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					The Hotel
Business




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Chapter 4        The Hotel Business

The Hotel Business



            Types of Lodging Businesses

            Hotel Operations




                                          2
               The Hotel Business

               Chapter Objectives

Identify the types of hotel classifications.
Differentiate between business and leisure
guests.
Explain the importance of yield management.
Identify the front-office positions in the rooms
division of a hotel.
Describe the guest services in the hotel industry.
Identify the support-staff positions in the back
house of a hotel.
                                                     3
                    The Hotel Business

                     Lodging Businesses

   According to the American Hotel and Lodging
   Association, the United States has more than
   47,040 properties, generating 2 million jobs and
   $102.6 billion in sales.




Section 4.1                                           4
                     The Hotel Business

                     Classification of Facility

   Lodging classification is based on four factors:




          Guest                               Style and
                    Price       Location
           type                               function




Section 4.1                                               5
 Classification of Facility
          Guest                                   Style and
                        Price      Location
          Type                                    Function

          Business      Budget      Resorts         All suite

              Leisure   Midprice     Airport      Extended stay

                                                Bed-and-Breakfast
                        Upscale     Highway
                                                     (B&Bs)

                                   Downtown           Spas

                                   Conference
                                                    Boutique
                                    centers
                                                    Vacation
                                                   Properties

                                                 Retreat centers

Section 4.1                                                         6
                       The Hotel Business

                       Classification of Facility

    The four categories of guest   transient guest an
    travel type or stay are:       individual traveler with
                                   a reservation, staying
                                   in a hospitality property
          Walk-in guest            for a maximum of 30
          Transient guest          consecutive days

          Corporate guest
          Group guest



Section 4.1                                                    7
                       The Hotel Business

                        Classification of Facility

   The price of a room is based on a number
   of factors:

         Location of property     Season
         Location of room         Types of guest
         Amenities                Meals
         Length of stay



Section 4.1                                          8
                      The Hotel Business

                      Classification of Facility

    Meal plan types include:      meal plan a room rate
                                  that includes meals
         European Plan (EP)
         Continental Plan (CP)
         Bermuda Plan (BP)
         Modified American Plan
         (MAP)
         American Plan (AP)

Section 4.1                                               9
                  The Hotel Business

                  Classification of Facility

    Hotels use yield          yield management a
    management to help        system of maximizing
                              revenue through adjusting
    maximize revenue.         room rates according to
                              demand




Section 4.1                                           10
                      The Hotel Business

                      Classification of Facility

    Calculation tools used in     average daily rate (ADR)
    yield management are:         a rate based on total
                                  sales for the day divided
         Average daily rate       by the total number of
                                  sold rooms
         (ADR)




Section 4.1                                               11
                     The Hotel Business

                     Classification of Facility

    Calculation tools used in    occupancy percentage
    yield management are:        (OCC%) a percentage
                                 calculated daily and based
         Occupancy percentage    on the number of rooms
                                 sold as a percentage of
         (OCC%)                  the total number of rooms
                                 available




Section 4.1                                               12
                      The Hotel Business

                      Classification of Facility

    Calculation tools used in     revenue per available
    yield management are:         room (revPAR) a rate
                                  that reflects a hotel’s
         Revenue per available    revenue per available
                                  room
         room (revPAR)




Section 4.1                                                 13
                     The Hotel Business

                     For All Types of Travelers

   Lodging accommodations come in all types and
   sizes to suit the needs of many kinds of guests.

   Travelers consider price, location, and style of a
   property when making reservations.




Section 4.1                                             14
                          The Hotel Business



4.1


      1.      What are three different types of hotel
              properties?

      2.      What are the two categories of hotel guests?

      3.      What are three factors that can determine the
              price of a room?

Section 4.1                                                   15
                   The Hotel Business

                   Hotel Organization

    The general manager of a   front of the house
    hotel is responsible for   (lodging) the area in a
                               lodging facility that guests
    both front-of-the-house    view, such as the lobby
    and back-of-the-house
    operations.                back of the house
                               (lodging) the area in a
                               lodging facility where
                               support services take
                               place that guests
                               usually do not view


Section 4.2                                               16
                      The Hotel Business

                      The Rooms Division

    The largest revenue center of a lodging facility is
    the rooms division.

    The rooms division includes the front desk,
    reservations, housekeeping, guest or uniformed
    services, and communications.




Section 4.2                                               17
                        The Hotel Business

                        The Front Office

    From a guest perspective, the front office is
    considered the heart and soul of any property.

    The primary functions of the front-desk staff are:


              Selling     Maintaining     Providing
              rooms        accounts     guest services



Section 4.2                                              18
                      The Hotel Business

                      The Front Office

    The sales division or the reservations staff sells
    rooms during the day.

    In the evening the front-desk staff assumes this
    responsibility.




Section 4.2                                              19
                     The Hotel Business

                     The Front Office

    Many lodging facilities have property
    management systems (PMS).

    Sophisticated information technology allows the
    front desk to provide better service while also
    reducing costs for the property.




Section 4.2                                           20
                     The Hotel Business

                     The Front Office

    The most important task of the front-desk staff is
    providing exemplary guest service.

    During check-in, guests contact the front desk
    with questions, requests, and special needs.




Section 4.2                                              21
                    The Hotel Business

                    The Front Office

    The night auditor is a      night auditor the hotel
    front-of-the-house          staff member who does
                                the night audit and
    accounting position.        balances the guests’
                                accounts each evening

    Some properties may         guest service agent
                                (GSA) a hotel staff
    employ a guest service      member who performs all
    agent (GSA).                the functions of a desk
                                clerk/agent, concierge,
                                and valet

Section 4.2                                               22
                    The Hotel Business

                    The Front Office

    Guests can often make reservations directly with
    a property through a centralized reservation
    system (CRS).




Section 4.2                                            23
                    The Hotel Business

                    The Front Office

    The housekeeping department directly affects a
    guest’s perception of cleanliness, safety, and
    security at a property.




Section 4.2                                          24
                      The Hotel Business

                      The Front Office

    Guest or uniformed             guests or uniformed
    services staff members         services staff members
                                   in uniforms, including the
    wear the official uniform of   bell staff, valet, security
    the hotel and are the first    officers, concierge, and
    people whom guests             door or garage attendants

    approach upon arrival at
    the property.



Section 4.2                                                  25
                     The Hotel Business

                     The Front Office

    The concierge position is     concierge a hotel staff
    found at larger properties,   member who helps guests
                                  make arrangements for
    often in city or resort       transportation, restaurant
    locations.                    reservations, event
                                  reservations, and
                                  entertainment tickets, and
                                  advises guests about
                                  activities in the area




Section 4.2                                                26
                     The Hotel Business

                     The Front Office

    The communications department of a hotel is
    another revenue center.

    In-house communications can include voice
    mail, fax service, e-mail, message centers, and
    pagers.




Section 4.2                                           27
                                 The Hotel Business

                                 Systemwide Departments

    Larger hotels maintain centralized systems for
    groups of units.

    Employees are classified as line employees and
    staff employees.

                                             Staff employees support the
              Line employees are in daily
                                            front of the house; they do not
                  contact with guests.
                                              interact much with guests.


Section 4.2                                                                   28
                       The Hotel Business

                        Support Staff

    Support staff in the back of the house include:

          Engineers
          Groundskeepers
          Attendants
          Sales and marketing staff
          Human resources staff


Section 4.2                                           29
 Support Staff
                      Oversee the hotel’s physical plant, buildings, and
          Engineers   grounds


                      Maintain and upgrades the exterior of the facility by
     Groundskeepers   landscaping the property


                      Oversee recreational facilities such as pools, tennis
         Attendants   courts, and golf courses


          Sales and   Persuades guests to stay at a particular property or
          Marketing   chain


           Human      Oversees recruiting, selecting, training, and
          Resources   compensating hotel employees

Section 4.2                                                                   30
                           The Hotel Business

                           Support Staff

    The sales force of a lodging business may
    include different types of sales personnel:

              Sales representatives
              Technical-support staff
              Sales assistants
              Telemarketers



Section 4.2                                       31
 Hotel Staffing                 General
 Food & Beverage                Manager


                             Food & Beverage


                                               Room
       Restaurant   Lounge      Banquet                  Kitchen
                                               Service




Section 4.2                                                        32
 Hotel Staffing                       General
 Front Office                         Manager


                                     Front Office


      Uniformed                                       House-
                      Reservations   Front Desk                    Security
        Staff                                         keeping

       Concierge      Reservations   FD Manager       Executive
                       Manager                       Housekeeper
    Door Attendants                  Asst. FD Mgr.
                                                      Inspectors
      Bell Captain                     FD Clerk
                                                        Room
        Security                     Guest Service    Attendants
                                        Agent
                                                       Laundry
                                     PBX Operator

                                     Night Auditor

Section 4.2                                                                   33
 Hotel Staffing                        General
 Support Staff                         Manager


                                   Support Staff


                                                    Human
              Marketing   Accounting                           Engineering
                                                   Resources

                Sales

              Marketing




Section 4.2                                                                  34
                          The Hotel Business


                             Hotels Online
   Operating an e-tail business on an electronic channel—the
Hotels.com books rooms at over 4,500 hotels throughout the
   Web—can hotel booking to design, delivery, returns, and
world. Similar be costly, due services have made it easier and
   operating expenses.
cheaper for travelers to find accommodations. These Web
sites feature photos and descriptions of rooms and amenities.
   Though Many larger dot-com companies crashed in the
Rating systems help guests know the level of quality they can
   1990’s, small stores like Harris Cyclery of West Newton,
expect in a particular destination. sales using a basic Web
   Massachusetts, actually increase
  site. Today, a third of Harris’s save travelers the hassle of
Online reservation services also bicycle business rides in on
  the and to get hard-to-find parts in personal service.
callingWeb booking overseas roomsanddifferent languages
and time zones.
  Describe an e-business’s home page to your class after
  viewing one through marketingseries.glencoe.com.
For more information, go to marketingseries.glencoe.com.
Section 4.2                                                       35
                      The Hotel Business



4.2


      1. What are three functions of the front office?

      2. What are examples of three uniformed
         services positions?

      3. What is the difference between line and staff
         employees?

Section 4.2                                              36
                   The Hotel Business

                   Checking Concepts

1. Name the factors used to        3. Business guests
                                   1. The factors used to
                                   2. Categories used to
   classify lodging facilities.       describe guests by
                                      are those lodging
                                      categorizetraveling
                                      facilities are are
                                      type of stay guest
                                      for business
2. List the categories used           purposes.
                                      type, price,
                                      business and
   to describe types of               location, and style
                                      leisure guests.
   guests by type of stay.            of service, and
                                      function.
3. Describe a business
   guest.


                       continued                            37
                  The Hotel Business

                  Checking Concepts

4. Identify three rates           6. The positions yield
                                  4. Properties forin the
                                  5. Rates used
   hotels use for yield              managementstyle
                                     identified by are
                                     rooms division are
                                     average daily areat
                                     and function rate
                                     front-office jobs
   management.                       (ADR), occupancy
                                     all-suite facilities,
                                     the front desk, in
                                     percentage
                                     extended-stay
                                     reservations,
5. Identify properties by            (OCC%), bed-and-
                                     facilities, and
                                     housekeeping,
   type of style and function.       revenue per spas,
                                     guest and
                                     breakfasts,
                                     available room
                                     boutique hotels,
                                     uniformed
6. List three positions in the       (RevPAR).
                                     vacation properties,
                                     services, and
   rooms division.                   and retreat centers.
                                     communications.


                      continued                          38
                 The Hotel Business

                 Checking Concepts

7. Name the staff in         8. The in uniformed
                             7. Staffimportance of
   uniformed services.          the sales and
                                services includes
                                marketing valet is
                                bell staff, staff
                                that they persuade
                                staff, concierge,
Critical Thinking               guests to stay at a
                                and security staff.
8. Discuss the importance       particular property
                                or chain. Accept all
   of the sales and             reasonable answers
   marketing staff in the       that demonstrate an
   back-of-the-house            understanding of
   lodging operations.          sales and
                                marketing.
                                                       39
End of


The Hotel
Business




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The Hotel Business




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