Financial Management Techniques for Hotel Industry
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This presentation explores the financial management techniques for monitoring and evaluating the performance of the hotel industry. It focuses on accounting ratios and their importance in increasing sales and profitability ratios for sustainability in the international marketplace.
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INTERNATIONAL HOTEL MANAGEMENT
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EXECUTIVE SUMMARY This project is based Gatsby Grange as being the part for small chain of Boutique situated at United Kingdom and Northern Ireland. In this project, the financial management techniques of accounting ratios have been explained for monitoring and evaluating its performance towards hotel industry. This is most important for organisation to increase their sales and profitability ratios for being sustainable at international marketplace.
TABLE OF CONTENTS οExecutive Summary οIntroduction οLiquidity Ratios οTurnover Ratios οProfitability Ratios οMonitoring financial performance of hotel industry οEstimating financial performance of hotel industry οEvaluating financial performance of hotel industry οConclusion οReferences
INTRODUCTION The Hospitality sector further involves hotel, restaurants, amusement parks, casinos, tourism-related services, etc., which encourage visitors to stay safe and live luxurious and comfortable lifestyle at low cost. This project is based Gatsby Grange as being the part for small chain of BoutiquesituatedatUnitedKingdomandNorthernIreland. This project monitors and estimates financial performance of hotel industry from the concept of accounting ratios.
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LIQUIDITY RATIOS The liquidity or solvency ratios that includes current, quick, debt to equityandinterestcoverageratios.Itismostimportantforan organisation to estimate these concepts within business administration to minimise the available long-term debts which leads to increase liabilities. The managers of Gatsby Grange are highly motivated and inspired in developing good employment relations for achieving their goals and objectives within certain date that leads company to gain competitive advantages.
TURNOVER RATIOS TheGatsbyGrangemanagersemphasizeonincreasingtheir turnover ratios for improving the financial position of company at competitive market for challenging with rivalries. It is very essential forhospitalityindustrytoadoptsuchstrategieswithinthe organisation that consists of Total assets, debtors and fixed assets turnoverratio.TheCompanyfurthertakesnecessarystepsto improvetheirqualitativeservicesforsatisfyingthechanging demands of customers by good interior designing with differentiated amenities, gyms, spas, travel and tourism services, etc.
PROFITABILITY RATIOS The main aim for managers of hospitality industry is to generate high profit-margin through enlarging customers by attracting them with various promotional activities. These include digital marketing, print and social media, advertisement, events, etc. The managers of Gatsby Grange further develops competitive strategy through gross profit margin, operating ratios, return on investment, net profit ratio, etc.
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MONITORING FINANCIAL PERFORMANCE The managers of hospitality industry further aims to monitor their financial performance for analysing the current position of company in this competitive world. It is most important for an organisation to perform its business activities as per the ability to achieve desired target that result in growth and expansion of company.
ESTIMATING FINANCIAL PEROFRMANCE The main purpose for managers of hotel industry is to estimate that the financialperformanceofcompanydescribesthetrueandfair estimation. It is most important for hospitality industry to notify each and every expenditure done on every client and the profit or loss generated from it. The main purpose for managers of Gatsby Grange is to estimate their budget for revenue and expenditure which minimise the unwanted expense that affects its profitability ratios.
EVALUATING FINANCIAL PEROFRMANCE The basic objectives for managers of hotels and restaurants is to evaluate that the calculations performed for business are accurate and determine the best suitable outcome for company. It must be analysed and evaluated that the financial estimation of company must create opportunity for company to develop futuristic goals and objectives effectively that leads to remain stable and competitive. The managers of Gatsby Grange further emphasize on minimising its expenditure which results in low cost of service that enlarge customers which increase sales and profitability ratios.
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CONCLUSION From the prescribed project it have been analysed that it is essential foranorganisationtoperformbusinessactivitiesinfinancial management as it analyse the current position of company. This project monitors and estimates financial performance of hotel industry from the concept of accounting ratios.
REFERENCES οMandi, A. K., Onyango, M. and Okelo, B. N., 2017. Influence of service quality on performance of hotel industry in Busia town, Kenya. οMartin,A.,2017.Aninvestigationintocontemporaryhotelgeneral managers behaviour and activity in the context of private, franchise and chain ownership/business models(Doctoral dissertation). οMiteva, N. and Ackovska, M., 2017, March. The impact of hotel chains on thecustomersatisfactionandloyalty.InInternationalScientific ConferenceonEconomicsandManagementEMAN.(pp.856-861). Association of Economics and Managers of the Balkans, Belgrade, Serbia.
CONTINUEβ¦. οSubramanian, N., Gunasekaran, A. and Gao, Y., 2016. Innovative service satisfaction and customer promotion behaviour in the Chinese budget hotel: an empirical study.International Journal of Production Economics. 171. pp. 201-210. οTrianasari, N., Butcher, K. and Sparks, B., 2018. Understanding guest toleranceandtheroleofculturalfamiliarityinhotelservice failures.Journal of Hospitality Marketing & Management. 27(1). pp. 21-40. οVellas, F., 2016.The international marketing of travel and tourism: A strategic approach. Macmillan International Higher Education.
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