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This is from Revenue Management for Hospitality Industry. The problem is as follows: The hotel has 175 rooms. Next month the hotel will serve as

This is from Revenue Management for Hospitality Industry. The problem is as follows:

The hotel has 175 rooms. Next month the hotel will serve as the host hotel for the Retired Firefighters Association. The Association blocked 90 rooms per night for Thursday, Friday and Saturday nights at a rate of $99 per night. All the rooms in their block have been picked up. The current rooms availability forecast for the three days of the meeting is as follows (the graph below). The group requested that Latisha add 20 rooms each night to its block at the orginially contracted rate of $99. It states that its members will use all of the additional rooms if they are made available. Latisha is in favor of increasing the block a nd keeping the group together. Mark is opposed. He is convinced he can sell 20 more rooms on Thursday , 40 rooms on Friday, and 30 rooms on Saturday at the normal rack rate of $149.99. Under his plan, he states "The hotel can maximize its ADR." Based on Mark's estimate of future sales to be made at rack rate , Poco (hotel RM) knows the hotel will sell out and maximize its occupancy percentage under Latisha's plan. Help Poco analyze the data and fill in the chart.

7.2

1 Day

3 Days

Total Rooms available at the Hampton Inn

175

525

Under Latishas Plan

Under Marks Plan

Thursday

Friday

Saturday

TOTAL

Thursday

Friday

Saturday

TOTAL

Firefighterss rooms @ $99.00/night

90

90

90

270

90

90

90

270

All Other Rooms @ $149.99/night

55

35

45

135

55

35

45

135

Total Reserved

145

125

135

405

145

125

135

405

Total Rooms Available

30

50

40

120

30

50

40

120

Additional Firefighters rooms sold

0

0

0

0

Transient rooms sold

10

30

20

60

Total Rooms Sold

175

175

175

525

Group revenue

Transient revenue

Total revenue

Occupancy %

100.00%

ADR

RevPAR

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