different from the subcontracting or the off-shoring of services
mainly due to higher costs and expertise, in the future, medical
tourism is likely to be the new global trend for provision of medical
services. Since medical services are an essential part of life and living,
the demand will increasingly grow. Like all rapid developments, there
will some need for regulation and monitoring of institutions to ensure
the health and safety of the medical tourists. It remains to be seen in
the future which countries will adopt this role and be proactive before
rather than reactive after a major medical tourism mishap.
Summary
Some of the key points of this chapter are as following:
  Medical tourism refers to travel activity that involves a medical
procedure or activities that promote the wellbeing of the tourist.
 The medical tourist would be a traveler travelling for the primary
purpose of receiving a healthcare service. For those travelling
for the purpose of undergoing a medical procedure such as
heart surgery, cancer treatment or other surgical procedures,
the traveller may travel alone of with one or more support
person who may be the spouse, parent or friend.
 Some of the reasons for the increase in medical travel are:

o Demographics of the developed nations

o Increased life expectancy

 Medical travel in Asia is emerging in the aftermath of the Asian

financial crisis in 1997.
 Although primarily driven by the private sector, including
hospitals and intermediary organisations such as specialised
travel agencies utilising competitive marketing initiatives,
governments are increasingly contributing to the development
of this industry in South-East and East Asia.

Topic 2: History of Medical Tourism

1. Objective

At the end of this chapter the student will be able to:

 Explain the origin and history of medical tourism.

 Describe medical tourism in various timelines.

Introduction And Medical Tourism History

Introduction

Long before Americans stepped onto foreign soil for cardiac surgery,
a tummy tuck or a dental job, medical travelers from around the
world have been searching far and wide to seek the best medical
services. One can say that the concept of medical travel is as old as
medicine itself. Medical tourism history in fact dates back to ancient
times.

The following is a short delve into the colorful history of medical

tourism. These time lines indicate that if ever healthcare is in short
supply - wherever the location or whatever period in time it may be -
sick and injured people travel for healthcare.

Medical Tourism History - Ancient Times

Studies of ancient cultures depict a strong linkage between religion

and healthcare, which dates back thousands of years. Most ancient
civilisations recognised the therapeutic effects of mineral thermal
springs and sacred temple baths. The following are some of the
earliest civilisations.

The Sumerians (circa 4000 BC) constructed the earliest known

health complexes that were built around hot springs. These
healthcare facilities included majestic elevated temples with flowing
pools.

During the Bronze Age (circa 2000 BC) hill tribes in what is now
known presently as St. Moritz, Switzerland recognised the health
benefits in drinking and bathing in iron-rich mineral springs. The
same bronze drinking cups that they used were found in thermal
springs in France and Germany, which could signify health
pilgrimages within these cultures.

The Ancient Greeks were the first to lay a foundation for a

comprehensive medical tourism network. In honor of their god of
medicine, Asclepius, the Greeks erected the Asclepia Temples,
which became some of the world's first health centers. People from
all over traveled to these temples to seek cures for their ailments.

Other therapeutic temples flourished under the Greek domain by the

year 300 BC. One facility called the Epidaurus was the most famous
and includes services like a gymnasium, a snake farm, a dream
temple, and thermal baths. Other temple spas include the Sanctuary
of Zeus in Olympia and the Temple of Delphi.

In India, the history of medical tourism was also slowly unfolding

with the popularity of yoga and Ayurvedic medicine. As early as
5000 years ago, constant streams on medical travelers and spiritual
students flocked to India to seek the benefits of these alternative-
healing methods.

When Rome became a global power, several hot-water baths and

springs called thermae came into existence and gained popularity
among the elite. These baths were not only healthcare facilities, but
became commercial and social networking centers for the rich and
the elite.

Medical Tourism History - The Middle Ages

With the downfall of the Roman Civilisation, Asia continued to be the

prime medical tourism destination for healthcare travelers. Temples
gave way to hospitals that provide clinical services to travelers
seeking healthcare. These institutions are chronicled in medical
tourism history.

In Medieval Japan, hot mineral springs called onsen became popular

throughout the nation due to their healing properties. The warrior
clans soon took notice of these springs and began using them to
alleviate pain, heal wounds, and recuperate from their battles.

Many early Islamic cultures have established healthcare systems

that also caters to foreigners. In 1248 AD, the Mansuri Hospital was
built in Cairo and became the largest and most advanced hospital in
the world of that time. With the capacity to accommodate 8,000
people, this hospital became a healthcare destination for foreigners
regardless of race or religion.

History of Medical Tourism - The Renaissance Period

The Renaissance Period during the 14th to 17th century not only
highlighted the rebirth of art and culture in Europe and England, but
it was also a period where medical tourism flourished.

A village known as Ville d'Eaux or Town of Waters, became famous

throughout Europe in 1326 when iron-rich hot springs were discovered
within the region. Prominent visitors like Peter the Great and Victor
Hugo visited these wellness resorts. The word “spa”, derived from the
Roman term “salude per aqua” or health through waters, was first
used here.
During the 16th century, the rich and the elite of Europe
rediscovered Roman baths and flocked to tourist towns with spas
like St. Mortiz, Ville d'Eaux, Baden Baden, Aachen and Bath in
England. Bath or Aquae Sulis enjoyed royal patronage and was
famous throughout the known world. It became the center of
fashionable wellness and became a playground for the rich and
famous.

History of Medical Tourism - The Post-Renaissance Period

Towards the end of the Renaissance period, aristocrats from around

Europe continued to swarm to Bath for healing and therapeutic
cleansing.

In the 1720s, Bath became the first city in England to receive a

covered sewage system and was ahead of London for several years.
The city also received technological, financial, and social benefits.
Roads were paved, streets had lights, hotels, and restaurants were
beautified – all because of Medical Tourism.

The most noteworthy traveler in the history of Medical Tourism is

Michel Eyquem de Montaigne, the French inventor of the essay, and
was believed to be the father of luxury travel. He helped write the
earliest documented spa guide in medical tourism history.

The discovery of the New World brought new destinations for

European medical travelers. During the 1600s, English and Dutch
colonists started building log cabins near mineral springs rich with
medicinal properties. During this time, it was noted that the Native
Americans in the New World were adept in the healing arts.
Knowledge in herbal medicine was exceptional and rivaled those in
Europe, Asia or Africa.

During the 18th and 19th century, several Europeans and Americans
continued to travel to remote areas with spas and health retreats
hoping to cure various ailments like tuberculosis.

Medical Tourism History From The 1900 To 2006

Medical Tourism History from the 1900s to 1997

During this time, the USA and Europe were not only the commercial
and industrial centers, but they were also the center of the
healthcare world. Medical travel was limited to the affluent rich who
traveled to these countries in order to receive high-end medical
services.

In 1933, the American Board of Medical Specialties (ABMS) was

established and became the umbrella organisation for the medical
specialty boards in the United States. The ABMS established
educational and professional policies, which became the blueprint of
standards around the world.

In 1958, the European Union of Medical Specialties (UEMS) was

formed. The UEMS is made up of different National Medical
Associations from member nations of the European Unions.

Medical Tourism History from the 1900s to 1997

During this time, the USA and Europe were not only the commercial
and industrial centers, but they were also the center of the
healthcare world. Medical travel was limited to the affluent rich who
traveled to these countries in order to receive high-end medical
services.

In 1933, the American Board of Medical Specialties (ABMS) was

established and became the umbrella organisation for the medical
specialty boards in the United States. The ABMS established
educational and professional policies, which became the blueprint of
standards around the world.

In 1958, the European Union of Medical Specialties (UEMS) was

formed. The UEMS is made up of different National Medical
Associations from member nations of the European Unions.

During the 1960s, India became a destination of choice for pilgrims

when the New Age movement began in the USA. The flower child
movement, which drew the elite and socialites of America and the
UK, eventually developed into a full-fledged medical tourism
industry, with yoga and Ayurvedic medicine rediscovered.

With the cost of healthcare rising in the 1980a and 1990s, American
patients started considering offshore options, like dental services in
Central America. While US doctors were appalled at the idea of
seeking healthcare in foreign hospitals during these periods, Cuba
started programs luring foreigners for eye surgeries, heart and
cosmetic procedures.

History of Medical Tourism from 1997 to 2001

The Asian economic crisis in 1997 and the collapse of Asian

currencies prompted government officials in these nations to direct
tourism efforts in marketing their countries as premiere destinations
for international healthcare. Thailand quickly became the hub for
plastic surgery, with fees charged at a fraction of what Western
countries offer.

It was in 1997 that the Joint Commission International was formed

to check and investigate international healthcare facilities for
conformance to international standards due to the emergence of
health providers around the world.

Medical Tourism from 2001 to 2006

After the events of 9/11 and the construction boom in Asia, medical
tourism continued its massive growth with as many as 150,000 US
Citizens traveling to destinations in Asia and Latin America in 2006.
During this time, the dentistry and cosmetic surgery industries
reached new heights in these countries.

Thailand, Singapore, and India became legitimate medical

destinations due to JCI accreditation. Other Southeast Asian and
Latin American countries are emerging as healthcare destinations as
well with JCI accreditation and partnerships with prominent US-
based health providers.

Medical Tourism In 2007 And Beyond

Medical Tourism in 2007 and Beyond

The number of American medical tourists swelled to 750,000 in

2007, the largest ever in medical tourism history. This figure is
estimated to reach millions by 2010, as patients continue to pack
suitcases and board airplanes for offshore procedures such as face-
lifts, bypass surgery or fertility treatments.

In 2008, several healthcare and insurance companies in the United

States have considered medical outsourcing. Offering their members to
get non-emergency procedures and surgeries in other countries. Many
are also considering foreign medical procedures as part of health plan
Summary
Some of the key points of this chapter are as following:

 The Sumerians constructed healthcare facilities that included

majestic elevated temples with flowing pools.
 In India, the history of medical tourism was also slowly unfolding
with the popularity of yoga and Ayurvedic medicine.
 During middle ages, Temples gave way to hospitals that provide
clinical services to travelers seeking healthcare.
 In the Renaissance period, A village known as Ville d'Eaux or
Town of Waters, became famous throughout Europe in 1326
when iron-rich hot springs were discovered within the region.
 Towards the end of the Renaissance period, aristocrats from
around Europe continued to swarm to Bath for healing and
therapeutic cleansing.

Topic 3: Medical Tourism Destinations

1. Objective

At the end of this chapter the student will be able to:

 Describe the medical tourism industry in different parts of the world.

 List the strengths and weakness of each tourist destination.
 Explain the medical travel industry in India and the scope it offers.

MT Destinations
Medical tourism or medical travel is the act of traveling to other
countries to obtain medical, dental, and surgical care. The term was
initially coined by travel agencies and the media as a catchall
phrase to describe a rapidly growing industry where people travel to
other countries to obtain medical care. Leisure aspect of traveling
may be included on such a medical travel trip. It includes medical
services like knee/hip replacement, heart surgery, dental procedures
and different cosmetic surgeries. A combination of many factors has
led to the recent increase in popularity of medical travel the high
cost of healthcare in industrialised nations, the case and
affordability of international travel, and the improvement of
technology and standards of care in many countries of the world.

A large draw to medical travel is the convenience in comparison to

that of other countries. Some countries that operate prom a public
health-care system are so taxed that it can take a considerable
amount of time, to get needed medical care. The time spent waiting
for a procedure, such as a hip replacement can be a year or more in
Britain and Canada; however, in Singapore, Bangkok, Manila,
Philippines or Bangalore, a patient could feasibly have an operation
the day after their arrival.

Reasons pushing medical travel include lower healthcare costs as

well as the search for medical expertise, quality of care and safety.

To understand the phenomenon of Medical travel, one can compare

the average costs of cosmetic surgeries between the industrialised
nations and the most popular countries in Latin America which are
specialised in medical tourism and cosmetic surgery tourism
(Argentina, Bolivia, Brazil, Costa Rica, Philippines, and Mexico). All the
prices have been provided by the offices affiliate with the ministries of
health in USA, Europe (France, Spain, and Switzerland), Argentine,
Bolivia, Brazil, Costa Rica, India, and Mexico.

Medical tourists can come from anywhere in the world and may seek
essential healthcare services such as cancer treatment and brain
and transplant surgery as well as complementary or 'elective'
services such as aesthetic treatments.

Popular Medical travel worldwide destinations are Brunei, Cuba,

Hong Kong, Hungary, India, Israel, Jordan, Lithuania, Malaysia, The
Philippines, Singapore, Thailand, and recently, UAE. Popular
Cosmetic Surgery travel destinations are Argentina, Bolivia, Brazil,
Costa Rica, Mexico, and Turkey.

In Europe Belgium and Poland are also breaking into the business.
South Africa is taking the term "medical tourism" very literally by
promoting their "medical safaris": Feelings towards medical tourism
are not always positive. In places like the US, where most have
insurance and access to quality healthcare, medical tourism is
viewed as risky. In some parts of the world, wider political issues can
influence where medical tourists will choose to seek out healthcare;
for example, in late 2006 some patients from the Middle East were
choosing to travel to Singapore or Hong Kong for healthcare rather
than to the USA.

While the tourism component might be a big draw for some

Southeast Asia countries that focus on simple procedures, India is
positioning itself the primary medical destination for the most
complex medical procedures in the world. India's commitment to
this is demonstrated with an ever-growing number of hospitals that
are attaining the US Joint Commission International accreditation
(JCI).

Singapore positions itself as a medical hub where healthcare

services, medicine, biomedical research and pharmaceutical
manufacturing converge. Singapore has made international news for
many complex surgeries in specialties such as nephrology, oncology
and organ transplants procedures. Currently, Singapore boasts the
largest number of US Joint Commission accredited hospitals in the
region.

On the other hand, in South America, countries such as Argentina,

Bolivia, and Brazil lead on plastic surgery medical skills relying on
the vast experience their surgeons have in treating the style-
obsessed. It is estimated that 1 in 30 Argentineans had taken plastic
surgery procedures, making this population the most operated in
the world after the US and Mexico.

In Bolivia the situation is impressive. According to the "Sociedad

Boliviana de Cirugia Plastica y Reconstructiva", more than 70%
women who belong to the middle and upper class had taken plastic
surgery procedure.

There are companies emerging to offer global healthcare options

that will allow North American patients to take full advantage of
dramatic reductions in air travel and access world-class healthcare
at a fraction of the cost. Companies that focus on 'Medical Value
Travel' typically will have experienced nurse case managers to
assist patients with pre-and post-travel medical issues. They will
also help provide resources for follow-up care upon the patient's
return.

While these services will initially be of interest to the self-insured

patient, several studies indicate that the rapid growth of Health
Savings Accounts will also drive interest to healthcare in other
countries.

Because standards are everything when it comes to healthcare,

there is a parallel issue around hospital accreditation. Potential
medical tourists may be assisted in making their choices by whether
or not hospitals have been assessed and accredited by reputable
external accreditation bodies. In the USA, JCI fulfills such a role,
while in the United Kingdom and Hong Kong, the Trent Accreditation
Scheme is a key player.

Medical Tourism In Asia

Medical tourism in Asia is growing rapidly, far outstripping the 4 to 6
per cent growth in general travel bookings predicted for 2006, with
the number of medical tourist visits to many countries swelling by
20 to 30 per cent a year. Asia's burgeoning medical tourism
industry, expected to be worth at least US $4 billion by 2012, is
proving a windfall for the travel and hospitality sector.

As per the new research report “Asian Medical Tourism Analysis

(2008-2012)”, the Asian medical tourism industry revenue is
projected to grow at a CAGR of around 17% during 2010-2012 and
expected to reach US$ 8.5 Billion by 2013. Asian countries such as
India, Malaysia, Singapore, and Thailand have been pouring
investments into their healthcare infrastructure to meet the demand
for quality-assured medical care through first-class facilities and
highly trained medical specialists, including tertiary hospital care
dominating the region’s medical tourism industry, with a combined
market share of around 90% in 2009

Thailand and India vie with each other for the medical tourism
crown. Thailand’s prices are a bit higher on average than India’s,
with the main advantages being a better overall tourist experience
and more bundling of services. In 2008 Thailand has treated the
highest number of international patients compared to any other
Asian countries.

India advantages are that it is the cheapest of any of the world

medical tourism destinations while being the equal of the other
major destinations in terms of quality of staff, equipment and
healthcare procedures. With many brand new state of the art
hospitals and western trained doctors, it is easy to see why it is a
leader in medical tourism. In 2008 India market shares in Asia
medical tourist arrivals were 18.7 percent and it is expected to rise
further to nearly 25 percent by 2013.

However, these two major players are getting tough competitions

from other Asian countries like Philippines, Singapore, Malaysia and
South Korea. All these have government-backed medical tourism
programs and are trying to catch up fast. Singapore is planning to
be developed into a leading healthcare destination in Asia with its
medical tourism market steady growth of 11.9 percent over the past
few years (2004 to 2008).

In comparison to this South Korea is planning to develop an island

into a healthcare hub with all the latest healthcare facilities by 2011.
The island will be a two-hour flight from five major Asian cities
Seoul, Beijing, Shanghai, Hong Kong and Tokyo. Malaysia is
concentrating on neighboring countries like Indonesia Singapore for
its growth going forward. The international patient arrivals to
Malaysia are expected to grow at a CAGR of 29.27 percent for the
period of 2009 to 2013.

India's medical tourism business is growing at 30 per cent per year

and is forecast to generate at least US $2.2 billion a year by 2012.
Singapore is targeting to attract one million foreign patients
annually and push the GDP contribution from this sector above US
$1.6 billion, while Malaysia expects medical tourism receipts to be in
the region of US $590 million in five years' time.

The current estimated 1.32 million medical tourists come to Asia

from all corners of the world, including US and Europe but much of
the travel is within Asia. While the long-haul market is important and
growing, much of the business is Intra-Asia. Some of the key origin
markets are Indonesia, Malaysia, the Middle East and Greater China.
This provides a good spin-off for airlines and low-cost carriers
especially those providing direct flights within the region.

More than 1 million tourists receive healthcare in Thailand, be it

inpatient or day surgery at facilities such as Bumrungrad
International Hospital, which offers a full spectrum of services from
executive health tests to cardiac packages, cancer therapy, eye
surgery, liposuction and other cosmetic options.

Singapore, on the other hand, makes world headlines for performing

complex neurosurgical procedures and delivering cutting-edge
medical treatment by the region's leading health specialists. The
Republic's reputation for high-quality medical facilities and well-
trained doctors pulled in more than 370,000 visitors last year.

The cost of treatments in Singapore, such as a hip replacement, can

be less than a third of the price in the United States. In some cases,
the cost is less than a tenth of what people would pay in America or
Europe. India is another fast-growing destination, currently
attracting about 150,000 medical tourists a year, while relative
newcomer Malaysia, treated about 100,000 patients in the first half
of 2005.

Asia is a preferred healthcare destination and is set to grow further,

fuelled by the relatively low-priced healthcare services available.

While low cost maybe a draw-card for some patients, the assurance
of a good quality healthcare system is important. Many hospitals
and medical institutions that cater to the tourist market are among
the best in the world."
India promotes its private healthcare sector as a tourist attraction,
providing first-class service at a third-world price. In many respects,
Asia is an ideal growth environment for medical tourism, with
competitively-priced, quality healthcare services in major tourist
cities and connected by extensive global travel networks.

Travel and hospitality providers have been quick to recognise the

enormous potential of medical tourism in Asia and tap the benefits.
Alongside with the growing number of surgery options from
hospitals, many travel agencies have developed specialised
packages, including a broad choice of rehabilitation and leisure
activities, which can be integrated with the healthcare options.

Hospitals and travel partners are actively working together to offer

customised medical packages to travelers and their families.

An emerging trend is the bundling of five-star healthcare services

with unconventional post-operation treatment. India is providing
traditional recuperation forms such as yoga and naturopathy, while
Thailand is promoting its ancient Thai herbal remedies to the West,
Middle East and the Far East.

To create awareness and market their medical services, Singapore's

Raffles Hospital works with 50 agents in 12 countries. Parkway
Group Healthcare has marketing offices in 15 countries including
China, India, Bangladesh, Sri Lanka, Vietnam, Brunei, UAE, Britain,
Russia, Canada, Indonesia and Malaysia, which last year helped
attract over 17,000 warded patients and 140,000 outpatients.

Thailand's Bumrungrad International Hospital appoints Flight Centre

North America as its preferred travel provider for patients traveling to
the hospital and Diethelm Travel Thailand to offer support services for
inbound patients. In this competitive landscape, everyone is looking for
an edge: Governments are collaborating for mutual benefit; hospitals
are creating incentives to retain their best medical talent, and travel
agents and hospitality providers are forming partnerships and offering
value-added packages. Increasing public awareness of the medical
tourism options, greater confidence in foreign hospitals and
satisfaction with the tourism elements will be the catalyst for future
growth.
MT In Philippines

History

Before the advent of medical tourism, as we know it today, the

Philippines was known as a destination for Catholic faith healing,
attracting thousands of visitors from North America and Europe in
the 1960s. In the 1970s, the Philippine government established
Centers of Excellence like Philippines Heart Center, National Lung
Center, National Kidney and Transplant Institute with the intention
of building the country into a hub of medical expertise for East Asia.

The Philippines is another country taking significant steps to cash-in

on the booming tourism industry, including healthcare tourism.
Travel and tourism in the Philippines is significantly contributing to
the national economic development. The Philippines received about
2.8 million international tourists in the year 2006, and the tourism
receipts were estimated to be US $ 2.5 billion. The Department of
Tourism has targeted to receive 5 million international tourists with
tourism receipts of US $ 4.9 billion by 2010.

Promotion of healthcare tourism received importance with the

launch of ‘Philippines Medical Tourism Programme’ (PMTP), a
Healthcare Tourism private-public initiative, with the involvement of
industries such as wellness, Spa, health, tourism and retail business.
The public-private partnership, which brings together relevant
government agencies and private sector representatives under a
Task Force, which formulates a development strategy for sub-
sectors such as Medical and Surgical Care, Traditional and
Alternative Healthcare, and Health and Wellness Care (Spas).

Following this initiative, it is estimated that around 17 competent

hospitals in the Philippines have been launched, and with the
increased thrust in promotion and policy focus. These 17 medical
institutions estimate that they will service around 125,000 foreign
patients generating an estimated revenue of US $ 125 million per
annum.
The Philippines has been projecting dentistry services, cosmetic
surgery, eye-bag removal, face-lift, nose lift, tummy tuck,
enhancement of organs, non-surgical specialties such as
dermatology, family practice or internal medicine. The Philippines
has also been projecting its advantages such as availability of well-
trained competent medical professionals, fluency in English,
healthcare cost differential, technological advances and a vibrant
tourism sector with compassionate and caring professionals, in its
promotional programmes. The broad policy framework for the
development of healthcare tourism under the National Tourism
Strategy of the Philippines include:

 Broadening the marketability of the Philippines by

promoting Spa and medical tourism;
 Contributing to regional development in terms of
employment generation and increase in local government
revenue;
 Increasing investments relative to health holiday activities;
 Promoting and developing the country’s thermal springs
and other resources for health tourism program.

The Government has included medical tourism in the Investments

Priorities Plan (2006), which outlines incentives for prospective
investors in this Sector. The IPP has also introduced the concept of
‘International Medical Zone’ which will be a notified area developed
into a center for professional healthcare. The Department of Health
plans to classify certain medical zones under medical tourism zones,
which in turn would be accredited by the Department of Tourism.

Incentives provided by the Government for development of Spa

tourism and medical tourism include reduced import tariff on select
Spa /medical equipment and tax holiday for hospitals.

The Philippines has in place, rules and regulations for the

establishment of Spa as well as tertiary hospitals for the purpose of
medical tourism. The rules and regulations have set minimum
requirements for accreditation of tertiary hospitals and Spas, as also
the principles governing operation and maintenance of such
establishments. Philippines has also enacted an Act creating the
Philippine Institute of Traditional And Alternative Healthcare
(PITAHC) to accelerate the development of traditional and
alternative healthcare in the Philippines, providing for a Traditional
And Alternative Healthcare Development Fund and for other
purposes.

The value chain of medical tourism in the Philippines comprises

various stakeholders such as patients, doctors, hospitals,
government agencies and tourist resorts. First, foreigners seeking
medical treatment use channels such as electronic and print media
to decide on the medical tourism package that meets their needs.
Medical tourists who choose the Philippines to receive treatment
from top private hospitals which are comparable with those in
developed countries. After their medical procedure, the patients can
rest and recuperate at world-renowned tourist resorts before
heading back to their home countries.

The main actors in the medical tourism industry in the Philippines

are state-of-the-art private hospitals and clinics based in the capital,
Manila, where they enjoy convenient transportation, strong
infrastructure, access to human resources and proximity to the
major universities. These-state-of-the-art hospitals have proactively
adopted the following strategies to ensure world-class technical and
service standards, promote quality awareness, and market
themselves to medical tourists:

1. Obtain international accreditation and establish

international
partnership: In 2003, St. Luke’s Hospital became the second
hospital in Asia to be accredited by Joint Commission International
(JCI), demonstrating that it has the appropriate systems in place to
provide safe and quality healthcare service to patients. New Medical
City obtained JCI accreditation in 2005, and other major hospitals
are following suit. Collaboration with top U.S. hospitals and
universities also help maintain human resources and treatment
quality at high standards. For example, St. Luke’s hospital is an
affiliate of New York Presbyterian Hospital and its medical schools at
Columbia and Cornell Universities; Makati Medical Center has a joint
training program with Stanford Hospital.
2. Attract foreign investment and partnership for medical
tourism facilities:
Thailand’s Bumrungrad Hospital, one of the premier medical tourism
facilities in Asia, brings knowledge and expertise through its
partnership with Asian Hospitals in the Philippines.

3. Provide readily available package medical services: For

example, the Asian Hospital provides packages for general medical
check-ups and a range of cosmetic surgery procedures, without the
long waiting times characteristic of many developed countries.

4. Focus on offering cost-effective, top-rate cosmetic

surgery, eye surgery and dental treatment, catering particularly to
overseas Filipinos: Major hospitals and clinics currently feature these
services on their medical tourism websites.

5. Participate in forums and conferences on medical

tourism: Over 250 participants from 16 countries attended the 2nd
Annual International Medical Conference (IMTC 2007) held in Manila,
Philippines. Philippine firms and government agencies are also
active participants in international medical tourism conferences.
Although these state-of-the-art hospitals are well-regarded in the
Philippines and among overseas Filipinos, at present they do not
have strong international brand recognition. While JCI accreditation
and partnerships with reputable institutions will help boost their
international profile, more needs to be done to make Philippine
medical institutions synonymous with world-class healthcare.

Why the Philippines

The Philippines is able to provide high quality healthcare to medical

tourists at prices lower than developed countries. An analysis of the
costs of various procedures (Table1) shows that the Philippines is
much cheaper compared to the U.S. It is also very cost competitive
as compared to its South American competitors including Mexico
and Brazil as well as regional competitor such as Singapore, and
comparable to Thailand. However, the high cost of air travel from
the U.S. is a disadvantage.

Table 1: Competitive Cost of Treatment between USA and

Philippines
Treatment USA Philippines

General medical check-up 5,000$ 500$

Coronary bypass surgery 50,000$ 25,000$

Kidney transplantation 150,000$ 25,000$

Lasik eye surgery 3,000$ 1,000$

Breast augmentation 5,000$ 2,000$

MT In Singapore
Singapore's healthcare services built on a heritage of excellent
quality, safety and trustworthiness, coupled with advanced research
and international accreditation, and is Asia's leading medical hub.
Nine hospitals and two medical centres in Singapore have obtained
joint Commission International (JCI) accreditation. JCI is the main
hospital accreditation agency in the United States Singapore is well
known for performing complex neurosurgical procedures and
delivering cutting-edge medical treatment by the region’s leading
health specialists, including surgeries such as liver and heart
transplants. The latest available medical tourism statistics from the
Singapore Tourism Board shows that visitors who went to Singapore
for medical treatment or related reasons grew 13 percent to
646,000 in 2008 compared to 2007.

The tiny island of Singapore has long been the choice of destination
for major medical care for patients from neighboring countries
Indonesia, Malaysia, Brunei, Cambodia, Vietnam, Indochina, Greater
China, Russia and the Middle East. There are 15 hospitals and
medical centers in Singapore that have obtained the United States-
based Joint Commission International (JCI) accreditation. Singapore
hospitals are also looking towards European and Asian-based
hospital accreditation systems.

Asia's economic growth and an expanding middle class have fuelled

strong demand for medical tourism in Asia. The small city-state is
considered a pioneer in medical tourism and has built a strong
image for itself as a provider of high-quality medical treatment and
complex surgery. The government has done a lot to help develop
the industry. But competition in medical tourism is increasing, with
more Asian countries promoting medical tourism So Singapore has
to compete with Thailand, India, Malaysia, the Philippines, South
Korea and Taiwan.

Singapore is increasingly becoming a springboard for Russian

companies that want to expand into Asia. Russia has steadily grown
in importance as a trading partner of Singapore over the years.
Singapore healthcare company Sourcelink built Russia's first private
hospital in Vladivostok, and will soon build its second in Tartarstan,
where healthcare facilities will be housed in the same building as
retail outlets and accommodation for medical tourists. So Singapore
is now targeting both Russians who want to come to Singapore and
those who want to be treated in Russia, with the aim of encouraging
medical tourists from other countries to go to Singapore owned
hospitals in Russia. Sourcelink Healthcare Services has been
launched to offer medical concierge services to assist foreign
patients from various burgeoning markets, namely Vietnam,
Indonesia and Russia, with the practical aspects of medical travel to
Singapore, including visa application, ticketing and accommodation

Many patients come to Singapore from neighbouring countries, such

as Indonesia and Malaysia. Patient numbers from China and the
Middle East to Singapore are also seeing fast growth. Patients from
developed countries such as the United States of America are
increasingly choosing Singapore as their medical travel destination
for its relatively affordable health-care services and clean
cosmopolitan image.

Singapore is Asia's leading medical hub, with advanced research

capabilities as well as nine hospitals and two medical centres that
have obtained JCI accreditation. It is also the oldest destination for
modern medical travel in the region. The upper-middle classes from
neighbouring countries like Indonesia and Malaysia have been
utilising Singapore’s medical centres since the 1980s.

Government support for medical travel in Singapore can be

considered exceptionally strong. Singapore Medicine, a multi-agency
government initiative, launched by the Acting Minister of Health in
the year 2003, leads and coordinates the medical travel drive.
Singapore Medicine identified three key growth areas: heart, eye
and cancer treatment. The initiative brings together the Economic
Development Board, which promotes new investments in the health-
care industry, the Singapore Tourism Board, which is in charge of
marketing, strengthening service delivery, and developing overseas
referral channels, and the International Enterprise Singapore, which
promotes the growth and expansion of Singapore’s health-care
players.

Medical travel is perceived as a positive development in Singapore

because its own population can benefit from the critical mass for
specialisation and sub-specialisation, retention of medical and
professional manpower as well as the acquisition of new technology.

Increased revenues and extension of benefits to the medical

community are other benefits. Singapore sees medical travel as part
of a larger economy/ecology.

In January 2007, Singapore's government announced that would

further step up its efforts to draw more foreign patients from outside
South East Asia to strengthen its role as a top provider of quality
healthcare services in the region. Singapore’s Health Minister even
announced in parliament recently that the Singapore would give
priority to hospitals when it came to buying land. The Singapore
Government plans to invest $974 million in medical research and
has hired McKinsey & Co to consult on its Singapore Medicine
project to increase progress towards its goal of attracting 1 million
foreign patients by 2012.

Such government-led initiatives have increased investor confidence.

Expecting increased numbers of patients, one major Singaporean
developer, and owner of the Fullerton Hotel, has already built a
medical complex next to Tan Tock Seng Hospital, a major
international facility and the second largest hospital in Singapore.
The positive investment climate has also led Parkway Holdings,
South-East Asia's biggest healthcare group by market value, to
launch a multi-million dollar real-estate investment trust.

Parkway Holdings owns three hospitals in Singapore, namely East

Shore Hospital, Gleneagles Hospital and Mount Elizabeth Hospital, as
well as a liver and cancer center, and a network of facilities in China,
Brunei, India Malaysia and Vietnam. Twenty per cent of hospital care
in Singapore is provided by the private sector, and 70 per cent of
this is cornered by Parkway hospitals.

The emphasis of the group is for international patients, who in 2003

made up 25-30 percent of their patient volume. The Parkway Group
Healthcare has marketing offices in 15 countries including
Bangladesh, Brunei, Canada, China, India, Indonesia, Malaysia,
Russia, Sri Lanka, United Arab Emirates, United Kingdom, and
Vietnam, and which in 2005 helped attract over 17,000 warded
patients and 140,000 outpatients. In 2006, 40 percent of their
revenue came from foreign patients. Third-quarter profits for 2006
rose 24 per cent from a year earlier to S$18.5m, with much of this
down to medical tourism. Raffles Medical Group, which owns a
hospital and more than 60 clinics in Singapore, as well as six clinics
in Hong Kong, is rapidly becoming an international patient hub.
Collaboration with international insurance companies, clubs and
associations, and foreign embassies located in Singapore also
contribute positively to the utilisation of Raffles Hospital's services
by international patients.

MT In Malaysia
Malaysia is one of the most popular tourist destinations in the
ASEAN region. Despite the global economic slowdown and concerns
regarding H1N1 flu, it received around 23.6 Million international
tourists in 2009, an increase of around 7% over the previous year.
Singapore, Indonesia, and Thailand are important sources of visitors
for the country.

According to the new research report “Malaysian Tourism Industry

Forecast to 2012”, international tourist arrivals in Malaysia will grow
at a CAGR of around 8% during the forecast period (2011-2013) and
tourism receipts from overseas tourists are expected to rise at a
CAGR of around 8% during the same period, thereby, surpassing RM
70 Billion (over US$ 22.4 Billion) by 2013. Apart from the ASEAN
countries, it is anticipated that tourist arrivals from China, India, and
the Middle East will strongly grow during the forecast period (2011-
2013). Malaysian tourism industry will continue to grow rapidly in
coming years, on the back of increasing promotional activities by
the government and growing reputation of the country as a
shopping hub.

In developing the medical travel industry and medical tourism in

Malaysia, much is owed to the concerted and synergistic efforts by
the various parties involved in the nation's health tourism think tank
– the National Committee for the Promotion of Health Tourism,
formed in 1998. This high-powered committee is chaired by the
Director General of Health and the core team comprises the Ministry
of Health; Ministry of Culture, Arts and Tourism; Tourism Malaysia;
Ministry of International Trade and Industry; Malaysian External
Trade Development Corporation (MATRADE); Association of Private
Hospitals of Malaysia; and the Malaysian Association of Tour and
Travel Agents. The committee is supported by various other
stakeholders both from the health-care and travel industries. The
committee has a two-pronged objective: to further raise the
standards of care and of caregivers, which in turn will put Malaysia
on the map as one of the most desirable healthcare destinations.

Five subcommittees were formed to address the following key

issues: identifying source countries to promote medical travel, and
drawing up tax incentives, fee packaging, and accreditation
guidelines and advertising guidelines.

Furthermore, the Government of Malaysia takes an important lead in

the marketing of medical travel and tourism overseas through trade
missions and other promotional activities. Road shows and marketing
promotions have been organised and carried out by MATRADE and
Tourism Malaysia, both of which are government bodies. In the period
2001-2002, MATRADE organised at least three specialised health-care
missions to promote medical travel and tourism in Indonesia,
Myanmar, Vietnam and countries in the Middle East. While Singapore and
Thailand have several years headstart, Malaysia’s hospitals are beginning to
catch up. The number of foreign tourists seeking treatment in Malaysia
generated about US$ 27 million in 2004. In 2005, the foreign patient market
was estimated to be worth about MYR 154 million (US$ 1 = approximately
MYR 3.6) and medical travel was expected to generate at least MYR 2 billion
a year in national earnings by 2010. A 2006 market analysis estimated that
the majority of foreign patients receiving medical treatment in Malaysia were
from: Indonesia (72 per cent), Singapore (10 per cent), Japan (5 per cent)
and West Asia (2 per cent).

The significant price gap is Malaysia's main advantage. The

Government is focusing on this advantage, in renewing its push for
medical travel as part of a wider effort to reduce the country's over-
reliance on manufacturing. To attract more foreigners to seek
private medical care in Malaysia, a Health Travel Unit was
established under the Ministry of Health to improve the quality of
health services. In its further effort to promote medical travel and
tourism, the Ministry of Health is cooperating with private hospitals,
tour agencies and other relevant bodies to come out with packages
to attract more travellers to Malaysia. Currently, there are 34
private hospitals involved in medical travel, targeting less-
developed markets such as Bangladesh, Indonesia, and Viet Nam, as
well as Middle Eastern countries. Common treatments are in
cardiology, cardio-thoracic surgery, radiotherapy and radiology.

MT In Thailand
The tourism industry has been regarded in Thailand as one of the
prime activity that contributes to the national economic
development. International tourist arrivals in Thailand in the year
2006 were 13.9 million (fourth largest in the Asia Pacific region), and
the tourism receipts were estimated to be US $ 12.4 billion.

It is reported that patients coming from China, Japan and Korea

mainly undertake plastic surgery; with the elders prefer for
facelifting surgery and the younger ones going for rhinoplasty
surgery. The Japanese and Korean women have been undertaking
breast augmentation surgery.

Thailand has been highlighting elements such as Spas and

alternative therapies in their promotional strategies for several
decades. However, since late the 1990s, Thailand has been
emphasising the ‘state-of-the-art’ hospitals and skilled medical
professionals in their promotional strategies. Healthcare tourism is
positioned as an extension of its well-known Spa and wellness
treatment offerings. Many hospitals in Thailand have installed
technologically advanced equipment such as Gamma Knife Brain
Surgery equipments. Thailand has also been emphasising on
associated services such as health check-ups, optical services,
dental services, rejuvenation and skin care, face lifting, rhinoplasty,
breast augmentation or reduction, fixing of an ear and digital
hearing aids.

In addition to having state-of-the-art hospitals and technologies,

Thailand has developed high professionalism in healthcare tourism
in such a manner that many of the hospitals are furnished like a
hotel, and customers are treated as hotel guests rather than
patients. Hospitals provide ambulances or other such transports at
the airport for transfer of patients as also the accompanying
persons. With world-class medical facilities and specialists, and
warm hospitality of service staff, patients are attracted to come to
Thailand for vacationing and treatment.

The experiences of hospitality and tourism industry, particularly the

travel agents, have been successfully leveraged by the healthcare
industry in Thailand. Further, the innovative promotional strategies
of the national carrier, Thai Airways International, have also helped
in the development of healthcare tourism industry in Thailand.

Communication technology has also been leveraged by the

healthcare tourism industry in such a way that the patients can
identify and select the hospital/doctor suitable for the treatment,
identify the favourable destination for holiday/recuperation, seek
online appointments for various healthcare services, and customise
the required packages with the travel/tourism operator. The
hospitals are also equipped with equipments for receiving patient
history through satellite.

Major hospitals in Thailand have set-up recuperating facilities at

tourist centres such as Phuket or Chiang Mai. The city of Chiang Mai,
in particular, is branded as a healthcare destination with its blend of
Spas and high-quality, low-cost medical, dental and therapeutic
services. The city has about 10 private hospitals with over 2000
beds and 700 doctors, currently operating at 50% capacity on an
annual basis.
It may be mentioned that aggressive and collective marketing by all
stakeholders, including the Royal Government of Thailand, has
positioned the country in the global map of healthcare tourism. In
the Marketing Plan (2005) of the Tourism Authority of Thailand
(TAT), healthcare tourism has been identified as a major “Special
Interest” tourism product to be promoted in all of its geographical
markets.

TAT has been collaborating with the Ministries of Public Health and
Commerce (MOPH) to implement a national strategy to develop
Thailand’s potential in the field of health and wellness. TAT has
identified staff training and skill development as a major
requirement for development of healthcare tourism sector. MOPH is
collaborating with the Thai Spa Association to formulate procedures
for accreditation and certification, to ensure international quality
standards.

Hospitals are encouraging the staff to develop their language skills

targeting the international patients. Many hospitals have staff with
knowledge of Japanese, Arabic and English to cater to the
requirements of international patients.

Spas in Thailand
Thai Spas are the traditional Thai way of preserving well being, curing
ailments, refreshing the body, promoting the balance of a healthy body
and soul, by utilising plants and herbs, with the use of water.

While the Spa operators around the world have opted for self-
regulation, Thailand has developed specific standards for the Thai
Spa industry and enforcement of industry standards via legislation.
Ministry of Public Health (MOPH) assumes the role of custodian
overseeing the growth and development of the Spa sector with one
of its duties being to assist in the development of guidelines and
specific standards for the industry. The standards are being
developed in accordance with existing benchmarks for quality
adopted by the global Spa industry, which helps the country’s
Health Spas, traditional Thai massage, and long-stay healthcare
products and services – competitive amongst international
travellers.
MOPH has announced that all Spas have to register with the Medical
Registration Department of the MOPH (or Provincial Health Offices
upcountry) and Spa operators and therapists must be certified to
work in Spas.

At present, Thai Spas are very popular with international travellers

as is evidenced by the key findings of the Spa Industry Surveys and
Spa Consumer Surveys conducted by Intelligent Spa, Singapore. The
survey has estimated that approximately 3.6 million visits were
made to Thai Spas in 2003-04, of which about 78% of the customers
are from abroad. About 22% of respondents were of the view that
Thailand would be their destination for Spa-holiday, and about 42%
of respondents have favoured to go to Thailand for their next Spa.
Most favourite Spa treatment by the survey respondents was
massage followed by body scrub and body wrap.

Source: Bumrungrad Hospital Public Company Limited, Annual

Report 2006.
Revenue contribution by Thai and international patients

The international patients who visit Thailand for medical treatment

are classified by the
Thailand Department of Export Promotion, Ministry of Commerce,
into three broad groups:
  Expatriate: comprising foreigners who work in Thailand
and its neighboring countries. These patients are generally
treated for heart disease, blood pressure, and respiratory
conditions, as well as seeking plastic surgery;
 Direct fly-in: comprising foreigners who visit Thailand
specifically to utilise the Thai health-care services. These
patients generally use health-care services for heart
disease, neurosurgery, eye care and kidney disease;
 Tourist: comprising foreigners who are tourists in Thailand
and require Thai health-care services for amongst other
things, common diseases and respiratory care.

An estimated 60 per cent of international patients visiting Thailand are

expatriates, 30 per cent are direct fly-ins and 10 per cent are tourists. The
Japanese still form the biggest chunk of medical travelers coming to
Thailand, though the Americans, the British and individuals from the Middle
East are now also coming in significant numbers.

In June 2004, the Thai Government published its health-care policy to

develop and promote Thailand as the leading health-care provider in Asia by
the year 2010. The government strategy sought to increase marketing and
public relations to foreigners, improve management, and develop health-
care products and services. The areas in Thailand which are being promoted
as international health-care centres are Bangkok, Chiang Mai, Koh Samui and
Phuket.
Bangkok's Bumrungrad Hospital is the leader in the field and
considered to be one of the frontrunners in medical travel
worldwide, though a number of other hospital groups are also
providing strong competition. Hospitals in Thailand offer a host of
facilities such as assistance in interpretation from more than 10
languages and assured quality through JCI accreditation.

Today many Thai physicians hold US professional certification. A

number of Thai hospitals have relationships with facilities in the US.
The US Consular information sheet gives the Thai healthcare system
high marks for quality, particularly facilities in Bangkok. In Thailand,
there is modern infrastructure, with clean, safe streets. According to
the US Consular information sheets, the crime rate in Bangkok is
lower than that of many US cities. Personal safety is another factor
to consider when traveling abroad both for vacation as well as
healthcare. Thailand offers everything from cardiac surgery to organ
transplants at a price much lower than the US or Europe, in a safe,
clean environment.

MT In South Africa
Described as a place to get sun, safari, and surgery, South Africa
has for some time been a popular medical tourism destination for
Europeans because of its proximity to the continent.

Although hospitals in South Africa aren’t as competitively priced as

hospitals in other destinations (it is still 50% cheaper than in the
U.S.) medical tourists flock to the country’s health facilities because
of its world-class medical institutions, tranquil vacation settings, and
highly skilled doctors; many of whom not only have certification in
South Africa, but also in the United States and the United Kingdom
as well. South African medical procedures are renowned the world
over, and it was on December 3, 1967, that Dr Christiaan Barnard
and his team made history with the world's first successful heart
transplant at Groote Schuur Hospital in Cape Town.

Other reasons why many Westerners seek medical treatment in

South Africa are that English is an official language of the country,
South Africa has advanced private and public medical
infrastructures and private hospitals are in competition with one
another and thus offer luxurious accommodations in order to lure
patients. There are also many top-notch spas and resorts that cater
to the recovery process.

Doctors in South Africa are well known for their quality, and many
are certified not only in South Africa, but the United States and the
United Kingdom as well. Doctors and hospitals are monitored by the
Health Professions Council of South Africa to ensure that they meet
the required standards, as well as by other professional boards
related to specialties. English is one of the official languages in
South Africa, so most doctors and their support staff should be easy
to communicate with.

South Africa has a well-developed public and private medical field,

with many states of the art hospitals and facilities. Private hospitals
are often in strong competition with one another, and as a result,
accommodations can be quite luxurious.

Treatment in South Africa is about half of what it costs in the United

States, due in part to favorable exchange rates, and the quality of
care is extremely high. South Africa is known for complicated
procedures such as heart transplants, but the real draw and reason
it is such a hotspot for medical tourists is cosmetic surgery.

With coasts bordering the Atlantic and the Indian Ocean, South
Africa has miles of beautiful beaches. For the adventurous, there is
always the option of embarking on a safari to see the wide range of
birds and animals that call South Africa home. For a more relaxing
vacation, South Africa is also known for its wines and there are a
number of spas and resorts to cater to help you make a speedy
recovery. South Africa is known for its wide variety of medical
tourism packages which can take care of all the arrangements for
you.

Popular procedures sought in South Africa are cosmetic, dental, eye,

laser, and fertility treatments, however, hospitals offer a wide range
of world-class procedures.

Strict Professional Ethics and High Competence

The "Association of Plastic and Reconstructive Surgeons of South

Africa" has standards of admission as strict as the best in Europe. Its
members are scientifically and technically up-to-date and have the
experience of many years in practice. European patients in South
Africa can't help noticing the relaxed and matter-of-fact manner, in
which the surgeons treat them. Plastic surgery has a long tradition
in South Africa. For an affluent South African lady, it is just a matter,
of course, to have a facelift, body styling, breast surgery or other
beauty treatments done.

Visa / Entrance Requirements

U.S. and Canadian citizens do not require a visa in order to enter

South Africa, however, a passport (valid for at least 30 days after
the date of departure) with at least two blank pages for the entry
stamp (not including the ‘endorsement’ page in the back) is
required.

MT In Costa Rica
With its beautiful scenery, friendly locals and temperate climate,
Costa Rica have long attracted travelers in search of adventure and
relaxation. What many are quickly realising is that Costa Rica is
much more than an eco-tourism destination. It is also home to
highly trained physicians that provide quality healthcare at a
fraction of the cost compared to the United States and Canada.

Each year a growing number of tourists visit Costa Rica to receive

cosmetic surgery on what has been dubbed ¨medical vacations¨.

In an era of rising healthcare costs and decreased medical coverage,

the concept of combining surgery with travel has taken off.

The last decade has seen a boom in the health tourism sector in
Costa Rica, especially in the area of plastic surgery. The country’s
excellent reputation is directly linked to the professionalism of its
internationally-trained doctors and array of cost-effective
procedures.

In fact, cosmetic surgery is so affordable that the total cost of a

medical vacation in Costa Rica including airfare, accommodations
and a few days of sightseeing is often far less than the procedure
alone would cost in the United States. Plastic surgeries cost a third
or even a fourth of what they do in the U.S., without compromising
quality or results. With a wealth of skilled surgeons and state-of-the-
art medical facilities, Costa Rica is internationally recognised as a
top-notch medical tourism destination. Over a million Americans
partake in medical vacations every year, and thousands are drawn
to Costa Rica’s modern hospitals and private clinics which have
Board Certified surgeons, many professionally trained in North
America or Europe. They offer patients a variety of cosmetic surgery
procedures using the latest technology, at affordable prices.

Medical treatments are usually about 50-70% cheaper than in the

US and no one has to wait their turn for surgery. A face lift in Costa
Rica costs around $3, 000 while the same procedure in the States
costs anywhere from $7,000 to $15,000. International hospitals are
staffed with fully certified bilingual surgeons that cater to foreigners
seeking superior medical care. Additionally, the Costa Rica Board of
Plastic Surgery offers prospective clients a list of certified and
credentialed physicians who are members of the association.

Easily accessible from US and Canada, there are frequent flights

from important cities in both these countries. Also, Americans,
Canadians and most Europeans staying in Costa Rica for less than
90 days do not require a visa. They do need a passport that is valid
for at least 30 days.

The cosmetic surgeons in Costa Rica are recognised for their

commitment to cutting-edge techniques in all cosmetic surgery
procedures. They have received extensive training in Costa Rica,
North America and Europe. Most have been in practice for over a
decade and specialise in procedures ranging from body contouring
and breast reconstruction to brow and face lifts.

They offer personalised follow-up care, visiting patients several

times after surgery to review progress and addressing any concerns.
The surgery center has top-of-the-line facilities, including modern
recovery rooms, a spa and wonderful post-operative care.

Costa Rica is a foreigner-friendly country; it attracts over 2 million

tourists every year. The phrase Pura Vida differently means "Full of
Life", "Purified life", "This is living!" or "Going great!" Â and reflects the
easy-going, relaxed lifestyle of Costa Ricans.
Costa Rica has a special police force called 'Tourist Police' that is
just to assist the tourists with directions and answering questions.

A politically stable country, Costa Rica does not have an army. It has
a high standard of living when compared to that of other Latin
American countries and also a stable economy. It has a literacy rate
of 96% and the lowest crime rates in the region. Many US and
Canadian citizens and Europeans choose Costa Rica to lead their
retired life because of the low cost of living, comfortable climate,
and its unspoiled natural habitats.

The healthcare in Costa Rica compares with the best in the world. It
is no surprise then that the UNDP's 2007/2008 Human Development
Report puts the average life expectancy in Costa Rica at 78.5, above
that of USA's 77.9.

Costa Rica's unique geographic location - it has the Pacific ocean on

the one side and the Caribbean Sea on the other - has endowed it
with beautiful pristine beaches, lush green mountains formed by
past volcanic eruptions, dense rainforests, lakes, and rivers. All
these help support one of the most diverse plant and animal life on
the planet. Costa Rica also has many active volcanoes and hot
springs. Sometimes called 'the Switzerland of Central America',
Costa Rica is famous for microclimates where in an hour's travel one
may experience from very hot and humid to hot and dry to cold and
rainy.

So, if a patient is looking for medical care abroad, Costa Rica is one
of the places to consider seriously. There couldn't be a better place
than Costa Rica to recuperate and unwind. Thus, medical tourism in
Costa Rica is a complete package of health, fun, and savings.

MT In Poland
Poland is becoming more and more popular with patients from
Western European countries mainly due to its location and the
substantial cost savings without losing quality. Medical tourism in
Poland has been increasing over the past few years with the boom
after Poland joined the European Union in 2004. The majority of
foreign patients are coming from Germany, United Kingdom,
Sweden and other Scandinavian countries. There is also a trend with
Polish American immigrants to return to have medical procedures
done while visiting their relatives, raising a much greater interest in
Poland as a medical tourism destination among other US citizens.

Most medical centers are located in the major cities and are easily
accessible by plane, like Warsaw, Krakow, Gdansk, Szczecin and
Wroclaw. Therefore, most patients are coming to the capital of
Poland-Warsaw; the former capital of Krakow, which has been
named a UNESCO Cultural World Heritage site; Szczecin and with
increasing popularity among Scandinavians and Germans; Wroclaw
with its beautiful architecture and Gdansk the icon of Amber and
Solidarity.

The rise of the low budget flights has made Poland even more
accessible. It takes a maximum of a two-hour plane flight from any
Western European airport to reach Poland.

The country is now better linked to the west than any other ‘new
European’ nation. The internet availability is also playing an
important role by allowing people to thoroughly research their
options. It is easy to have a look at any healthcare provider, medical
facility or medical tourism portal in Poland and what is more helpful
join a chat forum and message board and talk to people who have
had medical procedures done abroad. It’s never been easier to listen
to people or compare their experiences.

Patients are attracted to Poland due to its uniqueness, low prices,

state of the art equipment, the latest techniques and top quality
materials. Savings in excess of 70% can be made. Polish surgeons,
doctors and dentists perform all of the same procedures as their
western counterparts. Medical tourism services are carried by
private sector with very modern equipped clinics and medical
centers.

The Polish Foreign Investment Agency predicts that the number of

West European patients coming to Poland for private healthcare
may increase annually by 10-20%. It seems that Poland is high on
the list of EU newcomers and offers high quality and affordable
medical services to foreigners.

Cross-Border MT
Cross-Border Medical Tourism. It may be impractical for sick
Americans to travel to faraway places like India and Thailand for
major surgery. But many types of medical services are available
nearby — in Mexico and elsewhere in Latin America.

Mexico. Mexican physicians have a thriving business treating

American (and Canadian) retirees searching for of low-cost drugs,
dental care and physician services. Prices in Mexico are about 40
percent lower than in the United States. Cash-paying, uninsured
Americans can find better deals on procedures in Mexico, including
price quotes and package prices, which most American hospitals do
not offer.

Some 40,000 to 80,000 American seniors live in Mexico. In addition

to healthcare at lower prices (Medicare does not cover care outside
the United States), a number of them receive nursing home care at
bargain prices. In most areas of the United States, the cost of
nursing home care can easily surpass $60,000 per year. But in
Mexico, high-quality long-term care costs only about one-fourth as
much. For about $1,300 per month, a senior can get a studio
apartment that includes laundry service, cleaning, meal preparation
and access to around-the-clock nursing care.

Other Latin American countries provide services as well:

Colombia is a favorite destination for cosmetic surgery. Argentina

and Brazil have long been known for cut-rate plastic surgery, and
more advanced treatments are becoming available.

Plenitas is a Buenos Aires-based boutique clinic that arranges

medical travel. Although most of the services provided are cosmetic
surgeries, it also offers in vitro fertilisation and bariatric (weight
loss) surgery. Nine Brazilian organisations have established a
healthcare consortium to market Brazil as a medical tourism
destination in various countries. Europe. Northern and Western
Europeans have numerous opportunities to get lower-cost medical
and dental care:

Germans favor Szczecin, Poland, less than 100 miles from Berlin, for
low-cost, high-quality dental work. Sopron, Hungary, less than an
hour’s drive from Vienna, Austria, caters to medical tourists. Sopron
has more than 200 dentists and 200 optometrists, 10 times as many
as would be expected in a town of 20,000 people.

Latin America. Panama has high quality health care, concentrated

primarily in the metropolitan areas. Medical standards at Panama’s
top hospitals are comparable to those in the United States. Indeed,
many Panamanian physicians were trained in the United States.
Hospital Punta Pacifica in Panama City, Panama, is an affiliate of
U.S.-based Johns Hopkins International. Medical care in Panama is
40 percent to 70 percent less expensive than in the United States.

Medical Tourism In India

India is a recent entrant into medical tourism but is quickly catching up.
Recent estimates indicate that the number of foreign patients coming to
India is increasing by 30 per cent each year. The Deloitte report says that
Indian medical tourism is expected to grow 30% annually up to 2015. An
update on this report says that US recession is driving more people out of
the country for healthcare: US outbound medical tourism is projected to
increase 35% annually from 2011-2013.

The major Indian health destinations include Delhi, Mumbai,

Bangalore, Chennai and Thiruvantapuram. The south Indian city of
Chennai has been declared India's Health Capital, and is estimated
to receive 45 per cent of health tourists from abroad and 30-40 per
cent of domestic health tourists. India is particularly well known for
its low-cost advanced medical procedures, ranging from heart
surgery, joint replacements and hip resurfacing to cataract
operations, cosmetic surgery, dentistry and gallstone removal.

Most estimates claim that treatment costs in India start at around a

tenth of the price of comparable treatment and can go up to a
sixteenth of the cost in the United States and Europe. According to
the Business World report, a heart bypass surgery costs.
US$144,000 in the U.S.., US$25,000 in Costa Rice, US$24,000 in
Thailand. US$20,000 in Mexico, US$13,500 in Singapore, and
US$8,500 in India. Knee surgery (on both knees) costs US$ 7,700 in
India; in Britain, this costs more than twice as much. Dental, eye and
cosmetic surgeries in Western countries cost three to four times as
much as in India.
 In addition to the attraction of affordable advanced medical
procedures, tourists from abroad also visit India for alternative
treatments like Ayurveda, Yoga, and Kairali. The health tourism
focus has seen Kerala participate in various trade shows and expos
to showcase the advantages of this traditional form of medicine. The
large Indian community living abroad makes up a significant part of
the medical travel market in India. Wealthy expatriate Indians are
becoming increasingly aware of India's high-quality and low-cost
hospitals. It is becoming more attractive to combine regular visits to
India and save time and money by undergoing non-emergency
procedures such as eye operations, dental work, cosmetic surgery
and knee surgery.

To some extent, the large Indian expatriate market overlaps with

the Middle East and South Asian markets that make up the bulk of
medical travelers to India. However, in recent years there has also
been a steady increase in medical tourists from European counties,
in particular, the United Kingdom. At present, India is being
promoted as a healthcare destination in countries around the world.

The Government of India is committed to the goal of making India a

world leader in the industry. Merging medical expertise and tourism
became government policy when finance minister Jaswant Singh, in
the 2003-2004 budget, called for India to become a global health
destination as one of the three principal objectives on health. As
part of Government commitment on this, the 2003-2004 budget
offered several incentives to promote the medical tourism industry.
For example, in order to encourage private hospitals to either
establish new or to expand existing medical facilities, it was
proposed to make long-term capital more easily available to private
hospitals with 100 beds or more.

The following table gives a very brief comparative picture of

the price of the treatment

USD (in Difference in

Procedure USD (in USA) India) Price

Bone Marrow Transplant 250000 69200 28%

Liver Transplant 300000 69350 23%

Heart Surgery 30000 8700 29%

Orthopedic Surgery 20000 6300 32%

Cataract Surgery 2000 1350 68%

Dental Procedure

Metal Free Bridge 5500 600 11%

Dental Implants 3500 900 26%

Porcelain Metal Bridge 3000 600 20%

Porcelain Metal Crown 1000 100 10%

To ensure hospitals use the most advanced technology available, it

was further proposed to increase the depreciation rate to allow old
equipment to be replaced sooner. It was also proposed to reduce
the customs duty on specified life-saving equipment from 25 per
cent to 5 per cent, and also exempt such equipment from additional
customs duty. The Government, in partnership with private hospital
groups, is also taking steps to

Price Comparison of India and [Link] U.K.

Treatment Approximate C Cost in other Major Approximate

ost in India ($) Healthcare Destinat Waiting Period
 s in USA/UK (in
ion ($) months)

Open heart Surgery 4,500 >18,000 9-11

Cranio-facial Surgery and 4,300 >13,000 6-8

skull base

Neuro-surgery with
Hypothermia 6,500 >21,000 12-14

Complex spine surgery

with implants 4,300 >13,000 9-11

Simple spine surgery 2,100 >6,500 9-11

Simple Brain tumour

- Biopsy 1,000 >4,300 6-8

- Surgery 4,300 >10,000

Parkinsons

-
Lesio
n 2,100 >6,500 9-11

- DBS 17,000 >26,000

address medical travel deterrents such as concerns regarding
treatment and care standards, insurance coverage and general
infrastructure. As a result, quality of Indian hospitals has improved
significantly, translating into the increased international
accreditation of its hospitals. Insurance coverage for treatment in
Indian hospitals is also increasing.

For example, patients treated at the Wockhardt Hospitals are

insured by United States private health insurers Blue Cross and Blue
Shield. The British health insurer BUPA also insures the costs of
treatment at Wockhardt hospitals. In another example, BUPA also
signed a contract with the Ruby Hospital in Kolkata. India is also
putting in place policies to support medical tourism. India’s National
Health policy 2002, for example, says:

“To capitalise on the comparative cost advantage enjoyed by

domestic health facilities in the secondary and tertiary sector, the
policy will encourage the supply of services to patients of foreign
origin on payment. The rendering of such services on payment in
foreign exchange will be treated as ‘deemed exports’ and will be
made eligible for all fiscal incentives extended to export earnings”.

The formulation draws from recommendations that the corporate

sector has been making in India and specifically from the “Policy
Framework for Reforms in HealthCare”, drafted by the prime
minister’s Advisory Council on Trade and Industry. This indicates a
mature multi-ministerial collaboration.

Future projections for the medical travel industry in India vary but
are without exception positive. Medical tourism in India, which
reached an estimated US$ 480 million in 2005, provides ample
opportunity for growth as the Indian healthcare industry commands
only a 1.2 per cent share of the $40 billion global medical tourism
market.

Projections show that India’s multi-billion dollar health-care industry

could grow from anywhere between 13 - 25 per cent in each of the
next six years, boosted by medical tourism. According to RNCOS
growth in India’s Medical Tourism market will be a boon for several
associated industries including the Hospital Industry, Medical
equipment and Pharmaceutical industry. CAGR in revenue in 2011 -
2013 will be 26% in terms of medical tourists, the number would
touch 1.3 million by 2013 at a CAGR of 19%.

The Apollo group is the largest hospital group in India, the largest
integrated healthcare company in Asia and the third largest hospital
group in the world. In 2005, the group managed 37 hospitals and
over 7,000 beds.

The group has tied up with hospitals in Bangladesh, Mauritius,

Tanzania and Yemen; in addition to running a hospital in Sri Lanka,
and managing a hospital in Dubai. The major areas of activity of the
group consisting of: hospitals and clinics; hospitals consultancy;
information technology, including internet-based technology;
telemedicine; education and training; virtual medical university;
home healthcare and pharmacy retailing.

It is a hub for international patients looking for first class treatment

and is often called a super hospital, referring to the wide range of
procedures available and the scale of its operation. The hospital
handles close to 200,000 patients a year, of which an average of
9,500 are international patients from South-East Asia, Africa, the
Middle East and the United States. In the period 2002-2007, it
received 60,000 foreign patients from countries.

The group has gone to extensive effort to cater to the needs of

international patients. It runs an international patient care office and
has set up a first aid and help desk at the domestic arrival terminal
at the Hyderabad airport for patients and families traveling to its
Hyderabad hospital. Upon arrival, patients even get their own
website to facilitate contact with family and friends.

Wockhardt Hospitals Group is another chain of super hospitals in

India. The group has partnered with Harvard Medical International in
establishing a chain of super hospitals at Mumbai, Bangalore,
Hyderabad, Kolkatta and Nagpur.

Several new hospitals and facilities are in the planning. Wockhardt

attracts a large number of overseas patients from the United
Kingdom, United States, Canada and the Middle East. Hospitals have
established separate divisions to look after international patients;
managing the patient’s visit from arrival to departure, including visa
arrangements and tourism packages.

Another large private healthcare delivery company is Fortis

Healthcare, established in 1996 by the promoters of Ranbaxy
Laboratories, India's largest pharmaceutical company. The Fortis
network includes 12 Hospitals with a bed capacity of around 2,000
beds. Most of the hospitals of Fortis are multi-specialty hospitals
offering secondary and tertiary healthcare with a strong portfolio in
specialty areas such as cardiac care, orthopedics, neurosciences,
oncology, renal care, gastroenterology and mother and child care.

Fortis Healthcare is one of the fastest growing healthcare companies

of India with its revenue showing a compound annual growth rate of
89 per cent during the fiscal years 2002-2003 and 2006-2007. Its
average revenue per bed of about US$ 105,000 is the highest
among the Indian healthcare companies.

The company aims to increase its capacity by three times to 6,000-

beds by 2010. Fortis draws on the same international markets as the
other hospital groups. To service its international patients, the
company created the Fortis International Patients Service Centre in
New Delhi.

High standards at the affordable rates that the Indian super

hospitals are offering are attracting increased numbers of
international patients. Escorts, another corporate group running a
chain of hospitals, claims it has doubled its number of overseas
patients from 675 in 2000 to nearly 1,200 in 2002. Some estimates
say that foreigners account for 10 to 12 per cent of all patients in
top Mumbai hospitals.

Escorts Heart Institute and Research Center in Delhi and Faridabad,

India performs nearly 15,000 heart operations every year, and the
post-surgery mortality rate is only 0.8 percent, which is less than
half of most major hospitals in the United States.

States Promoting Health Tourism

The Indian Ministry of Tourism has announced a number of
incentives to give a fillip to the sector. It has identified 31 villages
across the country to be developed as tourism hubs. The states in
which these villages have been identified include Himachal Pradesh,
Gujarat, Maharashtra, Bihar, Karnataka, Madhya Pradesh, Andhra
Pradesh, Kerala, Tamil Nadu, Orissa, Assam, Sikkim, Rajasthan and
West Bengal

West Bengal: West Bengal, from where a large number of patients

go to the southern states for specialised healthcare, is itself likely to
become the hub of health hub of tourism in India soon. Three large
super specialty hospitals with world-class facilities would come up in
the state. West Bengal has produced many reputed doctors who are
working in different parts of the world and they have been invited to
work at these hospitals.

Kerala - THE PIONEER state Kerala, or God’s Own Country as its

corporate slogan goes, has pioneered health and medical tourism in
India. They have made a concerted effort to promote health tourism
in a big way, which has resulted in a substantial increase of visitor
arrivals into the state.

Kerala and Ayurveda have virtually become synonymous with each

other. However, though Kerala has strongly focused on Ayurveda
and its wide array of treatments and medications, good facilities are
also available in the other traditional forms of medicine as well as in
modern medical treatment. The bias towards health tourism in
Kerala is so strong that Kerala Ayurveda Centres have been
established at multiple locations in various metro cities, thus
highlighting the advantages of Ayurveda in health management.
The health tourism focus has seen Kerala participate in various
trade shows and expos wherein the advantages of this traditional
form of medicine are showcased.

Kerala has one of the best-qualified professionals in each and every

field, Allopathy, Dental, Ayurveda etc and this fact has now been
realised the world over. Regarding medical facilities, Kerala has the
most competent doctors and world class medical facilities. With
most competitive charges for treatment, Kerala is a very lucrative
destination for people wanting to undergo treatment of certain
medical problems who do not need immediate emergency
treatment.
Gujarat : Much of the NRI population, that is of Gujarati origin can
take advantage of the medical facilities in Gujarat. Some of the
major hospital groups such as Apollo already have a presence in
Gujarat and others are looking for strategic cooperation. Gujarat
based healthcare providers are open to strategic alliances with
hospitals, insurance and travel/tour operators abroad that may refer
patients from their countries of origin. . It is felt that many of the
Gujarat based operators would have to align with national or
international operators, possibly through a strategic stake to take
full advantage of the medical tourism possibility.

Karnataka: Karnataka and especially Bangalore is now an

acknowledged global medical destination. This is because of referral
quality health services supported by qualified and experienced
medical professionals, reputed medical research institutions, well
connected for travel, conducive climate and cost of treatment being
just one tenth that of global hospitals.

Between 2005 end and 2006 August, the state has also witnessed a
funding of 445 crore from leading corporate hospitals as a part of
the brownfield and green field projects. These include a Rs. 200
crore from the Manipal Health Systems, Rs. 140 crore from
Wockhardt Group of Hospitals, Rs. 100 crore from One World
Hospital and Healing Centre promoted by Maureen Berlin and Rs. 5
crore by HealthCare Global Enterprises Limited (HCG), a leader in
oncology care in the private sector in India.

Maharashtra: Maharashtra has a thriving tourism industry, and is

now set to have a new kind of tourism -Medical Tourism. The FICCI -
Medical Tourism Council of Maharashtra - is a dynamic initiative jointly
undertaken by the Government of Maharashtra, the Federation of
Indian Chambers of Commerce and Industry, the tourism industry and
private as well as public health tourism providers.

FICCI - Medical Tourism Council of Maharashtra has been

founded with a clear mission in mind:

 To offer the world's best healthcare facilities coupled with

the best heritage and tourist destinations. To show the
world how to deliver "Value for Money" healthcare, with a
human touch.
  To project Maharashtra as a synergising destination for both
medical academia as well as international medical
conferences.
 To regulate and monitor the medical tourism sector and
assist patients from abroad. Maharashtra has all the
necessary ingredients required to make medical tourism a
success.
 A range of hospitals covering the entire spectrum of
medical treatment.
 Over 70,000 highly qualified doctors, of whom 20,000 are
specialists.
 100,000 committed nurses and paramedical staff known for
their care and compassion.
 Latest technology and equipment that supports a large
number of medical investigations and treatments.
 Tourist spots that are supported by medical facilities,
making them the ideal places for rest and recuperation.
 Medical Tourism Risks
 Medical tourism does carry risks that local medical procedures
do not. Should complications arise, patients might not be
covered by insurance or be able to seek adequate
compensation via malpractice lawsuits, though it should be
noted that the malpractice insurance is a considerable portion
of the cost in the West. Nations such as India or Thailand have
different infectious diseases, and different prevalence of the
same diseases, than home nations such as the US, Canada,
UK.

 Exposure to foreign diseases without having built up natural

immunity can be a hazard for weakened individuals,
specifically for gastrointestinal diseases such as Hep-A,
amoebic dysentery and bacteria, which could weaken progress,
mosquito-transmitted diseases, and influenza, TB, etc.

 Also, travel soon after surgery can increase the risk of

complications, as can vacation activities. For example, scars
will be darker and more noticeable if they sunburn while
healing. Long flights can be bad for those with heart
(thrombosis) or breathing related problems (low oxygen
environment), not to mention uncomfortable.
  However, because in poor tropical nations diseases run the
gamut, doctors seem to be more open to the possibility of any
disease, including HIV, TB, and typhoid, there are cases in the
West where patients were consistently misdiagnosed for years
because it is perceived to be "rare" in the West, a famous case
of the misdiagnosis and death of a CDC researcher from TB,
something that few would rule out in India or Thailand.

Summary
Some of the key points of this chapter are as following:

 Medical tourism or medical travel is the act of traveling to other

countries to obtain medical, dental, and surgical care.
 Asia's burgeoning medical tourism industry, expected to be worth
at least US $4 billion by 2012, is proving a windfall for the travel
and hospitality sector.
 The major Indian health destinations include Delhi, Mumbai,
Bangalore, Chennai and Thiruvantapuram.
 Medical tourism carries risks that local medical procedures do
not. Should complications arise, patients might not be covered
by insurance or be able to seek adequate compensation via
malpractice lawsuits, though it should be noted that the
malpractice insurance is a considerable portion of the cost in the
West.

Topic 4: Travel Retailing and Logistics

1. Objective

At the end of this chapter the student will be able to:

 Explain the history of travel and tourism.

 List the scope of work of a travel agency.
 Identify the WATA and IATA guidelines for travel.

Introduction
Travel agency sector is the distributor element in the travel and
tourism marketing system. It can be considered to be a link between
the producers of various travel services like tour operators, airline
companies, transport operators and hotelier; on the one hand, and
their customers on the other. In other words, travel agents bring
buyers and sellers together with a view to creating markets in
places where these did not exist or to make existing markets more
user-friendly and efficient in order to expand the overall size of the
travel market.

Today, the travel agent has become an important, integral, part of

the travel and tourism industry worldwide. Majority of people are
using the services of travel agents for organising their travel both
international as well as domestic. It is estimated that worldwide
almost 70% of all international travel and 45% of all domestic travel
are arranged by the travel agents. The figure however, may vary
from country to country. The important role of the travel agent in
the modern world is summarised in the principles of professional
conduct and ethics of the American Society of Travel [Link]
role of travel agents in summarised as follows

"We live in a world in which travel has become increasingly

important and complex in its variety of modes and choices.
Travellers are faced with a myraid of alternatives as to
transportation, accommodation, and other travel services. They
must depend on travel agencies and others in the industry to guide
them honestly and competently"

Product Sale

The main function of a travel agency is the product sale. Product

sale is very complex subject especially when the product happens to
be a tourist product. Because of the special nature of the tourist
product and the multiplicity of manufacturers of the product, selling
assumes greater importance. In addition, the distribution channels
through which the tourist product finds its way to the consumers are
multiple and varied. The tourist product in medical tourism consists
mainly of attractions, transport, hospital treatment and
accommodation. The producers of elements of the above products
include air, sea, road transport companies and carriers, hotels and
other forms of accommodation units, and the organisations, which
are responsible for putting together attractions both natural and
man-made. In most of the countries product sale is conducted
through a distribution system controlled mostly by a network of
retail travel agents, tour operators and wholesalers. The individual
elements of a tourist product like international air tickets, domestic
air or train tickets are also mostly sold through agents or
representatives of airlines and railway companies, and purchased
directly by consumers. The consumers have, therefore, a choice
between direct booking and using the services of an agent. In
addition, there are alternative channels available to the consumers
through which they may buy their tourism products. These channels
include clubs and societies, mail order, travel shops in supermarkets
and departmental stores, tourist fairs and exhibitions and, more
recently, electronic booking methods like computers.

Early History

Any discussion on sale and organisation of travel must begin with

the pioneer named Thomas Cook. The history of the business of the
present Thomas Cook Group Limited can be traced back to over 150
years to its founder Thomas Cook, who not only was the first
organised Travel Agent in the world, but who, it could be said,
invented the travel business. A book salesman, a baptist preacher of
Derbyshire was on his way to a temperance meeting in Leicester
when he was inspired by "the idea of engaging a special train to
carry the friends of temperance from Leicester to Loughborough to
England and back to attend a quarterly delegate meeting." He
thought that it was a sounder proposition to persuade a railway
company, then in its infancy, to carry a train load of passengers at a
very cheap fare than to run the train at `standard' fares, but
possibly only a quarter full. The man was Thomas Cook and his idea
was put into operation with characteristic speed and efficiency. A
few weeks later 570 travellers made the journey by the Midland
Counties Railway at a specially reduced fare. This venture was soon
followed by excursions to various other places, and in 1843, 3,000
school children were taken on a trip from Leicester to Derby in
England.

Thomas Cook's real beginning as `mass excursionist' was, however,

the Liverpool-Caernaryon trip of 1845. The tourists travelled by rail
to Liverpool, from where they took a steamer to Caernaryon. The
advertisements for the trip caused a sensation and the response
was so overwhelming that a second trip had to be arranged. Cook
thought of every detail. He made a preliminary survey of
accommodation and facilities and produced a handbook of the trip
to Liverpool. The excursionist invasion of Scotland soon followed in
1846 and 1847. From 1848 to 1863 Cook conducted circular tours of
Scotland, with 5,000 tourists a season. With the citadels of the
landed aristocracy falling before him, he saw more enticing
prospects opening before him: "I had become so thoroughly imbued
with the tourist spirit that I began to contemplate Foreign Trips,
including the continent of Europe, the United States and the Eastern
land of the Bible."

Today, Thomas Cook Group is the parent company of a worldwide

group of companies which are partially or wholly owned. The
company also has a close trading relationship with Companie
International des Wagon-Lits et Tourism, and the combined
worldwide network of these companies, together with their
authorised agents. The company also introduced traveler’s cheques
which were originally called 'circular notes'. Members of the Thomas
Cook Group of companies now issue cheques as principals in
different currencies and are associated with partner banks in various
countries. It is also a large trader in the buying and selling of foreign
currency bank notes. Thomas Cook Group Limited today provides a
wide range of services to its customers in over 150 countries
worldwide through their network of over 1,200 outlets. The company
is considered to be one of the largest travel companies selling a
wide range of travel services.

Scope Of Work Of A TA
The scope and the role of the travel agency was limited in the
beginning since mass tourism as we know it today had not yet
begun. It was, however, the introduction of the air travel which gave
a boost to the travel agency business. The introduction of
an economy class by various airline companies crossing the North
Atlantic heralded the era of travel agency and was responsible for
their growth. The introduction of an economy class' in effect was
nothing more than a projection of Thomas Cook's original idea of
adjusting prices to encourage the full capacity use of every means
of transport.
Rapid development of transport system, especially the jet travel,
improved living standards combined with the reduction in working
hours is the root cause of today's upward surge in travel. Side by side
with the rapid improvements in industry and technology, practically all
aspects of life have become more and more complex particularly
during the past half a century. This is certainly the case in tile travel
industry in which, only a century ago, the job consisted almost entirely
of arranging a simple reservation for the travelers in some means of
transport. Today the functions and duties of a person at the travel
agency counter are vastly different and more varied. He is now called
upon to perform a variety of duties rather than just issue tickets and
reserve seats in a train, aeroplane or accommodation in the hotel.
Travel today is no longer the privilege of the few, but is sought by
millions. No longer does the travel agency exist for the sole purpose of
selling tickets from one point to another. The travel industry developed
along certain well-defined lines as the worldwide demand for its
services increased. The urge to travel became very intense over the
years resulting in wide-spread growth of travel agencies in the world.
Most of the travelers wished to have their travel arrangements made in
advance and to be relieved of the difficulties of coping with various
pre-travel arrangements of which they had only a very limited
knowledge.

Modern Travel Agency

Over the years the range and activities of a retail travel agent have
increased manifold. In the modern context, the role of a travel agent
is rather different to that of most of other retailers selling
merchandise. The travel agent does not purchase travel with a view
to reselling the same to its customers. It is only when a customer
has finally decided on the purchase of travel that the agent
approaches the principal on behalf of his customer. The retail travel
agent, unlike most other retailers, does not carry an inventory or
stock of travel products on his premises.

The main role of retail travel agents is to provide to their customers

a convenient location for the "purchase" of various elements of
travel like transport, accommodation and several other ancillary
services associated with holiday and travel. The travel agents act as
booking agents for holidays and travel and disseminate information
and give advice on such services. This role can be summed up as
follows:
i) To give advice to the potential tourist on the merits of
alternative destinations and

ii) To make necessary arrangements for a chosen holiday which

may involve booking of accommodation, transport or other relevant
services associated with his travel.

A travel agent, in order to give an advice to his potential customers

on the merits of a destination, must possess knowledge, expertise
and up-to-date information about that destination. Besides, a travel
agent has close contacts with providers of services,that is their
principals from whom they purchase services for their customers. In
other words, a retail travel agent is an intermediary providing a
direct link between the consumer and the suppliers of tourist
services such as airlines, transport companies, hotels and auto
rental companies. The retail agent is the one who acts on behalf of
the principal, the original provider of tourist services such as an
airline company, hotel company, shipping company, insurance
company, railways or a tour operator. An agent sells the principal's
services and is rewarded by a commission.

Travel Agency Operations

The scope and range of travel agency operations would depend on

the size of an agency. If the company is large in size, the range of
activities will be more comprehensive. In this case, the agency will
have specialised departments, each having to perform different
functions. To deal with the subject of a travel agency, the best
method of approach is, perhaps, to consider its functions. These
may be broadly classified as follows:

a) Provision of Travel Information

One of the primary functions of a retail travel agent from the point
of view of the tourist or the general public is to provide necessary
information about travel. This information is provided at a
convenient location where the intending tourist may ask certain
questions and seek clarifications about his proposed travel. This is a
very specialised job and the person behind the counter should be a
specialist having excellent knowledge of various travel alternative
plans. He should be in a position to give up-to-date and accurate
information regarding various services and general information
about travel, etc. The presentation to the potential customer must
be forceful, and exciting variations must continually be devised to
help sell tours. A good travel agent is something of a personal
counsellor who knows all the details about the travel and also the
needs and interests of the intending traveller. Communication plays
a key role in the dissemination of any type of information. This is
equally true in the case of dissemination of travel information. The
person behind the travel counter should be able to communicate
with the customer in his language. The knowledge of foreign
languages is an essential prerequisite for personnel working in a
travel agency.

b) Preparation of Itineraries

Tourist itinerary is a composition of a series of operations that are a

result of the study of the market. A tourist journey is characterised
by an itinerary using various means of transport to link one locality
with another. Preparation of different types of itineraries is another
important function of a travel agency. A travel agent gives advice to
intending travellers on the type of programmes which they may
choose for their holiday or business travel. The study and the
realisation of the itineraries call for a perfect organisation (technical
and administrative) as also knowledge of the desires of the public
for a holiday and the propensity to receive tourists by the receiving
localities.

c) Liaison with Providers of Services

Before any form of travel can be sold over the counter to a

customer, contracts have to be entered into with the providers of
various services. These include transportation companies, hotel
proprietors, the providers of surface transport like motor cars or
coaches for transfer to and from hotels and for sightseeing, etc., and
also for general servicing requirements. The work carried out under
these headings is usually that of the owners or senior employees of
agencies concerned. In the case of a large agency with worldwide
branches, the liaison work involves a great deal of coordination with
the principals.

d) Planning and Costing Tours

Once the contracts and arrangements have been entered into, there
comes the task of planning and costing tours, both for inclusive
programmes and to meet individual requirements. This job is
intensely interesting and at the same time challenging. It calls for a
great deal of initiative and drive, for travel to those places which are
to be included in the itineraries. Paradoxically many of those who do
this type of work visit comparatively few of the places included in
the itineraries they prepare. This is essentially a job for a meticulous
person and calls for considerable training and ability.

Many agencies, with the cooperation of airlines and other

transportation companies, take the opportunity of arranging
educational tours for such staff to destinations with which they deal.

Many large agencies have experts who are authorities in particular

countries and, in addition to a general programme, many will issue
separate programmes dealing with specific territories. Separate
programmes, dealing with holiday offers based on specific forms of
transportation, e.g., air, rail, road or sea, may also be prepared.
Programmes also have to be prepared to cover different seasons of
the year.

Publicity is an important part of the programme. Having spent

considerable time and money on preparing all that goes into the
issue of a programme, publicity must feature considerably in the
activities of a travel agency and more so if the agency happens to
be a large one. The majority of large travel agencies have their own
publicity departments under the management of an expert in the
publicity field.

e ) Ticketing

Selling tickets to clients using different modes of transport like air,

rail and sea is yet another important function of a travel agency.
This calls for a thorough knowledge of schedules of various modes of
transport. Air carriers, railways and steamship companies have
hundreds of schedules and the person behind the counter should be
conversant with all these. Ticketing is, however, not an easy job as
the range and diversity of international airfares is very complex and
varied. There are several different types of fare combinations on the
North Atlantic route alone. Changes in international as also in the
local air schedules and additions of new flights from time to time
makes the job of the travel agent one of constant challenge. An up-
to-date knowledge of various schedules of air companies, steamship
companies and railways is very essential.

Computerised reservation system has in recent years rather

revolutionised the reservation system, both for air and rail seats,
and also a room in a hotel. Many large travel agencies are using this
system. This system comprises a computer network that can be
used by the travel agent to reserve an air or rail accommodation as
also accommodation in a hotel. Through a wide network,
confirmation of reservations is available in a matter of seconds.

f) Settlement of Accounts

Linked with the function of ticketing and reservation of

accommodation in a hotel is the settlement of accounts of the
clients. Accountancy plays an important part and is one of the major
duties to be performed by the travel agency. Dealing with the
settlement of accounts in all parts of the world calls for a thorough
knowledge of foreign currencies, their cross-values and, above all,
the intricacies of exchange control regulations, which vary from
country to country.

g) Provision of Foreign Currencies

Provision of foreign currencies to intending travellers is another

specialised activity of a travel agency. Some of the larger travel
agencies deal exclusively in the provision of foreign currencies,
travellers' cheques, etc. This is an important facility to intending
travellers as it saves them a lot of time and energy in avoiding visits to
regular banking channels.

h) Insurance

Insurance, both for personal accident risks and of baggage, is yet

another important activity of the travel agency. Some of the larger
travel agents maintain sizeable shipping and forwarding
departments, aimed at assisting the traveller, to transport personal
effects and baggage to any part of the world, with a minimum of
inconvenience.
The multifarious activities mentioned in the above paragraphs show
that the travel agency's range of services in modern times has
expanded a great deal. The field of expertise is quite large and is
constantly growing with the fast changing travel needs of the
people. The job description of a modern travel agency can be
summed up as follows:

i) Preparation of individual pre-planned itineraries, personally

escorted tours and group tours and sale of pre-paid package tours.

ii) Making arrangements for hotels, motels, resort accommodation,

meals, car rentals, sightseeing, transfer of passengers and luggage
between terminals and hotels, and special features such as music
festivals and theatre tickets.

iii) Handling of and giving advice on the many details involved in

modern day travel, such as travel and baggage insurance, language
study material, travellers' cheques, foreign currency exchange,
documentary requirements (visas and passport) and health
requirements (immunisation and inoculations).

iv) Possession of professional knowledge and experience, as for

instance, schedules of air and train connections, rates of hotels,
their quality, whether rooms have baths All of this is information on
which the traveller, but for the travel agent, will spend days or
weeks of endless phone calls, letters and personal visits.

v) Arrangement of reservations for special interest activities such

as conventions, conferences, and business meetings and sports
events.

Organised Travel
There are various activities which a travel agency has to perform in
order that an intending traveller undertakes his proposed journey
and enjoys a holiday of his choice. There are various steps involved
from the time a traveller visits a travel agent to buy a ticket until he
returns home after visiting a place of his choice. Organised travel by
a travel agency can be of two types, i.e. (i) single client, and (ii)
group client. In order to effect the journey, the following main
elements (in both types of travel) need to be considered:
a) Study of the journey ,

b) Estimate of expenditure,

c) Execution of the journey and

d) Presentation of accounts.

Individual or Ordinary Trips

The following steps are involved in organising individual or ordinary

trips:

i) The client turns to the travel agent to organise for him a

particular journey (cultural, natural, business, religious, etc.).

ii) The agency from this angle will examine as to what will be
involved, details like scope of journey, when the journey is to take
place, various services needed and the accessories required.

iii) Based on the above evaluation and other elements in his

possession, the travel agent will suggest an itinerary and will then
communicate to the client the estimated maximum cost for the
client's approval.

iv) The travel agent will then compile the definite estimates, a total
of a series of various costs added up, e.g., transport,
accommodation, the services such as those of guides, operative
costs such as (postage, telex, telefax, E-Mail, telephones, etc.).

v) The travel agent then will present a document of the amount of

money to be paid in duplicate to the customer. The client returns
one of the debit copies signed on acceptance accompanied with a
deposit (in anticipation). The deposit normally is about 25 per cent
of the total cost.

vi) Once the client's approval has been obtained, the travel agent's
operation department then executes the journey.

vii) The `operation' department's task now is to book for the

established dates the transport and various other services. After the
booking confirmation has been received, the travel agent issues the
vouchers.

viii) The travel agent prepares the `tourist itinerary' which will
accompany the client through the entire journey. It will indicate the
tickets to be used, the hotels and other services booked and will
include vouchers, etc. Normally the itinerary is made in triplicate:
one for the client, another for the agency and the third for the
hotelier or those who will provide the required services paid by
means of vouchers.

ix) The last formality is the delivery to the client of the vouchers,
confirmed tickets, the technical itinerary.

x) When the group is particularly large, for instance like for

sports, then,the travel agent needs to take extra care by way of
informing public authorities for purposes of security.

Travel agents in a highly developed market cover all the above

activities and range of services which depend upon the extent of the
economic development of that country. The travel patterns of the
population in advanced countries are different as compared to those
in developing countries. The services of travel agents are
increasingly utilised in developed countries. In some of the
advanced countries like the USA, Canada, Germany and Japan a
very large percentage of tourists are utilising the services of travel
agents.

The Tour Operator

The dramatic growth of tourist traffic to the Mediterranean countries
of Europe is a principal feature of the history of mass tourism in the
last forty years. A major contributing factor in this growth of air
travel holiday tourism has been the development of `inclusive tour',
a method of packaging a holiday. The idea of buying a package of
travel, accommodation and perhaps some ancillary services such as
entertainment etc., became established in Western Europe in the
1960s. Essentially an `inclusive tour' is a package of transport and
accommodation and perhaps some other service which is sold as a
single holiday for an all-inclusive price. This inclusive price is usually
significantly lower than could be obtained by conventional methods
of booking transport and accommodation separately from individual
hotel and transport tariffs. The principal feature of the inclusive tour
is that the tourist may buy, for a single price, a holiday which is
much cheaper than would be possible for the holiday maker if he
bought the components of his holiday separately and directly from
individual hotels and from transport companies or from a retail
travel agent.

The chief functionary or the principal in this system is the tour

operator. It is the tour operator who buys aircraft seats and hotel
beds and certain other facilities such as surface transport or
entertainment and makes up the package. Historically, the tour
operator has mostly emerged from a retail travel agency. However,
today a clear distinction must be made between the tour operator
and a travel agent. The latter, the retail travel agent, undertakes to
sell the travel services of his principal, who will be airline companies
and other transport undertakings, hotel groups, shipping lines and
the providers of such ancillary services as traveller's cheques. Unlike
the travel agent who is the retailer of the tourism product, the tour
operator is a manufacturer of a tourism product. He plans, organises
and sells tours. The tour operator makes all the necessary
arrangements - transport, accommodation, sight-seeing, insurance,
entertainment and other matters and sells this package for an all-
inclusive price. A package tour is designed to fit a particular group
of travellers. These may be special interest tours, like mountain
tours and can be escorted. The escorted tour normally includes
transportation, meals, sightseeing, accommodation, and guide
services. It is the escort or the group leader who is responsible for
maintaining the schedule of the tour and for looking after all the
arrangements.

Group Inclusive Tour (GIT)

This is the most popular form of tour in this category where people
travel in groups of 15 or more persons. These tours are available for
any destination.

The terms and conditions for group inclusive tours are laid down by
IATA. The escort for such groups normally travels free as the airline
provides him with free passage and accommodation. 'Foreign
Inclusive Tours' (FIT) on the other hand are unescorted package
tours. These tours are comparatively more flexible. The traveller can
buy a predetermined package with arrangements for sightseeing,
hotels and certain meals, where necessary. He does not tour with a
group. He can make his own arrangements and programmes
according to his liking. The inclusive tour is one of the several
devices which enable tourists to enjoy the lower prices.

How does the tour operator manage to sell the package to the
traveller at such a low price? The low price of the package holiday or
inclusive tour is made possible by reason of the lower unit costs
obtainable both for the air travel and for the hotel accommodation.
The tour operator enters into long-term contracts for aircraft seats
and similar contracts with hotels for booking rooms. By mass-
producing holidays in the form of package tours, the tour operators
are able to procure substantial discounts from carriers, hoteliers,
etc. and offer their package deals at much lower rates. The profits of
the tour operators and the success of his operations, however,
depend on achieving of very high load factors for the aircraft and
very high occupancy rates for the hotel. In this way, unit costs can
be maintained sufficiently low to enable the tour operator to offer
his package at a price which is often less than the cheapest
available fare alone. A breakthrough in the business of tour
operation came when airlines recognised that tour operation can fill
the empty seats and introduced special fares for use exclusively by
tour operators for combining into an inclusive tour.

The tour operator has thus emerged as the true manufacturer of the
inclusive tour product packaged, standardised and mass-produced.
The tour operator may sell this product directly to the public or
through the channels of the retail travel agencies. It can be
marketed successfully in the tourist generating countries to a mass
market just because it is standardised, packaged and quality
controlled. The product is therefore susceptible to the similar
marketing techniques that are applied to the marketing of consumer
goods.

Handling A Client-WATA Guidelines

The agent's role in handling a client is very important. Once a client
enters the agency it becomes necessary for an agent to properly
anticipate his needs and requirements. The client also has come
with a pre-determined notion about a destination he is visiting.
WATA, the World Association of Travel Agencies, has prepared
comprehensive guidelines for handling a client. These guidelines are
based on the WATA Master-Key, an annual publication of the World
Association of Travel Agencies. Updated and published yearly, the
WATA Master-Key is a selectively comprehensive source of travel
information. Individual agency tariffs given in the publication,
represent the selling tool for members, incoming and outgoing
services. Along with the tariffs, the Master-Key gives a country
description sheet containing a wealth of useful background
information of a destination. In addition, the Master-Key also gives
detailed information about some hotels located in important cities
and tourist centres together with prevalent confidential tariffs and
other relevant information for travel agencies.

The WATA Master-Key is a valuable reference material for travel

agents. Its presentation makes it easy for the users to extract the
information they need. The guidelines as enumerated in the Master-
Key are as follows:

1. Sale of Tour

It should first be determined whether the client who wants to book a

tour prefers to:

a. Join an escorted tour, or

b. Choose a FIT, combining leisure and activity according to his

individual tastes and interests.

2. FIT/Your Relations with Client

If your client wants a "tailor made" tour, let him make tile
suggestions, without imposing your own views, on the following
points:

a) Itinerary

1. Determine the cities to be visited.

2. Number of days (overnights) in each place.

3. Mode of transportation between cities.

4. Establish a rough time schedule, taking into consideration the

time at his disposal.

b) Transportation

1. Air transport should be used when time is limited and for long
distances.

2. Surface transportation should be recommended for shorter

distances

3. For trains, determine whether advanced reservation is

necessary. Indicate stations where trains are to be changed.

4. Bus should be recommended in some countries, as it usually

allows additional sightseeing.

5. When arranging timetables, remember that your client is on

vacation, and therefore avoid early departures.

c) Hotel Accommodation

1. Category of Hotels : Examine with your client which category of

hotel he wants to stay at - Deluxe, First Class, Standard or Economy
class. It is preferable that he is accommodated in a maximum rate
room; however, if he must consider the cost, then rather suggest a
lower grade hotel with best available room.

2. Type of Rooms : Examine whether your client wishes a special

room on a special floor, with or without bath/ shower, sea view,
outside or inside, etc. Draw his attention to the fact that in high
season a room with a bath may be difficult to obtain in some places.
In some cases a double room for single occupancy can be
suggested, a single room being often small or not well situated.
Ifyour client insists on having a particular room, he may have to pay
a supplement.

3. Meals : Ask your client whether he wants to have

accommodation on bed and breakfast, demi-pension or full pension
basis. If accommodation is on bed and breakfast basis, keep in mind
that in certain resorts, demi or full pension is compulsory.

4. Check-in Time: Remind your client that check-in time at hotels

is usually after 12 noon. Immediate occupancy on early morning
arrivals can only be secured if the room is reserved for the previous
night. If your client leaves late in the evening you may propose to
him to pay for an additional night.

5. During periods of festivals, fairs or congresses, hotel space

may not be available, rendering it necessary for your client to
change the dates in those places; cabled hotel confirmation should,
therefore, be suggested.

6. During periods, such as important festivals and events, a

minimum stay of 5-7 days may be required. The same is applicable
to some winter resorts, where a minimum stay of two weeks is
required at Christmas and New Year.

d) Transfers

1. The need of transfers upon arrival or departure results from the

fact that it is often difficult to find one's way at airport, piers or
stations with which one is not familiar.

2. Transfers by agencies include interpreter meeting and

assistance, accompanying clients (unless otherwise specified),
porterage and transportation of 2 pieces of hand luggage per person
between airport, station, bus or air terminal and hotels or vice versa,
as well as tip to driver, but it does not include tip to hotel porter.

3. Type of vehicle varies according to cities, generally by private

car or taxi/cab.

4. Airport transfers are naturally more expensive, but also the

most convenient ones.

5. When opting for transfer from city air terminal, your client must
know that there will be no assistance at the airport, that he will have
to tip for baggage at the airport and pay for bus between the airport
and the city terminal.
6. Bus Arrivals: Certain bus companies stop at the major hotels to
drop or collect clients, the disadvantage of this being the clients'
dependence on time schedules and waiting for-his turn to be
dropped off. In addition, it will be necessary for the client to contact
the local agency if other services are not to be provided in that city.

e ) Sightseeing/Excursions/Tours

1. The advantage of arranging sightseeing in advance is that your

client does not have to waste his time, queuing up in the local
agency. Also, a balance can be established in advance between
leisure time and sightseeing, as well as for tours of the city and
countryside.

2. Motor Coach Tours: Apart from the economic viewpoint,

there is the advantage of meeting other travellers, but clients have
to arrange their own transportation to meeting points, as pick-up is
very seldom done on motorcoach tours.

3. Private Car Tours: Your client is picked up at the hotel, has

the choice of time of departure and can stop wherever he likes, but
this is the most expensive solution. In some places there are regular
private car tours, or else sightseeing can be done on a seat-in-car
basis.

4. Hire of Private Car with Chauffeur:

a) City hire-must be recommended to deluxe clients, whose time

is limited between trains, boats or planes, or who already know the
city and want to see only special places or go shopping. Since very
often the chauffeur cannot act as a guide, a private guide will be
needed for sightseeing.

b) Touring hire-if a private car is used for travelling from one city
to another, local guides in each place will be sufficient. Distance
covered daily should not exceed 250 km. Client's attention has to be
drawn to the fact that he will have to pay for empty run of car
(return to point of departure). The full daily basic charge is due,
even if the vehicle is picked up in the evening.
5. Motor Launch Tours/Boats Trips: The same applies here as
for motor coach tours. Deluxe clients will be picked up at the hotel
by private car and driven to embarkation pier.

6. Self-driven cars can also be provided when clients fill the

necessary conditions and, if wanted, a local guide can be placed at
their disposal.

f) Music Festival, Theatre and Concert Tickets

Clients must be told that advance reservation is necessary.

Confirmation of requested tickets cannot be guaranteed and tickets

are not refundable unless they can be resold.

3. Quotation

a) Land Arrangements

On the basis of all details furnished by your clients, it will enable you
to make an estimate of the land arrangements.

b) Transatlantic/Pacific Transportation

To the land arrangements, the cost of flight/boat tickets for

Transatlantic/Pacific transportation has to be added.

c) Cost Price

Items a and b above give you the cost price.

d) Selling Price

In order to obtain the selling price you have to add your 'handling
fees or mark-up, as well as a margin safeguarding any possible
increase.

4. Suggested Itinerary

a) A suggested itinerary should be drafted of what has been

agreed with your client and submitted to him, together with the final
price. The accompanying letter should clearly specify what is
included in the price:

1. Price and type of land arrangements.

2. Price and class of air/sea/rail tickets, indicating that they are

subject to change without notice.

3. The agency's conditions regarding handling charge ,

cancellation fees, possible deposit request, etc.

b) It should also point out what is NOT included, such as cost of

passport, visa, gratuities, tips to hotel porters, beverages, laundry,
taxes (government, landing, embarkation), etc.

c) Acceptance of suggested itinerary should be requested to

enable you to proceed with reservation, and a deposit should be -
asked.

Your Relation with Service Supplier

5. Reservation Procedures

a) Once you are in possession of the client's agreement you can

start reservations with carriers and hotels.

b) In case your client requests only hotel reservations in a few

places, it is advisable to make the reservations directly with the
hotels.

c) However, if transfer, sightseeing or other services are also

requested, then it is preferable to go through the local agent, who is
in a better position to replace a hotel by a similar one, in case of full
occupancy.

a) Transfers

Due to frequent changes in time schedules and/or due to changes

your client may require, it is NOT advisable to send transfer
requests earlier than one month prior to final documentation. An
exception can be made if a special service is required and rate
confirmation is needed.
1. Transfers should be requested by vouchers, indicating the
following items:

a) Full name- of client(s) and number of passengers (for a child or

an aged person give their age also).

b) Date of transfer.

c) Full description (indicate type of car, name of airport, city air II

terminal or station, exact flight or train number and arrival/
departure time)

d) Name of hotel the client is staying at.

e) Town and date of issue.

f) If you do not have the rate of a service, request the rate of

confirmation on the voucher copies.

b) Transportation

Whenever possible, obtain all tickets for rail, bus, boat, cruise, sleeping
cars, etc., that may be required locally from agencies of foreign
railroads, bus companies, steamship lines, etc.

c) Hotel Accommodation

1. Depending on the time you have, hotel reservations can be

made by reservation requests, by telex or cable (give paid reply),
through hotel representatives, or through a WATA office. If you
reserve through a a hotel representative or WATA office, their
conditions should be respected.

2. Once you have a hotel confirmation, issue a voucher for

re¬confirmation, indicating the following items:

a) Full name of client(s) and number of persons (for a child or an

aged person give their age also).

b) Type of room.
c) Arrival and departure date, time of arrival and flight/ train
number. ,

d) Meal conditions - clearly indicate whether rooms only, bed and

breakfast (Continental or American/English), half or full pension.

e) Always mention on hotel vouchers: "All taxes and service

charges included".

f) Method of payment-indicate who will pay the bill. If the client

settles the bill directly with the hotel, even when a deposit has been
sent, hotels do not always pay a commission.

g) Always ask for a re-confirmation of the rate on the voucher

copies.

3. If the best room is required, it should be determined as

DELUXE, and a 10 per cent supplement foreseen.

4. If a suite is required, it can be estimated at 21 times the

normal tariff.

5. Whenever necessary, an extra night is to be foreseen for early

arrival or late departure. Indicate on voucher early a.m. arrival the
following day or request additional night or day use, advising the
exact departure time.

6. In case of split stays at the same hotel, a separate voucher

should be issued for each day.

d) Sightseeing/Excursions/Tours

The same applies as for transfers - regular sightseeing tours should

not be requested earlier than one month prior to the final
documentation, except when a special service is required (e.g.,
sightseeing starting at airport) or for excursions/tours of two or more
days' duration.

1. Sightseeing/Excursions/Tours should be requested for WATA

affiliates by vouchers, indicating the following items:
a) Full name of client(s) and number of persons (for a child or an
aged person give their age also).

b) Date of sightseeing/excursions/tours.

c) Reference number of tour (if given), tour designation and title.

d) By private car or by regular scheduled motorcoach.

e) For regular tours, give time and place of departure for private
car tours, indicate "pick-up at hotel".

f) Name of hotel client is staying at.

g) Town and date of issue.

h) In case a complete description does not appear in the agent's

tariff, ask for additional information and rate confirmation.

2. If your client wants to start a sightseeing tour from airport or

station, add transfer-rate to sightseeing rate.

e ) Chauffeur Driven Car Hire

1. If private car hire with chauffeur is required, it has to be

reserved in advance on the basis of rates quoted in the Master Key.
If rates are not given, apply to the agency for rates and details.

2. For requests, issue voucher, indicating the following details:

a) Full name of client(s) and number of passengers.

b) Type of car (year of construction if available)

c) For city hire : Date and time of beginning of hire, length of hire
or time of termination.

d) For touring hire: Date of beginning and termination of hire,

starting time of hire and termination point, as well as stopovers.

e) Special requests, such as automatic cars, air conditioning,

luggage, rack, etc.
f) Name of hotel client is staying at.

3. City and Touring hire must be issued on separate vouchers, as

tariffs and minimum daily averages are not the same. Also, if more
than one day city hire is required issue one voucher for each day.

4. Touring rate is established on the basis of a reliable map. Ten

per cent of total mileage should be added for detours. If there are
overnight stops, an additional 20 miles should be foreseen for
possible use of car during the stay in city.

5. For empty runs, it should be noted that the law does not
authorise chauffeurs to drive more than 310 miles/500 km per day,
therefore, the total distance should be divided by this authorised
maximum to reckon the number of chauffeur's overnights to be
added to the touring rate.

6. For chauffeur's accommodation, the rate appearing in the tariff

has to be multiplied by the number of days the car has been used
(special rates if outside the country).

f) Self-Driven Cars

If given, use rates appearing in the WATA Master-Key, otherwise,

apply to the agency or consult Hertz, Avis, etc., for details and rates,
whenever so indicated. WATA Master-Key is a valuable document for
a travel agent. The guidelines given in `key' make the job of a travel
agent a lot easier. As a comprehensive source of travel information,
it facilitates the work of a travel agent. The destination profiles
provide a wealth of background information not only for a travel
agent but also for a traveller. The 'key' is updated every year
making it a valuable reference material.

IATA Accreditation For TA

Travel agents are the marketplace intermediaries responsible for
selling the services of airlines worldwide. Considering the role and
importance of air transport which is at the heart of travel and
tourism selling, its services becomes the key motivation for
engaging in travel agency business. Therefore, the importance of
IATA approval for a travel agency is essential to enable it to sell the
services of airlines.
For setting up a travel agency business there are no legal
requirements. In some countries, however, governments exercise
some kind of a licensing control over agencies. Most principals
license the sale of their services through the issue of an agency
contract, or agency agreement. In the absence of such a contract or
an agreement, a travel agency will not get any commission from
selling the services on behalf of the principal. The income of a travel
agent is derived only from a commission which he receives from the
principal after selling their services.

A licence is required by a travel agency for a commission to be

payable on the sale of services of air carriers who are members of
the International Air Transport Association. Domestic air services
are, however, exempted from this. Most airlines want to sell their
services worldwide but cannot do so on their own as it is not
economically viable for them to set up an extensive network of sales
offices in every city in the world. It is the travel agents who are the
marketplace intermediaries who make the sale of the services of the
airlines possible worldwide through their own network.

As IATA travel makes up a substantial proportion of a total sale of a

travel agency turnover, it is important for the travel agent who
wishes to offer his clients the full range of travel service to obtain
the necessary IATA approval or appointment.

IATA-Controlled Approval

The travel agency approval of IATA is controlled by its Agency

Administration Board. This Board is made up of a number of IATA
members operating from a particular country. Before approval is
granted by IATA, a travel agency has to fulfill certain conditions. The
most important condition is the demonstration by an agency of its
financial soundness or financial standing. It has to prove that it has
sufficient finances to settle the accounts of various airlines whose
business it is handling. Another condition which an agency has to
fulfil is to ensure the suitability and security of its premises. The
premises of a travel agency are to be centrally located preferably in
the centre of the town in a commercial district having proper
security. The security aspect is very important as the agency has to
keep the ticket stock of various airlines and this is quite expensive.
Proficiency of the staff of a travel agency is another important
aspect which is considered by IATA before giving an approval. The
staff has to be professionally trained in the handling of airlines
business. IATA in association with UFTAA conducts the International
Travel Agents Training Programme to meet the growing demand for
a professionally trained manpower for the travel industry. The IATA-
UFTAA training programme operates under the authority of the
Passenger Agency Training Board. IATA's Agency Training Services
(ATS) located in Geneva (Switzerland) is responsible for the general
administration of the programme.

In the field, the training programme is administered by a Local

Coordinator who is responsible for the promotion of the training
courses, the distribution of the training materials and the
organisation of the examinations.

The Local Coordinator is provided by the local IATA Agency Services,

the National Airlines or the National Travel Agents Association in a
particular country.

The IATA-UFTAA training courses have been designed primarily for

travel professionals who work in IATA accredited travel agencies and
whose main task is to sell international air transportation on -behalf
of IATA member airlines. The agents' staff can demonstrate
proficiency by completing an IATA/ UFTAA (passenger) training
course.

The applicant's ability to generate new business is another

requirement to be taken into consideration by IATA before
considering an application for approval. This is to ensure that an
agent is capable of generating new business in the market and has
sufficient contacts to do so. To sum up, any travel agency, in order
to get IATA approval for selling the services of IATA airlines
worldwide, has to ensure the following:

i) Financial standing

ii) Suitability of the premises

iii) Security for control of ticket stock

iv) Proficiency of the staff

v) Ability to generate new business

After considering the above aspects and if the IATA's Agency

Administration Board is satisfied, necessary IATA approval is
accorded to an agency. Once approved, a Passenger Sales
Agreement is issued and a numeric ticket validation code is
provided which will be stamped on all tickets issued by that IATA-
approved agent.

IATA approval enables the agent to do business on behalf of all IATA

members. It enables the agent to sell the services of all IATA
member airlines throughout the world. The entire process of getting
IATA approval can be quite time-consuming and lengthy and in the
meantime agents applying for IATA approval are expected to
generate business without getting any commissions.

Additional Appointments

In addition to the IATA approval which is basic for a travel agency,

there are certain other approvals/recognitions required for running a
travel agency. These approvals, however, will depend on the extent
of activities and range of services which a particular agency would
like to offer to its clients. For instance, in order to make
commissionable sales on the services of railways, domestic airlines
services and other principals such as car hire companies, shipping
and cruise services, necessary approval is to be obtained. These
approvals will enable travel agents to sell services on behalf of
these principals with remuneration. In case a travel agency is an
IATA-approved agent, or a member of the National Travel Agents
Association, obtaining approvals for most of other principals
becomes largely a formality.

Travel Trade Associations

Formation of associations of independent firms in a particular trade
or a group of industries is primarily done with a view to protecting
the interests of its members. Trade Organisations are voluntary
bodies formed by individual firms belonging to a particular trade not
only to protect but also to advance the common interests of their
members. The main objective of forming an association by
independent firms is to get strong representations which act as
channels of communication with the government and other
organised groups to further the interests of their members. In
almost all disciplines, members sharing similar interests or
complementing each other's interests in some way or other have
formed organisations/associations.

The ever-increasing importance of the tourism sector and the

increase in the growth in its volume over the years have resulted in
the formation of associations in this sector. Secondly, the ever-
increasing international character of the modern-day tourism and
the growing influence of international agencies in various fields have
also influenced the growth of international cooperations in the field
of tourism. All these developments, in turn, have brought together
members of the travel associations at national, regional and
international levels collectively to further their trade interests.
Different producers and sellers of various tourist services like tour
operators, travel agents, hotel companies, airline companies,
ground operators, etc., have formed associations of their members.

The scope of discussion in this chapter is limited to the associations

of travel agents and tour operators. These associations today have
assumed great importance and provide a platform to their members
where ideas are exchanged and topics of mutual interest discussed
and solutions arrived at. They provide services like information,
assistance and the advice in the conduct of their business to their
members. The various associations in the field of tourism can take
different forms. Broadly, the following five forms can be identified:

i) Those based on the education and training needs of the

industry. These may include professional bodies like Hotel and
Catering Management Association, Travel and Tourism Management
Association which are primarily concerned with the training and
educational standards of personnel working in hotel and travel
agencies.

ii) Those which are concerned with the sectoral interests of their
members. They include the National Associations of Travel Agents
and Tour Operators. Each country has such associations. For
instance, the American Society of Travel Agents (ASTA), the
Australian Federation of Travel Agents (AFTA), the Association of
British Travel Agents (ABTA), the Japan Association of Travel-Agents
(JATA), the Indian Association ofTravel Agents (IATA), the Swiss
Travel Agents Association (FSAV ), the German Travel Agencies'
Association (DRVS), etc.

iii) Those which are responsible for developing, promoting and

facilitating tourism among a particular region. These regional
organisations draw their membership from public or private sector
organisations dealing with tourism and sharing a common interest in
the promotion and development or marketing of a specific tourism
geographical area or a region. This area may represent a region, a
state, a country or a resort. The membership is opened to groups or
organisations, both in public and private sectors, rather than
individuals, such as Pacific Area Travel Association (PATA), etc.

iv) Those which are concerned with the promotion and

development of tourism globally. These organisations deal with all
the aspects of tourism. The rapid expansion in tourism activity
globally was responsible for creating a need for world bodies to deal
with tourism issues at the government level. The World Tourism
Organisation (WTO) is one such global tourism organisation
representing public sector tourism from most countries of the
world.

v) Those which are responsible for promoting and furthering

interests of specific trade groups in the travel industry, like travel
agents, and tour operators at the global level. Unlike the sectoral
trade association of travel agents and tour operators, these have
international impact. They play an important role in representing the
common interests of travel agents and tour operators worldwide in
crucial international issues like negotiation of travel agency
commission rates with International Air Transport Association
(IATA).

Universal Federation of Travel Agents Association (UFTAA) and the

World Association of Travel Agencies (WATA) are such associations.
Both UFTAA and WATA play an important role in representing the
interests of travel agents worldwide. The following pages will discuss
in detail the roles and functions of these two international
organisations of travel agents.

UFTAA
Universal Federation of Travel Agents Association (UFTAA)

Universal Federation of Travel Agents Association (UFTAA), an

important organisation of travel agents on a worldwide basis, was
founded in Rome in November, 1966 by the merger of the
International Federation of Travel Agencies (IFTAA) and the
Universal Organisation of Travel Agents' Associations (UOTAA). The
General Secretariat of UFTAA is located in Monaco.

The membership of the Federation consists of the National Travel

Agents' Associations from most of the countries in the world. Today
it represents over 33,000 travel agencies globally.

National Travel Agents Associations are the full members of UFTAA.

The membership of the Federation is split into nine regions each
covering a group of countries.

The Aims of the Federation

The following are the main aims of the federation :

i) To act as the negotiating body with the various branches of

tourism and travel industry on behalf of its members and also in the
interest of the public;

ii) To ensure for all travel agents through their national

associations the maximum degree of cohesion and understanding,
prestige and public recognition, advancement of the member's
interest and protection from legislation and legal points of view; and

iii) To offer to its member all the necessary professional and

technical advice and assistance in matters concerning their trade.

UFTAA provides several advantages to its members which include

the right to reproduce the symbol on the stationery, information
service on all matters of legal or professional nature, free of charge
assistance by its Legal Department for the recovery of outstanding
debts, arbitration services for litigations between a member agency
and a hotel company in different countries, etc.

The Annual General Assembly of UFTAA is the policymaking body.

The Assembly decides on the general policy of the Federation and
makes recommendations on any matter within its competence. The
Board of Directors, consisting of Directors elected from candidates
proposed by National Member Associations handle the routine
business of the Federation. The Executive Committee is responsible
for handling day-to-day activities and also urgent matters. The
UFTAA world congress which normally takes place annually is the
advisory body of the Federation. The world congress is open to
UFTAA registered agents and enterprises, UFTAA individual
members, suppliers of services and regional, national and
international public authorities.

UFTAA claims to have a series of achievements since its inception in

the year 1966. Prominent among its achievements is -its
collaboration with the International Rail Union resulting in obtaining
increased commission on several railway networks, creation
of professional training courses and the introduction of Rail-
inclusive Tours. With regard to air transport, the cooperation
between the Federation and IATA over a number of years has
resulted in the raising of the commission, introduction of an
overriding commission, 50 per cent reduction for the spouses of
travel agents and creation of international correspondence courses
for the training of agency sales staff. In the sphere of the hotel
industry, the federation, following negotiations with the International
Hotel Association has created an international convention, setting
down regulations for booking, and cancellation fees. A court of
arbitration to settle disputes between hotels and travel agents
located in different countries has also been created.

WATA
WATA, the World Association of Travel Agencies, is another
important worldwide association representing travel agencies.
Founded in the year 1949, WATA is a non-profit organisation created
by independent travel agents for the benefit of all travel agencies
around the world. The Association has over 200 members from 175
cities in 80 countries. The headquarters of WATA is located in
Geneva, Switzerland.

The basic idea of WATA is to bring together local travel agencies into
an international network, so that every member is offered all the
facilities and advantages of being associated with an international
body in addition to enjoying local prominence. WATA is registered as
an association under Swiss Civil Law and is essentially a non-profit
making organisation. Under its statutes, WATA and its members are
required to assist one another.

The General Assembly of WATA held every year provides a forum for
discussion of the Association's business and an opportunity to talk
with fellow members. It enables members to have an exposure to
new business and ideas applied successfully elsewhere. One day,
before the General Assembly, the meetings of the Regional
Assemblies are held which provide a chance to its members to
discuss regional travel problems as well as the implementation on
the regional level of the decisions taken by WATA governing bodies.
The regions also have the possibility to submit to the General
Assembly ideas and suggestions.

Advantages of a WATA Membership

The advantages of WATA membership include:

1. Guaranteed Payment of IHA Invoices

WATA headquarters guarantees payment of all invoices for services

rendered by the International Hotel Association (IHA) hotel members
to WATA members, up to a certain amount. In return, the IHA has
requested its members to accept vouchers for individual clients
issued by WATA members to be billed after the client's departure.

2. Internal Guarantee

Subject to certain conditions, unsettled services rendered by one

WATA member agency to another, are paid by WATA headquarters.

3. WATA Standard Exchange Voucher

An agency's own exchange voucher bearing the WATA logo and the
reference to the IHA/WATA agreement or the standard WATA
exchange voucher printed by the headquarters with the name of the
agency, are widely accepted by hotels worldwide. In the majority of
the cases, hotels accepting these vouchers will agree to bill the
services after the departure of the clients without prepayment or
deposit.
4. Membership List and Introduction Card

A small booklet listing all WATA members and their addresses is

available for agencies to give to clients who go on extended trips, in
case they need assistance and service en route. For especially
important clients, a special introduction card is available for the
members.

5. WATA Master-Key

Updated and published yearly, the WATA Master-Key is a

comprehensive source of travel information. Individual WATA
agency tariffs represent an invaluable selling tool for members'
incoming and outgoing services. Master-Key carries the tariffs of
WATA members offering incoming services. A standard presentation
makes it easy for users to extract the information they need. Along
with the tariffs is a country description sheet provided by the
respective National Tourist Offices containing a wealth of
background information.

6. WATA Circular Letters for Latest Developments

This internal newsletter keeps members abreast of new

developments in WATA. It also gives members an opportunity to
describe special activities of their own.

7. WATA's Overriding Commission

A supplementary commission of 5 per cent is allowed between

members, on prices published in WATA Master-Key for transfers,
sightseeing, excursions, tours and chauffeur-driven car hire.

WATA Membership Categories

1. Full Members

Membership in WATA is open to any travel agency, preferably

privately-owned, which can prove a sound financial structure,
adheres to the highest professional ethics expected in the industry
and enjoys prominent standing in the local community.
All WATA members have the same rights, privileges and obligations
within the association. Individual members are grouped into three
sub-categories depending on the scope of their activities, as follows:

1) Agencies offering both outgoing and incoming services.

2) Agencies offering outgoing activities only.

3) Agencies offering incoming service only.

2. Associate Members

A travel agency may apply to become an associate member. This

category offers the possibility to become a WATA associate member
for a trial period of 2 years. The associate members have the same
rights and obligations as the full members but the fees are generally
reduced.

3. Allied Members

A category open to hotels, airlines, shipping lines and car hire

companies. The aim of this category is to develop the business
relations between the members and their partners. Allied members
may attend the WATA General Assembly, they will be listed in the
WATA publications, receive all WATA publications and circulate
letters and have the right to display on all their printed matter, the
WATA logo created for this category. They have no voting right nor
can they be elected to the WATA governing bodies.

Both UFTAA and WATA are playing a valuable role in representing

the interests of travel agents worldwide. In addition to the above
two international travel associations representing travel agents,
there are some important national travel agents organisations like
the American Society of Travel Agents (ASTA) which has influence
beyond the confines of USA. The American Society of Travel Agents
draws its membership not only from travel agents and principals
within the country but also from principals throughout the world who
have interest in promoting overseas tourism from the United States
to their country.

ASTA World Travel Congress

The American Society of Travel Agents (ASTA) American Society of
Travel Agents (ASTA) is the leading professional society of travel
agents in the USA. The world's largest professional travel trade
association, ASTA was established in New York in the year 1931.
Originally named the American Steamship and Tourist Agent's
Association, the present name was adopted in the year 1944. The
Society was established to foster programmes for the advancement
of the travel agency industry, promote ethical practices and provide
a public forum for travel agents. It has now over 25,000 members
and is the only organisation representing all segments of the travel
industry. The membership consists of travel agents, carriers, hotels,
etc.

Purpose

The purpose of ASTA is the promotion and advancement of the

interests of the travel agency industry and the safeguarding of the
travelling public against fraud, misrepresentation and other
unethical practices. The Society maintains legal representation and
also a Government Affairs office in Washington, D.C. to provide
direct contact with the Federal Government and the regulatory
agencies in the travel and transportation field, and to protect the
legitimate interests of travel agents.

Services

ASTA's services to travel agents also benefit the general public.

Such activities include sponsorship of frequent conferences on travel
matters, involving airlines, steamship companies, agents, municipal
and government officials, and other interested parties; discussions
with airlines on fare structures and travel destinations; research
studies into traveller preferences; close cooperation with various
city, state and government agencies across the country in
travel¬oriented matters, assistance to all agencies across the
country in travel-oriented matters; assistance to all levels of
government consumerism departments in upgrading standards of
service to travellers.

The American Society of Travel Agents is primarily the trade

association of the travel agency industry. There are more than
25,000 members in the Society covering all segments of the travel
industry. Out of the total membership of 25,000 over 14,000 are
travel agents in the United States of America and Canada. In
addition to travel agents, there are allied members representing
airlines, railways, hotels, government tourist offices, etc. The Society
has a membership in over 140 countries all over the world. In order
to qualify for the membership of the Society, an applicant must be in
the business of travel under its present ownership or control for a
minimum period of three years.

Membership

There are two basic classifications of membership-Active and Allied.

Active members are year-round travel agents or tour operators.
Allied members include airlines and steamship companies, railroad,
bus lines, car rental firms, hotels, resorts, government tourist offices
and other organisations regularly engaged in the travel industry or
associated industries.

ASTA has over 2,500 travel agency members outside the USA and
Canada. All are engaged in travel agency operations on a
year¬round basis and have been in business for at least three
consecutive years. The international roster has its own elected
governors and actively participates in all phases of Society
meetings. International members come from Algeria, Bolivia, Sri
Lanka, Denmark, Ethiopia, Fiji Island, Ghana, India, Iran, Japan, the
Netherlands, Portugal, South Africa and Sweden.

ASTA World Travel Congress

The year's foremost meeting place is the ASTA World Travel

Congress. The Congress is the single most important meeting held
annually in the travel industry and the programme includes
workshops, seminars, business meetings, film presentations, and
social events. Members from throughout the world travel industry
participate, give talks, lead discussion groups and conduct sessions.
The ASTA World Travel Congress has been the platform for
launching many important and beneficial education programmes for
agents. The Congress grants Travel Hall of Fame awards, an honour
given to those whose careers have made long-standing impacts on
the development and expansion of the travel industry and tourism.
The awards are given every year to outstanding members.
ASTA consists of the following departments:

a) Policy implementation

b) Administration

c) Industry Relations

d) Membership Relations

e) Communication

The members of the society derive various advantages which

include education and training. ASTA has a comprehensive list of
travel courses and seminars which are attended by its members.
The society also offers professional training courses to senior travel
agency personnel. Various research papers and newsletters are
brought out from the Society's headquarters for use of its members.

ASTA Chapters

The society has 28 chapters in the United States of America and

Canada and another 28 chapters overseas. Each chapter has
elected officers and appointed committees. There is a National
Board of Directors which establishes policies of the Society. Every
two years a new President and Chairman of the Board are elected by
Active Members. Day-to-day activities of the Society are looked after
by a professional staff which works under the guidance of an
Executive Vice-President who, in fact, is the Chief Operating Officer
of the society and makes recommendations on policy matters to the
Board and Executive Board. The Vice-President directs the
headquarters staff in providing a broad programme of services and
facilities to ASTA's membership and carrying on the day-to-day
business of the Society. ASTA world headquarters are located in New
York City, USA.

Indian Medical Travel Association

Leading Indian Hospitals, Healthcare providers (both Modern
Medicine and Traditional Indian Medicine), Travel and Medical
Tourism Industry providers have come together to form an industry
association - Indian Medical Travel Association (IMTA) that aims to
work together to make India the leading global healthcare
destination.

The phenomenon now popularly known as Medical Tourism is often

cited as the next big opportunity for India after the IT outsourcing to
earn billions of dollars in forex earnings and create jobs in the
healthcare sector. So far only a select group of Indian hospitals have
been making valiant attempts to market their services in
international arena. More than a million overseas patients already
treated at top Indian corporate hospitals like Apollo, Fortis,
Wockhardt, Max, Manipal and many others have already proved to
the world that the clinical quality, technology and cost proposition
offered by India is unmatched. The capacity in super specialty
segment Indian hospitals is expanding fast and thereis no waiting
period for local or overseas patients.

CII Mc'Kinsey study first reported on medical tourism as the billion

dollar opportunity for India way back in 2002 and the steady growth
in overseas patient arrivals has validated the potential. With a large
number of new private super specialty hospitals and even integrated
health cities coming up in India's top ten cities, India has the
potential to become the global leader in the Medical Travel/
Outsourcing industry. Indian doctors and professionals are world
renowned for their skills and the country has abundance of all the
inputs like talented young manpower, local high quality
manufacturing base for pharmaceuticals, technology hardware and
software that makes the Indian costs for high end surgical
procedures so attractive. The challenge really is on the non medical
side, primarily on the marketing front and also to create
infrastructure and services to support the growth of medical
tourism.

Indian Medical Travel Association (IMTA) - a non profit body and a

unified voice of the Indian healthcare (modern medicine as well as
traditional Indian medicine) and travel industry is aimed at
preparing India for facing the challenges of global competition and
actualise the tremendous opportunity for India to become a leading
global healthcare destination. Modern medicine as well as India's
5000 year old traditional therapies like Ayurveda, Siddha and Yoga
can offer to the world an unbeatable healing package.

Medical Visa Requirements For MT

While each government has its own regulations and requirements
for visas for medical tourists, understanding general principles about
such visas is essential for people involved in medical tourism, the
examples which are given below:

 Facilitator helping clients receive care in another country;

 Healthcare provider recruiting patients from other countries
to use your services;
 Government policy maker identifying visa issues; or
 A person seeking medical care in another country.

Despite its flaws and frustrations, a great deal can be learned from
the US immigration system about obtaining a visa for medical
treatment and the particular steps followed by tourists. The process
and documentation required by the US system, while perhaps more
extensive than other countries, is a role model for medical tourists
traveling anywhere for medical care.

Travel into the United States by nationals of other countries requires

that the individual have two documents: a valid passport and a valid
visa. In general, to enter the US, a passport should be valid for 90 to
180 days from either the date of entry or the date of intended
departure. The passport validity requirements should be clarified
with the local US Consulate as the requirements differ based on the
person’s nationality.

What is a Visa?

A visa is a certificate issued to an individual and placed in the

person’s passport by a duly authorised governmental agent
verifying that permission has been granted to enter the country for
a specific period of time and for a specific purpose.

Requirements to obtain a US visitor visa for Medical

Treatment
Under the US immigration law, medical tourists are considered to be
visitors and must meet the requirements for obtaining a visitor visa,
also called a B-2 visa. When contacting the US Consulate to apply
for a B-2 visitor visa, the patient or the applicant must prove all of
the following elements to qualify for the visa:

 The purpose of the trip is to receive medical treatment;

 The stay in the United States will be of a limited and defined
period of time;
 The applicant has sufficient funds to cover all expenses
including the cost of medical care while in the US;
 Evidence of financial and social ties to the home country;
and
 Evidence of a residence outside the US to which the
applicant will return once the purpose of the trip is
concluded.

Before starting the application process, it is essential to collect the

documentation needed to prove each of the five itemised points as
well as holding a valid passport. While each application is unique,
here are some suggestions for the types of documentation needed
to satisfy the B-2 visa requirements.

To prove the purpose of the trip is to receive medical treatment, the

patient has to obtain a letter from each doctor or hospital in the US
that is going to provide medical care from initial evaluation to
testing to surgical procedures to rehabilitation services. Each letter
should be on business stationery, signed and dated by the doctor
and state the diagnosis, course of treatment, estimated costs and
length of treatment. An explanation as to why the person is coming
to the US for treatment must be provided. Documenting the period
of time that an individual will stay in the US can be accomplished by
a round trip airline ticket, travel itinerary including hotel
accommodations, and doctor’s letter specifying the length of
treatment including recuperation. It is reasonable to ask for a period
of time before and after the medical treatment to remain in the
United States in order to arrive and recover from jet lag as well as to
relax for a few days before heading back home.

Often time’s medical tourists will come to this country and stay with
a friend or relative who is referred to as a “sponsor”. In this
situation, a letter of invitation from the sponsor is needed that spells
out how long the medical tourist is expected to stay as well as any
financial arrangements made on behalf of the tourist. For example,
a sponsor’s letter of invitation may state “My aunt, Susan Miller, is
invited to stay with me for one month at my home. During her stay, I
will provide food and transportation for her as well as any
miscellaneous expenses.” Along with the letter of invitation, the
sponsor should complete Form I-134, Affidavit of Support, which is
available on the internet at [Link] and click on “Immigration
Forms”. Financial information from the sponsor like the most recent
Federal Tax Return, pay stub, or bank statement should be attached
to the Affidavit of Support. The sponsor must have legal status in
the United States and submit documentation to prove it.

The US government is extremely concerned about individuals

coming to the US for free medical care so be prepared to carefully
document the ability of the medical tourist to pay for all aspects of
medical treatment and other expenses during the visit. Proof of the
individual’s financial ability to pay for the medical care can consist
of bank statements or documents showing the amount of cash on
hand, investments, loans, and other assets. A copy of a contract
detailing financial arrangements between the US healthcare
provider and medical tourist should be supplied as part of the visa
application process.

Under US immigration laws, there is a presumption that every visitor

has the intention to stay in the US indefinitely so medical tourists
must prove that they have financial and economic ties to their home
country that are strong enough to compel a return to the home
country. Documentation to meet this requirement includes a deed or
lease on a place of residence; foreign bank accounts; employment;
immediate relatives; assets such as a car, business, and other
property. In general, it is better to have too much documentation
rather than too little when preparing to apply for a visitor’s visa for
medical purposes.

Lessons for Medical Tourists to other countries

While some of this information is strictly related to the US system,

the basic principles behind the visitor visa requirements apply
generally to the process of obtaining medical tourism visitor visas to
other countries. For example, India has created a category of visas
specifically for medical tourists. The government has started issuing
M (medical) visas to the medical patients, and MX visas to the
dependent accompanying them, which are valid for a year. While
much “friendlier” than the US application process, the Indian
medical tourist visa does look at similar issues such as the
availability of medical treatment in the home country, the type of
medical treatment to be provided in India, where treatment will be
provided, and related issues. The application process and much of
the documentation is similar to the US system. India, like the US, is
concerned about abuses of the visa system but has adopted a pro-
medical tourism policy that is lacking in the United States. The
policies and processes behind medical tourism visas in many other
countries is a variation on the theme set by the United States.

The US system for issuing visitor visas for medical tourists provides
insights as to policies and documentation needed for medical tourists
of any nationality traveling to any country for medical services.
Regardless of the destination for medical treatment, make sure to
verify the passport and visa requirements of the country where
treatment will be provided as well as the documentation needed to
obtain the necessary visa. With planning and preparation, the
immigration issues should go smoothly so that the focus of the trip can
be on obtaining medical treatment and returning to good health.

Summary
Some of the key points of this chapter are as following:

 Travel agents bring buyers and sellers together with a view to

creating markets in places where these did not exist or to make
existing markets more user friendly and efficient in order to
expand the overall size of the travel market.
 The main role of retail travel agents is to provide to their
customers a convenient location for the "purchase" of various
elements of travel like transport, accommodation and several
other ancillary services associated with holiday and travel.
 The scope and range of travel agency operations would depend
on the size of an agency. This includes:

 Provision of Travel Information

 Preparation of Itineraries
Liaison with Providers of Services
 Planning and Costing Tours
 Ticketing
 Settlement of Accounts
 Provision of Foreign Currencies
 Insurance
 The WATA guidelines are:

1. Sale of Tour
2. FIT/Your Relations with Client
3. Quotation
4. Suggested Itinerary
5. Reservation procedures

Topic 5: Marketing Concepts & Strategies in MT

1. Objective

At the end of this chapter the student will be able to:

 Explain the importance of marketing in medical tourism.

 Define tourism marketing and its concepts.
 Explain the tourism marketing mix and promotion strategies.

Introduction
The attitudinal behavior and approaches of tourists and service
providers have undergone significant changes during the closing
decades of the twentieth century and beginning of the third
millennium from the viewpoint of tourism marketing. Earlier only a
small segment of the world population was involved in tourism-
related activities but now tourism has emerged as a globally popular
human activity with considerable social, cultural, political and
economic consequences. Mass tourism bringing with it diversity and
conflicting perceptions and expectations has dramatically expanded
the scope and nature of tourism.

The phenomenal growth of domestic as well as international tourism

has been caused by very specific shifts in social systems and
disposable incomes the world over. This has subsequently raised
several critical issues related to marketing. These issues invite
tourism planners and practitioners as well as academicians and
researchers to systematically consider emerging issues and propose
a more viable approach to marketing tourism products and services.
One such major issue is the need to keep the concept of
sustainability in clear focus consideration. A very small section of
people involved in tourism is familiar with this concept and realise
its importance. “In marketing terms, sustainability is primarily an
issue of product quality. There is no clear evidence in the developed
world that more than a small minority of visitors understands
concepts of sustainability and environmental good practice and
draw on them when choosing products, although travelers from
countries such as Germany, Holland and Scandinavia appear to be
further ahead in this respect. There is even less evidence that the
great majority of visitors are willing to pay premium prices for the
products of tourism businesses operating to high environmental
standards. But there is convincing evidence that customers turn
away from what they consider to be overcrowded, polluted
destinations which have allowed their environmental quality to
become eroded through over development. This

is especially true where health risks, as from air and water pollution,
are perceived as problems. There is also convincing evidence that
customers generally in the 1990s are more experienced in travel,
more demanding, and searching for a combination of quality and
good value for money which they are increasingly able to
recognise”(Middleton, 1998). The journal of Sustainable Tourism
defines the concept of sustainability in its simplest form as ‘a
positive approach intended to reduce the tension and friction
created by the complex interactions between the tourism industry,
visitors, the environment and the communities which are host to
holiday makers’ (Bramwell and Lane, 1993). Thus a sustainable
approach would involve a coordinated attempt to manage the
tourism environment in such a way that the long-term integrity of a
region’s natural and human resources will be preserved. Those who
favor this approach recognise that there are limits, to extend
beyond which would result in the ultimate destruction of the
resource.

In recent years one of the key problems has been the narrow
perspective of marketing adopted by the travel and tourism sector.
Many organisations continue to equate marketing with promotion
and to concentrate solely on the expansion of overall visitor
numbers (Dinan, 2000). As Wheeler (1995) puts it, authorities and
companies have had an unbalanced view of marketing, only using
promotional techniques and viewing price as supplementary to the
target of attracting additional numbers. This, in turn, has caused
visible effects on the environment. Over zealous marketing by
tourism organisations can result in the attraction of potentially
harmful numbers of visitors, who by their very presence alone can
erode coastal paths, displace local wildlife and generate additional
levels of both noise and vehicular pollution (Dinan, 2000). Promoters
and developers are less inclined towards promoting tourism as a
social activity but tend to consider it as a source of quick financial
advantage. Rapid growths in some destinations seem to accelerate
the declining stage without holding on to introduction, growth and
maturity stages. In the 1990s Kotler refined and broadened the term
Marketing.

Kotler defines the marketing concept as follows: "The marketing

concept holds that the key to achieving organisational goals
consists in determining the needs and wants of target markets and
delivering the desired satisfactions more effectively and efficiently
than competitors."

Marketing For Tourism

It is a well-known fact that as long as the inherent sense of curiosity
and adventure dwells in the hearts of human beings, the desire to
travel, in order to see new sights and experience new things, and to
live under different environments, will always grow. It may be
presumed that such being the case, marketing in the tourism
industry is greatly simplified as part of the process has already been
completed by, the desire for travel in people.

The best example would be that a person may or may not choose a
tangible product which has been introduced by a manufacturer in
the market, solely depending on his ability to afford it or his likes
and dislikes. On the other hand, without exception, all human-beings
will always nurture a desire to travel in order to see places. The
question then arises that if the desire is ever-present in people to
travel and experience new things, why would the tourism industry
need marketing efforts at all?

Tourism is a very complex industry because of its multi-faceted

activities which together produce the 'tourist product'. It is also
complex because of various sub-sectors that are in themselves
complete industries, if considered independently (lodging, transport,
etc.). Its complexity, furthermore, lies in the fact that tourism
promotion in its various forms has to be directed at large numbers
of people in various lands of different socio-economic structures,
having different needs, tastes, attitudes, expectations and behavior
patterns. It is the only efficient marketing strategy that will help
understand people's tastes and preferences for travel and hence the
need for marketing in tourism.

Defining Tourism Marketing

Tourism marketing is defined in a number of ways. It could be

defined as the "systematic and coordinated efforts exerted by the
National Tourist Organisations and/or the tourist enterprises at
international, national and local levels to optimise the satisfaction of
tourists, groups and individuals, in view of the sustained tourism
growth."

According to Krippendorf, J., marketing in tourism means

"systematic and coordinated execution of business policy by tourist
undertaking whether private or state-owned at local, regional,
national or international level to achieve the optimal satisfaction of
the needs of identifiable consumer groups, and in doing so to
achieve an appropriate return."

The Tourist Product

Tourism marketing and marketing in general both emphasise
consumer orientation and satisfaction. The concept of consumer
orientation, however, makes it necessary to understand the
components of the tourist product from the point of view of the
consumer. The product for the tourist covers the complete
experience from the time he leaves home to the time he returns.

Availability of a product is the prerequisite in the marketing

function. Unless there is a certain product, be it tangible or
intangible or a service, marketing is not possible. A product may be
defined as the `Sum of the physical and psychological satisfactions
it provides to the buyer.' `Marketing' by definition is the
development of a product to meet the needs of the consumer and
then employing the techniques of direct sales, publicity and
advertising to bring this product to the consumer. In the case of
tourism product, the basic raw materials would be the country's
natural beauty, climate, history, culture and the people. Other
aspects would be the existing facilities necessary for comfortable
living such as water supply, electricity, roads, transport,
communication and other essentials.

In other words, the tourist product can be seen as a composite

product, as the sum-total of a country's tourist attractions,
transport, accommodation and entertainment which hopefully result
in consumer satisfaction. The tourist product can be entirely a
manmade one or nature's creation improved upon by man. Each of
these components of a tourist product is supplied by individual
providers of services like hotel companies, airlines or other
suppliers, and is offered directly to the tourist by them. A consumer
can combine these individual tourist products through a large
number of ways. There would be many possible destinations, each
with a number of hotels, each to be reached by more than one
airline. Thus the potential choice facing the consumer is very large.

A number of tourist destinations have placed at the disposal of a

tourist a large variety of tourist products in abundant quantity from
a large number of competing destinations. This, eventually, has led
to the adoption of new marketing concept in tourism by various
countries promoting tourism. The important point about marketing
is that it is applied to situations where the choice can be limited to a
relatively small number of brands giving the consumer a reasonable
choice. The process of selection thus becomes easier. In the field of
tourism, this process is taking place by the increasing use of
'package tours'. A package tour is a travel plan which includes most
elements of vacation, such as transportation, accommodation,
sightseeing and entertainment. The tourist product is a composite
product, whether it is sold as a package or assembled by the
individual tourist himself or his travel agent.

Medical Tourism Packages

Medical tourism packages are chiefly designed to offer patients a
complete cure and revitalised experience. These packages allow
patients not only complete healthcare facilities but also excellent
tour options as well. The medical tourism packages are
implemented through successful partnerships among some of the
best tour operators, well-established healthcare centers, hospitals
and travel service providers. Aimed to stand up to the expectations
of international patients, medical tourism packages encompass all-
possible facilities within their purview- be it diagnostic, surgical,
holistic or any other complementary treatments. These packages
enable foreign patients not only to undergo medical treatment but
also to discover the rich cultural heritage of the countries they visit.

This combination of healthcare and tourism facilities at an affordable

price serves as a magnet to attract patients from all over the world.
Not only are patients provided with world-class facilities but are also
let to travel around the country and have a glimpse of its social life
and culture. Besides, recent successes of Indian doctors treating
overseas patients has also inspired more and more foreign patients
to opt for these destinations.

Besides, patients do not have to wait long to undergo any

complicated surgery or treatment in these medical tourist
destinations in contrast to the long waiting list in Western countries.
Such a long waiting list can even cost a patient's life! This is another
reason for the constant insurgence of foreign patients in the Asian
medical tourism sector.

The medical tourism industry has thus found an effective strategy to

boost up its market by offering a wide range of medical tourism
packages. Medical tourism services provide detailed information on
all different medical tourism packages along with some valuable
suggestions as well. With hospitals, hotels, conveyance facilities
meeting international standards, medical tourism packages are set
to make their target customers sit, relax and enjoy a rejuvenating
experience!

Tourism Marketing- Special Features

Tourism, basically, is an infrastructure based service product. The

nature of the service marketed being highly intangible and
perishable offers a limited scope for creating and maintaining the
distinctive competitive edge. Effective marketing of tourism needs
constant gearing up of infrastructure to international standards and
presupposes its co-ordination with the tourism suppliers. In strategic
terms, it calls for the action of an integrated approach to
management and marketing. In operational terms, it means the
implementation of a better defined, better targeted market-driven
strategy for realising the defined objectives.

Marketing of tourist product has certain peculiar characteristics.

Although general principles of marketing of products of other
industries could be applicable to the marketing of tourist product,
there are certain differences in approach. Among the peculiarities of
the tourist product are :

Tourism is an Intangible, Non-material Product

No transfer of ownership of goods is involved as compared to a

tangible product, say, for example, a motor car. In tourism, instead,
certain facilities, installations, items of equipment are made
available for a specified time and for a specified use. For instance, a
seat in an aeroplane or a train for a journey from one point to
another or a booking in a hotel through a travel agent are carried
out for a customer or services such as information and advice are
provided.

Production and Consumption of Tourist Services are closely

interrelated

The travel agent or tour operator who sells his product cannot store
it. Production can only take place or can only be completed if the
customer is actually present. There is a close link between
production and consumption of tourist services. Most tourist services
cannot be consumed incrementally. In other words, consumption,
once begun, cannot be stopped, interrupted or modified at all. As a
result, risk and uncertainty for the customer are higher, and his
need for reliable pre-purchase information is stronger. The potential
customer's decision-risk and dependence on accurate information
are further increased because he cannot see, inspect, compare or
try out tourist services before deciding to use them.

Multiplicity of Producers

The tourist product cannot be provided by a single enterprise. Each

of the components of a tourist product is highly specialised and
together make the final product. This is not so in the case of other
tangible products where one manufacturer produces a total product.
In tourism, on the other hand, an airline considers `seats flown' or
passenger miles to be its product; a hotel produces `guest nights' a
travel agent 'bookings', a theatre and museum or an archaeological
site measures its `production' in number of

visitors. In the tourist's view, however, the product he buys covers

the complete experience of his visit to a particular place. In other
words, the tourist product is not an airline or a rail seat, or a hotel
bed or a theatre ticket, but rather an amalgam of many components
which together make a complete product. Because of these peculiar
characteristics, coordination in marketing efforts is very crucial.

Highly Unstable Demand

The demand is influenced by factors such as seasonal, economic

and political conditions. The seasonal changes greatly affect the
demand. Seasonality means that tourism plant is frequently used for
a limited part of the year and therefore uneconomic. Many tourist
areas have a short season - often as little as three months. A
corollary of this seasonal usage is the seasonal unemployment,
which is a serious problem. Some of the developing countries which
have recently established tourist industries suffer, particularly from
seasonality. Seasonality also places strains on the transport system
and other services. Thus seasonality presents a problem not only in
relation to employment but also in relation to investment. On the
other hand political unrest and economic instability caused by
currency fluctuations and inflation, etc., greatly affect tourism
demand.

Dominant Role of Intermediaries

In most industries, manufacturers have predominant control over

product design; distribution and promotion and pricing. On the other
hand in medical tourism, sales intermediaries like tour operators,
travel agents, reservation services, hospitals and hotel brokers play
a very dominant role and enjoy superior marketing strength. From
the standpoint of tourism marketing, this strong position of the
travel trade has significant implications. The travel trade determines
to a large extent which services will be sold and to whom. The type
of services to be offered as well as the pricing policies and
promotion strategies to be adopted by tourist enterprises, are,
therefore, determined not only by the needs and preferences of the
customers but also by those expressed by travel sales
intermediaries.

Medical Tourism Marketing By Hospitals

Medical tourism presents an opportunity for hospitals to fuel growth
by tapping the potential of the international patient market. To
attract foreign patients, healthcare providers may consider
leveraging on both business and clinical considerations. The
advancement in medical technologies increased patient mobility
and demand for immediate quality healthcare is arousing interest
among healthcare providers globally. This is spawning the new
medical tourism industry, offering clinical services to foreign
patients.

Growth led by private sector

Well-developed indigenous healthcare systems and improvements in technology have
supported the growth of medical tourism among Western countries for many years.
Medical tourism in Asia is however relatively new, brought on in the aftermath of
the Asian Financial Crisis that led private hospitals to seek alternative revenue
sources. Thailand’s Bumrungrad Hospital was among the first in the region to focus
on attracting foreign patients, enticing hospitals in other countries to follow suit.
Governments have led the development of this industry in some countries. The
Malaysian Government has successfully exerted its leadership to facilitate and
encourage industry development, with the formation of National Committee for the
Promotion of Health Tourism. The Hong Kong Government is starting to consider the
possibility of marketing its Traditional Chinese Medicine (TCM) capabilities to the
region, while concerted efforts have similarly been launched by government agencies
in Singapore to market its world-class medical capabilities.

However, governments are also sensitive to their role of providing public health
services for its citizens, and are mindful not to be perceived as being completely free
to generate revenue from public resources sold to foreigners. In countries such as
Australia, Thailand, US or the UK, the onus remains on the private sector to analyse
available opportunities, spearhead sectoral development, and formulate strategies to
improve their competitiveness. For this reason, governments are keen to appear
politically – correct when managing the visibility of their efforts, intentions, and
activities relating to public hospitals and doctors.

With the tightening of immigration rules and security checks, the US has seen a
decline in the number of foreign patient visits. More patients, especially those in the
Middle-East, are moving towards alternatives like the UK, France, Germany or even
Australia, although patient volume is currently still limited. Over 100,000 foreign
medical tourists visit Malaysia annually, while Singapore and India are also starting to
experience positive growth in patient visits as a result of their aggressive marketing
initiatives to source countries like Indonesia. However, Thailand leads the Asia-
Pacific region with about 400,000 foreign patients each year.

Thailand is able to attract such a large volume of patients as it is itself well-reputed as

a tourist haven, with a variety of existing tourist attractions for recuperating patients, a
relatively low cost of living, expat-friendly locals, and a respectable quality of
healthcare— especially in niche areas such as cosmetic surgery frequently travel to
“gold standard” destinations such as the US and UK. Wealthy individuals in Asia who
prefer first-world quality treatment within the region tend to visit Australia or
Singapore. The inelastic demand among such patients represents a more lucrative
revenue stream, more loyalty, and even a willingness to travel further distances.

Non-medical services
Healthcare providers are starting to offer non-medical services such as logistics
arrangements and hospitality services, as discerning patients are increasingly
demanding a total consumer experience even when seeking medical treatment. For
instance, hospitals such as the London Bridge Hospital offer airport pick-up services
for patient convenience. Hospital reception areas are fitted as luxuriously as five-star
hotels; Bumrungrad Hospital in Thailand for instance even features a Starbucks café
and McDonald’s outlet. Bangkok’s Piyavate Hospital may even feature spa facilities
that offer a holistic wellness experience. Western-style hospitals such as in the US,
UK or Australia feature their own on-site accommodation, both for patients in the
aftercare stage, as well as for their relatives. These include a variety of luxury
features, across all price points. Similarly, many Asian hospitals that do not manage
their own accommodations also offer link-ups with different hotels, hostels, B&Bs,
etc.

A key part of training for staff taking care of international patients has been in
teaching sensitivity. Apart from bedside manners, hospital staff members are also
being recruited to accommodate to their religious, dietary and cultural needs.
Hospitals in the US or the UK that are experienced in seeing royalty, politicians,
prominent businessmen or celebrities are even trained to manage anonymity concerns,
such as with the use of code names for all cases and confidentiality agreements.

Diverse Motivations
It is comparatively simple to determine why people buy a certain make of refrigerator,
smoke certain brands of cigarettes, use certain brands of toothpaste or prefer a certain
type of packaged food- The subjective and objective reasons, expectations and desires
which influence tourists' choice for a certain holiday destination, type of
accommodation and vacation activities are far less evident. Very often two people
make exactly the same choices for entirely different and sometimes even mutually
exclusive reasons.

Travel motivations unlike motivations for buying a tangible article like a refrigerator,
are heterogeneous - composed of diverse elements. Marketing in tourism, due to the
various factors mentioned above, as compared to marketing in other industries,
therefore, needs a somewhat different approach. Tourism marketing to a considerable
extent depends on various market factors mentioned above. Unlike the normal
consumer product or service, the tourist product is marketed at two levels.

i) The national or regional tourist organisation will be engaged in a marketing

campaign to persuade the potential tourist to visit the country or region for which it is
responsible. In view of the fragmentation of supply, the complementarities of tourist
services, the predominance of many small and medium-sized enterprises and
importance of tourism to an economy, the official tourist organisations have important
functions in tourism marketing. The official tourist organisation will however not sell
a tourist product directly to customers. It will have two major objectives. In the first
place, it will seek to create knowledge of its country in tourist-generating markets and
persuade visitors in these markets to visit that country. Secondly, it will seek to create
an image of its country's tourist attractions in the best possible manner in tourist-
generating markets so that the potential visitors are attracted.

ii) The various individual firms providing tourist services can market their own
components of the total tourist product after the national tourist organisations have
launched marketing campaigns to persuade the potential tourist to visit the country or
region for which it is responsible.

Marketing Functions
We have seen earlier while discussing various definitions of the
marketing concept that it is basically customer-oriented, backed by
integrated marketing aimed at customer satisfaction. The focus of
marketing, therefore, centers around a customer. Professor Kotler in
his definition has also emphasised this fact and stated that
achievement of organisational goals depends on determining the
needs of target markets (customers) and delivering the desired
satisfaction more effectively and efficiently.

From the above it follows that organisations, before achieving their

desired goals, have to go through series of marketing functions; and
specific understanding of both marketing functions and specific
marketing tasks becomes very crucial to grasp the subject of
marketing. In this chapter, we would discuss the marketing function
which can be considered as a system where interaction occurs
between an organisation and a customer. The main marketing
functions and the tasks these functions set for themselves are as
follows :

a) Market Research

b) Product formulation and development

c) Analysis and selection of target markets (segmentation)

d) Distribution networks

e) Product Promotion

Market Research
Identifying the customer needs especially in a tourism industry
which has very high service base content is very important. This is
possible only through systematic market research and analysis. This
is basic for successful marketing. It relates to providing answers to
various questions pertaining to the marketing activities. Market
research can be defined as the "Systematic collection of information
relating to supply and demand for a product or a proposed product
in such a way that the information may be used by the organisation
to formulate informed decisions about its policies and its
objectives." The marketing process, in fact, starts by finding out
answers to questions like who are the potential tourists, where do
they come from, what are their likes and dislikes, etc. In order to
formulate any marketing strategy it is very essential for a national
tourist organisation and others engaged in marketing a tourist
product to know the answers to the following questions:

i) Who are the persons who engage in tourism and where do they
live?

ii) Who are the potential customers and where do they come
from?

iii) What are their likes and dislikes?

iv) What are their travel preferences and interest?

v) What do they buy and where do they stay?

vi) What mode of transport do they use?

vii) What are their entertainment preferences?

viii) What are the trends in competition?

(ix) What type of marketing programmes would be needed? Answers

to all the above questions are obtainable only through research. A
tourist-organisation promotion effort, without appropriate answers
to the above questions, will go waste. To make the overall
marketing efforts effective and successful, the tourist organisation
has to be totally aware of the trends in the travel habits, vacation
habits and most important of all, the reasons attributed to the better
success of a competing destination. A marketing manager cannot
visualise successful marketing strategy without having uptodate
knowledge of their markets in general. It is very important to have
detailed information on all the aspects of a market. Results of such
research will work as guidelines for launching a successful
marketing programme.

Research Techniques

Market research is a continuous process. Among the variety of

methods used, some seem to be widely resorted to because of their
advantages over others. Research techniques can be grouped as:

i) Desk research

ii) Field research

iii) Sample surveys

iv) Motivation research

Desk research includes the collection and analysis of all available

data, statistics and published information on tourist trends and
markets. In tourism, much of the basic information about tourist ''
trends and markets is available from existing sources. There are a
number of international organisations like United Nations, WTO, EC,
OECD, IATA, WTTC, ICAO, etc., which publish certain statistical
information. Other data and statistics may be obtained from national
tourist organisations, trade associations, carriers, hotel companies,
etc. This information proves very useful in helping national tourist
organisations to identify their markets and determine the
objectives.

This published information is of particular use to those countries-

which do not possess resources enough to undertake independent
market research. Field research, on the other hand, is the research
work carried out in the tourist-generating markets itself. The special
investigations in the field are to be carried out with a view to know
more details of the market situation. Field research includes many
methods among which the most common are the sample surveys
and the motivation research.
Sample survey could be defined as the study of a given population
through only a part or a fraction thereof. Much marketing
information is obtained through the use of samples. In this method
the population or `Universe' for which information is required is
defined, for example, all households in a country might be the
universe or population under investigation. Then, a statistically valid
sample of the population is drawn and information is obtained from
the sample. Sampling techniques consist of personal interviews of
tourists, travel agents, carriers and hotel managers, etc., by way of
personal interviews with the help of prepared, questionnaires, by
mailing questionnaires or through telephone contacts. There are
certain advantages of this method. Lower cost is the major reason
why data are collected by sampling in place of complete
enumerations. The actual obtaining of information from the sample
units (i.e., households in this case) is done by way of use of
interviews and questionnaires. The questionnaire is administered to
the sample population and various data obtained. The sampling
place could be anywhere. Interviews may take place at homes or
offices, at the place of arrival departure or temporary stay. In many
countries, there are a number of specialised firms which carry out
sample survey enquiries, as well as government agencies similarly
equipped.

The survey investigation can be classified by reference to the kind of

information they seek to provide. There are surveys of market
behavior which record the holiday habits of the population, cross
analysed by socio-economic and other characteristics. The trends in
holiday-making over many years may be seen and inferences made
about the motives of holidaymakers. Furthermore, surveys may be
undertaken to monitor the conduct of marketing campaigns.

Motivation research on the other hand attempts to describe and

forecast the motives of the population under investigation, by use of
techniques originally used in psychology. Assuming that every
individual knows what he wants, motivation research is oriented to
discover the needs of potential tourists in order to adopt the tourist
supply accordingly and thus be able to satisfy them. In other words,
motivation research is the investigation into the motives behind
travel. It concerns itself to answering the `why' of human behavior
in contrast to answering the `how' which is subject to sampling
surveys. It analyses rather than describes the attitudes of both
actual and potential tourists to traveling in general and to the tourist
product offered in particular. Motivation research provides answers
to very important questions. Research in the past has shown that
people from some countries, are traditional good travelers (the
French, the Germans, the American and the British), while others
have become a nation of travelers only recently.

The most important techniques used in motivation research is the

depth interview method. The questionnaire to be used for this
method needs to be carefully designed, as motivation research aims
at discovering the deep, subconscious and even unconscious of
human beings. An ill-designed questionnaire is likely to reach no
deeper than the conscious level where rational factors prevail. Other
techniques used are the projective methods like word association
tests, sentence completion test and pictorial tests and

observations. Means have been devised to record the reactions of a

person and to understand his motives.

Product Formulation and Development

Having identified the consumers and the markets through the

method of market research, the next step is the product formulation
and development. The concept of consumer orientation makes it
necessary to understand the various components of the tourist
product from the point of view of the consumer. In the tourism
industry, product is what gives the consumer the various benefits
they are seeking and its production and delivery. The formulation
and development of a product involves factors like service, quality,
range of different products offered in the market, the features and
benefits it offers, and the brand name.

Availability of a 'product' is the prerequisite in the marketing

function. Unless there is a certain 'product', be it tangible or
intangible or a service, marketing is not possible. A 'product' may be
defined as the 'Sum of the physical and psychological satisfaction it
provides to the buyer.' Marketing' by definition is the development
of a product to meet the needs of the consumer and then employing
the techniques of direct sales, publicity and advertising to bring this
product to the consumer.
In the case of tourism product, the basic raw materials would be the
country's natural beauty climate, history, culture and the people.
Other aspects would be the existing facilities necessary for
comfortable living such as water supply, electricity, roads, transport,
communication and other essentials. In other words, the tourist
product can be seen as a composite product, the sum-total of a
country's tourist attractions, transport, accommodation and
entertainment which hopefully result in consumer satisfaction. The
tourist product can be entirely a manmade one or nature's creation
improved upon by man. Each of these components of a tourist
product is supplied by individual providers of services like retail
travel agents, tour operators, hotel companies, airlines or other
suppliers, and is offered directly to the tourist by them. A consumer
can combine these individual tourist products through a large
number of ways. There would be many possible destinations, each
with a number of hotels, each to be reached by more than one
airline. Thus the potential choice facing the consumer is very large.

A number of enterprises have placed at the disposal of a tourist a

large variety of tourist products in abundant quantity from a large
number of competing destinations. This eventually has led to the
adoption of the new concept, i.e., the marketing concept in tourism
by various enterprises marketing tourism. The important point about
marketing is that it applies to situations where the choice can be
limited to a relatively small number of brands giving the consumer a
reasonable choice. The process of selection thus becomes easier. In
the field of tourism this process is taking place by the increasing use
of package tours. A package tour is a travel plan which includes
most elements of vacation, such as transportation, accommodation,
sightseeing and entertainment. The tourist product is a composite
product, whether it is sold as a package or assembled by the
individual tourist himself or his travel agent. The tourist product can,
therefore, be analyzed in terms of:

i) Attractions

ii) Facilities

iii) Accessibility.
The tourist attraction is a very important element. Unless these are
there, the tourists will not be motivated to go to a particular place.
Attractions are those elements in the tourist product which
determine the choice of a particular tourist to visit one particular
destination rather than another. The attractions could be cultural
like sites and areas of archaeological interest, historical buildings
and monuments or scenics like flora and fauna, beach resorts,
mountains, national parks or events like trade fairs, exhibitions, arts
and music festivals, games, etc. Facilities are those elements in the
tourist product which are a necessary aid to the tourist centre. The
facilities complement the attractions. These include
accommodations, various types of entertainments, picnic sites,
recreation and so on. These are indeed important for every tourist
centre. Accessibility is another important component in the tourist
product. It is a means by which a tourist can reach the area where
attractions are located. Tourist attractions of whatever type would
be of little importance if their locations are inaccessible by the
normal means of transport. If the tourist attractions are located at
places where no means of transport can reach, or where there are
inadequate transport facilities, these become of little value. The
tourist attractions which are located near to the tourist-generating
markets and are linked by a network of efficient transport, receive
the maximum number of tourists.

Segmentation
Market segmentation is one of the important functions of marketing.
The technique of market segmentation has been used by
organisations to effectively target selected groups in the market
with specially designed products and services. Market segmentation
can be defined as "the process whereby producers organise their
knowledge of current and potential customer groups and select for
particular attention those whose needs and wants they are best able
to supply with their products. According to Dibb, Simkin, Pride and
Ferrell

Market Segmentation is defined as:

"The process of dividing a total market into groups of people with

relatively similar product needs, for the purpose of designing a
marketing mix (or mixes) that precisely match the needs of
individuals in a selected segment (or segments)."

From the above definition, it emerges that the market segmentation

is the process of identifying groups of buyers of a total market with
different buying desires or requirements. It identifies and analyses
the socio-economic, life styles and motivational characteristics of
potential buyers into useful categories and thereby launching
advertising and promotional campaigns for these selected groups.
The identification of segment of a total market is therefore of crucial
importance. Due to manpower and financial constraints, it is not
possible for an organisation to reach the entire market.
Segmentation of the market in therefore made in order to achieve
the most efficient use of marketing resources. The main objectives
of the market segmentation, therefore, are:

a) Developing new markets for product variations or new

products;

b) Developing defence against competitors by differentiating

one's own product from theirs and matching it more closely to the
requirements of a particular segment of the market;

c) Achieving maximum effects for given expenditure on marketing

activities, particularly communication activities,

d) Developing marketing programmes and budgets on the basis

of a clearer idea of the response characteristic of specific segments.

The following information on the tourist markets will assist

in segmentation:

i) Income distribution of overseas travelers and particularly

correlations between income and distance traveled and travel
expenditure;

ii) Travel expenditure data, i.e., distribution of per head

expenditure on travel;

iii) Discretionary income of households, correlated with other

characteristics enabling targets to be identified closely;
iv) Historical trends in travel in different socio-economic
categories;

v) Survey data on attitudes to and motivations for overseas

travel;

vi) Geographical dispersion of potential customers within the

market ;

vii) Membership of clubs and associations associated with other

characteristics which identify particular groups as potential
customers;

viii) Influence of intermediaries (travel agents, tour operators,

wholesalers, carriers etc.) on destination choice in particular
markets;

ix) The relative importance of different intermediaries in particular

markets (e.g., is all relevant type of travel business concentrated
among relatively few intermediaries or it is dispersed throughout the
market?).

The segmentation process divides the markets on the basis of

several factors. The most important and commonly used market
segmentation includes the following:

A. Geographic segmentation

B. Demographic segmentation

C. Socio-economic segmentation

D. Psychological segmentation

E. Behavioral segmentation

F. Product-Based segmentation

Under each of the above principal variables, there are several areas
which are considered while segmenting the travel markets. These
are as follows:
A. Geographical

Operational areas, e.g., sales regions. Sales Districts such as

provinces, cities, Political administrative zones.

B . Demographic

Age groups Sex differences Ethnic origin Marital status Religious

affiliations

C. Socio-economic

Income Levels Types of occupation Social class Educational level

Level of economic activity

D. Psychological Individual lifestyles Personality types

Perceptual differences Motivational differences

E. Behavioral

Patterns of purchase, Loyalty to fashions Levels of brand loyalty

Benefits/recognition sought

F. Product-based

Travel purposes

Type of holiday

Average length of stay

Type of accommodation

Mode of travel

Arrangements for travel

Individual / group travel

In tourism, market segmentation is very important. The strategy of

market segmentation in tourism recognises that a few vacation
areas are universally acceptable and desired. Therefore, rather than
waste promotional resources trying to please all travelers, the best
market strategy is to isolate those segments of the entire market
which are likely prospects and aim at the promotional efforts
specifically to the needs of these selected groups. Thus, one of the
early steps in marketing tourism is to divide the present and
potential market on the basis of meaningful characteristics and then
concentrate on promotion, supply and pricing efforts on serving
these most prominent sections of the market - the target markets.
Usually as stated earlier, the market segmentation for tourists is in
terms of the following criteria: demographic, geographic,
psychographic, social and economic.

For example, market for particular area might be largely

archaeologists in their middle years who have an income of over
S100,000 per year and who live in mid-eastern United States, or it
might be largely businessmen in the age group of say 40-60 years
who have an income of over $150,000 per year and who live in
southern parts of West Germany. In tourism marketing, the total
tourism market can be divided into the above major segments. A
further segmentation, however, is possible within each of the above
major segments for practical marketing purposes, and includes:

i) The vacation tourist:

The vacation or the holiday tourist is the most common and popular
tourist. He is immensely affected by changes in price, and is easily
influenced by skilled and aggressive marketing effort. This type of
tourist is resort-oriented (Rome, Bombay, New York, London, Paris
are resorts as much as Venice, Goa, Pattaya, Miami). The vacation
tourist market has been regarded as highly seasonal.

ii) The business tourist:

In recent years the market for this type of tourist has increased
greatly. The choice of destination of a business tourist is generally
determined by the nature of his business. The marketing efforts will
not influence much the choice of the business tourist. As in the case
of the vacation tourist who has proved to be very sensitive to price
changes, the demand for business tourism is relatively price-
inelastic. The demand will tend to be big-city oriented. The visits are
of shorter duration and relatively frequent. The trade fairs,
 conventions, exhibitions, conferences and similar other events
attract this kind of tourism.

iii) The common interest tourist:

This segment comprises visits to relatives and friends, and visits for
the purpose of education, for pilgrimages, etc. Demand for this type
of tourism will be relatively price-elastic. The common interest
tourist will not be easily influenced by the promotional efforts. The
average length of stay of this type of tourist will be relatively longer.
Because of his friends and relatives, he will not be a significant user
of a hotel and other such types of accommodation. The visits will not
be frequent and expenditure relatively little on his stay as compared
with other two groups.

Market segmentation in tourism has developed from the realisation

that there is no such thing as a homogenous tourist market. Tourist
market is composed of several homogenous sub groups having
same wants, desires and behavior etc. It is therefore advantageous
for an organisation/company to serve one or more of these
segments.

iv) The Medical Tourist:

This segment comprises visits to other countries or places for medical

treatment. The consumer profile of medical tourists can be divided into
three types.

Description Countries Demand Driver

Low-Cost Healthcare
combined with trip back
Non-Residential Indians Numbering 20 million home
I across the world

II Patients from Countries Nepal, Burma, Quality Healthcare at

 Bangladesh, African
Countries, Middle East
with Underdeveloped Countries, Latin America
Facilities Affordable Prices.

Low Cost of Healthcare, Capacity

Patients from Developed Constraints for Services in Home
III Countries U.S, U.K, Canada Country.

Steps in Marketing Segmentation

1. Delineation of the segment and identifying its potential

2. Target market selection matching the characteristics of those

segments with what you have to offer

3. After matching the two, preparing a marketing plan or

programme based on marketing mix.

4. Implementation and control or monitoring

Segmentation strategy is effective:

a. When the total market is diffused demographically,

geographically and psychologically

b. When the organisation has been in business for several years

already c. When there are several competitors

d. When most competitors employ a segmentation strategy

It may, however, be mentioned here that the market segmentation

in itself is not sufficient. The identification and location of potential
buyers of a tourism product or service do not ensure that purchases
will be affected. Market segmentation is merely the first initial step
in the development of a total marketing strategy of a firm or an
enterprise. It helps in the process of converting as many as possible
of the potential buyers into actual buyers.
Marketing Mix
The most important objective of a tourist enterprise is to achieve the
best results. This to a larger extent depends on a properly conceived
marketing plan through which a strategy is to be developed to
achieve the best results. Through the segmentation process,
appropriate targets are identified and analysed. The marketing
strategy thus developed would now attempt to penetrate and
persuade the target markets through a variety of tools mainly
promotion and advertising. In addition, the marketing strategy will
also look into the crucial question of pricing and distribution. The
various tools are to be mixed in such a way that the enterprise
obtains the optimal use of financial and manpower resources
available at its disposal.

The mixture of various marketing tools is called the 'marketing mix'.

The marketing mix is a mixture of elements which interact and
complement each other to achieve targeted results. The term was
first introduced by Professor Neil Bordes in the year 1953 when he
got the cue from a study of Management of Marketing costs which
described the marketing executive as a mixer of ingredients.
Professor Philip Kotler, has defined the 'marketing mix' as the set of
marketing tools that the firm uses to pursue its marketing objectives
in the target market.

Tourist Marketing Mix

Tourist 'marketing mix' is largely a complex group of several factors

intervening to achieve the marketing 'end product' which is
increased effectiveness in demand output in relation to supply and
marketing investment by tourist enterprises. Marketing mix helps
the marketing manager of an enterprise whether individual or firm
or an official tourism organisation to understand where marketing
action can be initiated to improve the acceptability of a tourist
product and stimulate the demand within the market. A tourist
enterprise with a combination of specific activities can achieve the
best possible results. It can decide which specific activity to use,
how it is to be used, when and where to use and what resources to
be allocated to them. A judicial mixture of activities at the
appropriate time would give the enterprise to achieve its set
marketing objectives.
The different components or elements of the mix may be seen as
co-operating with or replacing each other as complements or
substitutes. An example would be a policy of price reduction by an
enterprise to tourist services or facilities which could be substituted
by enhancing/increasing available facilities and services for the
same price or by strengthening various promotion activities in view
of competition offered by competitors and thereby increasing the
sales output. A strategy to combine both reduction of prices and at
the same time offering extra facilities or extra advertising and
promotion may or may not however always be efficient or result
oriented. It is therefore essential that the target markets must be
clearly defined for the success of marketing mix strategy.

Main Variables of Marketing Mix

Marketing mix incorporates four core variables. The four variables or

four Ps as originally used to describe marketing mix by McCarthy in
the year 1960 are:

Product

Product means customer value, the perceived benefits provided to

meet needs and wants, quality of service received and the value for
money delivered assessed against the competition. The market-
based system is guided by self interest and profit motivation.

Therefore, consumer preferences are only accounted for if there is

an ability to pay.

These values are represented by a lack of concern for those who

cannot afford a holiday.

The product dimension to achieve more sustainable tourism involves

both:

* Developing products which are more sustainable in nature

 Conservation holidays
 Medical tourism
 Vacation packages using public transport rather than private
cars
 Small-scale rural community-based tourism initiatives
* Moving away from offering products which are
intrinsically not sustainable

 Hunting trips
 Destinations with poor environmental standards where
inappropriate development is taking place holidays on which
tourists consume too many local resources which may be in
short supply, such as water, wood etc (Swarbrooke, 1999).

Price

Price means cost. Suitable costs of health and medical services in

India and determining the appropriate tariff regarding the medical
and health services for standards organisation are the most
important factors of pricing for successful medical tourism in India.

This includes the prices at which visitors are admitted including any
promotional and discounted offers. The main emphasis in pricing in
tourism has been on low prices to encourage high volumes to
ensure high profit levels for enterprises (Swarbrooke, 1999). In
general, the public sector has little influence on prices (except in
cases of public ownership and through taxes, fees and the like) but
is a most influential tool in the hands of the commercial sector to
influence demand. Price is inversely related to demand (Beeton &
Benefield, 2002).

For sustainable tourism development, the price paid by the tourist

should cover the full cost of their holiday. The cost must also be high
enough to:

 Ensure a satisfactory experience for the tourist

 Provide a satisfactory level of profit for the tourism industry
 Generate an appropriate level of benefits for the host community
 Cover costs involved in putting right any damage caused by the
tourist to the environment
 Pay for the resources consumed by the tourist
 Allow employees to be paid a reasonable salary (Swarbrooke,
1999)
 Automatically discourage large numbers of visitors (Clements,
1989)
 Present an image of exclusivity; a positive factor in image
building (Clements, 1989)
The principles of sustainability also mean ensuring that the tourists
feel they have received value for money, rather than leaving them
with the idea that they have been exploited.

Place

Place means convenience, in current marketing practice, products in

travel and tourism are designed for and continuously adapted to
match the needs and expectations of target customers and their
ability to pay (Middleton & Clarke, 1998).

Place refers to the location at which any service component the

subject of the marketing campaign will be delivered. Place also refer
to the channels of information that are used to disseminate the
message. If, for example, the decision is taken to issue all visitors
with a tourism code of conduct, the co-operation and commitment of
intermediaries such as travel agents, tour operators and those
responsible for tourism attractions themselves will be required
(Dinan, 2000).

Therefore, - Encourage trends towards direct selling, leaving out the

marketing intermediaries, as this often results in a better price for
the consumer (Swarbrooke, 1999).

 Where an agent is used, action should be taken to ensure

that the way they sell a product is ethical and does not raise
unrealistic expectations in the minds of tourists (Swarbrooke,
1999).

Promotion

One type of marketing ‘pollution’ is the over abundance of different

types of promotional material, at destinations which often makes
them less attractive. There are roadside poster sites,
advertisements on taxi cabs, messages painted on buildings, and
leaflets given away and then discarded, all of which create both
visual and physical pollution. There is a trend to produce
advertisements that aim to shock, and there are others that offend.
“Marketers have made extensive use of sexual imagery and
language to promote tourism products and destinations, as any
perusal of a conventional 3S (sun, sand and sea) - resort brochure
will confirm. The imagery ranges from overtly sexual displays (e.g.
micro-bikini clad female models in provocative poses), to more
suggestive and subtle messages (e.g. expressions and poses).
Promoting sustainability through more sensitive promotional and
Marketing Practices could utilise all mediums including brochures
and websites.

Promotion means communication. It is important and visible that

promotion or communication is still only one of the levers used to
manage demand. Promotion on websites or internet, publishing special
brochures, advertising traditional and complementary medicine and
procedures are the necessary issues for the medical tourism industry
in India. Participating in international exhibitions and introducing
health, medical and tourism attractions of India are one of the most
important factors for marketing this industry. Advertisement in the
embassies of other countries has a basic role in promoting medical
tourism.

Promotional techniques (the specific presentation of objects, stories

and themes, and all the forms of display provided for visitors) can
be a vital element in creating more sustainable forms of tourism.
Sustainable promotion should reflect the manner in which a tourist
site is promoted and advertised, and such promotion must
accurately reflect the unique characteristics of the area in order not
to cause disappointment and frustration among tourists. It is
important that the industry, in its brochures and advertisements,
does not create expectations that the product cannot live up to.
Tourism organisations and destinations can also use literature and
advertisements to raise tourist awareness of key issues relating to
sustainability. They can undertake ‘green marketing’ and
communication of information explaining and interpreting the nature
of the attraction/ resource and its significance, for example, by
promoting ‘soft’ tourism that minimises adverse environmental and
cultural impacts (e.g. nature tourism) as well as informing tourists of
the impacts of their presence.

Each of the above variables includes within it many sub-elements.

Cowell in the year 1993 however revised the marketing mix
variables for service industry including the travel and tourism.
According to Cowell in addition to four original elements of product,
price, promotion and place, there are three more which are:
People
Physical Evidence
Process (Customer involvement variables)

The three revised variables as introduced by Cowell in 1993 are to

be used for travel and tourism since being a service industry it has
certain special features. The use of marketing mix in travel and
tourism has both short as well as long term aspects. The short term
aspects relate to meeting the immediate initiatives of the
competitors and include aspects like:

a. Price reduction

b. Aggressive promotion

c. Introduction of a new product

d. Special offers e. Incentives

Long-term aspects relate to meeting the objectives set aside for

future long-duration plans. These are based on longer-range plans
and are derived from the study of all kinds of trends in the market
like natural, economic, social environmental and technological.

Medical Tourism Promotion

The unique selling points of the medical tourism industry are its cost
effectiveness and its combination with the attractions of tourism.
The latter also uses the ploy of selling the exotica of the countries
involved as well as the packaging of healthcare with traditional
therapies and treatment methods. Price advantage is, of course, a
major selling point.

The slogan, thus, is First World treatment at Third World prices. The
cost differential across the board is huge: only a tenth and
sometimes even a sixteenth of the cost in the West.

Since competitive advantages for the different components of the

medical tourism system lie with different players, forming inter-
organisational networks with a common marketing front might turn
out to be a great idea. This coordinated move will synergise the
operations and minimise the scope of service failures. For example,
with the objective of promoting and establishing Kerala as a medical
tourism destination, Kerala Tourism Development Corporation,
Amrita Institute of Medical Sciences and Intersight Tours have
signed a MoU. The consortium plans to promote Kerala as a medical
tourism destination, where medical treatment will be provided at
AIMS, holiday options will be provided by KTDC and the logistics of
travel will be provided by Intersight.

The Taj Hotels Resorts and Palaces (the Taj Hotels) in India has
allied with Apollo Hospitals for the promotion of medical tourism. Taj
Hotels is expected to promote Apollo Hospitals among the tourists
staying at its hotels in the country and abroad. The cost benefits of
conducting operations in an Apollo hospital in India will be conveyed
to the tourists. In exchange, Apollo Hospitals would recommend Taj
Hotels to its patients for lodging. The alliance will also involve the
participation of tour operators in recommending Apollo Hospitals for
medical tourism.

Role of Medical Facilitator in Medical Tourism

Sometimes referred to as medical tourism agencies, or a medical

travel facilitator, these are companies – (some are mom and pop
operations) that, as their name suggests, act as facilitators or
middlemen for medical tourism patients engaging in medical
tourism.

Medical Tourism Facilitators have played an important role in

promoting the growth of medical tourism, and for many medical
tourism patients, represent their first face to face contact with the
concept of medical tourism.

Over the last three or four years, thousands of these companies

have popped up, most sporting names synonymous with health and
travel. They function much like a travel agency, requesting and
obtaining passports, booking flights, and arranging a medical
tourism patient’s lodging, transportation and tours. The key
difference, of course, is that they also serve as the liaison or
mediator between you and the international hospital and doctor. In
effect, it is the facilitator’s job to repackage the medical provider’s
service offering, make it more appealing, and then guide you along
the medical tourism process. For those trying to decide whether or
not to use a facilitator, it is important to weigh both the advantages
and disadvantages they provide.

Advantages of using a Medical Tourism Facilitator:

One-stop Medical Tourism shopping: The convenience of being able

to choose and access information about a variety of destinations,
hospitals, procedures, and services. Users can come to a medical
tourism facilitator’s website and request a price estimate for a
particular procedure from several different hospitals or clinics, and
then choose which provider better serves their needs and budget. In
addition, once you have made a decision on where to travel, the
medical tourism facilitator can usually take care of all your travel
logistics such as flights, lodging, and transportation.

Established relationships with international providers: Medical

Tourism Facilitators, at least in theory, have already done the
groundwork to make sure your chosen hospital and doctor are
accredited and safe to work with. The best case scenario is that they
have visited your chosen hospital and already have a system in
place to make your Medical Tourism Trip process is a smooth one.

Convenient transfer of medical information: Most medical tourism

facilitators have a mechanism in place for quickly transferring your
medical information including large files such as CT’s and MRI’s.
Language and culture barriers are usually not an issue: Contacting
some international hospitals can be challenging due to time zone
differences, language barriers, and cultural differences. As shown
above, medical tourism facilitators already have the right contacts and
a Medical Tourism Trip/medical tourism process in place with your
international hospital.

Networking With Travel Companies

The Apollo Hospitals in Bangalore and Delhi have been accepted
into a US medical travel company’s network of international
hospitals for getting medical care outside the US at affordable
prices. With the acceptance of the two Indian facilities by
Companion Global Healthcare Inc, it can arrange travel, set
appointments and provide other services to its individual clients and
US employer group members who choose treatment at either
facility. Companion Global Healthcare network hospitals offer
surgery and other care to American patients at rates substantially
lower than those charged by most US hospitals.

The network includes 13 hospitals in India, Costa Rica, Singapore,

Thailand, Turkey, Ireland and Taiwan. All network hospitals are
accredited by the Joint Commission International (JCI), and all have
completed Companion Global Healthcare’s extensive credentialing
process. The hospitals’ fees are up to 90 percent less than those
typically charged by US facilities. Companion Global Healthcare Inc
headquartered in Columbia, South Carolina, provides assistance to
clients who travel to its network hospitals around the world. The
company serves uninsured and underinsured individuals, as well as
employers and insurance companies that have included the
Companion Global Healthcare network in their benefit plans.

E-marketing of medical tourism services will help the medical

tourism firm to reach the customer directly, bypassing the
middlemen. This will help the firm to provide services at a lower
price, on-time, and in a highly customised manner. Probably, such
an e-platform can facilitate initial consultations via telemedicine
facilities before the patient embarks upon the trip.

Since medical service is a credence (complex) service, long-term

relationship building and maintaining the same will be the key to
sustained business.

No firm that wants to continue in this business should look towards

one-time transaction-specific approaches. Firms should tap on
referrals, positive words of mouth, etc since these carry more
credential that an impersonal advertisement. Yet, patients are now
learning more and more about their own illnesses, and are most
familiar with their available treatment options. Patient marketing,
such as with an informative website, transparent pricing schemes,
or advertising placements such as within in-flight magazines have
thus become basic information and advertising platforms.

However, healthcare providers need to be aware of the varying

influence that other stakeholders may have. For instance, the
doctor’s opinion in conservative markets like Japan or Korea is
seldom challenged. In contrast, a key influencer in the Middle-East
might instead be the multinational corporations sponsoring their
expatriates for overseas treatment. As such, marketing efforts
across different markets could be targeted towards the patients, the
referring doctors, hospitals, insurers, or corporations--depending on
who the actual decision-influencers are.

Hospitals that are successfully attracting foreign patients enlarge

their geographical footprints with representative offices or agencies
in other countries. For example, Cromwell Hospital in the UK has
representatives in India and Pakistan, while hospitals in Singapore
are also setting up offices such as in Indonesia or the Middle-East.
These agents help establish and maintain relationships such as with
local hospitals, doctors, embassies, sponsor corporations, or
insurers. Participating in different events also facilitates such
relationships. For instance, trade shows, exhibitions or training
seminars allow healthcare providers to share their medical
expertise, while longer-term physician exchanges may also be
organised in alliance with medical universities.

Govt Initiative To Boost Medical Tourism

Central Government and State Governments have been encouraging
rural handicrafts and fairs and festivals that have a direct impact on
the preservation of heritage and culture of rural India. It also draws
tourists from all over the world. Regional fairs, festivals help the
growth of tourism, provide a ready market for the handicrafts,
alternative income to the community, and facilitate regional
interaction within the country. Leading states such as Kerala, Goa
and Maharashtra have taken the initiative to promote medical
tourism as a package in itself rather than just a side issue or an
added benefit. The effect has apparently been a success a medical
tourism has picked up in these states. The state governments have
been monitoring closely the ecological relationship, socio-cultural
impact and conducting feasibility studies before selecting tourist
sites. The state governments also ensure that: Tourism –

 Does not cause the tension for the host community

 No adverse impact on the resources
 Psychological satisfaction for the tourist.
 The large inflow of tourists would not put a stress on the
local system
 Local community should not be deprived of basic facilities
for the benefits of tourist
 The rural tourism does not disrupt the rhythm of community
life Thus the Central Government and State Governments
have taken various steps for the promotion of tourism and
attainment of the goal of sustainable tourism
development.
 Tourism Ministry Promotes India as a 365-day
Destination: The ministry of tourism in an effort to
promote India as a 365-day destination launched three
CDs on MICE, adventure sports and cruises. The ministry is
showcasing India as a world-class MICE destination with
many convention halls coming up in the line of Hyderabad
International Conference Centre (HICC). The CDs also give
details about all the adventure sports facilities available in
the country and the many cruising options that are coming
up.
 Tourism Ministry issues Guidelines for Adventure
Sports: The ministry of tourism recently issued special
guidelines for adventure sports activities in the country.
The guidelines are regarding land activities like
mountaineering and trekking; water sports like river
running; and air sports like parasailing, paragliding and
bungee jumping. The ministry has laid down the basic
minimum standards for adventure tourism related
activities that are undertaken in different parts of the
country.
 Kerala Tourism revives the Uru / Arab Dhow: Kerala
Tourism has plans to start URU cruises to replicate the
spice route travel of the 16th century. The uru is a home
made colossal sailing vessel made out of timber which
used to ply the Indo Persian routes in times gone by. It is
the Indian equivalent of the Arab Dhow. When launched
they will operate on the Bekal - Cochin sector. This has
been quite a crowd puller for medical tourists who flock to
Kerala especially for the Ayurvedic and relaxing
treatments offered. The curious mix of vegetarian food,
exotic back waters, courteous and pleasant people and not
to mention extremely smart doctors had made Kerala a
very popular destination
 Helicopter Tourism Service in Kerala: God's Own
Country Kerala will be luring tourists by launching a
''Helicopter tourism'' service. Visitors will be taken from
one tourist spot to the other in a seven-seater helicopter to
save time and also discomfort on the roads. A number of
cost-effective packages have been designed in the
helicopter tourism segment like ''Capital by Air'',
''Backwaters by Air'', ''Fly the Hills'' and ''Shoreline
Flights''. The ''Capital by air'' offers sightseeing trips
around Thiruvananthapuram. The backwater trip takes
tourists around Kumarakom, while the ''Fly the hill''
provides tourists a taste of the hill stations at Thekkady
and Munnar.
It will also touch Kochi and Kumarakom. The ''Shoreline''
flights offer sightseeing to Kanyakumari along the
picturesque coastline. This service is extremely helpful to
the patients who are unfit for long journeys by road or rail.
Not only that it is very fast and the medical tourist also
gets to have his own privacy. In times of emergency the
patient can be immediately flown to and from the nearest
airport or helipad.

 Palace on Wheels adds Several Luxuries: The second

Palace on wheels launched in Rajasthan has a dance floor,
a massage center, a conference room and bars. It will be
the third tourist train to be operated by Rajasthan Tourism
after Palace on Wheels and Heritage on Wheels (on the
Shekhwati sector). The second Palace on wheels will also
have special suites. This has been a great success with
post operative tour patients ie to travel in a princely way.
It brings in the nostalgia about the past eras when the
prince and kings and heads of states traveled in a grand
way.
 Medical Tourism Brochure Released: The Ministry of
Tourism is aggressively promoting India as a global
healthcare destination and has recently released the
‘Incredible India Brochure on Medical Tourism’. The
government has also started issuing M (medical) visas to
the medical patients, and MX visas to the dependent
accompanying them, which are valid for a year. Around
200000 medical tourists visited India last year, and the
figure will grow by 50% this year.
  Train to Kashmir Hits the Highway: Ever heard of a
train running on a road? It does in Jammu and Kashmir. Set
to chug in Kashmir's bewitching landscape in snowy
February 2007, the first-ever trial train to Kashmir took off
for the Valley on November 7, not on traditional tracks but
on the 300 km-long Jammu-Srinagar national highway. It
has added another chapter to the history of Indian
Railways and Kashmir's national rail project, as the first
trial diesel mobile unit coach, a 36 tyre wheeled train
pulled by a 460 HP engine, drove up the Jammu-Srinagar
Highway at 0700 hrs and headed toward Kashmir's
Budgam railway station by taking a road route and not a
train track. The world recognises Kashmir as the paradise
on earth or the Swiss alps of the east. It is especially
targeted to overseas visitors.
 Jaipur to Sell Heritage Liquor: Shops all over Rajasthan
will sell heritage liquor, made from age-old recipes of
Rajasthan Royals. It is made from dry fruits, nuts, herbs
and spices with a touch of saffron sometimes. To begin
with, shops in Jaipur, Jodhpur, Kota, Bikaner, Ajmer,
Udaipur and Bharatpur will sell the special liquor. General,
as well as medical tourists, can now take these away as
souvenirs.

“Visa on Arrival”

The Indian Government recently announced tourist visa on arrival

for citizens of five countries - Japan, New Zealand, Singapore,
Finland and Lumembourg in an effort to promote tourism. This
facility has been found very useful not only by holiday tourists but
also by a large number of foreign patients who now find it very
convenient to plan a quick visit to leading Indian hospitals for
advanced health check-up and medical treatment.

The IMTA welcomes Indian Governments new guidelines on “Visa on

Arrival” and has strongly recommended to the government to open
up the facility to citizens of a larger number of countries. Most of the
IMTA’s member hospitals have reported higher volumes of patient
arrivals and also enquiries from potential patients who wish to avail
of “Visa on Arrival” facility.
Medical tourists spend more money and their time of stay is longer
than regular tourists and each visiting medical traveler to India
spends on an average 5000 US Dollars which make this segment a
very special target for India’s medical and tourism service providers.
The Government of India and its various arms are actively
supporting the growth of medical tourism to India. . India's Ministry
of Tourism has achieved phenomenal success in last five years with
its much acclaimed "Incredible India "campaign that has multiplied
the arrival of foreign tourists to India. Recently the Ministry of
Tourism has launched a new Medical Tourism Incredible India
campaign that highlights India’s unmatched service offerings both in
modern medical treatment as well as wellness promotion.

The volume of foreign patient arrivals at Indian hospitals is growing

at a healthy pace of over 40 percent every year and medical tourism
is indeed the next billion-dollar opportunity after IT outsourcing for
India to benefit from its fast-expanding private healthcare
infrastructure. Indian doctors and professionals are world renowned
for their skills and the country has abundance of all the inputs like
talented young manpower, local high-quality manufacturing base for
pharmaceuticals, technology hardware and software that makes the
Indian costs for high-end surgical procedures so attractive.

Conclusion

The medical tourism industry offers high potential for India primarily
because of its inherent advantages in terms of cost and quality.
However, the competition is getting heated up and success in future
will largely be determined by development and implementation of a
joint strategy by various players in the industry. The government
should step in the role of a regulator and a facilitator of private
investment in healthcare. Joint ventures with overseas partners and
establishment of MEDICITIES will help in India building a significant
advantage and leadership position in the industry.

Summary
Some of the key points of this chapter are as following:

 Tourism marketing is defined as the "systematic and coordinated efforts exerted

by the National Tourist Organizations and/or the tourist enterprises at
 international, national and local levels to optimize the satisfaction of tourists,
groups and individuals, in view of the sustained tourism growth.
 Medical tourism services provide detailed information on all different medical
tourism packages along with some valuable suggestions as well.
 Tourist 'marketing mix' is largely a complex group of several factors intervening to
achieve the marketing 'end product' which is increased effectiveness in demand
output in relation to supply and marketing investment by tourist enterprises.
 The main variables of marketing mix are product, price, place and promotion.
 The unique selling points of the medical tourism industry are its cost effectiveness
and its combination with the attractions of tourism.

Topic 6: Hospitality and Hotel Industry

1. Objective

At the end of this chapter the student will be able to:

 Describe the history of hospitality and hotel industry.

 Identify the importance of accommodation in tourism industry.
 Explain the status of the Indian hotel industry and its role in boosting medical
tourism.

Introduction
Among the important inputs which flow into the tourist, system is
tourist accommodation. Accommodation facilities constitute a vital
and fundamental part of tourist supply and an important feature of
the total tourist image of a country. Many countries have recognised
the vital importance of accommodation industry in relation to
tourism and their governments have coordinated their activities with
the industry by way of providing attractive incentives and
concessions to suppliers of tourist accommodation, which have
resulted in the building up of various types of accommodation. For
instance, availability of sites for tourist accommodation on liberal
payment terms, special concessions in the form of long-term loans,
liberal import licenses and tax relief, cash grants for construction
and renovation of buildings, and other similar concessions are
provided to the accommodation industry.

The United Nations Conference on International Travel and Tourism

held in Rome in 1963 considered, in particular, problems relating to
means of accommodation. The Conference acknowledged the
importance of means of accommodation, both traditional (hotels,
motels) and supplementary (camps, youth hostels, etc..) as
incentives to international tourism. The Conference recommended
that governments should consider the possibility of including
tourism projects, and particularly those relating to accommodation
on the list of projects eligible for loans from their industrial or other
corporations, and that, where required, they should establish special
financial corporations for tourism. It also, recommended that
governments should give sympathetic consideration to the
possibility of granting special facilities and, incentives for
accommodation projects. An adequate supply of accommodation
suitably tailored to the requirements of the tourist market is one of
the basic conditions of tourism development. The . provision of
accommodation facilities and their growth should, at the same time,
be regarded in a much broader context as they make an
important contribution to the economy as a whole, by stimulating
economic development, social contacts and commercial activities.

In the promotion of tourism, of all the constituents of the tourist

industry, the accommodation sector thus constitutes the most
important segment. Tourism is, to a great extent, dependent on the
type and quantity of accommodation available. Accommodation is a
very important part of the tourism infrastructure and the expansion
of tourism inevitably brings about the development of
accommodation. It is rather the core of the tourist industry.
Accommodation is, in other words, the matrix of tourism, and is thus
the obvious choice to play a distinctive role in the development of
this expanding industry.

According to the World Tourism Organisation, WTO Report on `The

Development of the Accommodation Sector, tourist accommodation
is used to denote the facilities operated for short term
accommodation of guests, either with or without service, against
payment and according to fixed rates. For the purposes of
classification, all tourist accommodation has been divided into the
following groups:

i) Hotels and similar establishments (the hotel industry proper)

and,

ii) Supplementary means of accommodation.

The first group usually includes hotels, motels, boarding houses and
inns, while the second includes registered private accommodation
(rented rooms; apartments, houses), camping and caravan sites,
youth hostels, recreation centres for children, mountain huts and
shelters as well as health establishments, that is, sanatoria and
convalescent homes.

Early History
The early history of accommodation for travellers can be said to
have its origin in the Greek Word 'Xenia'. By this word, ancient
Greeks meant not only hospitality but also all forms of protection
given to a visiting stranger. In ancient Greece, hospitality was a sort
of divine order. The city or a town itself was bound to offer
hospitality to a visitor and protect him from any discomfort. This was
a custom. In the city of Sparta, whose extremely rigorous customs
did not attract many visitors, it was the goddess Athena who was
considered as. protector of strangers, and hence her name 'Xenia
Athena'.

Travelling during this period was not an easy affair. Travellers were
mainly diplomats, philosophers, intellectuals and researchers. There
were no lodgings specially designed to receive visitors. Guests were
invited to stay in the dwellings of noblemen. This was rather a gift
comprising a place to stay, food, care and bath. This explains the
presence of baths in most archaeological finds. In ancient Olympia,
one can find one of the first buildings constructed with the aim of
accommodating strangers, called the "Leonidio", built in 4th century
B.C.

As travelling became more frequent, accommodation for travellers

was viewed in two ways. The traveller who left his home required
accommodation at his destination and, during journeys which could
be completed in a single day, he needed overnight accommodation.
The institution of `inns' came into being. Inns can perhaps be
considered to be the first of such accommodation units which
catered to the needs of travellers in early times. During the Roman
Empire, many such inns were established which provided food, drink
and also entertainment to weary travellers. However, with the
decline of the Roman Empire by about A.D. 500, the institution of
inn-keeping lost its importance and for many years there was not
much development since people travelled very infrequently and
there being not much trading activity, there was not much need felt
for innkeeping.

Later, when travelling began to be undertaken in coaches, travellers

were lodged in ‘Hostelries’ situated at the relay stations where both
the traveller and their horses found rest and food. From this time
onwards, hospitality was not always offered free. Payment for
accommodation used was being resorted to. After the advent of
Christianity, it was the Church which came to the rescue of the
travellers. Travel grew again for religious pilgrimage purposes.
Travellers in thousands visited religious centres. Monasteries took
over the role of providing lodgings and facilities to travellers who
were mainly pilgrims. These welcomed the travellers and made their
stay a comfortable experience. Every large monastery had a person
responsible for the reception of visitors and their well-being. The
accommodation and the hospitality provided were free. By the 15th
century, the institution of the ‘inn’ once again developed in several
countries in Europe, especially in England and France. During the
seventeenth and eighteenth centuries, the facilities provided in the
inns were expanded. Some of the inns had as many as 30 or more
rooms. The English Common Law declared the inn to be a public
house and imposed social responsibility in the innkeeper for the
well-being of the traveller. Even today over one hundred odd inns
are still operating in England as hotels as part of Trust House
Limited. Some of these were built about four hundred years ago.

In the United States of America another type of accommodation

unit, known as the ‘tavern’, was opened in the year 1634 by a man
called Samuel Coles who had come by ship to the New World in
search of a fortune in the year 1630. By 1780, taverns were popular
meeting places where people used to come for eating, drinking and
entertainment. Many important events were associated with
taverns. In the year 1783, General George Washington bid farewell
to his top ranking officers at the Frances Tavern in New York city.
The famous Boston Tea Party was planned in a tavern called Green
Dragon.

In India the concept of shelter for travellers is not new. In fact, it is

as old as its recorded history. The historical records are replete with
the mention/references of viharas, dharamsalas, sarais, and
nausafirkhanas. These establishments provided a home to all
wayfarers, be they pilgrims, scholars, adventurers or merchants.
The shelter under various names has always been a part of India's
culture as a valuable institution, providing a vital service. The
ancient Buddhist monks were probably the first to institutionalise
the concept of a shelter in India. The cave temples scattered all over
'the south-western region of India have both a chaitya (sanctuary)
for worship and prayer and a vihara (monastery). These monks,
although living in their quiet retreats, away from towns and villages,
were nevertheless mindful of the needs of travellers and pilgrim;
who found shelter and food at these monasteries. It is interesting to
note that these monasteries were located on the ancient trade
routes between important centres of pilgrimage of the region. It is
gathered from some inscriptions that merchants gave liberal
donations for the construction and maintenance of these
establishments. The mere charity was obviously not the motivation
in these displays of generosity. The trader travelled with their
merchandise and money on these routes and the viharas were their
`hotels'!

In the medieval period, this ancient institution gradually assumed a

more secular character. Although religious centres invariably had
dharamsalas and musafirkhanas attached to them, the caravan
sarai appeared as an exclusive traveller's lodge with a Nanbai or the
cook attached with it. Sher Shah Suri, the Great Afghan Emperor and
the builder of the Grand Trunk Road, is credited with having built
caravan sarais at regular intervals all along this highway creating
favourable conditions for commerce and travel. However, he was
not alone in this venture. The Mughals built such facilities all over
their empire. Later kings, rajas, nawabs, rich businessmen and
philanthropists built sarais making travel less arduous.
At approximately the same point in time, the inn was the western
counterpart of India's sarais. With the expansion of commerce,
travelling became profitable and with it emerged the business of
providing comfortable shelter and good food to the growing number
of travellers. The sarais in India, like the inns in Europe, or the stage
coach stations in the USA of the 18th and 19th centuries, stood all
along the well-travelled routes. They provided food and shelter to
the travellers and fodder to their horses. The amenities these early
hotels offered would seem to us to be primitive but they conformed
to the life-style of that age. However, with the passage of time, the
age-old institution of the sarai or the inn adapted itself to the ever-
changing and constantly growing requirements of the market.

The Hotel
The institution of hotel had its beginning in the early fourteenth
century. The first hotel in the classical sense, the forerunner of the
present day existing complex unit, is said to have been created in
Paris, in the year 1312. Other similar hotels were soon established in
France, Holland, Italy, Germany and many other countries.

With the growth of travel in the eighteenth century, there appeared

in London the prototype of the modern hotel with the opening by
one David Low in 1774. The next fifty years saw a gradual increase
in the hotels and resorts in many countries of Europe. In the United
States of America, hotels emerged from institutions known as
`Tavern' by the simple expedient of a change of name. By about the
beginning of the nineteenth century, the terms tavern and hotel
were used to describe the same thing. By the year 1820, `hotel'
became the accepted term to describe a place where people stayed
for the night and took their meals on payment. In the 1820s the first
tourist hotel appeared in Switzerland. The period preceding World
War I also saw many hotels coming up in Europe especially in
resorts of France, Italy, Switzerland and Germany. The hotels in
fashionable resorts such as Vichy and Evian in France, Montecatine
in Italy, Baden-Baden in Germany became very popular with
tourists. In the same way, hotels also came up in summer resorts
along the French and Italian Riviera.

From the age of carriage and horses through the age of rail-road
into the era of the jumbo jet, the hotel industry developed with the
simultaneous development of transportation systems. In the field of
mass passenger transport, railways could perhaps be credited with
being the pioneers. The evolution of the railway system in the
eighteenth century greatly affected the quality and the quantity of
accommodation used in conjunction with travel. The growth of the
railways also brought in a speedy network of stage coach services.
By the mid-nineteenth century, the use of the stage coach as a
means of travel had almost [Link] industrialisation in its wake
brought increased urbanisation. The great number of people who
flocked to various urban towns in search of employment and also
entertainment needed some kind of accommodation.

This need for accommodation enabled promising and enterprising

people to build hotels and inns in many such urban towns to cater to
an increasingly local market and also to serve a large number of
travellers carried by the railways. Until about the middle of the
nineteenth century, the bulk of the journeys were undertaken for
business and vocational reasons, by road and within the boundaries
of individual countries. The volume of travel was relatively small and
was confined to a fraction of the rich segment of the population in
any country. Inns and similar establishments along the main
highways and in the principal towns grew to become the hallmark of
the accommodation for the travellers. The traveller could reasonably
expect, at most inns, a clean and comfortable stay when he wished
to eat or spend the night. It provided the bulk of accommodation en
route. This trend continued until the end of the nineteenth century,
as most people travelled by coach.

Emergence of the Hotel

Although the earliest hotels date back to the eighteenth century,

their growth on any scale occurred only in the following century
when the railways created sufficiently large markets to make large
hotels possible. During this period a large number of hotels grew up
at important destinations. The hotels were developed along the
main railway and highway routes in major towns. Substantial
development of the hotels thus awaited the volume and the type of
traffic only the railways could bring. With the development of
railway systems in many other countries within and outside Europe,
the number of hotels also increased. These hotels catered to the
increasing volume of traffic.
The 1860s also saw the introduction of Thomas Cook's railway and
hotel coupons. Starting in 1868 Cook arranged regular circular tours
of Switzerland and Northern Italy from England. By the 1890s, 1,200
hotels throughout the world accepted hotel coupons. Thus we find
that railways greatly influenced the development of hotels during
the early twentieth century.

The demand for accommodation of tourists was thus met by a

variety of facilities ranging from inns, taverns, private houses to
hotels. The main changes in the demand for tourist accommodation
have come about from changes in tourist transportation and in the
popularity of different forms of holidays. After the introduction of the
motor car and the aircraft, a large number of hotels sprang up at
various tourist areas and destinations. The growth of hotels
continued until the 1950s. Hotels as a unit of accommodation
dominated the scene all over the world.

Definition

Hotels provide accommodation, meals and refreshments for

irregular periods of time for those who may reserve their
accommodation either in advance or on the premises. In broad
terms, hotels provide facilities to meet the needs of the modern
traveller. The dictionaries define hotel in several ways: `a place
which supplies board and lodging', `a place for the entertainment of
the travellers', `large city house of distinction', and `a public
building.'

The common law states that a hotel is "A place where all who
conduct themselves properly, and who, being able and ready to pay
for their entertainment, are received, if there be accommodation for
them, and who without any stipulated engagement as to the
duration of their stay or as to the rate of compensation, are, while
there, supplied at a reasonable cost with their meals, lodging, and
such services and attention as are necessarily incident to the use of
the house as a temporary home."

A definition of the hotel as a business entity worthy of study was

presented by hotel operators during the consideration of the hotel
business to authorities of the National Recovery Administration, in
Washington in 1933. This definition, as formulated by Stuart
McNamara, was: "Primarily and fundamentally a hotel is an
establishment which provides board and lodging, not engaged in
interstate commerce, competitive with or affecting interstate
commerce (or so related thereto that the regulation of the one
involves the control of the' other), but is a quasi-domestic institution
retaining from its ancient origin certain traditional, and acquiring, in
its modern development, certain statutory rights and obligations to
the public, where all persons, not disqualified by condition or
conduct, prepared to pay for their accommodation, are to be
received and furnished with a room or place to sleep or occupy if
such accommodations are available, and with such services and
attention as are incident to their use of the hotel as a home, and/or
with food, at stipulated prices, and with or without contract as to
duration of visit, and which conducts, within the confines of its
physical locations, this business of supplying personal services of
individuals for profit. Incidental to such fundamental and principal
business, the hotel may furnish quarters and facilities for the
assemblage of people for social, business or entertainment
purposes, and may engage in renting portions of its premises for
shops and business whose contiguity is deemed appropriate to a
hotel".

Categories Of Accommodation
Accommodation can be categorised in different ways.'I'hese could
be categorised by location, price, by type of visitors and by type of
facilities they offer. Luxury hotels are at one end of the scale while
budget or economy hotels are at the other end. Some are within the
city limits or in the city centre while others may be in suburban
areas. Some properties may cater to business travellers while others
may cater to families on holiday. Yet another way to categorise
them is on the basis of whether they are fully serviced, partially
serviced or non-serviced. It is however, difficult to place
international lodging accommodation into strict, exclusive
categories.

According to the organisation for Economic Cooperation and

Development (OECD), there are eleven different types of
accommodation plus two 'other' categories. The 'other' categories
refer to other "hotels and similar establishments" and
"supplementary means of accommodation". Following are the main
categories of accommodation:

Hotels

i) International Hotels

ii) Commercial Hotels

iii) Residential Hotels

iv) Resort Hotels

v) Floating Hotels

vi) Capsule Hotels

vii) Airport Hotels

International Hotels

International hotels are the modern western-style hotels located in

almost all metropolitan and other large cities as well as principal
tourist centres. These hotels are luxury hotels and reclassified on
the basis of an internationally accepted system of classification. The
hotels are placed in various star categories. There are five such
categories ranging from five star to one star, depending upon the
facilities and services provided. These hotels provide, in addition to
accommodation, all the other facilities which make the stay a very
comfortable and interesting experience. These facilities include a
well-appointed reception and information counter, banquet halls,
conference facilities, etc. There are also a number of shops, travel
agency, money changing and safe deposit facilities. Restaurant
facilities, bars and banqueting are an integral part of the business of
a hotel.

The various services provided in these hotels include international

and local cuisine, food and beverage service and speciality
restaurant service. These hotels also provide entertainment for the
guests in the form of various dance and music programmes, sports
and games.
A number of these hotels belong to the luxury category. There are
some international chains which own a large number of such luxury
hotels. Hotels belonging to international chains are mostly owned by
public companies and controlled by a Board of Directors. These
hotels have various departments which are managed by persons
qualified and experienced in the field of hoteliering. The chief of the
hotel designated as General Manager is responsible for the overall
management and operation of the hotel through his departmental
heads. International hotels are suitable for metropolitan cities and
for other large business and commercial towns and principal tourist
centres. The potential of these hotels is therefore limited to these
areas. A number of this type of hotels have conference/convention
facilities and are suitable for holding meetings, conventions and
conferences.

Resort Hotels

Resort hotels cater to the needs of the holiday-maker, the tourist

and those, who by reasons of health, desire a change of
atmosphere. Resort hotels are located near the sea, mountain and
other areas abounding in natural beauty. Rest, relaxation and
entertainment are the key factors around which resorts are built.
The primary motive of a person visiting them is rest and relaxation
which he is looking for, away from his routine, busy work life. The
resort hotels, in order to provide special services to the visitors, are
built to give a visitor special welcome and an atmosphere of
informality. The type of services and amenities located in resort
property include recreation facilities such as swimming pool, golf
course, tennis courts, skiing, boating, surf-riding and various indoor
sports. Other important amenities include coffee shops, restaurants,
conference rooms, lounge, shopping arcade and entertainment.
Emphasis in resort hotels, however, is on recreational facilities. The
clientele of resort hotels is mostly persons with considerable income
looking for relaxation and recreation. Resort hotels rarely attract
commercial patronage.

Resorts can be of various types and can be classified on the basis of

climate and topography Broadly they fall in the following categories:
(i) Summer resorts, (ii) Winter resorts (Iii) Hill resorts, (iv) All season
resorts, and (v) Health resorts.
A majority of the resort hotels are seasonal establishments which
work to capacity during the high tourist season. Generally, the high
tourist season is the period when there are holidays at educational
institutions. However, in recent years many of the resort hotels, with
a view to extend the season, provide certain special facilities and
various other concessions to the guests. The concessions provided
include reduced tariffs, free entertainment, sightseeing, gifts, etc.

Commercial Hotels

The commercial hotels direct their appeal primarily to the individual

traveller as compared to international or resort hotel where the
focus is on group travel. Most of the commercial hotels receive
guests who are on business although some have permanent guests.
As the hotel caters primarily to people who are visiting a place for
commerce or business, these are located in important commercial
and industrial centres of large towns and cities. These hotels are
generally run by the owners and their success depends on their
efficient running and the comfort and facilities they provide. In some
of the large industrial towns, fully licensed commercial hotels exist
complete with restaurants, grill room, functional accommodation
and a garage for those travelling by automobile.

Residential Hotels

These hotels can be described as apartment houses complete with

hotel services. These are often referred to as apartment hotels. The
tariff of rooms in these hotels is charged on the monthly, half-yearly
or yearly basis and is charged for either furnished or unfurnished
accommodation. These hotels, which are located mostly in big cities,
operate exclusively under the European plan where no meals are
provided to the guests. These hotels were developed in the United
States of America where people discovered that permanent living in
hotels offers many advantages. Services and amenities provided in
these hotels are comparable to those of an average well-regulated
home. These are very popular in the United States and western
Europe where these are also popularly known as Pension.

Floating Hotels
As the name suggests, these hotels are located on the surface of the
water. It may be on the sea or on a lake. All the facilities and
services of a hotel are provided here and these are very popular in
many countries. In some countries, old luxury ships have been
converted into floating hotels and are very popular among tourists.
The atmosphere they provide is exclusive and exotic. In India,
floating hotels in the form of houseboats are very popular with
tourists.

Capsule Hotels

Capsule hotel is the newest innovation in the budget hotel market.

The first of its kind was opened in Osaka in Japan in the year 1979,
as a spin-off of the 1970's fashion in Japanese architecture for
capsules. These have now sprung up in increasing numbers in big
cities of Japan.

The capsule is a box made of glass-reinforced plastic or cement,

open either at one side or one end, in which are concentrated some
of the functions of a traditional hotel room

- bed, a clock, radio, TV, flexible lighting, a box for valuables and a
miniature table for writing. Rooms in a capsule hotel generally are
lined up in double¬decker fashion along a central aisle as in a
sleeping compartment of a train. Toilets and washrooms,
vending machine room, and lounge are close by on each floor, of the
hotel. The functions of each capsule are controlled and monitored by
a central computer system and the security is controlled by close
circuit TV cameras. The hotels cater mainly to business travellers.
The low tariff and vintage locations are the major factors for their
popularity. The hotels are well located near major transportation
centres in Japan's largest cities.

Airport Hotels

Airport hotels, as the name suggests, are located near the airports
primarily to cater to the needs of transit passengers, airport crew as
also passengers of delayed or cancelled flights. The various facilities
provided in these hotels are designed to offer comfort and
convenience to the air travellers. The various services may include
parking and shuttle service to and from the airport terminal. The
hotels may also provide services for business travellers for
organising meetings, conferences and conventions etc.

Space Hotels

Space tourism is probably just another decade or so away. A brand

new phenomenon in the hotel stay to be available in space travel
would be called 'Skotel'. It would perhaps be the world's first
airborne hotel. In the initial stages, space travel may start off as
suborbital flights which would mean taking off in a shuttle and
staying put in space for a few days. It may limit to flying off from an
airport orbiting the earth once and then landing back on it.
According to the International Institute ofTourism Studies, space
tourism is broadly applied to the concept of paying customers
travelling beyond earth's atmosphere. It can include parabolic flight,
vertical suborbital flights, orbital flights lasting up to three days or
week-long stays at a floating space hotel, including participatory
educational, research and entertainment experiences as well as
space sports competitions.

Many experts have conceived different designs and ideas regarding

the structure of space hotels. Some experts feel that space hotels
wouldn't be anything more than clusters of pre-fabricated cylindrical
modules. Inside these cylinders, there could be lots of fun. Since
there would be zero gravity one may find the bar of the hotel merrily
perched on the ceiling, while the other guests laze on the ground
below. Studies are, however, going ahead on Space Hotel concepts.
Some of these concept hotels including one called space Hotel
Europe can room around 50 guests. Most travel specialists would
advertise them as elevated or uplifted establishments, since space
hotels would be above earth hotels simply because of the physical
reality of being airborne or floating in space.

Supplementary Accommodation
Supplementary accommodation may be of various types other than
the conventional hotel type. Although hotels have been and still are
the principal form of accommodation, there has been a growth and
development of some other forms in various parts at the world.
Supplementary accommodation can be classified on the basis of its
location, type of construction, type of management, etc. A study of
these indicates that their diversity is a reflection of the specific
nature of each one and their names simply indicate various ways in
which one and the same function can be fulfilled or a need can be
satisfied.

Supplementary accommodation may be described as the premises

which offer accommodation, but not the services, of a hotel.
Services provided here is minimal and not comprehensive as in the
case of hotel establishments.

All establishments under the heading of supplementary

accommodation are designed to offer the possibility of stay
overnight and meals in return for the cash payment per day and on
the basis of services provided. The standard of comforts is modest
compared to that of a hotel. On the other hand, however, there are
certain inherent advantages in this type of accommodation. The
biggest advantage is that of price. It is moderately priced. In
addition, the atmosphere is informal and there is more freedom with
regard to dress, etc. There is also more emphasis on entertainment
and sports resulting in increased social contact among the guests.

Supplementary accommodation plays a very important role in the

total available tourist accommodation in a country and can cater to
both international as well as domestic tourist traffic. In fact, in some
countries more tourists utilise this type of accommodation than
hotels. In France and Italy as also in some other countries in Europe
and elsewhere there are more campers than there are hotel clients.
The following are some of the principal forms of supplemental
accommodation:

i) Motel

ii) Youth Hostel

iii) Camping Sites

iv) Pension

v) Bed and Breakfast Establishments and (vi) Tourist Holiday

Villages.

Motel
The concept of motel and motel-hotel originated in the United States
of America. Motel was meant for local motorists and foreign tourists
travelling by road. Primarily designed to serve the needs of
motorists, motels almost exclusively meet the demand for transit
accommodation. They serve the function of a transit hotel except
that they are geared to accommodate motor travelling guests for an
overnight stay, The important services provided by motels include
parking, garage facilities, accommodation, restaurant facilities,
public catering and recreational facilities. Hence all motels are
equipped with filling stations, repair services, accessories, garages,
parking space, elevator service to the automobile, restaurants, etc.

There are also equipment and tools available which the guest can
use himself if he wishes to repair his vehicle. The price charged for
accommodation and meals/ refreshments is much cheaper as
compared to that in hotels.

Motels are mostly located outside the city limits in the countryside
along the main highway and preferably at an important road
junction. Since these establishments cater mainly for persons
travelling by road, their development is linked with the development
of new motorways along which these are necessarily located. Motels
are of different types. Some provide just the minimum services
while others are well-furnished, with comfortable accommodation
and excellent facilities. The accommodation provided is of a chalet
type, which is furnished, having a dining hall and a fixed menu.
Shopping facilities for travelling public are also provided.

In many countries, especially the United States of America, motel

accommodation is ranked with hotel accommodation and subject to
general standards applicable to the hotel industry. In countries like
Norway, France, Ireland, Turkey, etc., specific legislation has been
introduced for motels. This includes requirements for the approval of
plans, easy access of cars, minimum capacity, provision of
restaurant where necessary, minimum standards for facilities and
provision of petrol pump or service station where they exist and
model classification standards similar to those for hotels. For
instance, in France, there are three categories designated by stars,
the classification being based on location, sanitary fittings and
collective amenities.
Caravan and Camping Sites

Caravan and camping sites constitute a significant accommodation

category in many holiday areas. These are very popular in some
European countries as in the United States of America. These are
also known as open-air hostels, tourist camps or camping grounds.
Camping, originally practised by hikers on foot, is increasingly giving
way to car camping. The sites are usually located within the large
cities in open spaces. Equipped to receive mobile accommodation in
the form of caravans, the camping sites provide facilities for
parking, tent pitching, water, electricity, toilet, etc.

Though the services provided generally include restaurants,

recreational rooms, toilets and at certain places a grocer's shop, the
type of services often vary from place to place. Some countries have
enacted legislation establishing the minimum facilities that must be
provided and these include health and sanitation standards, prices
to be charged for parking and use of 'various services and facilities.

Pension

This type of accommodation is very popular in certain European

countries. Particularly in Italy, Austria, Germany and Switzerland
these establishments are used extensively by the tourists. Pension
is also described as a private hotel, a guest house or a boarding
house. Catering facilities are optional and are usually restricted to
the residents.

Many of them stay for longer and definite periods such as a week or
a fortnight. The reservation of accommodation is made in advance.
Mostly managed by a family, a pension is much cheaper than a
hotel.

Bed and Breakfast Establishments

Also known in some countries as apartment hotels and hotel garnis,

they represent a growing form of accommodation units catering for
holiday as well as business travellers. These establishments provide
only accommodation and breakfast but not the principal meals.
These are usually located in large towns and cities, along
commercial and holiday routes and also resort areas and are used
by en route travellers. Some of these are very popular with holiday-
makers.

Tourist Holiday Villages

Tourist villages were established in some European countries after

World War II. These are situated at warm seasides and in the regions
which offer certain facilities for tourists. In Italy and Spain, tourist
villages are located in the regions not economically developed,
thereby helping the region economically. The villages are mostly
promoted by important clubs, social and tourist organi"sations.

The village complex is a centre of accommodation providing

extensive sports and recreation facilities, riding, swimming, tennis,
volleyball, football, sauna, mini-golf, badminton, table tennis and
yoga. These provide both board and lodging. The atmosphere in
these villages is kept as informal as possible. Telephones, radios,
newspapers and TV are banned unless there is [Link].
Wallets and other valuables are locked away at the beginning of
one's stay. The staff are chiefly educated young people who live on
an equal basis with the holiday-makers. The accommodation
provided is usually in multiple units and many provide for self-
catering. The furnishing provided in the rooms is minimal. The easy
mixing of guests is encouraged by the banning of advance booking
of tables in the village restaurants. One rarely finds oneself sitting
with the same group twice.

The holiday villages are usually based on family units, each

providing a convertible living room, bath/shower and sometimes a
kitchen. The villages are self-sufficient, providing almost all
necessities required by the residents. There is also a small shopping
complex where one can buy articles of daily need. The services of a
doctor are available. The accommodation is sold for a week or a
fortnight at an all-inclusive price. In Spain and Italy, these are
classified into three categories according to the services and
amenities provided.

Timeshare and Resort condominiums

Through timeshare and condominium concepts a tourist has a

unique range of options for resort holiday and lodging. In the case of
condominiums, a tourist owns a room or a suite within a
condominium or hotel complex and uses the same as required by
him or it can be rented to other tourists. The owned condominiums
usually are within the complex of rooms or suites that are rented as
regular hotel or resort rooms. It is difficult to tell the difference
between an owned and a rented room.

Timeshare, on the other hand, is a modification of condominium

ownership. The units are owned partially. The timeshare owner may
own one-fifth of a unit thereby sharing the unit's use and costs. In
some cases, the owner may only purchase a certain set of weeks to
use the unit. In other cases, a group of investors may jointly own a
property through actual deeds. The timeshare title implies that the
unit is shared with others throughout the year.

Timeshare began in the French Alps during the mid-sixties.

However, it was in the USA that the concept began to take a proper
shape. It is said that Timeshare was born when distressed real
estate developers of United States in the Florida region, could not
sell their second homes in the mid-seventies and decided to sell one
apartment fifty times over for each week of the year. Holiday
timeshare brings a number of benefits not only to the buyer and
developer but also to the holiday resort areas and the traditional
suppliers of services to the holiday industry.

Today, timeshare owners have the choice of trading the use of their
units with others. This provides the owners a unique opportunity to
vacation at comparable prices at destinations throughout the world.
May timeshare companies are available to help timeshare owners
locate others interested in exchanging units.

Timeshare today has become quite popular with holidaymakers

especially with families. It offers high-quality accommodation and
associated amenities ideal for repeat visitors. It also offers better
price and value than a hotel room for extended stays and is a hedge
against room rate inflation. Timeshare offers flexibility of use and a
variety of experiences through exchange options as also peripheral
benefits offered through an exchange company.

Regulation Of Accommodation
Tourist accommodation is an important component of a tourist’s
plan. As an individual product it is intangible, often bought in
advance of its use. The tourist at the time of making purchases thus
cannot inspect or accept or reject. Accommodation as such, raises
some issues in its development and in its marketing, both as an
individual product and as a part of a package. It creates a need for
reliable and accurate information for both the tourists and the travel
agents, and therefore, may require supervision and control. An
individual operator needs to bring information about his
accommodation to the tourist before he sets off on his journey and
also when he reaches his destination. Similarly, the tourist, on the
other hand, needs to know in detail what accommodation is
available at what price in a particular destination from which he can
make a choice about where to stay. Schemes of classification,
registration and grading of the tourist accommodation are intended
to meet these requirements.

The United Nations Conference on International Travel and Tourism

held in Rome in the year 1963 also emphasised the need for some
sort of regulation of accommodation with a view to safeguard the
interests of the users. Considering that special attention should be
given to relations between the public authorities and the operators
of tourist accommodation facilities, the conference advocated the
adoption of a hotel trade charter codifying the regulations applicable
to the hotel industry and, in particular, giving official tourist
organisations powers enabling them to perform the activities
devolving on the state in that field. The conference observed that
many states classify tourist hotels or are considering doing so.
Acting upon the recommendations put forward by the International
Chamber of Commerce, the conference advocated the
standardisation of methods of classification and in particular the
sub-division of hotels into five categories, each identified by a
conventional sign (stars) in conformity with the sets of standards
appropriate to different climatic conditions. The conference also
considered the question of classifying supplementary means of
accommodation such as tourist bungalows and camps.

Registration

The aim of registration is to provide a complete list or register of

tourist accommodation within a particular definition. A registration
scheme results in an inventory of accommodation which can be kept
up-to-date. In order to be comprehensive, it normally has to have a
statutory legal authority and is administered by a government
authority or a statutory body. Because of the wider range of
accommodation used by the tourists, a scheme of registration
should normally cover all forms of accommodation used by them.

Gradation

Grading separates accommodation into different categories or

grades, on the basis of judgments such as standards of amenities
and service. A grading scheme provides qualitative judgments on
the amenities and facilities of a particular accommodation unit in a
form which enables the user to choose the quality of
accommodation he requires. This may refer to the physical facilities,
food and other services of the establishment, various amenities
provided, etc.. The establishments are graded individually or
collectively by way of giving them numbers, letters or symbols.

Classification

The chief aim of classification is to maintain standardisation of

services and security for tourists. By establishing uniform standards
of classification, it is easier for all concerned with tourism (tour
operators, travel agents, tourist enterprise and tourists themselves)
to know exactly what standard of services are offered by each hotel
(according to the number of stars) thus leading to more effective
uniformity both in statistics and in regulatory and control
[Link] adopted scheme envisages that hotel establishments
are to be divided into five categories, symbolised by stars,
and based on objective standards. The categories are assigned on
the basis of two types of requirements:

i) Minimum requirements common to all categories, as stated in

the classification scheme, concerning health, sanitary, material and
staff standards;

ii) Minimum requirements for each category, expressed as specific

conditions for the hotel (as a building), the rooms, additional
accommodation, facilities and guest service.
The classification scheme is intended as a guide for National
Tourism Administrations in their efforts to perfect a classifications
system in collaboration with the hotel sector, on the basis of the
principles set forth in the scheme. The classification system is to be
adopted in a flexible manner so that any establishment failing to
comply with a particular, though not fundamental requirement,
would not be downgraded provided it complied with all other
requirements.

International Hotel Association (IHA)

Founded on 18th March, 1946 in London on the initiative of Societe

Suisse des Hoteliers, the International Hotel Association (IHA)
replaced the International Hotel Mens Association set up in June
1869 and International Hotel Alliance set up in April 1925. The main
aim of the new association was to bring together members who
could be of mutual benefit to each other. The IHA was registered by
a French Ministerial Decree of 23 September 1949 having its
headquarters in Paris.

The priority objectives of IHA include the protection and coordination

of hotel interests in their relations with travel agencies who often
play an important intermediary role between hotels and clients.
Through the IHA/LJFTAA Convention, there is a formal codification
and confirmation of international practice governing relations
between hoteliers and travel agencies. It informs hoteliers on their
rights concerning payment, commission, cancellation, late arrival or
no-show and relevant compensations.

Membership

IHA has a membership spanning 160 countries, comprising hotels

and restaurants whether chains, both national or international, or
individual establishments, who wish to participate directly in the
Association's activities, even whilst being represented by their
National Associations.

In addition, there are hotels and tourist personalities as individual

members. Affiliates like hotel schools, training centres, tourist
organisations, suppliers and services companies etc.. also
participate in HI activities. The Association today represents more
than 700,000 hotels and restaurants throughout 160 countries and
more than seven million hotel industry wage earners.

There are over 90 National Hotel Association members of the IHA. Each
Association has the right to send delegates to vote their numbers
being determined by the number of hotels who are members of the
Association in the respective country. Independent hotels, which
constitute about 80 per cent of IHA membership, are entitled to the
numerous services offered to IHA. All members receive a personalised
membership card which entitles them to 25 per cent discount on
accommodation in IHA member hotels.

Aims

The aims of IHA include the following:

i) To federate National Hotel Association of all countries.

ii) To study problems affecting the international hotel industry and

international tourist traffic including re-establishment of free traffic,
economic policy for hotels and restaurants, hotel guides,
international currency exchange, hotel insurance and conditions of
work and personnel;

iii) To create an international employment service for qualified

hotel personnel and for the exchange of apprentices;

iv) To inform members of international problems concerning hotels;

and

v) To give commercial information concerning travel agencies.

Structure

The association has a General Congress which meets at least every

two years, an Executive Committee consisting of 30 members and a
Council having 180 members. The Association is headed by the
President and assisted by a Deputy President and five Vice
Presidents. There is a General Secretariat responsible for looking
after administrative and personnel matters. Planning and Finance
Committee looks after all matters pertaining to finances
includingmembership. Publications Committee is responsible for
various publications of the association and their distribution. In
addition, the following Functional Committees look after various
subjects of the Association:

a) Industry Economic Committee

b) Sub-Committee on computerisation

c) Travel Agencies and Commercial Relations Committee

d) Seasonal and Resort Hotels Sub-Committee

e) Legal Committee and

f) Labour Relations and Training Committee.

One of the most important activities of IHA is, however, the

provision of a wide range of practical services for hoteliers
interested in attracting business from all over the world. The
services include the following:

Annual IHA international meetings are held where the most pressing
issues confronting the large hotel chains, individual hotel owners,
and service and supply companies are addressed. These meetings
provide an ideal environment in which members can exchange
valuable ideas, promote individual properties, and discuss specific
problems and concerns of the industry.

International Hotel Guidebook: An annual listing of all IHA

members is provided to members free of charge. The guide is an
automatic sales tool: used by travel agents, hoteliers, airlines,
international corporations and business and professional offices
worldwide promoting all the properties and services listed. Hotels &
Restaurants International, a bi-monthly magazine published in the
US, with a special IHA section in every issue. This magazine keeps
the industry well informed of all the activities of the IHA, its
members and councils. International Bibliography, a publication
listing books in western languages concerning hotel-related
information, administration, proper management, hotel catering,
etc. available to members upon request.
The World Directory of Travel Agents, a valuable reference book for
hoteliers, listing 6,000 reliable travel agencies approved by the IHA.
All listed agencies must belong to their national association, and
must be in business for at least one year.

Debt Recovery Service is available to members upon request. The

IHA intervenes and assists member hotels to claim payments
overdue from foreign travel agencies.

Statistical Service on Payment Incidents is a subscription service

offered to members.

Monthly lists are provided of at least 100 slow-paying travel

agencies worldwide.

Confidential information concerning travel agents is available upon

request.

International Hotel Training and Staff Placement: The IHA

brings together hoteliers and distinguished specialists in hotel
education. The IHA offers a hotel trainee network that facilitates the
mobility and coordination of hotel training worldwide. The network
also organises introductions for the placing of upper management.

Documentation Centre: The IHA provides members with a wide

and varied range of information on the hotel and tourism industries.
For example, the IHA member may obtain lists of hotel publications,
information on public utility charges, tariffs and all relevant hotel
and industry material.

Address Labels of travel agencies worldwide are available to

members for promotion and sales use at a small fee.

IHA Membership Card: This card entitles the member to a 25 per

cent discount on accommodations in other IHA member hotels
worldwide. It encourages referral business the year round and is a
valuable sales tool in low seasons.

Accommodation Volume
The number of rooms that are available to the travelling public
within lodging facilities varies from country to country and from
region to region. Within a country, most of the accommodation units
will be located where the demand for these is very big.

The demand will be more near the location of tourist attractions

both natural or man made. Internationally the demand for
accommodation will be more pressing in the regions which receive
more tourists. Today Europe and America are the regions which
receive maximum share of world tourists and it is here that the
largest number of accommodation units are located.

According to World Tourism Organisation (WTO) estimates, or a

survey conducted by them, the total capacity of hotels and similar
establishments like motels, boarding houses and inns is over 20
million bed places. The largest accommodation capacity is, however,
available in the continent Europe which is about 10 million bed
places in the hotel industry proper. This consitiutes about half of the
total bed places available all over the world. The explanation for this
is that the demand for both international and domestic tourists in
Europe is maximum.

In several European countries, hotel development is concentrated in

small and medium-sized hotel constructions. In many countries,
within the framework of general exapansion of the accommodation
sector, the increase in hotel accommodation was outstripped by the
increase in supplementary means of accommodation, such as
camping and caravan sites, rented rooms, apartments, etc. This
type of accommodation has become the main provider of lodging for
domestic tourism and has also started to play a very significant role
in international tourism. In America the total capacity of hotels and
similar establishments increased significantly in several countries of
the regions.

In East Asia and the Pacific region, several countries are currently
enjoying a hotel-building boom. In South Asia, the countries of the
region are undertaking great efforts to develop the accommodation
sector. In the Middle East, hotel construction in the region is mainly
concentrated on luxury-class hotels intended chiefly to cater to
business travellers. In view of the high profitability, there are many
hotel projects which are under construction. In the African region,
accommodation facilities are concentrated in the northern part of
the continent.
Changing Profile of the Accommodation Sector

The accommodation sector has undergone substantial changes in

recent years. New developments in tourism and transportation,
changes in the organisation of travel and technological innovations
are some of the factors which are responsible for these changes. In
addition, increasing consumer demand among tourists, due in turn
to the improvement in living standards and economic conditions,
has also changed the profile of the accommodation sector.

All the above factors seem to have influenced the structure of the
hotel industry as a whole. The tendency among middle-income
groups to take a holiday at any time of the year has encouraged
accommodation operators to offer novel kinds of arrangements
which are now available in addition to traditional hotel
accommodation.

New types of accommodation, particularly holiday villages suitable

for family-type tourists, condominiums and apartment houses,
private villas and camping facilities have proved very successful and
to a certain degree are replacing traditional hotels and boarding
houses. These changes reflect changes in demand with new, often
younger, groups entering the international travel market and also
new approaches to the problem of providing facilities in every
competitive industry with a highly seasonal demand. The probable
future developments in the accommodation sector were the subject
of study undertaken in WTO's research programme. Some
conclusions which emerge from the study are as follows:

a) A significant growth in accommodation supply will continue to

be contributed by chain operators, including airlines. This expansion
will result mainly from the further development of management
contracts and franchise agreements;

b) There will be a continuing move towards the further

diversification of accommodation. The development ofbudget
accommodation, covering budget hotels, and also supplementary
means of accommodation, is likely to continue as mass tourism
stimulates new demands for competitively¬priced accommodation;
c) Rising building and operating costs, growing environment and
conservation pressures, as well as the need to keep staffing levels
at a minimum, will influence design and construction of
accommodation units;

d) The standard of accommodation will continue to rise. Demand

for recreational and sporting facilities will increase in both business
and leisure accommodation;

e) Advances in technology will both influence the traditional

construction methods, for example, more frequent use of
prefabricated building techniques, as well as traditional methods of
hotel operations.

In recent times, several environmental problems have come to be

recognised in the accommodation sector. Several environmentalists
as well as users of accommodation are demanding that
environmental issues associated with accommodation industry
should be addressed properly. Tourists visit different places of
tourist interest and consume various products they buy. The
consequences of the pressure of consumers on tourist services
results in putting pressure on the environment. However, with few
exceptions, industry owners are taking various steps to address the
environmental issue in its proper perspective.

Status Of Indian Hotel Industry

Boost in tourism activity in India

Hospitality has been a top sector for Foreign Direct Investment (FDI)
in India. Several international chains including Sheraton, Holiday Inn,
Intercontinental, Hyatt, Radisson, Best Western, Days Inn, Hilton,
Quality Inn, Ramada Inn, Meridian, Kempenski, Four Seasons
Regent, Accor, and Marriott International are entering or expanding
their hotel network in India. The industry has been growing at a
CAGR of 15%, mostly driven by huge tourist influx into India.

According to the Ministry of Tourism data, 3.4M international visitors

arrived in India compared with 2.7M in 2003. The total spend in
2004 was $4.9B, or $1,451 per person. This places India 11th among
the Asia Pacific markets in terms of visitor numbers and seventh in
terms of total visitor spend. The high growth rates seen in 2003 and
2004 – 15.3% and 23.5% for tourist arrivals, 21% and 40% for
tourists’ receipts respectively – were considered the best
performance in India’s tourist history. Business travelers accounted
for 32% of the visitors while vacationers accounted for about 43%.

The 5 year growth rate was much higher in the business segment.
Overall, this impressive performance is attributable to a strong
sense of business and investment confidence in India: inspired by
the steady growth in the Indian economy (GDP growth of 8%), a
strong performance of domestic corporate sector, initiatives taken
to make peace with Pakistan, strengthen ties with other nations and
open sectors of the economy to private sector and foreign
investment.

Government’s commitment towards tourism is evident from the

allocation of $500M to tourism in the tenth 5-year-plan (2002-2007).
Some of the key components of the plan are to provide a major
thrust to domestic tourism (which has been fueled in the last couple
of years by a rise in per capita incomes and rise in per capita leisure
expenditures), which will act as a springboard for the growth and
expansion of international tourism and to market India as a global
brand in order tap into India’s vast tourist potential. Government
has also taken several structural changes to boost Tourism Move
towards rationalisation of taxes: In the past two budgets
Government of India has granted a host of tax rationalisation
initiatives for the hotel sector:

 Waiver of 10% expenditure tax on rooms and F&B;

 Service tax on banqueting and catering services;
 Reduction in customs duty on imported liquor;
 Reduction in luxury tax in states like Goa, Kerala and
Karnataka;
 Extension of relief under section 10 (23) (g) of the Income
Tax Act to lenders to Hotel Project.

Airline seat capacity increased: In October 2003, Government

announced its open sky policy allowing international airlines,
including those operating from Gulf region to operate a flight in
India. Open sky policy will translate to an increase of 3,000 to 4,000
additional air seats per week leading to increased tourist inflows
during the season. Infrastructure development: Though
infrastructure doesn’t directly contribute to the growth in tourism,
development of infrastructure is a key to boost tourism. Government
of India has taken some key steps for development of infrastructure
in the country –

 Plans to set up two global standards international

convention centers with investments of about Rs.10B will
lead to growth in MICE(Meeting, Incentive, Convention and
Exhibition) segment;
 Modernisation and up-gradation of Mumbai and Delhi
airports;
 Initiatives at the state and the sentral level include building
new airports in Bangalore and Hyderabad with private
sector participation;
 Disinvestments in state-owned ITDC Hotels;
 Construction of Golden Quadrilateral with over 10,000
kilometers of high quality roads;
 Sports initiatives like ASIAN Games in Delhi, and planned F1
circuit in India will provide a tremendous boost to tourism
in this region; etc.

Aviation sector reforms in the pipeline: Government in January

2004 announced the new charter policy allowing outbound charters
to travel operators. Abolition of IATT (15%) and reduction of excise
duty on ATF from 16% to 8% has substantially reduced the domestic
air ticket charges. Apart from this, the ‘Naresh Chandra Committee
Report on Aviation Sector’ released in November 2003 has prepared
a road map of reforms for the aviation sector.

Hotel Industry In India

Hotel industry in India: Beneficiary to tourism activity

The hotel industry has been a major beneficiary of the trends in the
business and leisure tourism. The following section provides a
snapshot of the market size, trends and competition and shows that
hotel industry qualifies for an excellent investment opportunity.

Market Size
According to Euromonitor data, spending on tourism by inbound and
domestic tourists was estimated at Rs756 billion in 2004. This
expenditure grew at a CAGR of 16% during the review period.
During 2004, estimated growth was 21%, reflecting the boom in
tourism.

The largest component of tourism spending was travel, which

accounted for over 60% of spending in most years of the review
period. The large share of travel is mainly because domestic tourists
stay in cheap hotels and spend most of their travel budget on
transport. Accommodation comes next with a share of 22-26% of
spending.

Key metrics

Two key metrics used to analyse the hotel industry are as follows:

1) Average occupancy: equals the average percentage of the

times in a year when the room is occupied. This number usually
fluctuates for Indian hotels because hotel industry is cyclical, with
high demand for rooms in months when tourist influx is high.

2) Average Room Rate (ARR): equals the average rent charged

per night per room. This number can also fluctuate depending on
the demand for hotel rooms.

Diversification of revenue streams

The industry is moving towards new revenue sources in an effort to

have greater stability:

Spa: With the promotion of leisure resorts as rejuvenating

destinations, there is a huge market for this concept. These
concepts are still at a nascent stage in India.

Medical tourism: A market estimated at Rs.1.2B to Rs.1.5B and

growing at 30 per cent, offers immense potential. Players are
waking up to this opportunity, and hotels/resorts in South, especially
in Kerala and some in UP, have been cashing in on the trend.

Competition is heating up
A series of public and private divestitures has given rise to new
hotel entities. Hotel operations have seen major changes in terms of
ownership from 2000 till date. India Tourism Development Corp Ltd
(ITDC), with its 100% government share holding, divested 18 of its
hotel units leaving it with only eight hotels and seven joint-venture
hotels.

Hotel Corp. of India (HCI), a wholly owned subsidiary of Air India,

divested from its properties Centaur Hotel Juhu Beach, Indo Hokke
Hotels Ltd, a subsidiary of HCI and Centaur Hotel Mumbai Airport.

In August 2004, ITC, the Indian business conglomerate, which owns

72% equity stake in ITC Hotels, announced that it would be merging
ITC Hotels with itself. This consolidation of ITC’s hotel business has
resulted in economies of scale and cost reduction and has redefined
the competition within the organised sector.

The two main players in the Indian hotel industry are the Indian
Hotels Company Ltd. (IHCL) and EIH Ltd (earlier known as East India
Hotels). IHCL, a part of the ubiquitous Tata Group of Companies,
owns the well-known Taj Hotels, whereas EIH owns the equally
famous Oberoi brand. Both these companies own properties that
can be classified into various types such as luxury, business and
budget, heritage as well as beach and hill resorts. Cumulatively,
these two hotel leaders raked in Rs11,102 million in 2003/2004.

The two top hotel players, Indian Hotels Co and EIH Ltd, had a
combined value share of nearly 23% in 2003, which is expected to
rise gradually. However, the shares of these two companies fell
since 2001, as younger players expanded their hotel networks and
leading international chains like Hyatt Regency and Marriot
International started invested more aggressively in India.

Budget hotel chains have also begun to spring up in the country,

eating into the share of independent hotels that largely comprise
the three-star and lower categories. This trend is expected to
continue, as hotels will be allowed to reap benefits accruing from
mergers and acquisitions, which will see a lot of independent hotels,
merge with branded chains to improve occupancy rates.
The Department of Tourism also has a category of “heritage hotels”
which includes old palaces and buildings converted into hotels. In
2003, there were 77 heritage hotels registered with the Department
of which 12 are in the South, 10 are in the north, 5 in the east, 48 in
the west and central India and 7 in the east. The total number of
hotels that are registered with the DOT but await classification are
81. More than half of these are in the south.

According to estimates of the Country Report - India 2008 of World

Travel & Tourism Council (WTTC), Indian tourism demand will grow
at 7.6% from 2008 to 2018 in real terms, which would place India as
one of the most rapidly growing tourism markets in the world. Travel
& Tourism, a labor-intensive industry, generated three crore jobs in
India in 2008 or one in every 15.6 jobs in the country. China
benefited by 7.5 crore jobs for the same year. Thus, the world’s
most populous nations – China and India - have been benefitting
from the employment generating potential of this sector. This is
even more relevant in India, as the country’s economic
transformation relies on the services model, while that of China
relies on manufacturing-for-export industries.

The Indian Union Budget had proposed an outlay of approximately

Indian rupees (INR) 1,000 crore for development of tourism
infrastructure in 2008/09, an increase of nearly 50% over the last
year. However, even with this figure, it led to only 1% of the total
government spending on a sector that contributes 6% to the GDP
and generates millions of jobs.
For a country of India’s size and potential, it is astonishing to see the
ratio of hotel rooms in comparison to the population. India has
approximately 2,000 registered hotels with a total room count of
approximately 120,000 rooms. As evident from Exhibit 2-5, there is
a dearth of hotels across every category and city in India. Tianjin, a
suburb of Beijing has more rooms than Indian cities like Mumbai and
New Delhi.

While the Indian economy is growing at a record-breaking pace, the

cities remain starved for quality hotels and room accommodation.
Apart from the four major cities noted in Exhibit 2-5, there are at
least 35 other cities in the country with a population of one million
and more. Thus, demand fundamentals for the country are strong.

Though the growth rates predicted by WTTC for India look very
aggressive, this is a case of low foreign tourist visitation base.
Exhibit 2-1 compares the total foreign tourist arrivals into India with
that of some major cities across the world in 2007. It is to be noted
that these international cities are able to attract equal or more
tourists than the whole of India. It highlights the immense potential
for growth of a historically and naturally rich and culturally diverse
country like India, given the regulatory environment and
infrastructure development - the key facilitator of tourism.

In summary, the Indian hotel industry is proving to be an exciting

investment opportunity.
 Issues Facing Indian Hotels

Infrastructure Status:

Hotels are long-term asset classes which provide large-scale

employment and earn foreign exchange for the country.

The government allowed the benefits of 100% FDI to the sector.

However, the economic trauma in the Western world has not
allowed this window to largely help the sector.

Table 1: Hospitality - Key issues

Regulatory Financing Taxation Approval Operations

 Hotels  High cost of  Incorrect  100+licences  Star category

considered as dept for hotel treatment required is unable
'Real Estate' development of multiple to
rather then  No fund Luxury agencies adequately
infrastructure raising Tax in responsible represents
project through many states for approval the
 Industry status ECB /FCCB  Variety tax Opaque hotel's
to structure process quality
Regulatory Financing Taxation Approval Operations

across the
 Higher room
country
teriffs
multiple
 6-12 month of as
tourism in few taxation
route approval compared
states only system
process to the
 Removal of
APAC
Tax
region
incentives

Over the last 12 years of its India operations, it has been observed
that it is particularly difficult to raise capital for hotel development
through public sector financial institutions and banks. In the absence
of resident experts on the hospitality sector, most banks are
susceptible to herd mentality, which makes them impose tough
conditions for lending purposes. As discussed earlier, loans in India
are one of the most expensive and come with a short tenure (seven
to ten years). The hotel business is cyclical in nature and every
trough brings with it good opportunities to invest at attractive
valuations, for an upside that may be just around the corner. We are
aware that numerous hotel projects with favorable locations,
branding and prospects are stuck due to the unavailability of debt.

Industry Status: The seventh five-year plan (for the period 1985-
1989) proposed that tourism be conferred with ‘Industry’ status. The
conferral of industry status on tourism would entitle tourism to
secure several advantages, notably in project funding, exemption
from local taxes for the first few years and concessional power
tariffs. However, the decision and implementation were left to the
states and only a few granted ‘Industry’ status to tourism over the
course of the last two decades (Table 2).

Table: 2 States Conferring Industry Status to Tourism

Goa Sikkim
Utter Pradesh Arunachal Pradesh

West Bengal Jharkhand

Haryana Daman & Diu

Uttarakhand Dadar & Nagar Haveli

Jammu & Kashmir

As can be deduced from Table 2, of the states implementing

‘Industry’ status to tourism, Goa is the only one with a formidable
tourism standing. Other Indian states - like Maharashtra, Delhi and
Karnataka – view conferral of industrial status as a loss of revenue
since industries are given many concessions. As a result, a high
operating costs makes Indian hotels much more expensive than
their foreign counterparts. Power tariffs are a good example to
demonstrate this effect. Most states have commercial tariffs for
power usage in hotels. These are 30-50% higher than industrial
tariffs, making energy costs the second-highest expense after those
of human resources (HR). To counter this, a nationwide industry
status for tourism is considered a preferred approach by most
industry leaders. Table 3 lists some of the countries that recognise
tourism as an industry.

Table: 3 Countries Conferring Industry Status to Tourism

China UK
UAE Malaysia

France Thailand

Germany Singapore

Recommendations:

 Include Tourism as a subject in the Concurrent List of the

Constitution of India. This would enable both the central
and state governments to participate in the development
of tourism with greater harmony.
 Grant hotels infrastructure status under Sec 80-IA of Income
Tax Act. This would enable hotels to access cheaper debt
from international markets. Related tax benefits would also
help the sector.
 Grant hotels ’Industry’ status across India. This would allow
them benefits like concession in VAT/sales taxes, property
tax, and industrial rates on consumables like electricity
and water amongst others.

Computation of Luxury Tax: India has an unscientific tax

structure, with regard to taxes applied on hotel room tariffs. Hotels
in many states charge Luxury Tax on the Published room tariff and
not the discounted room tariff. This means that the guests pay
additional tax amount on the commissions (to travel agents) and on-
the-spot discounts. Also, if a hotel tries to apply a free upgrade to a
guest and offers him a better room (with a higher published rate) for
the same price, the difference in tax has to be either absorbed by
the hotel or the guest.

Recommendations:

 Impose single luxury tax based on the actual room tariff,

uniformly across all Indian states
  Impose uniform tax rates on rooms, food and beverages,
and liquor across the country
 Give incentives, in the form of tax breaks, to reinvested
capital in hotel industry
 Extend the benefits of Section 80-ID to other parts of India

High room tariffs in India: India is widely believed to be a much

more expensive destination than its APAC counterparts like Thailand,
Malaysia and Singapore. One of the key reasons behind this anomaly is
a huge deficit of budget or value-for-money hotels. This category is
largely represented by poorly maintained and unsafe lodges and
guesthouses scattered around the transportation hubs of most Indian
cities. Rising disposable incomes and the need to de-stress is providing
more opportunity to the middle-class population of the country to take
vacations.

The availability of branded budget hotels, which can offer clean and
safe rooms across major cities, is a trigger that can lead to explosive
growth in domestic tourism. India can easily emulate the growth story
of budget hotels in China where the number of budget and economy
hotels increased from just 23 in the year 2000 to 1,689 by 2007 – a
growth of 7,243%. It needs two important ingredients to achieve this:
funding and franchising.

There are no special incentives which may aid the development of

budget hotels. Again, being considered as a Real Estate sector has
been a limiting factor for hotels, particularly those of lower market
orientation. Franchising is a model which is preferred across the globe
for budget hotels and Indian entrepreneurs could benefit from the
franchisor’s technical know-how and distribution channels. However,
the government has certain archaic laws under the Foreign Exchange
Management Act (FEMA), 1999, which requires a review by the
Secretariat of Industrial Assistance (SIA). The process is cumbersome
and completely avoidable.

Recommendations:

 Advocate the potential of MICE to state governments (by

Ministry of Tourism) to rationalise local taxation guidelines
in favor of the sector
 Grant special incentives to budget hotels across the country
for alleviating funding issues
 Ease restrictions on franchisors operating in India
Hotel development in India has faced multiple impediments. While
some may pose short-term issues like high prices of hotel rooms,
others have a long-term impact like poor supply pipeline and aborted
projects. In order to address multiple pain points of the hotel sector,
the following measures are recommended:

 Include Tourism as a subject in the Concurrent List of the

Constitution of Indian
 Grant hotels infrastructure status under Sec 80-IA of IT Act
 Grant hotels industry status across India
 Impose a single uniform luxury tax, based on the actual
room tariff only, across all Indian states
 Impose uniform tax rates on rooms, food and beverages,
and liquor across the country
 Give incentives, in the form of tax breaks, to reinvested
capital in hotel sector
 Extend the benefits of Sec 80-ID to other parts of India
 Rationalise and increase transparency for the entire
license/approval process, with minimum documentation
 Develop a more scientific rating system to truly benchmark
hotel quality
 Grant special incentives to budget hotels across the country
for alleviating funding issues
 Ease restrictions on franchisors operating in India.
 Envision a national tourism master plan with a broad
outlook
 Augment infrastructure at all touch points for tourists
 Advocate the potential of MICE to state governments (by
Ministry of Tourism) to rationalise local taxation guidelines
in favor of the sector
 Current Trends
 Foreign tourist arrivals to India have been showing an
increasing trend estimated at 5.3 million in 2008 (Source:
Ministry of Tourism, GOI). Over the last eleven years, foreign
tourist arrivals into India have recorded a growth of 124% (2.37
million in 1997 to 5.3 million in 2008). However, at this
visitation level, India accounts for less than 1% of the global
tourism market. Domestic travel, both business and leisure,
had also benefited from a strong performance of the corporate
sector in India, and the overall sense of optimism with regard
to the economy that prevailed in the country until recently.
  Foreign tourist arrivals (January-September 2008) were up by
approximately 10% in comparison to the same period in 2007.
However, the last quarter (October-December) experienced a
decline of 9% in tourist traffic over Q4-2007 figures due to
extraneous factors like global recession and the growing
security/ terrorism concerns.

Summary
Some of the key points of this chapter are as following:

 Accommodation is the matrix of tourism, and is thus the obvious

choice to play a distinctive role in the development of this
expanding industry.
 Tourist accommodation has been divided into the following
groups:

o Hotels and similar establishments (the hotel industry proper)

o Supplementary means of accommodation

 Accommodation is categorized by location, price, by type of

visitors and by type of facilities they offer.
 Following are the main categories of accommodation:

o International Hotels

o Commercial Hotels

o Residential Hotels

o Resort Hotels

o Floating Hotels

o Capsule Hotels

o Airport Hotels

 Two key metrics used to analyze the hotel industry are:

1. Average occupancy
2. Average Room Rate (ARR)

Topic 7: Spa and Wellness Tourism

1. Objective

At the end of this chapter the student will be able to:

 Explain the origin and evolution of spa and wellness tourism.

 Define the nature and types of spa.
 Describe what do you mean by a spa and spa tourism in India

Introduction
The Spa is a small town in the quaint and beautiful European nation
of Belgium. Spa is generally seen in context with health and medical
treatments that are applied for rejuvenating one's mind, body and
soul. Spa towns or spa resorts are generally the destinations which
offer such kind of health and fitness services.

History

Spa means a resort or place of treatment. A Spa is a unit committed

to boosting the overall well-being through a variety of professional
services that promote the restoration of mind, body and spirit.

The term is derived from the name of the town of Spa, Belgium,
where since ages infirmities caused by iron deficiency were treated
by drinking chalybeate (iron-bearing) spring water. As the
celebrated spot of healing hot springs, Spa has been frequented as
a watering-place since ages. Today the town of Spa has become
synonymous with any place having a natural water source that is
believed to possess special medicinal properties.

Types of Spa
Cruise Line Spa: Spas aboard cruise ships that offer spa
treatments, fitness programs, workout facilities, and often spa
cuisine.

Day Spa: Full-service spas offering hour-long to full-day therapeutic

or pampering treatments; accommodations are not provided on-site.

Destination Spa: Dedicated to health and renewal through an all-

inclusive program that usually includes spa services, physical
fitness, healthy cuisine, and educational programs.

Eco-Spa: Facilities that limit the use of plastic packaging, bleached

paper, and chlorinated, antibacterial wastewater.

Medi-Spas: Facilities that combine the best of Western medicine

with therapeutic spa treatments; physicians address everything
from chronic headaches, sleeping disorders, and weight
management to total mind-body-spirit healthcare.

Resort Spa: Combine vacation fun with the spa experience. Spas
found in a resort or hotel include spa services, fitness and wellness
programs, and sometimes spa cuisine.

Spa Vacation

Whether one dreams about an adventure vacation, spiritual renewal

or a stress-free retreat, there's a destination spa vacation which is
exactly the place to be at. One gets a platform to discover the soul-
soothing and the long- lasting effects of the spa lifestyle. The
benefits of a spa vacation are real and certainly durable for as far as
the enrichment of one's life is concerned.

Spa Tourism Worldwide

There is growing demand for spa and well-being holidays nationally

and internationally. In the more mature Asian markets, such as
Singapore, Malaysia and Hong Kong, activities focus on giving
travelers new and enduring fitness techniques through numerous
product experiences. In countries like China, the focus is on
educating consumers and trade about the destination.
In addition to this spa, tourism is also gaining a stronghold in
developed nations like USA, Australia and Canada. The Caribbean's
is also a hit destination amongst the tourists for its inventive and
novel spa culture.

Spa Tourism In India

The spa industry in India currently boasts over 2,300 spas,
generating revenue representing approximately USD $384 million
annually. Initiatives are underway to train spa personnel to meet the
growing demand for these 2300+ spas, and for the hundreds more
that are likely to establish themselves in the next five to ten years.
While the Indian spa market is still a modest sliver of the overall
$60-billion-plus core global spa economy, India is poised to attract
significantly more western tourists (particularly on the
medical/wellness travel front)…as well as continue to develop its
own vibrant, indigenous spa market at a heady pace. With over 700
spas predicted to open doors in the next 2-4 years, there’s no doubt
that the spa industry in India is growing fast.

India, the land of beauty, has combined health and beauty. As a

result, spa holidays have become popular in India nowadays. There
are several popular spa resorts promoting spa tourism in India. The
Ananda in Himalayas Spa resort is One of the most well known spas
in India that offer therapeutic treatments based on traditional
ayurveda, yoga and meditation. The Spice Village in Periyar (Kerala)
and Rajvilas Spa hotel in Jaipur are also unique tourist destinations
that offer a wide range of spa and therapeutic treatments.

Emerging trends in the booming Indian spa market

Ayurveda Represent Serious Business: Yoga, one of the most

profitable wellness modalities in the word, is a lifestyle for millions of
people who are enthusiastic about traveling to the spiritual and
cultural source: India. Spas in India will continue to expand their
Ayurvedic menus, for both overseas clientele who want to
experience authentic Ayurvedic therapies--as well as for locals
already familiar with the benefits, or who wish to adopt their own
Indian healing traditions. As state tourism departments promote and
package Ayurveda, look for new legislation mandating scientific
methods and quality control, trained therapists, Ayurvedic doctors
and license certifications.

Spa Popularity:

There are few things in life as comfy and refreshing as the coddling
and attention received at a plush spa. Spas help to reduce the stress
of the world in tranquil and calm settings. The growing popularity of
spas has helped spawn new spa services throughout Europe, the
Caribbean, Mexico, Hawaii, Asia, and the United States.

European Spa Industry

Development of the spa industry within Europe is founded on the
interest of people from the earliest times in mineral springs that
differed from ordinary springs in their appearance, taste and
temperature. These ‘miraculous’ springs were used for cures
primarily by the Romans, who came across them during their
military campaigns, especially in what is now France, but also in
other parts of Europe (modern Germany, Croatia, Hungary, etc.).

Following European tradition, in the past, and especially in the first

half of the last century, the spa industry developed in mutual
interdependence with the state overall, as a society in the individual
countries has developed. The essential framework of the spa
industry is based mainly on the use of natural resources (including a
healthy climate) with an important contribution from medical care
and a comprehensive approach to therapeutic stays.

Today spa visits, health tourism, wellness, beauty and fitness

programmes, regenerative, reconditioning and relaxation stays, are
all dynamically growing products and tourist product packages
which, combined with all-inclusive accommodation, catering,
entertainment, sporting and other activities, are responding to the
most challenging demands of individual tourists, as well as tourist
offices and agencies.
Spa tourism in Europe has recently been going through a
renaissance, and future dynamic growth is to be expected as a
result of the unification of Europe – with the expansion of the
member states of the Union. This not only means overall growth in
the standard of living and the health awareness of the citizens of
Central and Eastern Europe; it also involves preparing partnership
agreements, assuming mutual co-operation within Europe in the
fields of health and social welfare: i.e. potential extension of
healthcare insurance to cover events abroad.

From the point of view of the potential of spa products, Europe has
at least a thousand spa locations in almost all countries (with the
exception of Scandinavia and some Baltic states, this number
includes all the countries on the Continent and in the
Mediterranean), with countless facilities and programmes for a
variety of types, lengths and purposes of stays. Besides classical
and traditional European therapeutic procedures, these key
European centres continue to welcome new, alternative and modern
trends, including Indian, Chinese and oriental treatment methods,
and natural cures are enjoying a revival (Kneipp’s cures). Spa
centres also more and more often include modern aquaparks,
cosmetic centres and similar services.

The type of client at spas ranges from guests in search of a rest all
the way to the truly ill, including all forms of prevention (primary,
secondary and tertiary) up to rehabilitation and the treatment of
chronic diseases. Spas are a frequent tourist destination of young
and old, singles, families with children, and recently also a favorite
venue for putting on congresses and conferences. Besides fixed
schedule treatments several weeks long, short stays with a variety
of durations are also possible.

Healthy guests, especially, can choose among hotels and pensions

of different price ranges, all available in spa locations. As far as
medical treatment facilities, guests can choose out-patient centres
located within and outside the centre of town, in-patient treatment
performed totally or partially in a health centre, or in the case of
acute illness, in a fully equipped clinic. Spa Tourism has been an
important part of medical treatment in Central and Eastern Europe
for a very long time. Lately. the trend has been adopted and
reinvented in luxury hotels and specialised Spa Hotels and resorts
offering a range of options from Turkish hammams to relaxing
Thalassotherapy treatments.

A number of Spa Associations actively promote and work on

developing the industry further by focusing on spa specialisms such
as eco-friendly spas, luxury spas, romantic spas, pampering spas,
stress management and maternity options.

Wellness Tourism
In many ways, this is one of the most ancient forms of tourism if one
considers the scrupulous attention paid to well-being by Romans
and Greeks, the quests for spiritual enlightenment of Mediaeval
pilgrims, or the medical seaside and spa tourism of the 18th and
19th century European elite.

The concept of "wellness"-and along with it wellness philosophy-was

developed by the American doctor Halbert Dunn in 1959 when he
wrote for the first time about a special state of health comprising an
overall sense of well-being which sees Man as consisting of body,
spirit and mind and being dependent on his environment. Dunn
called this condition of great personal contentment "high-level
wellness".

Wellness is a state of health featuring the harmony of body, mind

and spirit, with self-responsibility, physical fitness/beauty care,
healthy nutrition/diet, relaxation (need for destressing)/ meditation,
mental activity/ education and environmental sensitivity/social
contacts as fundamental elements. This understanding includes
what Americans also call mind/body health, meaning that the mind
helps control one's health.

Wellness tourism is regarded as a subcategory of health tourism.

Health tourism is the sum of all the relationships and phenomena
resulting from a change of location and residence by people in order
to promote, stabilise and, as appropriate, restore physical, mental
and social well-being while using health services and for whom the
place where they are staying is neither their principle nor
permanent place of residence or work. Since we feel that the holistic
approach to wellness during vacations can best be observed in a
hotel specialising in wellness services, we define the concept of
"wellness tourism" in a narrower sense.

Wellness tourism is the sum of all the relationships and phenomena

resulting from a journey and residence by people whose main
motive is to preserve or promote their health. They stay in a
specialised hotel which provides the appropriate professional know-
how and individual care. They require a comprehensive service
package comprising physical fitness/beauty care, healthy
nutrition/diet, relaxation/meditation and mental activity/education.

Arguably, however, there has been an unprecedented intensification

in the pursuit of wellness in the history of tourism in recent years.
The proliferation of wellness centers, holistic retreats, spas, and
spiritual pilgrimages, complementary and alternative therapies is
unprecedented (House of Lords Report 2000).

Wellness can be defined in various ways. Saracci (1997) questioned

the World Health Organisation’s much-cited definition of health as ‘a
state of complete physical, mental and social well-being and not
merely the absence of disease or infirmity’. He suggested that this
state corresponds much more closely to happiness than to health.
One could easily be healthy but not necessarily happy. Myers,
Sweeney and Witmer (2005: online) define wellness as being ‘a way
of life oriented toward optimal health and well-being in which the
body, mind, and spirit are integrated by the individual to live more
fully within the human and natural community’.

Adams (2003) refers to four main principles of wellness:

1) Wellness is multi-dimensional;

2) Wellness research and practice should be oriented towards

identifying causes of wellness rather than causes of illness;

3) Wellness is about balance; and

4) Wellness is relative, subjective or perceptual.

Table 1: Dimensions of Wellness Tourism

Tourist Motivation Typical Locations/Activities Reference

Medical/Cosmetic e.g., hospitals, clinics Connell

Lea: Lehto, Brown

Chen and Morrison:
Puczko and
Corporeal/Physical e.g., spas, massage, yoga Bachvarov

Pechlaner and
Fischer: Puezko and
Escapism and Relaxation e.g., the beach, the spa, mountains Bachvarov

Hedonistic/Experiential e.g., festival spaces Lea: Pernecky and Johnston

e.g., holistic centres

focused on self-
development and
philosophical Smith and Kelly:
Existential and Psychological contemplation Steiner and Reisinger

Devereux and
Carnegie: Pernecky
and Johnston: Lehito,
e.g., pilgrimage, New Age events, Brown, Chen and
yoga retreats Morrison
Spiritual e.g., voluntary work Devereux and
Community- charity treks, holistic Camegie: Smith and
oriented centres Kelly

Some authors have argued that spirituality is at the core of wellness

(e.g., Steiner and Reisinger; Devereux and Carnegie; Pernecky and
Johnston). This represents a shift away from orthodox religion
towards a kind of transcendent spirituality, where one aims to
develop beyond the self and the ego. Indeed, transcendence as a
phenomenon within wellness tourism is of some importance.
Tourists frequently seek locations and activities that are
transcendent. For example, De Botton (2002) describes how
travelers are attracted to ’sublime’ landscapes that benefit their
soul by making them feel small, yet part of an infinite and universal
cycle. It is no coincidence then that many wellness centers are
located beside the ocean or on a mountain top. For example,
Pechlaner and Fischer note the importance of location in the context
of ‘Alpine wellness’.

Some feelings of transcendence are artificially enhanced through

music or dancing (e.g., Lea refers to festival spaces where
’hedonists’ may gather). Tourism can arguably contribute to many
of the aforementioned dimensions of wellness, although obviously, it
is debatable as to how far a transitory phenomenon can make a
significant difference to long-term wellness. Equally, tourists need to
be in good enough physical health to embark on a journey, as well
as being materially affluent (a state rarely encouraged by many
spiritual gurus!). As with all forms of tourism, the flows of people are
predominantly from more developed to less developed countries.

The recent trend, however, is for western tourists to seek solace in

Eastern philosophies and therapies (e.g., Chinese medicine,
Buddhist meditation, Indian Ayurveda, Thai massage). Such
alternatives already pervade many Western societies, but tourists
are often just as keen to visit the origin of the practice.

Similarly, the age-old tradition of spa tourism offered little more

than a soak in warm, medicinal waters. Given the definitions
discussed above, in order to qualify as a contemporary wellness
tourism experience, we would contend that some deliberate
contribution has to be made to psychological, spiritual or emotional
well-being in addition to physical. This takes wellness tourism from
the realm of being merely a passive form of tourism with a focus on
escapism to one where tourists are purposefully driven by the desire
to actively seek enhanced wellness. A majority of wellness tourists
are already active at home in some form of wellness enhancing
activity (e.g., yoga, meditation, massage, healthy eating). Those
that are not, often aim to engage further in the wellness activities
they have experienced on holiday, thus, demonstrating that even a
short trip can have a long-lasting effect on one’s everyday life.

A summary of the dimensions of wellness tourism follows: In terms

of demand, wellness tourists are likely to be ’Active Health Seekers’
(House of Lords Report 2000), who are highly motivated and
determined to play a role in their own health. They frequently
choose alternatives to orthodox medicine and are not afraid to
experiment. The main market identified for wellness tourism is
being ’baby boomers’ (aged the late 30s to mid-50s) and
predominantly female.

There may be some need in the future to encourage younger people

and men to partake of the flourishing wellness tourism sector,
especially given the worrying statistics on young male depression
(Mullholland 2005). However, the way in which wellness centers are
promoted and the activities contained therein may have to change
somewhat for this to be possible.

Many wellness tourists already dabble in holistic lifestyles to greater

or lesser degrees. The enthusiast-as-tourist tends to be the most
demanding in terms of what (s)he expects from the range and
quality of services offered by wellness operators. However, it is
worth noting the relative infancy of the holistic market in Western
countries. For example, it is only recently that there has been
widespread acceptance of the spiritual.

dimensions of yoga (previously viewed mainly as an exercise regime

or sport). Similarly, the benefits of meditation and other spiritual
practices are only just starting to become accepted in Western
psychology. It is, therefore, not surprising that it is the ’New Age’
and ’alternative’ tourists who seem to have been leading the way in
some of the more experimental psychological and spiritual
dimensions of wellness tourism.

The wellness sector is, therefore, often viewed with some suspicion,
seen as being unorthodox, esoteric, or just plain weird! This is also
partly because it is largely unregulated and can be viewed as
potentially dangerous to the consumer. For example, the House of
Lords Report (2000) cites certain therapies as offering ’no credible
evidence base’ according to orthodox medicine – and these include
some of the more ancient traditions, such as Chinese and Ayurvedic
medicine.

However, this is not to say that they do not have positive benefits,
even if they have a placebo effect. If wellness is predominantly
psychological, and the consumer feels well without any negative
physical side-effects, the therapy has surely achieved its objective.
However, where there is also physical manipulation of the body
(e.g., massage, yoga, reflexology), practitioners should certainly be
fully qualified as they need to be to practice osteopathy or
chiropractic techniques. It is worth noting that the British Wheel of
Yoga is currently urging formal training and accreditation for all
yoga teachers in the UK.

In spiritual terms, there is growing dissatisfaction amongst New Age

tourists with ’fake gurus’. There is also a question on the labels that
are being placed on wellness facilities such as spas, as they are
often confusing or misleading for the consumer. Clearly, further
research is needed to identify which areas of wellness and wellness
tourism are still unregulated and which would benefit from
increased intervention. However, this is a difficult area because the
holistic sector is often ’ad hoc’ in structure and practice, especially
in Asian countries. Ironically, this is often the major reason for its
great appeal in comparison to more orthodox forms of medicine and
therapy.

Conclusion
Wellness is a journey, not a destination! (Wright State University
2003). One of the key themes that emerge from the research on
wellness tourism is that the journey towards wellness is far more
important than the destination (e.g., Devereux and Carnegie note
that arrival at the final destination often leaves pilgrims or charity
trekkers with a sense of anti-climax). The destination in wellness
tourism is often an alternative space in which one can engage in
self-analysis without the stresses and distractions of home. The
addition of a supportive, like-minded ‘community’ can sometimes
help to further encourage the individual on a journey of self-
discovery.
However, for other wellness tourists, the age-old preoccupation with
rest, relaxation and escapism reigns supreme. But arguably all
wellness tourists are self-aware, active seekers of enhanced well-
being, health and happiness. Of course, wellness is not a static
concept and is subjective and relative, thus always in flux. The
needs of wellness tourists will clearly vary enormously at different
times and stages of their lives. The current diversification of this
sector is, therefore, a welcome development and one which is
worthy of close observation and dedicated research.

Future of “wellness tourism”

The turn of the century has produced concern about the future of
the spa industry in its classic form as a component of a
comprehensive health system; on the other hand, there is the talk of
a renaissance in which the spa industry becomes a fixed component
of the hotel trade. Spa hotels, which up till now shared highly similar
operational and business conditions, are worried about heretofore
lucrative long-term stays, the loss of interest from the healthcare
sphere, the loss of the possibility to generalise the results of spa
treatment, as well as the loss of motivation by qualified healthcare
providers. This trend concerns all traditional spa industry leaders.

On the other hand, the spa industry is becoming a component of

hotel services on a global scale. Wellness or spa operations are not
missing from any newly opened “full-service/upscale” hotel, hotel
lines are adding spa facilities, and “spa brands” are being
franchised. On one hand, traditional spa hotels fear sophisticated
competition, while on the other they could capitalise on the fact that
consumers already consider spa services to be standard offerings
and that these consumers have become accustomed to them and
are familiar with individual procedures.

The traditional facilities are attempting to set themselves apart from

the competition and maintain a hallmark of exclusivity in various
manners such as employing the appellation of “medical wellness,”
certificates, and so on.

Summary
Some of the key points of this chapter are as following:
  Spa means a resort or place of treatment. Spa is a unit
committed to boosting the overall well-being through a variety
of professional services that promote the restoration of mind,
body and spirit.
 The various types of spa are:

o Cruise Line Spa

o Day Spa

o Destination Spa

o Eco-Spa

o Medi-Spas

o Resort Spa

 Spas in India will continue to expand their Ayurvedic menus, for

both overseas clientele who want to experience authentic
Ayurvedic therapies--as well as for locals already familiar with
the benefits, or who wish to adopt their own Indian healing
traditions.