URGENT ANSWER NEEDED WITHIN 20 MINUTES
Subject: Revenue and Profit Management
You are the Reservations Manager of a hotel with 310 rooms serving the two main transient markets, independent business traveller and independent leisure traveller, and also tour groups. The average room rate normally achieved from both transient markets is RM95 (Room only excluding VAT). Average sleepers per transient room are 1.5. The average spend on Food from both transient markets per sleeper per night is RM35. Today, 5th November 2021, you have received a fax from a Tour Operator asking whether you will accommodate a tour of 96 passengers plus 2 courier-drivers for three nights arriving on Monday 16th April 2022. They require 50 rooms, 48 rooms for the 48 couples, and two rooms for the courier-drivers. There will be no charge for the rooms for the courier-drivers, but they will be charged for food (breakfast and dinner). The prospective group is asking for the following Tour Group rate: - Rate details Rate incl. Rate excl. Food VAT VAT allocation Room Per Room allocation person allocatio per person multiplier n per room per person RM23.00 2 RM 46.00 Tour Priced per RM50.00 RM42.50 RM27.00 Group person for S two people sharing Includes full breakfast and dinner. Current room bookings Sun Mon Tue Wed Thu Fri Sat 15/4 16/4 17/4 18/4 19/4 20/4 21/4 165 185 200 160 160 160 Definite Tour Group & Conference 110 bookings (rooms) Forecast Transient 50 Demand (rooms) 90 105 110 130 45 55 Forecast Length-of-Stay Sun 15/4 Mon 16/4 Tue 17/4 Wed 18/4 Thu 19/4 Fri 20/4 1 night 40% 70% 80% % 8096 65% 30% 2 nights 50% 20% 20% 20% 20% 55% 3 nights 10% 1096 1096 0% 1596 15% a) Calculate the likely net revenue gain or loss from accepting this booking after primary transient displacement. Please show all your workings clearly in your answer. + 15 marks) b) Calculate the likely net revenue gain or loss from accepting this booking after total transient displacement (primary and secondary). Please show all your workings clearly in your answer. ( 15 marks) c) What other influences are there on the decision to accept or reject other than the gain/loss calculation? (10 marks d) Other than accepting or rejecting this booking, what other action could be taken? (5 marks) You are the Reservations Manager of a hotel with 310 rooms serving the two main transient markets, independent business traveller and independent leisure traveller, and also tour groups. The average room rate normally achieved from both transient markets is RM95 (Room only excluding VAT). Average sleepers per transient room are 1.5. The average spend on Food from both transient markets per sleeper per night is RM35. Today, 5th November 2021, you have received a fax from a Tour Operator asking whether you will accommodate a tour of 96 passengers plus 2 courier-drivers for three nights arriving on Monday 16th April 2022. They require 50 rooms, 48 rooms for the 48 couples, and two rooms for the courier-drivers. There will be no charge for the rooms for the courier-drivers, but they will be charged for food (breakfast and dinner). The prospective group is asking for the following Tour Group rate: - Rate details Rate incl. Rate excl. Food VAT VAT allocation Room Per Room allocation person allocatio per person multiplier n per room per person RM23.00 2 RM 46.00 Tour Priced per RM50.00 RM42.50 RM27.00 Group person for S two people sharing Includes full breakfast and dinner. Current room bookings Sun Mon Tue Wed Thu Fri Sat 15/4 16/4 17/4 18/4 19/4 20/4 21/4 165 185 200 160 160 160 Definite Tour Group & Conference 110 bookings (rooms) Forecast Transient 50 Demand (rooms) 90 105 110 130 45 55 Forecast Length-of-Stay Sun 15/4 Mon 16/4 Tue 17/4 Wed 18/4 Thu 19/4 Fri 20/4 1 night 40% 70% 80% % 8096 65% 30% 2 nights 50% 20% 20% 20% 20% 55% 3 nights 10% 1096 1096 0% 1596 15% a) Calculate the likely net revenue gain or loss from accepting this booking after primary transient displacement. Please show all your workings clearly in your answer. + 15 marks) b) Calculate the likely net revenue gain or loss from accepting this booking after total transient displacement (primary and secondary). Please show all your workings clearly in your answer. ( 15 marks) c) What other influences are there on the decision to accept or reject other than the gain/loss calculation? (10 marks d) Other than accepting or rejecting this booking, what other action could be taken
