Front_Office_Operations

Chapter 6– Yield management, statistics and reports

Occupancy and revenue statistics

RevPAR (Revenue per available room) / Room yield

RevPAR combines the average room rate and occupancy percentage figures, to determine the contribution each hotel room has made to the financial performance of the hotel in a given period.

In a hotel charging a per-room rate is calculated, simply, as:

Number of available rooms

The position is a bit more complicated if it charges a per-person rate, however, because of the varying multiple-occupancy percentage. An alternative calculation can therefore be used:

RevPAR = Average room rate x room occupancy % in a given period

Chapter 6– Yield management, statistics and reports

Occupancy and revenue statistics

GOPPAR (Gross operating profit per available room)

Of course, businesses are interested in the 'top line' of revenue - but they are even more interested in the 'bottom line' of profit: that is, how much revenue they earn over and above the costs of operating the hotel.

Total rooms available

Gross operating profit figures will be drawn from the hotel's accounts, as prepared by the Finance Manager or hotel accountant.

Chapter 6– Yield management, statistics and reports

Front office reports

4.Front office reports

4.1Daily occupancy reports

4.2Occupancy forecasts

4.3Departmental notifications

Chapter 6– Yield management, statistics and reports

Front office reports

4.1 Daily occupancy reports

An occupancy report is usually prepared daily, either by night audit staff or by the last shift on reception duty. A specimen report form is shown in Figure 6.1, although the exact format and content will depend on the hotel and the computer system used to generate the report (if any).

Note that:

●Different room types are listed separately, to show the occupancy from each type.

●Discounted and complimentary rooms are listed separately, so that managers can ensure that all reductions are justified, and have been authorised.

●The 'room revenue' figure can be cross-checked against the amount posted to guest bills.

●No-show and cancellations are expressed as a percentage of reservations.

Chapter 6– Yield management, statistics and reports

Front office reports

4.2 Occupancy forecasts

Having compiled 'historical' data about occupancy rates for each day, month, season and year, the hotel is not only interested in looking backwards to analyse its performance, it will also be interested in projecting historical patterns and trends forwards to help I forecast or estimate future occupancy levels.

The hotel will seek to forecast future booking levels and patterns, for the purposes of yield management, so that It can target Its marketing, booking and pricing decisions in such a way as to 'smooth out' fluctuations in demand. A three-month forecast is often used for purpose.

Short-term forecasts is also needed, so that reservations staff can make more immediate booking decisions (whether to hold or release rooms and at what rate), and so that operational departments can plan for estimated levels of occupancy.

●A monthly general forecast of occupancy can be made by front office, based on: occupancy the same month of previous years; the level of advance reservations already made; and any known factors which might be anticipated to increase occupancy (e.g.. a special event in the area or

decrease it (e.g.. a new competitor hotel) compared to the previous year.

Chapter 6– Yield management, statistics and reports

Front office reports

4.2 Occupancy forecasts continued…

●A five-day forecast is often produced by front office to cover the next five days, enabling it to take into account more accurate information about current reservation levels, guests' changing plans (e.g.. extended or shortened stays) and so on. The five-day forecast is generally compiled daily, updating it (with the latest reservation data) and extending it one day further ahead. It is posted at the reservations desk - allowing clerks to accept or reject short-notice bookings (and to post 'go slow' notices on the stop/go chart, say) on the basis of the forecast for a given day. It is also circulated to other departments, so that housekeeping can plan work rosters, food and beverages can plan the purchasing of supplies and so on.

Chapter 6– Yield management, statistics and reports

Front office reports

4.3 Departmental notifications

In a computerised system, the sharing of information between different departments of the hotel is comparatively easy. Each relevant department will have access to the same Hotel Management System, via its own computer terminal(s) and/or hand-held devices, and can call-up a variety of reports and status displays.

When a guest arrives, reception inputs the details in the check-in system - and the arrivals list, housekeeping task lists, guest index (for Switchboard) and so on are automatically updated, for the information of other departments. Similarly, if a guest changes rooms, or checks-out, all relevant records and status displays are adjusted accordingly. All relevant records can be printed out (e.g.. to give housekeeping a list of the rooms that require preparation for re-Ietting on a given day), or interrogated by entry to the data base (e.g.. if housekeeping wants to confirm the status of a particular room).

Many hotels still use manual notifications, however, or keep the system in place as a 'back-up' and, as ever, it helps to know what the underlying procedures are.

Chapter 6– Yield management, statistics and reports

Front office reports

4.3 Departmental notifications continued…

Arrivals list

An arrivals list is prepared one day in advance, showing a list of all arrivals expected on the following day: as part of pre-arrival procedures. In addition to the copy retained by reception, to check off checkins, the arrivals list will be circulated to:

●The concierge, porter or enquiry desk: in case of messages, mail or visitors for guests who are due to arrive

●The switchboard: in case of telephone calls for, or enquiries about the arrival of, a guest

●Housekeeping: to confirm that rooms will be made up for a new occupant, and any special requests and requirements

●Guest services: to confirm any special requests and requirements (e.g.. flowers In the room for arrival)

●Guest relations: to warn of the arrival of any VIP guests, for whom special arrangements must be made

Chapter 6– Yield management, statistics and reports

Front office reports

4.3 Departmental notifications continued…

Change notifications

When guests check-in - or at any other point during their stay - they may request or require:

●A different room - e.g.. if the room allocated is not to their liking, or if something is wrong with the room (the air conditioning isn't working), or if the room is not available for the whole duration of their stay

●A different rate or terms - e.g.. if they request an upgrade part way through their stay, or are given a discount or special terms in compensation for some failure of service

●A different number of people in the room - e.g.. if an additional party joins them part way through their stay.

Chapter 6– Yield management, statistics and reports

Front office reports

4.3 Departmental notifications continued…

Guest list

An alphabetical guest list / a house list / guest index is generally prepared each evening to reflect the day's actual arrivals. This is generally circulated throughout the hotel, so that any department can be aware of (and, if necessary, verify) the identity of bona fide guests on the premises.

This will be of most use to:

●Reception: e.g.. to quickly locate or verify a guest's room number, if the guest asks for a key

●Switchboard and concierge: e.g.. to quickly locate a guest's room number, if telephone calls, mail or enquiries come in for them

Room list

A list of all the rooms in the hotel, In room number order, may prepared in accordance with room status records and housekeeper's reports, to show the current status of each room.