Question

44. If a Management Contract only had a provision for the Management company to make Base Management Fee’s only, then they could spend opulently on things like excessive labor to create the most amazing service experience possible?

T / F

45. What is the primary reason for having a minimum of 4 hotels in your comp set?

a. Confidentiality and sufficiency (meaning there are the correct minimum hotel’s in your set)

b. If you had fewer than 5 you may be able to isolate the data and sufficiency

c. It’s just the rules from Smith Travel

d. None of the above

46. If a hotel’s RevPAR index is under 100, why might the GM still get a call from his/her regional Vice President or owner complimenting the results?

a. The hotel’s comp set is underperforming

b. The hotel’s rates are improving on the Transient side

c. The hotel’s % change year over year shows solid growth

d. The GM and the Regional Vice President and stretching to find positive news to share with an owner

47. If the transient rate at the Four Season’s 45 days out is up 12% YOY and transient pace is up strongly YOY 45 days out what would be a logical shift in the hotel’s revenue management strategy be?

a.   Just continue to go after transient volume and forget about trying to find group

b. Keep your premium transient rates open, watch them closely so you don’t accept too much transient as you close in on Day of Arrival, and have sales and marketing aggressively attempt to find high rated group in the Association or Other Segment?

c. Stop accepting transient and have Sales and Marketing should go after high rated Corporate group

d. Close your lower rated Transient Discounted segments, leave all other transient segments open and pray a high rate Corporate Group to drop out of the sky

Answer 1

Answer 44) True

In a Management contact having provisions to make Base Management Fee’s only, then the fees and charges related to manage direct expenses will reduce, thereby giving ample scope for the organization to spending on things like excessive labor, so that the best serice is delivered.

Answer 45) a. Confidentiality and sufficiency (meaning there are the correct minimum hotel’s in your set)

A set of hotels who are the direct competitors for the hotel in concern can be called as a competitive set or comp set. The minimum number of hotels in the set should be 4 as it is impossible to find single or two hotels in all parameters for a similar source of demand. Thus 4 hotels will provide data sufficiency for the expereiment (standard) and will also maintain confidentiality.

Answer 46) c. The hotel’s % change year over year shows solid growth

The reason for GM calling and complimenting will b the improvement of the hotel year over year. It is because the RevPAR index is under 100 then the hotel is underperforming the competitors and as it is calculated on daily basis thus a decrease in short term is not a reason for complementing.

Answer 47) b. Keep your premium transient rates open, watch them closely so you don’t accept too much transient as you close in on Day of Arrival, and have sales and marketing aggressively attempt to find a high rated group in the Association or Other Segment

Transient guests in a hotel is one of the major source of revenue and thus the transient time being longer then the hotel must try and find out ways to earn more revenue through aggressive marketing and other related practices. Also reservation should be limited when the transient date appoaches.