Hospitality Industry Definition and Terminology

What is the Hospitality Industry?

In the hospitality industry, effective communication is crucial. Whether it’s managing guest expectations, coordinating events, or optimizing operations, the specialized jargon of the hotel sector plays a pivotal role. Accurate translation of these terms is not just a matter of linguistic precision—it’s essential for maintaining the integrity of service delivery and ensuring seamless interactions across different languages and cultures. Understanding the hospitality industry definition serves as a starting point to grasp the broad scope of this sector.

Read more about the Translation for the hospitality industry.

The hospitality industry encompasses a wide range of services that cater to the needs of travelers, guests, and patrons. It includes sectors like hotels, restaurants, event planning, theme parks, travel and tourism, and more. This industry is characterized by its focus on customer satisfaction and the provision of luxury, comfort, and convenience. It is a key driver of economic growth in many regions, contributing to job creation and cultural exchange. The hospitality industry’s unique structure requires businesses to maintain high standards of service and often involves complex operations that must be managed efficiently to ensure customer satisfaction. This sector thrives on creating memorable experiences, which makes understanding its nuances and terminology essential for anyone involved.

Hospitality Industry Meaning

The meaning of the hospitality industry extends beyond its basic definition. It embodies the principles of service excellence, cultural sensitivity, and operational efficiency. The term “hospitality” itself originates from the Latin word hospes, which means host or guest, emphasizing the importance of treating customers with care and respect. In a broader sense, the hospitality industry is about creating a welcoming environment where guests feel valued and their needs are met.

In today’s globalized world, the meaning of the hospitality industry extends to navigating cross-cultural interactions and delivering services that resonate with a diverse clientele. Accurate translation and localization of hospitality terms are therefore essential, ensuring that the core principles of hospitality are effectively communicated across different languages and cultural contexts.

Hospitality Key Terms Used

Below is a comprehensive list of key terms used in the industry:

• Act of God – A natural disaster that was unpredictable when a contract was agreed upon. Such occurrences are beyond the jurisdiction of the involved parties, thus releasing them from their contractual duties.
• Adjusted Gross Operating Profit (AGOP) – An index of operational earnings after the deduction of the hotel management base fee from the total revenue.
• ADS (Alternative Distribution System) – Encompasses the web and other electronic networks apart from the General Distribution System (GDS), also identified as IDS (Internet Distribution System).
• Advance Rates – Preferential pricing offered to encourage consumers to make reservations ahead of time.
• Affinity Groups – A prevalent mode of group travel, often involving familial gatherings, nuptial celebrations, or educational excursions. Participants share a collective interest or objective for their journey.
• Agenda – A compilation or sequence of activities that form the checklist or timetable for an event.
• Agent – An individual appointed to perform tasks for someone else, granted the authority to do so (e.g., a third-party planner).
• Agreed (AGR) – Rooms that have been reserved under a contractual agreement for a group.
• Allocation – Often pertains to the ‘assignment of rooms,’ such as a set number of rooms reserved for a conference at a special rate.
• Allotment – A specified quantity of hotel rooms set aside for commercialization by a representative or provider.
• Alternative Availability – Proposing different accommodations when the initially sought property is unavailable.
• Amenity – An item or service offered at no extra cost by the hotel for guests or groups (e.g., personal care products).
• Analytical Market Segmentation – A systematic approach for creating revenue management segments from booking data, aimed at providing a solid foundation for forecasting and optimization.
• Ancillary Revenue – Income derived from non-core sources such as parking services, spa facilities, and entertainment venues.
• ARI (Availability, Rates, and Inventory) – An acronym representing Availability, Rates, and Inventory in the hospitality context.
• Arrival – The moment a guest reaches the hotel and completes the check-in process.
• ARR (Average Room Rate) – The mean rate for rooms sold over a specific timeframe.
• Assistant Food and Beverage Manager – Supports the oversight of food and beverage service operations.
• Assistant General Manager – Provides assistance to the General Manager and oversees operations in their absence.
• Assistant Front Office Manager – Involved in supervising front desk operations, including the arrangement of work schedules and conducting staff training.
• Assistant Housekeeper – Contributes to the management of housekeeping responsibilities and may be responsible for particular areas.
• Attendee Density – The ratio of the actual number of event participants to the maximum capacity that the venue can accommodate.
• Attrition – A contractual term in hotel agreements that holds an organization accountable for meeting its booking commitments.
• Attrition Fee – Fees calculated as the financial difference between the actual number of rooms filled and the minimum number required as stated in the attrition clause of a hotel contract.
• Automated Conversation – A fully automated conversation where human intervention is not required.
• Automation – The application of AI technology to various processes so they can be performed without human input.
• Average Bed Rate (ABR) – The total amount charged for beds divided by the total number of beds sold.
• Average Booking Value per Available Room (ABVPAR) – A metric in the hospitality industry that can be calculated by multiplying the number of occupied rooms by the difference between the Average Daily Rate (ADR) and the Cost Per Occupied Room (CPOR).
• Average Daily Rate (ADR) – Calculated by dividing daily revenue by the total number of rooms sold.
• Average Length of Stay (ALOS) – The number of days guests stay at a hotel during a specific period.
• Average Published Rate (APR) – An average price for various types of hotel accommodations calculated over the year and factoring in peak and off-peak seasons.
• Average Rate Index (ARI) – This index reflects the relative price of a hotel’s accommodations compared to its market competitors.
• Back of House – The sections of the hospitality establishment inaccessible to guests, such as the kitchen and storage areas.
• Banquet – A formal, often celebratory meal prepared for numerous guests.
• Banquet Captain/Manager – The individual who oversees the execution of service for catering and events.
• Banquet Setup – An arrangement involving the collective placement of circular banquet tables to optimize the efficiency of meal service.
• Bartender – Responsible for crafting both alcoholic and non-alcoholic drinks for guests.
• Base Fee – A prearranged fee that the hotel’s management company pays to the hotel operator, usually amounting to two to four percent of the hotel’s gross monthly revenue.
• Bed Tax – A supplementary charge added to the cost of a hotel stay, levied by municipal or national authorities based on the hotel’s location.
• Bellhop/Bellman – Provides assistance with guest luggage and acquaints guests with their accommodations.
• Benchmarking – The process of evaluating your hotel in comparison to its competitors, which can span various aspects such as product pricing and service quality.
• BEO (Banquet Event Order) – A document detailing the logistics of an event, used to guide hotel staff in preparing for it.
• Best Available Rate (BAR) – The lowest booking rate available to all guests, which can change depending on the time of day, week, or season.
• Best Rate Guarantee (BRG) – A sales tactic promising that the rate offered on the hotel’s website is better compared to other websites for the same booking.
• Blackout Dates – Specific dates when discounted rates are unavailable at a hotel, often due to peak demand periods.
• Blocked – Rooms held in reserve and awaiting a deposit or confirmation.
• Booking – The act of securing accommodations at a hotel, hostel, or flat/apartment.
• Booking Engine – An online system that can be used by prospective hotel guests to check room availability and make reservations.
• Booking Pace – The speed of reservation confirmations extending from the initial booking to the date of check-in.
• Boutique Hotel – Intimate, upscale hotels that distinguish themselves from larger chains through personalized service and unique offerings.
• Breakfast Included – A hotel rate that includes the cost of breakfast.
• Business Mix – The composition of different market segments contributing to hotel occupancy, quantified by percentage.
• Cabaret Setup – A room arrangement consisting of round tables and seating oriented toward a performance area, with no seats facing away from the stage.
• Check In – The procedure where a guest officially registers at a hotel and receives their room key or key card.
• Check Out – The act of a guest finalizing their hotel bill and returning the room key or key card upon departure.
• Chief Engineer – Manages the upkeep and functionality of the hotel’s critical systems, including heating, ventilation, air conditioning, electrical, and plumbing.
• Children’s Policy – The guidelines a hotel sets regarding accommodations and amenities for guests under the age of 18.
• Concierge – A hotel staff member who assists guests with obtaining services and information about external attractions and amenities.
• Continental Breakfast – A type of breakfast offering that usually includes beverages like coffee and tea, along with baked goods and fruits.
• Convention Services Manager (CSM) – A hotel staff member responsible for coordinating the logistical aspects of events and conferences.
• Cut-off Date – The deadline after which any unreserved rooms in a block will become available for general booking.
• Day Guests – Individuals who utilize hotel services during the day but do not stay overnight.
• Days to Arrival – The count of days remaining until the guest’s scheduled check-in, relevant for evaluating booking trends and forecasting.
• Demand Forecast – The process of using predictive analytics to estimate future consumer interest and product needs.
• Direct Booking – Reservations made on a hotel website, as opposed to bookings made through OTAs, travel agencies, and other third-party networks.
• Early Arrival – A pre-arranged understanding permitting guests to check into their hotel accommodations ahead of the conventional check-in schedule.
• Early Bird – A term used to describe promotions and discounts related to advance bookings within a specific range of dates.
• Eco-friendly – Pertains to goods or services designed to have a reduced impact on the environment.
• Ecotourism – Travel that is environmentally responsible to natural regions, contributing to ecological conservation and benefiting the well-being of local inhabitants.
• En-suite – A private bathroom directly accessible from a bedroom.
• Executive Chef – The culinary leader responsible for menu creation and overseeing all aspects of kitchen operations.
• Executive Housekeeper – The individual overseeing the housekeeping staff, responsible for the overall cleanliness, maintenance, and visual appeal of accommodation.
• Extranet – A secure online platform that enables hotels to manage their rate inventory, information, and restrictions.
• F&B (Food and Beverage) – A common abbreviation used in the hospitality industry for food and beverage services within a hotel or restaurant.
• Family Room – A spacious hotel room designed to accommodate families or groups, typically larger than a standard room.
• Feeder City – A term for smaller cities that provide travelers to larger hub or gateway cities, indicating the origin of tourism flow.
• Financial Controller – Responsible for managing the financial activities of the hotel, including budget management and financial reporting.
• Fitness Centre – An amenity within a hotel offering guests access to gym equipment and workout facilities.
• Forecasting Model – Techniques or tools utilized for projecting key performance indicators (KPIs) within a hotel.
• Front Office Manager – The individual in charge of front desk operations, including managing reservations, guest services, and the concierge team.
• Full Board – An accommodation pricing option that includes a bed and all main meals.
• Full-service Hotel – A hotel providing comprehensive amenities, including but not limited to a pool, fitness center, and dining options.
• Gala Dinner – A formal evening event often featuring speakers or entertainment.
• General Manager (GM) – The executive responsible for the overall operations and strategy of the hotel.
• Geo-Coding – A method to pinpoint the precise geographical coordinates of a hotel in terms of latitude and longitude.
• Global Distribution System (GDS) – A reservation system offering a platform where various services can be purchased from different providers in a comprehensive manner.
• Green Hotels – Refers to accommodations that actively pursue sustainability and aim to minimize their ecological footprint.
• Gross Operating Profit (GOP) – The financial outcome derived from subtracting a hotel’s total operational expenses from its gross operating income.
• Guest Relations Officer/Guest Services Manager – The individual tasked with handling guest feedback and addressing any concerns or grievances.
• Half-Board – A lodging option that includes accommodation, breakfast, and one main meal, typically either lunch or dinner.
• Head Chef – The culinary leader responsible for overseeing the kitchen brigade, which includes Sous Chef(s), Chef de Partie(s), and Commis Chef(s).
• High Season – Peak periods of travel activity when accommodation prices are generally at their highest.
• Hospitality/Hotel Chatbot – A conversational software designed for the hospitality industry, simulating a conversation with a human agent.
• House Count – The total number of guests staying in a hotel at any given time.
• House Manager – A managerial role directly below the General Manager, responsible for the operations of a single hotel.
• Inbound Tourism – The influx of international visitors whose expenditure contributes to the destination country’s economy.
• Individual Booking – A reservation made by a single individual, as opposed to a group reservation.
• Inventory (relative to hotel distribution) – The total count of rooms a hotel has available for sale across various booking platforms.
• Key Performance Indicators (KPIs) – An objectively quantifiable metric used to measure and evaluate the level of success in meeting objectives within a hotel.
• Lanai – A hotel room that features a veranda or ground-floor patio, often with scenic views of a body of water or landscaped gardens.
• Last Room Availability (LRA) – A rate strategy that allows for the hotel’s final room to be booked at a predetermined rate.
• Late Arrival – Guests who notify the hotel that they will be checking in later than the established arrival time.
• Late Check-Out – An option for guests to vacate their rooms after the customary check-out time.
• Lead Time – The interval from when a reservation is booked to the actual date of the guest’s arrival.
• Leisure Guest – Individuals who travel for non-business reasons, primarily for relaxation or enjoyment.
• Limited Service – A type of hotel that does not provide a full spectrum of amenities, such as on-site dining facilities.
• Low Season – A period during the year when travel demand is at its lowest, often resulting in lower hotel rates.
• Loyalty Programme/Scheme – An incentive plan offered by hotels to reward guests for repeated stays by offering points or benefits that can be exchanged for discounts or complimentary services.
• MICE (Meetings, Incentives, Conferences, and Exhibitions) – A specialized sector of tourism dedicated to planning, booking, and facilitating conferences, seminars, and other events.
• Minimum Length of Stay (Min LOS) – The shortest stay a hotel requires guests to book for certain dates.
• Mystery Guest – An assessment tool where a person disguised as a guest covertly evaluates the service quality and operations of a hotel.
• Natural Language Processing (NLP) – A subcategory of AI that helps machines understand and process human language, often used in conversational AI technologies in the hospitality industry.
• Net Rate – A wholesale rate offered to travel intermediaries, such as agents and tour operators, which can be marked up for resale to the end traveler.
• Night Auditor – The hotel employee responsible for overseeing and reconciling all financial transactions from the day during overnight hours and managing late check-ins.
• No-Show – A reservation status when the guest fails to arrive and does not provide prior cancellation notice.
• Occupancy Rate (Occ) – A metric that calculates the percentage of occupied rooms by dividing the number of rooms sold by the total number of available rooms.
• Off-peak – A period during which there is reduced demand for hotel rooms, often resulting in lower prices and promotional offerings.
• Online Travel Agency (OTA) – Third-party online platforms that allow customers to book accommodation and/or other travel services. Examples include Expedia, Booking.com, and Airbnb.
• Operator – Typically refers to the entity responsible for managing a hotel property under a contractual management agreement.
• Optimization – The strategic process that combines analysis of forecasts, available inventory, pricing configuration, and customer interactions to determine the most profitable pricing and room inventory decisions for a hotel.
• Outbound Tourism – The activity of residents traveling from their home country to an international destination.
• Overbooking – The practice of selling a higher number of rooms than the hotel can actually accommodate based on expected cancellations and no-shows.
• Par Rate – The standard rate for hotel services, typically used as a benchmark to compare with other rates, such as discounted or promotional offers.
• Parity – A commitment to ensure uniformity across all sales channels, which may relate to rates, room types, content, and other sales terms and conditions.
• Pax – Slang for “passengers” or “guests,” referring to the count of individuals in the hospitality industry.
• Peak Season – The time period when a hotel experiences its maximum level of occupancy.
• Per Diem – A daily allowance given to guests, typically covering expenses like meals and transportation.
• Porter – An employee at a hotel who assists guests by carrying their luggage.
• POS (Point of Sale) – A combination of software and hardware on the front desk of a hotel or store that allows businesses to sell products, take payments, and record transactions.
• Property Management System (PMS) – Software that streamlines the management of bookings and operational duties within a hotel. Key features include front desk management, booking systems, distribution channels, room cleaning schedules, pricing, room availability, and transaction processing.
• Rack Rate – The standard full price of a hotel room before any discounts or special offers are applied.
• Receptionist/Front Desk Agent – The hotel employee who serves as the initial contact for guests, responsible for managing check-ins and check-outs, assigning rooms, and responding to primary guest requests.
• Revenue Management (RM) – A discipline in hospitality focused on optimizing room availability and rates to maximize revenue, often involving the strategic use of inventory and pricing.
• Revenue Per Available Room (RevPAR) – A metric in hospitality calculated by dividing the average daily room revenue (ADR) by the number of rooms available at the hotel.
• Room Block – A group of rooms held in reserve for a specific set of guests, such as those attending a conference or event.
• Room Service – An amenity provided by hotels allowing guests to order food and beverages to be delivered directly to their room.
• Rooms Yield – A metric calculated by taking the average revenue from all available rooms, then dividing by the total number of rooms and again by 365 days.
• Sales Manager – A professional tasked with promoting and selling the hotel’s services to both individual and corporate clients.
• Security Manager – The person in charge of maintaining the safety and security of the hotel, its staff, and its guests.
• Self-learning AI/NLP – A technology that can learn new expressions and topics and apply them to previously presented issues, often used in hotel chatbots and other AI-driven guest communication tools.
• Shoulder Season – The time frame around the high season, which experiences somewhat reduced hotel occupancy but not the lowest annual rates.
• Single Room – A hotel accommodation designed for individual occupancy, featuring a single bed.
• Snag List – A compilation of defects or issues to be resolved, typically identified during the final stages of a hotel’s construction or refurbishment.
• Sous Chef – The deputy chef in the kitchen hierarchy, acting directly under the Head Chef.
• Spa Manager – The individual responsible for overseeing all aspects of a hotel’s spa operations, including staff management.
• Suite – A more spacious and luxurious accommodation option in a hotel, typically including additional facilities and a distinct living space apart from the bedroom.
• Sustainable Tourism – Pertains to practices in travel and hospitality that are mindful of environmental impact, with travelers or hoteliers often inquiring about a hotel’s ecological footprint.
• TRevPAR (Total Revenue per Available Room) – A KPI used in hospitality to indicate the total revenue that a room can generate, including services such as hotel restaurants and bars (unlike RevPAR, which is limited to the room rate only).
• Tourist Season – The part of the year characterized by a surge in visitors, which can lead to increased accommodation rates.
• Transient Business – A market segment that includes individual travel bookings as opposed to group reservations.
• Turn – The task of rearranging or resetting a meeting space for different events in succession.
• U-Shape Setup – A meeting room configuration where seats are arranged in the form of a ‘U’ with seating typically on the outside facing inwards.
• Upselling – A sales technique encouraging guests to spend more money on purchasing upgrades and premium versions of what they already booked. Examples include room upgrades, hotel spa treatments, special breakfasts, or tickets for local attractions.
• Vacancy – Refers to a hotel room that is ready and available for booking.
• Valet – An individual responsible for parking and retrieving vehicles for guests.
• VIP (Very Important Person) – A guest who is afforded extra attention and privileges due to their significance or relationship to the hotel or event.
• Walk – The action of relocating guests to a different hotel if the original hotel is overbooked.
• Walk-In – A guest who arrives without a prior reservation and books a room, often at a higher rate.
• Wholesale – The sale of hotel rooms in bulk, often at a reduced rate.
• Yield Management – The strategic control of inventory to sell it to the right customer at the right time for the right price to maximize revenue; also known as Revenue Management.
• Year to Date (YTD) – A period starting from the beginning of the current year to the present date, used for financial comparisons and performance assessments.
• Zero-Hour Contract – A working contract between an employer and employee in which the employer is not bound to provide any minimum working hours, while the employee is not bound to accept any work offered.