Rooms Divison Management Review PDF

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Rooms Divison Management Review...

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Rooms Division Management Factor influences tourists:     

Religion->political instability Preferences Enough money to go to the country Transportation Money they have to pay

Inbound tourism: travel inside their own country Classify a hotel:  

Service and quality Target group (different hotel types)

Target markets 1) Purpose of travelling 2) Markets Market  

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Commercial: business hotels near train station Airport: layovers, catch a flight early in the morning, plane crew, cancelled flights  Room service, wake up service, transport, late check in /check out, 24h reception, early breakfast/breakfast to go, newspaper, free local calls, gym Residential : “rent” ( room for a longer stay )the service, offer everything Resort: “destination in destination”, not in a crowed place, perfect landscape B&B: Bed & Breakfast, low budget, limited service Vacation ownership (timeshare): particular period of time, more owners, kind of bought it for a particular time (Novalsol in condominimum) Casino Conferences: banqueting rooms, beamer, equipment, business, often go along with commercial hotels Life-style: modern (example: Ibis Style)

Target market importance     

Guest needs and wants Need to be perceived as attractive by a particular market (loose battle against your competitors) Guest expectations Knowledge about target market helps to be able to translate into an attractive “product” Decision when managing rooms greatly depend on your target market

Service characteristic: important basis    

Intangibility : there is no “tangible good” as a product Inseparability: you cannot separate production and consumption Heterogeneity: the potential for high variability in service delivery Perishability: service cannot be stored

Perishability: Fixed supply and varying demand  

Today only 50 are sold, revenue lost Tomorrow , Super bowl in town, but I can only sell rooms  No way to make up lost revenue  Now way to increase production to meet increased demand

Location   

Fixed: cannot move or deliver to high demand areas Changing value of fixed location: re-routing of highway could harm your business Marketing and sales promotion very important: need to bring customers to hotel

Main markets 1) Business  Early breakfast, flexible check in/ out, shifts (3- shifts), easy connection to travel hubs, wifi, single rooms, dayrooms, corporate rates, easy cancellation policies, women have different needs (lady-spa, high class cosmetic toiletries, inhouse conference rooms/offices)  Single rooms with desk, good communication infrastructure, easy & fast checkin /check- out, easy connection to travel hubs, frequent traveler programs, corporate rates, easy cancellation policies  Year-round, with limited seasonal fluctuation  Less price sensitive than leisure market  Very competitive  Women increasing 2) Travellers Leisure  SPA, different restaurants, entertainment, spacious rooms, king size beds, extended breakfast 7-12h or 11.30h, packages, minibar, (can be used as a fridge), competitive rates through online platforms and at travel agents, available packages with other tourism activities International  Maps, multi lingual staff, transfer service (pick up), breakfast (according to their taste, early/extended)  Acceptance of multiple paying methods (credit cars, traveler cheque), exchange currencies  In-room info material in multiple languages  Easy access to airport (shuttle service) MICE (meetings, incentives, conferences, events)  Banquet rooms, place cars, decoration of hotel facilities, with branded material (flags,..), event contact person outside catering/entertainment, upgrade, treatments (fruits, magazines, flowers, champagne, branded greeting message)  Package of rooms and meeting/ conference facilities  Single contact person at hotel (event and banquet manager)  Know-how of guest´s competitors ( not BMW and Mercedes at the same time) Group travellers  Institutional (open to public), corporate/ government (closed to public)  Meetings off season and generating revenue during a slow time  Try to fill up the hotel  Discount on room rate  Simultaneous check in/ check out for all members  Rooms close to each other

International travelers:   

Travel outside one´s country of citizenship Tend to spend more money than locals May have specialized culinary/other needs

Facts promoting international travel       

Rise in disposable incomes Longer vacation periods Globalization of all businesses More people exposed to international issue through TV, Internet, Movies Decrease in international airfares Exchangeable currency, credits, ATMS

Mission-> goals-> strategies and techniques Rooms division           

HSK (room attendant including supervisors as well as staff) Florist/decoration Laundry F/O Night auditors/concierge F/O agents Reservation Reservation agents Telephone operators Revenue management Yield

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Training Payroll

HR

Sales & Marketing   

Sales (MICE, corporate) PR Marketing

Finance   

Controlling Accounting Purchasing

IT/eng.  

Eng. /maintenance IT sup (Fidelio)

Organization chart: 1. 2. 3. 4. 5. 6.

GM Sales/marketing HR Food & beverage Financial department Rooms Division  Front office  Reservation  Revenue / yield management  Housekeeping  Engineering

250 rooms 70 % occupancy -> 175 rooms      

Average time needed : 5 min (c/i, c/o) per guests ALS Average length of stay: 1 day/night (2x5)x175=1750 minx 7 days=12250 min 8hrsx60min =480min x 5 work days=2400min  Working time/employee per week 1750:480min=3,6->4 employees Shift leaders : 3 agents (1 agent/shift)

Best better case:      

2 res M 2 res agents Yield Housekeeping 5 floor supervisors Technique staff :2

Management: 1. 2. 3. 4. 5. 6.

Objectives Planning Decision Realization Controlling Different objectives  It is a cycle that is not going to end

Managerial Action Plan (what should it cover):   

The objectives  Check out of a bus traveler group 5 am -> satisfy the group The planned action  More employees within the early shift The person responsible for that action  F/O manager

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Other people involved  F/O agents and HR A timeframe and/ or deadline  Operative The needed resources (money, time, material)  Employees Control mechanism  Evaluation Aimed-for benefits  Satisfied customers/ return to our hotel Further points to consider: problem description, potential obstacles, threats, or other negative outcomes  If bus traveler agency is not satisfied with the front office, they probably will not book the hotel anymore  Missing social skills  Hiring employees

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Managerial Action Plan Objective

Action

Responsible

Involved

timeframe

Clean room

train staff

HR/HSK

HSK superv.

Now needed

Control

Benefits

HSK superv.

Satisfied guests

resources

Care of customer: complaints   

Good personal skills, good verbal and non-verbal communications (welcome smile) Every customer makes a contribution towards your salary Dealing with complaints  Listen carefully  Do not interrupt  Wait until the person finished  Apologize  Speak normally  Summarize the complaint  Explain actions taken and how quickly

Main responsibilities:     RD

Welcome First impression Efficient manner Sensitive approach

 F/O -> Guest relation

HSK (rooms out of order, occ. Rooms, satisfied guests)

Reservations Pre arrival-> arrival-> stay-> departure-> post-departure Pre Arrival:  

Revenue manager Guest relation  Revenue management  Marketing efforts  Loyalty programs

Arrival   

F/O Guest relation Concierge  Welcoming  Check-in  Luggage service  Creation of folio

Stay     

F/O HSK Concierge Guest relation Engineering  Communication  Folio maintenance  Room maintenance  Guest profile  Maintenance

Departure   

F/O Concierge Porter  Check-out  Biling  Good-bye

Post-departure  

Guest relations Marketing/sales  Guest retention  Lost and found

Reservation request:

     

Letter Fax E-mail Telephone Personal Travel agency

Immediate request

Future request

Not possible

perhaps

possible

Regret

wait list

accept

Information contained in the reservation 

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Arrival and departure dates, number of nights  Required to avoid confusion  Guest may not be aware of check-in / out cycle Number of persons and who they are  Determine number of beds/ cribs needed Number of rooms required  Party size and type  Groups may be referred directly to hotel/ sales department Type of rooms required  Linked to quality desired/ price sensitivity Corporate affiliations (Annahme, Zugehörigkeit)  Pre- negotiated rates with some companies, corporate rates Price  Quoted top-down or as suggested by yield system  Up-sell by giving benefits of more expensive rooms  Cross-sell by suggesting other properties in the chain Name  Verification and record- billing, info, lost property  Guest history, frequent guest programs (FGP), personalized service Quality of the reservation  Probability no-show Essential information needed to complete reservation

Optional reservation data (nice to know)      

Estimated time of arrivals Save room for late arrivals Special requests (handicap access, ocean view, desired floor)  Rarely guaranteed- try on arrival Smoking preferences Discount or affiliations ( convention rate) Address (needed for record and mail confirmation)

Confirming reservation   

Unique confirmation number Printed confirmation mailed Printed confirmation mailed to guest on request

Reservation coding 

Advance deposit  Cancel reservation if deposit not received Late arrivals  Make sure room is held, if guaranteed Credit card guarantee- indefinite (unbegrenzt) hold, bill if no-show Corporate guarantee- indefinite hold, bill corporation if no-show Travel agents (commission noted) VIPs (fruit basket,..)- treatments Convention/group delegate (separate codes for different groups)

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Individual Traveller Guest not part of a group ( easy to plan One transaction handles many rooms/ people

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Scheduling employees, reducing wasted food etc.

Con:   

May alienate (abschrecken) non-group guests Reduces image of exclusivity in luxury properties Group rate substantially lower than individual rates

Guest profile The more you know about your guest, the better you can provide service  Name, contact, home country, company  Date of birth  Guest history (#of visit, money they spent)  Billing information  Traces Strategic tasks:    

Manage room inventory Provide data for room occupancy, room rate and revenue forecasting Act as a sales generator Support F/O, guest relation, sales & Marketing and general management with info on guests & rooms

Strategic importance 

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General management:  Occ. Figures  Info on VIP guests Sales & marketing  Guest profiles  Guest preferences  Occ. Figures  Up-/ bolt-on/ Cross sale F&B  Guest profiles  Guest preferences  Occ. Figures  Cross sale

HSK  Occ. Figure for staff management Revenue management  Occ. Figures  Booking patterns (which guest book when and how?) Guest relations  Info on (VIP) guests/ returning guests (# of visits, complaints, needs, likes)  Room revenue per guest F/O  Update guest profil  Create & maintain reservations

Cross sell

Reserve a room plus an adjacent product (dinner, spa treatment ) Upsell Originally, the guest wanted a standard room, but you persuade him into booking a deluxe room (selling a better product within the same department Bolt-on sell The guest wants to book a night next week. You sell him a pay –TV package or free WIFI on top (selling a matching product from same department)

Inventory Management   

Match between rooms in the hotel and reservations accepted Hotels should be able to forecast room availability for any given day Common figure to express the status of a hotel´s inventory (quantity) is

Occupancy rate in %= Number of rooms occupied/ number of rooms available On what kind of data can we base our room forecast?        

Arrivals/ check-ins Walk-ins Stayovers No-shows Understays Check-outs Overstays Out-of-order /inventory (OOO/I)

No- shows: 

Scheduled arrival that does not show up (no-show)

No-show %= Number of not checked-in guests */number of guests due to check in Purpose: helps manager to decide when and if to sell rooms to unexpected guests (walk ins) when the hotel is almost fully booked) *guest that have not cancelled their reservation in due time (according to policy) Handling No-shows:     

Push guaranteed & pre-paid bookings Provide cancellation/ confirmation numbers Immediately inform guest if no-show charge is applied Carefully document credit card info Send reservation confirmation stating cancellation and no-show policies

Walk in 

Unexpected arrival that did not make a reservation

Walk in %= Number of unexpected guest/ number of guest due to check in Purpose: Helps F/O manager know how many walk-ins to expect, especially when the hotel is almost fully booked Overstay 

Guest scheduled for departure deciding to stay longer

Overstay %= Number of guest extending stay/ number of guests due to check out Purpose: alerts from F/O manager to potential problems when the hotel is almost fully booked and rooms have been reserved for arriving guets. Understay 

Departure before scheduled departure date

Understay%= Number of guests departing early/ number of stayover guests Purpose: Alert F/O manager to probable additional room availability when the hotel is near full occupancy

Overbooking:    

Anticipate overbookings Train staff how to “walk” on guests Keep a list of available rooms in comparable hotels on critical days Constantly revise no-show/ over- understay etc percentages

Yield management:  

Important to draw the line between elastic and inelastic demand Room nights are conducive (zuträglich) to yield management  Perishable  Fixed capacity

 High fix and low variable costs  Rooms are sold to markets that can be segmented  Increased revenue is a benefit (3-8% additional revenue should be generated by a good yield management system) Necessary information:    

Market segmentation -> willingness of customers to pay Demand and booking pattern -> historical data Pricing knowledge -> competitive pricing methods Integrated information -> yield integrated into every department´s portion of the property management system  Sell the right inventory unit to right customer for the right price at the right time

Yield:   

Allocation control Rate control Availability control:

Performance indicators 

ADR (average daily rate) in €  The € amount received for each room sold  Measure the quality of the business  Problem: what if only one room is sold, but at a high rate. ADR can be misleading  Average daily rate= room sales (measured in €) / number of rooms sold  Example: total revenue 7200€, your numbers of rooms sold: 85 7200€/85 = 84,70€/room

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Occupancy percentage  Relationship between demand (number of rooms occupied) and supply (number of rooms available for sale)  Measure the hotel´s “share of the market”, so it measures quantity  Occupancy rate in %= number of rooms occupied / number of rooms available (all hotel rooms)  Example: your hotel has 120 rooms, you sold 85 85/120 =0,708 -> 70,08 %

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REVPAR (revenue per available room) in €  Relationship between revenue per room and the hotel room inventory available  Measure how well management fills rooms, without cutting prices  REVPAR = total room revenue/ number of rooms available for sale  MOST IMPORTANT MEASURE!  Example: your hotel room revenue is 7200€, your room available for sale 120 7200€ / 120= 60€

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REVPAC (revenue per available customer) in €

 Average revenue generated by each guest  REVPAC: total revenue/ number of guests  Important figure for hotels with high multiple occupancy-> provides an average spending figure per guest 

Double (multiple) occupancy  Refers to any rooms in which there is more than one person  Double occupancy increases per-room revenue, if rates are per-person  In full-service hotels, double occupancy leads to more additional sales  Number of rooms occupied by more than one guest/ number of rooms occupied  Example: 10 rooms are occupied by more than one guest / 85 rooms occupied 10/85 = 0,118 or 11,8%

Terms to know:            

Understay: guest who leaves earlier than expected Overstay: guest who stays longer than expected Stayover: continuing guest, as per booking Overbooking: more rooms sold than available Expected arrivals: guest booked to arrive today Expected departures: guests booked to depart today No show: guest with confirmed/ guaranteed booking who does not arrive, has not cancelled Early arrival: guest who arrive earlier (days before booking) Walk-ins: guest without reservation needing rooms Room count: status of rooms sold and available House count: number of guests in hotel Walking the guests: sending a guest with a confirmed or guaranteed booking to another hote as we are fully booked...