Marriott Hotels is one of the world's
leading operators of hotels and resorts. At year-end, Marriott offered
more than 30,000 rooms through 75
hotels, resorts and franchised inns
located in 59 cities, primarily in the
U.S. An aggressive expansion program will more than double the number of rooms by 1985.
Review of 1980
Performance of the Hotel Group
was strong again in 1980. Operating
profits rose 17% over 1979, while
sales increased 21%.
The 1980 results reflected a
13% growth in the number of company-operated rooms, and higher
room rates. While industry occupancy
rates were hurt by the recession,
demand for Marriott rooms remained strong and occupancy of
comparable units averaged above
80% for the year. The recession did
cause a slight decline in customer
counts in hotel restaurants.
Approximately 70% of our company-operated rooms are owned by
outside investors and managed by
Marriott under long-term agreements. This proportion increased
during 1980, resulting in a slight decline in the group's profit margin.
Marriott proved again in 1980, as
it had in 1974, that its strong marketing capability can adjust to offset a
dip in the nation's economy. And
Marriott continues as one of the
world's most successful major hotel
companies in terms of overall profits,
occupancy rates, and food and beverage profitability.
We plan to expand the company's
hotel rooms at the rate of 20 to 25%
per year through the mid-1980s. This
is an ambitious but achievable
program. To accommodate this
expansion, we have substantially
strengthened our management development capabilities and quality
Since the average hotel project
takes about four years to complete,
much of the room growth for the
next five years now is in some stage
of development We now have over
50,000 hotel rooms—representing
nearly 100 properties—in our development "pipeline".
We gained 3,900 rooms in 1980
through the addition often hotels,
resorts and franchised inns, and
expansion at existing properties.
Approximately 10,500 rooms, including 22 new hotels, are scheduled to
open in 1981. A complete list of
Marriott Hotels appears on page 16.
Strengths of the Marriott System
Over the years, Marriott has developed unique strengths and capabilities in the hotel business, which we
continue to build upon as the Hotel
Group is expanded. These strengths
□ Fully integrated, marketing oriented hotel development process.
We manage every aspect of development, construction and operation,
locating only where two of our three
key market segments appear in depth
(individual business, groups of all
types, or individual pleasure travelers). Locations are carefully balanced
among downtown, suburban, airport
and resort sites, with geographic dispersion over most major markets.
□ Distinctive management philosophy. Marriott hotels have more
comprehensive management involvement and control than is typical
in the industry—particularly in key
areas such as food and beverage,
and marketing. We also have full-
time regional executive teams for
every eight to ten hotels, to help
ensure consistently high service
standards and substantially increased productivity.
□ Strong commitment to organizational and management development. The company worked for
two years to complete the organizational groundwork and accelerated
management development necessary to accommodate the Hotel
Group's rapid expansion in the 1980s.
The regional management organization necessary to handle the new
hotels through 1981 was largely set
by mid-1980 Estimated needs for
property-level management over the
next four years are updated constantly. Special cross-training and
other development programs are
underway, supplemented by selective
recruiting, to ensure that an adequate
pool of qualified management candidates is available.
□ Continued improvements in
products and services. In addition
to innovations in our new hotels, we
continue to improve existing hotels
with an expanded reservation system, updated room decor, new restaurant concepts, rapid check-in and
check-out, and other refinements.
The prospects for Marriott's hotel
operations are more promising than
at any time since we entered the
business 24 years ago. Aggressive
expansion into growth markets, plus
proven management and a continued industry shortage of high quality
rooms, underscore our expectations.
We will continue to further strengthen
our leadership in this industry during