Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Based upon his best estimates of each channel's performance, which channel would produce the highest ADR? Based upon his best estimates of each channel's performance,

image text in transcribed

  1. Based upon his best estimates of each channel's performance, which channel would produce the highest ADR?
  2. Based upon his best estimates of each channel's performance, which channel would produce the lowest ADR?
  3. Based upon his best estimates of each channel's performance, which channel would generate the highest occupancy percentage?
  4. Based upon his best estimates of each channel's performance, which channel would generate the lowest occupancy percentage?
  5. Based upon his best estimates of each channel's performance, which channel would generate the highest RevPAR?
  6. Based upon his best estimates of each channel's performance, which channel would generate the lowest RevPAR?
  7. If you were Scott, to which channel would you allocate the 100 rooms? Why?
6 Scott Haner is the general manager at the City Center Plaza, a 300-room franchised hotel. He is evaluating alternative options regarding the allocation of 100 unsold guest rooms for the third weekend of next month. His property's group room sales department believes (but is not positive) that it can sell 80 group rooms for that date at a rate of $165.00 per room. The hotel's FOM believes that if the 100 rooms are listed on the "Deals at This Hotel" page of the franchisor-operated website, with a 20% discount off the hotel's normal $229.99 rack rate, 90 rooms could sell through the franchisor's CRS website. The sale would apply only to buyers willing to agree that the room would be billed to the guests at the time of purchase and could not be cancelled. Uberhothotels.com, a third-party Internet sales site operator is willing to pay the hotel $160.00 for each room it purchases but wants a commitment from the hotel that it would be able to buy and then resell up to 100 rooms. It believes that it can do so if it lists the rooms as open to all buyers and at a rate of $179.99 per night (plus its estimated taxes and its service fees). Scott already has 200 rooms sold for this specific night at the hotel's rack rate. He has summarized the information about his various sales options below: Scott's Saturday Night 300 200 Rooms available Rooms currently reserved Channel Group sales CRS sale (20% discount off rack rate) Third-party merchant Estimated Room Sales Estimated ADR 80 90 100 $165.00 $183.99 $160.00 Assume that each distribution channel produces as projected. Complete Scott's RevPAR estimate worksheet and answer the questions that follow: RevPAR Estimate Worksheet: City Center Plaza Prepared By Scott H Distribution Channel Group Sales CRS Sale Third-Party Merchant Previous Booked Revenue: 200 rooms @ $229.99 $45,998$45,998 Estimated Channel Revenue Contribution Total Rooms Revenue Estimate Total Rooms Sold ADR Occupancy % RevPAR $45,998

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Management Accounting

Authors: Leslie G. Eldenburg, Albie Brooks, Judy Oliver, Gillian Vesty, Susan Wolcott

2nd Edition

1742166148, 978-1742166148

More Books

Students also viewed these Accounting questions

Question

=+ Which stakeholder needs will be met and satisfied?

Answered: 1 week ago

Question

How much can you spend?

Answered: 1 week ago