UNDERSTANDING HOTEL ORGANIZATIONS. Organizational Chart Line and Staff Functions Business Forms Revenue Sources Profit and Costs. Contents. Like most service related organizations, hotels are divided between LINE functions and STAFF functions.
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UNDERSTANDING HOTEL ORGANIZATIONS
FOOD AND BEVERAGE DEPARTMENT
Food and Beverage Department cont.
Sales and Marketing Department
Human Resources Department
Engineering and Security
Concierge / Bellhop
The five basic lodging business forms:
Additional costs typically include royalty fees, reservation fees, marketing fees, frequent traveler fees, and miscellaneous charges for items like training or commissions. These numbers are calculated assuming a 300-room hotel with 60% occupancy for the first year, so actual costs can vary. Total costs over ten years can run as high as $10 million or more.
A revenue source is the result of a product or service a hotel makes available to guests for a price.
e.g. 75 rooms sold of 100 rooms available
= 75% occupancy rate
1. Selling space for a specified period
2. Providing food and beverage service in theserooms
Debt service of owners$0.50
Roomcost =Actual CostRoom Rate
Room Rate – Room Cost = Profit
Food cost = Purchase Price / Menu Price
ItemPurchase PriceMenu PriceFood Cost
Caesar Salad $1.99/ea. $ 9.95 20.0%
Consider the following example:
Room CostRoom RateProfit Margin
The daily maximum room profit potential is:$48,000 ($120x400)
$17,520,000 is the maximum potential room profit that ABC Hotel could make in a year. Each unoccupied room subtracts from that number. It is easy to understand why hotel operators focus so much attention on occupancy.