PNW Sportsman$$s Bar

$$ $$140$ for one spoon of Hungarian wine

$$ $$23$ per shot of house liquor $($e$.$g$.$ gin, rum, tequila, vodka$)$

$$ $$100$ for oysters

$$ $$250$ for a spoon of caviar

$$ $$59$ for a BLT Sandwich

Bronlieu$$s Boutique $($the gift shop$)$

$$ $$3,000+$ per men$$s suit

$$ $$13$ small ice cream

$$ $$21$ for nail clippers

$$ GNI$-$brand shampoo and conditioner start at $$6\mathrm{.}50/$ea for a hotel size and go to $$115/$ea for a full size $($selling non$-$Marriot approved amenites of certain types, including shampp and conditioner, is not allowed per the franchise agreement$)$

$$ $$15$ for a GNI$-$logo bag, only available with purchases of $$100$ or more $($also not allowed per the franchise agreement$)$

Sisley$-$Paris Spa

$$ $$215/$hr for massage treatment

$$ $$380$ for a couple$$s massage

$$ $$80$ for each additional half hour $($single$,$ $$105$ for each additional half hour for couples$)$

It is not possible to view a line$-$item P&L statement for the property, but these amenities combined are currently profiting $$5$ million$/$year$.$ Given the aforementioned fixed and variable costs, the hotel$$s amenities are possibly making approximately $$10$ million in revenue each year. This is an astounding figure that is well above industry averages in even the most profitable luxury resorts. Unlike room revenue, these amenities can be out$-$sourced. This means Marriott corporate does not necessarily have access to the financial statements from these amenities. What you do realize is that this Ritz$-$Carlton property has the lowest global occupancy but the highest global amenities revenue. This is solid evidence that something illegal is taking place $$ most likely laundering money.

Also, these figures do not account for event management, banquet space, or the Poverty Bay Steakhouse restaurant $($the primary dining option, which also features in$-$room dining$).$

Based on the information available to you, you believe the following data is correct:

$1.$ Food cost is $20\%$ property$-$wide;

$2.$ The property makes $$12,000,000$ in revenue from these amenities annually;

a$.$ Spa$=20\%,$ Boutique$=15\%,$ Bar$=35\%,$ Valet$=10\%,$ Parking$=5\%,$ and Other$=15\%$

$3.$ The hotel manages $$10,000,000$ in revenue from banquets;

$4.$ The Poverty Bay Steakhouse on property makes $$7,000,000$ in annual revenue $($including room service, which accounts for $10\%$ of Poverty Bay Steakhouse revenue$)$;

Complete the chart on the next page using the aforementioned information.

Table $2.$ Ritz$-$Carlton Seattle Smith Tower

ADR RevPAR Occupancy Supply Demand

Ritz$-$Carlton Seattle

Table $3.$ Ritz$-$Carlton Seattle, Amenities, Food, & Banquets

Q$1$ Q$2$ Q$3$ Q$4$ Annual

REVENUE

Rev, Banquets $$2,500,000$

Rev, Bar $$1,050,000$

Rev, Poverty Bay Steakhouse

Room Service $$175,000$

Rev, Boutique

Rev, Spa

Rev, Valet

Parking $$600,000$

Rev, Other

REVENUE $$29,000,000$

COSTS

Food Cost

Variable Costs $($F&B$)10\%10\%10\%10\%10\%$

Variable Costs $($non$-$food$)25\%25\%25\%25\%25\%$

Fixed Costs

PROFIT