Sample Paper on Occupancy and Room Revenue Demonstrating

Introduction. 3

1.4 evaluate services provided by the rooms division in a range of hospitality businesses. 3

2.1 The importance of the front of house area to effective management 4

2.2 discuss the key aspects of planning and management of the front of house area for a given hospitality operation. 4

2.3 critically discuss the key operational issues affecting the effective management and business performance of the front office area for a given operation. 4

3.1 assess the importance of property interiors and design to effective management 5

3.2 discuss the critical aspects of planning and management of the accommodation service function for a given hospitality operation. 5

3.3 key operational issues affecting the effective management and business performance of the accommodation service function for a given operation. 6

4.1. Explaining revenue yield management 7

4.2. Techniques used in data analysis to promote and maximize revenue. 9

4.3. Evaluating the usage of forecasting and statistical data in the room division. 10

4.4. Describing with calculation the performance indicators used to measure accommodation sales success. 11

Conclusion. 11

References. 12

 

Introduction

Every business activity in the hotel industry is directed towards the revenues (profit) maximization objective. In various instances therefore, hotel managers engage in those activities that will boost performance, allow for growth through improved sales while maintaining higher quality services (Algonquin College 2008). For a revenue maximizing hotel, the intension is to maintain a loyal, and more satisfied customer base in order to remain highly competitive in different market segments. This means having in place a more vibrant leadership structure that will provide guidelines on how the revenue maximization objectives can be met.

1.4 evaluate services provided by the rooms division in a range of hospitality businesses

The rooms division provide three different types of accommodation including vacation rentals for customers on trip training, hospitality exchange accommodation like conferences and camping. Under vocation rentals the hospitality business leases houses and apartments to willing individuals, particularly in areas that capture large number of tourist (Algonquin College 2008). In such a case, it is the responsibility of the rooms division to supply the relevant accommodation utilities apart from meal services in order to cut down the cost of operation. Camping on the other hand is considered self-accommodation practiced among travellers where an individual erect a self-managed roof for security purposed. Before camping, the individual is required to get a permit from the relevant authority to avoid land trespasses and unnecessary conflicts with landowners (Professional Association of Innkeepers International 2010). Hospitality exchange is where the organization itself connects its employees with the locals of an area to be visited. This will ensure prior establishment of a temporary accommodation among the residents of the area to be visited.

2.1 The importance of the front of house area to effective management

As an entrance to the room division, the front of area gives the first impression about the nature and the kind service as well as the space available in the hotel. To ensure effective management, the front of house area should be well decorated and the reception area should have proper ventilations with good lighting points. The front house areas provide visitors with the hotel’s scenic value and should therefore be well protected.

2.2 discuss the key aspects of planning and management of the front of house area for a given hospitality operation

The planning and management aspects should be in line with proper room keeping conditions, well maintained hygiene, safety measures, a 24-hour surveillance, and facility maintenance. Those in charge of security to ensure safety of infrastructure alongside maintaining safer operational environment for the hotel’s workforce and customers.

2.3 critically discuss the key operational issues affecting the effective management and business performance of the front office area for a given operation

Some of the operational issues affecting the front of house area include adequate management and motivation that will result into a warm am highly welcoming staff, and an active department that will convert the needs of customers into completes satisfactions. Similar to motivation is the roles of sales and marketing strategists, which must always be relevant and focus on the changes in market needs (DeFranco 2006). This will also include proper team management that is crucial in areas of decision making. All the mentioned issues will aim at ensuring that the service provided to customers are of higher quality and meets the expectations of both the hotel and customers.

3.1 assess the importance of property interiors and design to effective management

Property interiors and designs only become important to the hotel’s operations if positioned at the front desk (DeFranco 2006). In the case where there are positioned at the front desk, the front office staff and hotel managers find the opportunity to get have a clear view of all guests entering the lobby from either the streets, or the hotel elevators or other points of entrances. The focus on perfect interior decorations of the reception areas, rooms, and lobbies aims at providing customers with a good impression of the hotel and the services provided (Algonquin College 2008). The decoration should include small flowerpot at the reception to bring out the scenic value. The alignment of rooms should be that which matches the colour of linens used in decoration.  Just like in other cases, the hotel offices should be ventilated, spacious and kept tidy at all the times.

3.2 discuss the critical aspects of planning and management of the accommodation service function for a given hospitality operation

Even though the company’s management is to maintain proper operations and relationships between the hotel and its customers, certain ethical issues may arise and these may have negative impacts on the company’s overall revenue yields (Teare, Ingram & Savini 2012). An example of an ethical dilemma that may require critical aspects of planning is where the company management fails to provide an up-to-date information to customers concerning the price changes and discount services the hotel offers. Where the prices change to higher levels, the hotel may experience lower sales since most customers will be forced to seek for alternative products elsewhere (DeFranco 2006). The growth in revenue will, however, be positive where the prices change to a lower level or in situations where the company decides to offer price discounts for bunched purchases. This means that proper customer management entails establishing accurate means of communication and ensuring that customers are well informed about the changes in prices or about the new developments that may have direct impact on them.

In addition to providing appropriate performance structure, the management should ensure accuracy is process formulation; maintain higher levels of accountability and; deliver to the market goods and services that fulfil the tastes and desires of customers (DeFranco 2006). The ability to expand the company, hence the industry, underlie the various programs used by the management to provide detailed analysis of sales techniques the company can us to promote sales. In general, the company through it management must forecast customers preferences in order to be in a position of delivering high quality services that will eventually meet the tastes of customers.

3.3 key operational issues affecting the effective management and business performance of the accommodation service function for a given operation

The main objective of the accommodation service function it to improve office administration and also to ensure provision of maximum hospitality to every guest visiting the hotel. In this line with the mentioned operational issue, the line managers and other office staffs involved in the provision of accommodation services must be empowered to remain flexible, well-articulated and reading to handle the needs of customers while recognizing the state of diversity that exists in the hotel (DeFranco 2006).  The management should also focus on marketing strategies, providing sufficient finances to meet the growing budgets and ensuring that customers are provided with transport services in case of an adventure.

4.1. Explaining revenue yield management

From the introduction section, our attention is first drawn to some of the fundamental processes of that can lead to revenue maximization. Among the many techniques, it is prudent that the management focus on the consumption behavior of the customer, forecast the sales levels based on experiences, and establish a positive perception of the company’s products in order to maximize the sales and profits. The whole concept of revenue management falls under the main category of yield management, which has three fundamental aspects (Professional Association of Innkeepers International 2010). In the process of managing revenues, the company leaders must recognize the fact that the resources are recurrent, perishable and vitally demanded in various market segments by the competitors. A hotel that offers proper management to channels like internet, television media, and social websites in advertisements improves product and service accessibility to customers (Teare, Ingram & Savini 2012). The advertisement platforms also eliminate instances of information asymmetry on the best practices that can allow the company to compete favorably in any of the markets.

The ability to incorporate internet, social sites, and controlled websites to facilitate promotional activities of the company is one of the ways the company can encourage viral advertisement of it bands and services (Professional Association of Innkeepers International 2010). This means that the customers, by searching the company’s products, brands, and services online, get the opportunity to access more information concerning the hotel and the services they expected before their actual visits. Such an information about a product, brand or service is vital sine customers must make rational judgment, compare the company’s products and services with those of other companies in the same industry so that there is quality choice based on individual’s tastes and preferences.

Apart from online promotion, the hotel company and its management may decide to employ the services of intermediaries who also have measurable attributes and contributions when it comes to sales promotion. Under yields management, the major idea is to ensure that the company’s products have the desired values in the market and therefore capable of attracting the projected revenues. The major functions of middlemen in this case will be to purchase the company’s products and services and as a link to more interior markets, ensures that the company’s products sell across different markets (Professional Association of Innkeepers International 2010). The actions of intermediaries contribute to the general growth of the company since the hotel will now be operating in a more expanded market. Similarly, the promotional roles of sales agents also have impact on the amount of sales the company makes in every delivery. With the sales agents in position, the company in one way interacts with its clients and new customers. The sales agents will act as company’s sales representatives in respective markets and they services will only focus on improving the company’s sales over the period of employments.

On lower counts, the hotel management may decide to operate on lower price discounting concepts for the regular customers or for the customers who pay full accommodation prices at the time of booking (Teare, Ingram & Savini 2012). This may also go along with the time allocated to serving each customer, and where a customer has taken more time in waiting for the services to be offered, the management may decide to offer a price waiver with an aim of motivating such a customer to remain patients until the services is provided. It is true that most hotels operations are based on the loyalty and trust from customers and therefore, situations that may create negative perceptions about the company’s operations should be eliminated so that the company is able to maintain the best records throughout its operations (Professional Association of Innkeepers International 2010). The time the customers take before obtaining the services required should be reduced because it may show laxity in service delivery, which may have negative implications on the company’s revenues, or in other operational systems.

Studies have shown that revenue or yield management in a hospitality industry is one of the driving forces for the acquisition of new markets, especially with the changes is production and delivery techniques (Kasavana & Brooks 2009). A company can only subsidize its cost of production if there is value in its operations. Subsidizing the cost of production would mean focusing on those resources that have higher social value attached, and ensuring that every resource in accurate proportion is capable of producing the desired levels of output to meet the growing market demands. Matching current market needs with the hotel’s productive capacity is crucial to the company since the production technique allows managers to plan for the available resources, ensure that the resources are optimally used and finally increase the hotels’ sales and market shares (Kasavana & Brooks 2009). However, at times the approach given in yield managements may expose customers to price differentiation, which according to most studies conducted is considered unethical practice that only aims at maximizing revenues and profits, but not welfare improving. The yield management practice must be welfare improving since both the hotel and customers are considered rational participants in the industry. Without meeting the expectations of customers, it would be hard for the hotel to realize its revenue and profit objectives since the amount of sales will be educing significantly.

4.2. Techniques used in data analysis to promote and maximize revenue

The hotel company that aims at maximizing its revenues must be ready to establish a strong customer based. By engaging in providing customers with loyalty cards, price discounts and service incentives as part of the loyalty program, the hotel management increase service relationship in a way that improves that overall sales for the company (Kasavana & Brooks, 2009). The hotel management must at all times ensure that there is strong customer attachment to the products and services offered, and where there are changes in normal operations, the customers should be kept aware. In other words, detecting, analyzing and influencing the behaviors of customers improves the levels of consumption for the hotel products, brands and services in which case the sales and revenues will increase.

At the same time, the hotel management should consider working on customer referrals (Andrews 2008). The referrals can only be obtained through a performance feedback system, where the satisfied customer suggests the services of the hotel to another customer. Through the referrals, the management gets the opportunity to evaluate its past performance with an aim of making future operations more appealing to customers (Andrews 2008). Otherwise, where the hotel works of different rates, there should be a clear operational structure to eliminate discrepancies that may arise during room charging and allocation. As already stated in our previous section, the hotel managements should also consider providing tariffs on negotiable settlements during peak and off-peak seasons. For example, a client with a corporate package should not be given the same treatment or charges as a family client since their interests and satisfaction requirements are completely different and may be costly on the side of the hotel (Andrews 2008).

4.3. Evaluating the usage of forecasting and statistical data in the room division

Forecasting in rooms division entails providing statistics on cost estimations require by the management to effectively provide the most crucial accommodation services (Andrews 2008). The forecasting in this context is based on the hotel’s historical guest turnout through which the management finds the opportunity to monitor, estimate the value and divide rooms.  In general the hotel management must at all times be in a position to apply forecasting techniques in order to determine the number of guest expected to visit the hotel at a specific period, and therefore putting in place appropriate mechanisms to fulfill the customers’ expectations. This means that the hotel management in bid to maximize room capacity must plan to take future actions following the past experiences with customers. Where there is poor planning, the hotel risks losing a section of its potential customers (Andrews 2008). The Forecasting process should be systematic in order to identify the major barriers in the course of room division that may prevent the management from meeting its targets. The first stage in forecasting entails retrieving statistical data for the previous operational years. The generated data or information can then be used as a starting point to design better methods of reaching potential customers for the purposed of establishing better performance relationships.

The statistical results used in forecasting will help managers make important decisions that will have positive impacts on the future performance of the hotels (Andrews 2008). Particular to such decisions are improved ability to develop marketing strategies, expand the accommodation services, create more departments and engage rooms division to accommodate increasing demands of customers.

4.4. Describing with calculation the performance indicators used to measure accommodation sales success

The May room breakdown for the Five Seasons Hotel in Winchester can be calculated as follows:

Room occupancy percentages = (Occupancy/Total Number of Rooms) x 100% = (180/215) x 100% = 83.7%

Sleeper occupancy percentages = (Guests/total beds) x 100% = (260/355) x 100% = 73.2%

Average rooms rate (ARR) = (11.900/180) = $ 66.11

The above calculations are mainly used by the accommodation department to measure the success of accommodation and sales of rooms.

Conclusion

Industrial competition is one of the factors motivating managers to engage in activities like room division, accommodation allocation and other management relevant to hotel activities.  Improving the services offered by the hotel will include proper decisions to expand the hotel’s accommodation capacity, reservations and also ensuring good access to customers’ details as well as keeping customers updated through the hotel website on the changes in operation and prices. The close contact between customers and the hotel is one of the techniques that can be used by the hotel managements to obtain data on possible sales and expected revenues if all the customers were engaged in consumptio

References

Algonquin College. 2008. Rooms division operations: Student manual, HOS2217. Ottawa: Algonquin Pub. Centre.

Andrews, S. 2008. Textbook of hotel housekeeping management and operations. New Delhi: Tata McGraw-Hill.

DeFranco, A. L. 2006. Hospitality Financial Management. Hoboken: John Wiley & Sons.

Kasavana, M. L., & Brooks, R. M. (Eds.). 2009. Front office procedures. East Lansing, Mich: Educational Institute, American Hotel & Motel Association.

Professional Association of Innkeepers International. (Eds.). 2010. Industry study of bed-and-breakfast/country inns: Operations, marketing & finances. Santa Barbara, CA: The Association.

Teare, R., Ingram, H., & Savini, S. 2012. Strategic management: A resource-based approach for the hospitality and tourism industries. London: Cassell.