Scenario - Replacement of hotel vacuum cleaners

In support of sustainability, the general manager of YYZ Hotel is considering replacing all its old vacuum cleaners, which are used in cleaning up guest rooms.

The new cleaners have to be more energy efficient, with better HEPA and filtration system.

Background of the hotel

A 4-star hotel in Markham with 300 rooms

Average occupancy is 75% with ADR of $90

On average, each housekeeper can clean up a room in 30 minutes.

Check out time of the hotel is 11am and check in is 3pm

Of all the rooms needed to be cleaned, approximately 70% have to be done during 11am to 3pm

All housekeepers are scheduled a 9-hour work day with 1 hour break (no paid)

With the new vacuum cleaners, 2 minutes can be saved on cleaning up each room

The power of existing vacuum cleaners are 1,500 watts

Required

Prepare a cost benefit analysis to help making decision based on the scenario above.

Identify the framework of your cost benefit analysis (i.e., goals and objectives; metrics to be used e.g., currency)

Identify cost and benefits

Compare the total value of benefits and costs