Question
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.
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| 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 |
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Additional Firefighters rooms sold |
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| 0 | 0 | 0 | 0 |
Transient rooms sold | 10 | 30 | 20 | 60 |
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Total Rooms Sold | 175 | 175 | 175 | 525 |
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Group revenue |
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Transient revenue |
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Total revenue |
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Occupancy % | 100.00% |
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ADR |
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RevPAR |
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