Question

	2015			2014
	Rms	Rate	Rev	Rms	Rate	Rev
Retail	14,413	894.80	12,896,723	14,090	888.12	12,513,626
TMC/ Consortia	7,530	831.31	6,259,727	5,638	807.66	4,553,604
Corporate	10,194	454.67	4,634,866	10,140	544.29	5,519,151
Pkg	3,150	826.13	2,602,319	3,420	684.80	2,342,001
Fit/ Wholesale	7,734	452.15	3,496,891	6,292	441.93	2,780,649
Disc	7,525	553.57	4,165,599	7,636	565.06	4,314,790
OTA	5,766	453.11	2,612,633	5,603	411.46	0
Ttl Trans	56,312	651.17	36,668,759	52,819	649.94	34,329,229
Gr Corp	9,093	446.61	4,061,033	8,341	441.02	3,678,584
Gr Assn	161	373.18	60,081	394	518.67	204,356
Gr Gov	0	0.00	0	8	309.00	2,472
SMERF	228	530.82	121,028	226	770.90	174,223
Ttl Group	9,482	447.39	4,242,141	8,969	452.63	4,059,635
Total Rooms	65,794	$ 621.80	$ 40,910,900.50	61,788	$ 621.30	$ 38,388,864.00

The Attached report shows the performance of Hotel XYZ for 2014 and 2015. Hotel XYZ is a luxury resort with a mix of 85% Transient and 15% Group.

After looking at this report, please answer the following questions:

• What was the Total YOY( year over year) growth? Was the growth driven by Room nights? ADR? both?
• Which segment drove this growth or decline? Transient or group?
• Which sub-segment within Transient and Group drove the growth or decline? Please explain both.
• Hotel XYZ overall strategy for next year is to grow rate without significantly increasing room nights. Based on the performance of 2015 and 2014, how will you shift your segmentation in order to achieve this?

Answer 1

	2015			2014			Total Year Over Year Growth			% contribution in total Revenue for year 2015
	Rms	Rate	Revenue	Rms	Rate	Revenue	Room Nights	ADR	Total Revenue
Retail	14413	894.8	12896723	14090	888.12	12513626	2%	1%	3%	31.52
TMC/ Consortia	7530	831.31	6259727	5638	807.66	4553604	34%	3%	37%	15.30
Corporate	10194	454.67	4634866	10140	544.29	5519151	1%	-16%	-16%	11.33
Pkg	3150	826.13	2602319	3420	684.80	2342001	-8%	21%	11%	6.36
Fit/ Wholesale	7734	452.15	3496891	6292	441.93	2780649	23%	2%	26%	8.55
Disc	7525	553.57	4165599	7636	565.06	4314790	-1%	-2%	-3%	10.18
OTA	5766	453.11	2612633	5603	411.46	2305408	3%	10%	13%	6.39
Total	56312	651.17	36668758	52819	649.94	34329229	7%	0%	7%	89.63
Gr Corp	9093	446.61	4061033	8341	441.02	3678584	9%	1%	10%	9.93
Gr Assn	161	373.17	60081	394	518.67	204356	-59%	-28%	-71%	0.15
Gr Gov	0	0.00	0	8	309.00	2472	-100%	-100%	-100%	0.00
SMERF	228	530.82	121028	226	770.90	174223	1%	-31%	-31%	0.30
Total Gr	9482	447.39	4242142	8969	452.63	4059635	6%	-1%	4%	10.37
Total Rooms	65794	621.80	40910900	61788	621.30	38388864	6%	0%	7%	100

the Total YOY Growth can be calculated by using the Formula = {(value of year 2015 - Value of year 2014) / Value of year 2014}* 100
the Total ADR ( Average Daily Rate) can be calculated by using the Formula = Room Revenue / No. of Rooms Sold
% contribution in total Revenue for year 2015 can be calculated by using the Formula = (Sub-Segment Revenue for the year 2015 / Total Revenue from all Rooms ) * 100
It can be seen that the total Increased Revenue is a product of increase in Booth the Room Nights and the ADR.
It can be seen that the retail as is comprising the major proportion of the revnue, the increase in the Retails have impacted the total Growth as a whole.
The Sub Segment of Retails in the Transient Segment has showen growth. This Sub-segment comprise of the 32% of the total revenue generated for the year 2015. And an increase in Revenue from this sub-segment has helped the overall growth of the Organisation. The Sub Segment of Gr Corp in the Group Segment has showen growth. This Sub-segment comprise of the 10% of the total revenue generated for the year 2015. And an increase in Revenue from this sub-segment has helped the overall growth of the Organisation.
Hotel XYZ wants to increase the Rates without significantly increasing room nights, we need to see which segments are still occupied even after increasing the ADR. In the Pkg Section, it can be seen that the occupancy has reduced with the increase in the ADR, and hence we should not increase ADR for the Pkg Sub-segment. Similarly, in the Retail and TMC Sub-segment,the increase in the ADR or the Room Rates have not impacted the Room occupancy, and hence the Room Rates of these sub-segments can be increased. These two sub-segments comprise of total of aprox 47% of the total Revenue (i.e., 31.52 + 15.30 ), hence this will give rise to a total growth. Also, Gr Corp sub-segment also is well occupied even after an increase in ARD. This sub-segment comprise of almost 10% of the total revenues and hence a slight increase in the Room rates for Gr Corp will also help the growth in total Revenue of the Hotel XYZ.