HFT 1000 Unit 3 Chapter 11 Managing Revenue and Expenses Making a profit Increasing revenue Lowering costs Seasons Competition In a hotel in industry these factors affect revenue Lowering costs Does not alter the quality of business Income sources in the Hotel industry Occupancy percentage of rooms sold divided by of rooms you have available Determine a acceptable rate by National averages Use of daily audit report from past records Goals of Management Comparison of a competitor s rates Many hotels are business hotels Higher percentage rate during the week V S Resort hotels that perform better on weekends Double occupancy Price by number of guests in a hotel room The more guests per room the more expensive the room will be of guests rooms sold rooms sold Average Daily Rate Measurement of how well management is maximizing revenue income through double occupancy and selling more expensive rooms Attempting to sell as many rooms as possible at the highest rate the market will allow IF room revenue is 63 210 and 430 rooms were occupied what is the average Rule of thumb The ADR cannot be less than the minimum published room rate or greater Room revenue of rooms occupied ADR Average price of rooms sold that night daily rate than the maximum published room rate Yield management How the two compare Occupancy percentage and ADR combined Goal Attain maximum revenue for the hotel Revenue in the Restaurant Industry Revenue concerns are crucial due to high failure rate Very very important to open a restaurant in the right location Failure rate of independent restaurants is very high 50 within the first year of operation fail 90 within the first 3 years of operation fail Prime Costs are the major concern Prime Costs Food and Beverage Two LARGEST expenses in the restaurant industry Often gets wasted given away stolen or sold Cost of food sold Food sales Food Cost 1 the food cost percentage Managing food wisely 1 a Limit wasted food 1 b Securing food to guard against theft 1 c Limit give aways 1 d Payroll 1 e Food cost measures the effectiveness of restaurant management IF food sales equals 85 000 and the cost of the food sold equals 25 500 what is 1 f Maximizing Revenue through selling 1 g Method used by many managers to stay competitive 1 i Reducing and item form the regular price 1 h Discounting 1 j 1 k Up Selling 1 l Goal is to get the consumer to purchase the more expensive item among those that he she is already interested in purchasing upgrades 1 m Top Down Approach 1 n Attempting to sell the most expensive item first and working your way down 1 o 1 p Controlling Costs in the Hotel Industry 1 q Two of the most effective types of cost control in the hotel industry 1 b Saving when it comes to energy help reduce costs 1 c Controlling heat air conditioning water usage electric usage and gas usage 1 e Influenced by seasonality EX if you own a hotel on the beach you may need to reduce 1 a Energy Management 1 d Labor Costs staff during the winter 1 f Can be controlled by 1 1 Increasing staff during peak hours 1 2 Estimating customer levels during meals 3 Hiring more part time workers Adjustments in staffing should be made to reflect the of hotel occupancy Controlling Costs in the Restaurant Industry Food cost control Voluming purchasing is effective but most consider perishability and EP weights to factor in normal waste or shrinkage that occurs during cooking edible storage factors AP weights meaning as purchased portion Two of the most effective types of cost control 1 a Portion control 1 b Volume Purchasing 1 c 1 d Key Management positions 1 e The majority of management and supervisory positions in the hotel and restaurant industry involve revenue and cost control 1 f 1 g Chapter 12 1 h Human Resources Management 1 i In today s business world people are the key The people that work for you are the most important asset of the company 1 j The Human Resources HR Department handles this challenge 1 k Human Resources handles all paper work 1 l Selection Hiring people 1 m Termination Firing of someone 1 n Legal Mandates 1 o Benefits Bonus at the end of the year health coverage 1 u The process of how organizations treat their people in order to accomplish the goals and 1 p Training 1 q Compensation 1 s 1 r Human resources sets their own policies 1 t Human Resource Management objectives of the firm 1 v Functions of the HR department 1 w Planning 1 x Staffing People that would meet the needs of the company 1 y Training and Development Constant always training esp on cruise lines 1 z Turnover and employee loyalty Make sure you have chosen the right person 1 aa Evaluation Monitor how well employees are doing 1 ab Compensation of Benefits 1 ac Health and Safety 1 ad Legislation 1 ae 1 af Planning 1 ag Find out where the demand for new employees is 1 ah HR must predict the future employment needs in terms of turnover or growth 1 ai HR must look into the future trends to asses additional skill needs 1 aj Must develop a plan to conduct needed training 1 ak Remain competitive with wages to attract the best in the industry 1 al Before an organization can open their doors they must determine What work needs to be accomplished How the work should be completed The skills necessary to complete the job Job Analysis Tangible idea of what work needs to be done Hiring a food HR tools manager 1 g Job Descriptions Identifies the tasks responsibilities and dutiesunder which jobs are performed What the food manager needs to do 1 h Job Specifications The knowledge skills and abilities necessary to perform the position A food manager that is certified Job Descriptions and Job specifications 1 1 a 1 b 1 c 1 d 1 e 1 f 1 i 1 j The basis for Recruitment 1 m Selection Training development Evaluating Compensation benefits Health safety issues 1 k 1 l 1 n 1 o 1 p 1 q 1 r 1 s 1 t 1 u 1 v 1 w 1 x 1 y 1 Job Design An HR planning tool Determines how the job should be performed Examines how the job is organized Seeks Productivity for the employer Job satisfaction for the employee The most widely used techniques in job design are 1 a Job simplification Keeping the job simple and not overwhelming the employee 1 b EX no more than 40 hours a week 1 c Job Enlargement Additional assignments given 1 d Job Enrichment Adding more duties and responsibilities to a certain individual because they see potential in you Educating and training the individual so they can operate their skills 1 e Job rotation Employees that have a variety of skills so
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