Hotel Revenue Management Strategies

This assignment delves into the critical area of hotel revenue management. It examines various strategies employed by hotels to optimize revenue generation, including yield management techniques, pricing strategies, and demand forecasting. The role of technology in modern revenue management systems is also discussed, along with current trends shaping the industry. The provided bibliography includes a range of academic sources and online resources.

Room Division
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TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
TASK A...........................................................................................................................................3
a) Key aspects of legislation and regulatory requirements relevant to rooms division operations
(1.3)..............................................................................................................................................3
b) Roles and responsibilities of selection of accommodation and reception staff (1.2)..............4
c) Variety of services offered by rooms division for wide range of hospitality businesses with
an emphasis on accommodation and front office department (1.1, 1.4) .....................................5
d) Importance of the front of house area and accommodation service to effective management
(2.1, 3.1).......................................................................................................................................6
e) Key aspect of planning and management of the front of house area and the accommodation
services (2.2, 3.2).........................................................................................................................7
f) Main operational issues affecting the effective management and business performance of the
front of house area and accommodation service (2.3, 3.3)..........................................................8
TASK B..........................................................................................................................................9
a) Explanation of yield/ revenue management (4.1)....................................................................9
b) Analysis of sales techniques used to promote and maximize revenue (4.2)...........................9
c) Evaluation of usage of forecasting and statistical data in room division (4.3)......................10
d) Calculation of performance indicators used to measure the success of accommodation
services (4.4)..............................................................................................................................10
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12
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INTRODUCTION
In order to enable the success of hospitality organization within the industry the role of
room division and management plays a vital role for the success (Koide and Ishii, 2005).
However, the Room division department also plays an essential role in enabling the good
housekeeping with managing the front office effectively so that hospitality organization may
attain competitive advantage . However, within the service industry it generally aims to satisfy
the customers and visitors by providing them best services and facilities. Therefore, it can be said
that effectual management of room division operations is consider as an effective aspect that
influences and impact the overall organizational processes.
The present report is being carried out on the Ritz-Carlton hotel company one of the
subsidiary brand of Marriott International. The hospitality organization operates their activities in
the different countries and provide leisure and luxurious services to different visitors and
customers. Furthermore, the report will also measure key aspects of regulation and legislation
that the enforced by the government so that hospitality organization can perform the rooms
division operations in the effective manner. However, the learning will also focuses on
evaluating the diverse range of services that are offered by the room division with the main
emphasis on accommodation and front office department.
TASK A
a) Key aspects of legislation and regulatory requirements relevant to rooms division operations
(1.3)
In order to operate hospitality activities and room division operations of Ritz-Carlton in
the domestic and international marketplace successfully, it is essential for the management to
focus on different aspects of legislation (O'Fallon and Rutherford, 2010). Through focusing on
different legislation and statutory norms, it results in formation of effective room services.
Different legislation and regulatory requirement relevant to room division operations are as
follows-
 Health and safety at workplace: The foremost legislation that is relevant to room division
operations within Ritz-Carlton is focused on enabling health and safety within the
premises so that it may affect individual’s activities within the hotel. The main purpose of
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health and safety legislation is to provide risk-free and safe working environment to the
customers and employees within the organization (Koide and Ishii, 2005). .
 Food safety: Another key legislation that is required within the room division of Ritz-
Carlton includes proper safety while preparing food for the customers and clients. Food
safety legislation generally focuses on providing healthier and nutritional food to their
clients and customers.
 Data protection act- Another key aspect of legislation and regulation related with the
room division operations includes protecting data and personal information of the
customers and clients who prefer their hotel for pleasant stay. It is considered as
significant law that generally aims to protect the information of customers so that their
information cannot be used for unethical purpose (Hussain, 2012)..
b) Roles and responsibilities of selection of accommodation and reception staff (1.2)
In order to provide quality services to the customers and clients, Ritz-Carlton hotel’s key
focus is on the accommodation and reception services as these services attract more customers so
in future, they will prefer their services as compare with the other hospitality organizations.
However, there are varieties of roles and responsibilities that are performed by the staff of
reception. Different roles and responsibilities of the staff related to accommodation and reception
services are as follows-
Accommodation services
1. Staff within accommodation department generally ensures that rooms and
accommodation area are clean and well maintained (Hai-yan and Baum, 2006). .
2. Another role of accommodation staff is to repair the damaged furnishing items and
manage the decoration of room so that customers or guests may have pleasant stay in the
hotel.
3. It is the responsibility of accommodation staff to clean the rooms and change the beds,
curtain etc. when guests leave from the hotel premises.
4. However, it is the role of accommodation staff to mop the bathroom, refill the shampoo
bottle and other items in the bathroom.
Reception staff services
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1. The main role that is played by the staff at reception is to greet visitors and customers
who visits Ritz-Carlton hotel premises along with providing them required information
regarding their services.
2. It is the responsibility of reception staff to supervise guests and give answers of guest’s
questions regarding their reservation of hotel rooms (Key roles and functions in
hospitality enterprises, 2011).
3. Furthermore, the role of reception staff is to answer all the queries and questions of
customers in a proper manner so that they may easily satisfy their guests.
c) Variety of services offered by rooms division for wide range of hospitality businesses with an
emphasis on accommodation and front office department (1.1, 1.4)
Hospitality organization offers numerous of services to their customers and clients that
support in attracting and enhancing its brand image within the hospitality industry. Ritz-Carlton
is one of the renowned luxurious hotels in the UK which offers range of services like
accommodation and front office services. Therefore, it assist in attracting customers by rendering
quality services so that they may have pleasant stay within the hotel. These are also consider as
key services within the hotel as it help in rendering quality services to the customers.
Accommodation department: Key service offered by the room division of Ritz-Carlton is related
to accommodation services (Finn, 2014). This generally includes housekeeping services, linen
services as well as cleaning services that result in keeping room in healthy and safe condition.
Different accommodation services offered by room division include:
 Housekeeping services- In the contemporary scenario, cleanliness and hygiene within the
hotel premises are considered as the foremost priorities for the guests while selecting the
rooms of Ritz-Carlton. Therefore, accommodation department must focus on keeping the
room and lobby of hotel in the clean and hygiene condition. It is the duty of
housekeeping staff to maintain and manage the room clean and free from effluent so that
customers and guests can have pleasant stay. Housekeeping services also have different
functions and responsibilities like changing bed sheets, curtains, towels etc. in the rooms.
 Cleaning services- Another key service within the accommodation department includes
cleaning service that consists of room maids that ensure proper cleaning of lobby and
whole hotel premises (Wood and Brotherton, 2008).. Cleaning service staff generally has
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duty to clean the lobby and other area of hotel so that it may attract customers. However,
it is the duty of cleaning staff to clean waste material from the room’s dustbin and other
area of hotel regularly that increase the ratio of revisiting of guests and clients in the
hotel.
Front office department
 Reception services- It is consider as key services within the hotel as reception area is the
foremost area that is mainly visited by the customers. The reception area is responsible
for creating the first and last impression regarding the services of hotel in the mind of
customers. The main aim of the reception area is to greet and welcome the customers and
guests and meet their requirement and services. However, it's the duty of reception staff
to properly allocate the rooms and suites according to the budget and need of the guests
and customers (Ingram, 2004).
d) Importance of the front of house area and accommodation service to effective management
(2.1, 3.1)
In order to ensure effective management of services within the Ritz-Carlton it is essential
to review the significance of the front house area and accommodation services within the hotel.
However, with the effective interior of premises and design of the hotel is also essential for the
hotel to attract and enhance the brand image of Ritz-Carlton within the hospitality industry.
The front of house area within the Ritz-Carlton is the reception and reservation area that
is consider as mirror of the hotel (Gayar, 2011). However, it is also consider as significant area
of the hotel management system that renders quality services to their guests and customers who
visited their hotel premises. However, the front office area manages all the operational activities
and also handles the meeting with customers, answer the customers phone call, overcome their
issues, manage and maintain the customers data in the system record etc. therefore, the front
office area of Ritz-Carlton plays important role in the effective management of the overall
activities of the hotel (Anderson and Xie, 2010). However, well interior and exterior decors
rooms generally attracts the customers and guests. Ritz-Carlton hotel generally focuses on
providing the pleasant factor that is look and feel by enabling effective interior and exterior
décor of the premises. Furthermore, the effective décor and ambiance of the accommodation and
front office area also attract the customers and guests as providing comfortable environment to
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guests is consider as sense of attracting the visitors to visits the hotel in future also (Blomme,
Van Rheede and Tromp, 2010). In addition to this, front office area also plays significant role in
the hotel as it generally focuses on the preparing the lists of customers that check-in and check-
out from the hotel premises so that they can effectively manage the room services. Furthermore,
well presented and well organized front area of the Ritz-Carlton also act as profitable in
attracting the guests.
e) Key aspect of planning and management of the front of house area and the accommodation
services (2.2, 3.2)
For enabling the success and smooth functioning of the organizational activities it is
essential for the management to focus on planning and managing the activities of front office
area and accommodation services (Ransley and Ingram, 2012). However, the Ritz-Carlton
subsidiary of Marriott International generally focuses on organizing and managing the activities
of front office such as-
 Departmental goals: The foremost planning within Ritz-Carlton hotel must include
assigning the different duties and responsibilities of each and every employees rendering
services within the different department in front office area so that they can perform their
full services for enabling smooth functioning of the organization (Verma, Walsh and
Siguaw, 2010).
 Usage of technology: Another aspect of planning and management of front house area
include using proper technology for enabling the billing and sales to the customers. With
the help of Point of sales and property management system they can easily manage the
account of customers.
 Evaluation process: However, for managing and planning the front office area of Ritz-
Carlton they can also ensure evaluating the requirement and needs of customers and
guests who visited their hotel. The front office area will take proper feedback and
response from the customers regarding the hotel services so in the future they can
improve their services according to needs of customers (Boella and Goss-Turner, 2013).
However, for enabling the effective accommodation services in Ritz-Carlton the
management must focuses on managing and planning their activities so that effective services
must be rendered to their guests and visitors. Foremost aspect of planning and managing the
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services include inspecting the room before allotting the room to another customers or visitors.
For this housekeeping services keep clean the room and wash the bedsheets and curtains before
allotting the room to other customers and guests (Chen and Lin, 2015).
f) Main operational issues affecting the effective management and business performance of the
front of house area and accommodation service (2.3, 3.3)
In order to manage the business performance of Ritz-Carlton front house area and
accommodation services management must engage with the different operational issues. These
operational issues within the Ritz-Carlton directly affect their business performance. However,
managing the services basically involve scheduling of the employees, managing and repairing
the old furnishing etc. so that they may attract large number of visitors and guests (Huang and Ji,
2013). The different operational issues affecting the effective management and business
performance of Ritz-Carlton include-
 Different mind customers- The foremost operational issues the affect the management of
accommodation and front office area include customers. As,the front office area of Ritz-
Carlton have to deal with the different attitude customers that act as the issue in the area.
The front office staff have to deal with all type of customers with different mental
attitude so that they can render quality services to them. Therefore, Ritz-Carlton hotel
must focuses on ensuring the guest service supervisor that monitor the needs and wants of
the customers. However, they will also ensure taking proper feedback from the guests
and customers that have visited Ritz-Carlton hotel for having the pleasant stay (O'Fallon
and Rutherford, 2010).
 Managing human resource- Another operational issues that affect the effective
management of accommodation and front house area services are related with hiring the
qualified candidate for the accommodation department within the Ritz-Carlton. Through
selecting the incompetent personnel within the accommodation area it may act as the loss
for the organization as they will not render quality room related services to their
customers and guests.
 Overbooking of the rooms- Furthermore, overbooking of the hotel room of Ritz-Carlton
is also act as the key operational issues that will affect the accommodation and front
office services of the hotel premises (Koide and Ishii, 2005). As, overbooking of the
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room will affect the performance of the hotel and also lower the reputation as they are not
able to provide accommodation to their customers and visitors.
TASK B
a) Explanation of yield/ revenue management (4.1)
In order to gain or generate the higher profit margin from the operations of Ritz-Carlton it
is effective for the management to focus on the yield/revenue management. However, this
process result in forecasting, indulging and influencing the behaviour of the visitors and
customers of Ritz-Carlton to use their services. Therefore, it can be stated that enabling the
revenue management will assist the Ritz-Carlton in boosting and encouraging the sales of their
rooms and suites with generating the higher profit margins (Hussain, 2012).
In addition to this, it also support the Ritz-Carlton in assessing and predicting the demand
of customers and visitors in the hotel with modifying the services and pricing of the rooms so
that they can directly maximize the revenue of the organization. It has also been stated that with
the increase in number of hotel services it will result in attracting large number of customers and
guests towards the services of Ritz-Carlton.
b) Analysis of sales techniques used to promote and maximize revenue (4.2)
 Effective promotion and marketing: One of the effective sales techniques that is being
used to promote and maximize the revenue of hotel include focusing on effective tool of
promotions and marketing so that it may enhances their brand image in the overall market
(Hai-yan and Baum, 2006). However, with the help of effective promotion they may also
target large audiences and provide information regarding their services that often
maximizes the revenue structure of the organization.
 Customers loyalty programs: Another sales techniques that is used by Ritz-Carlton to
promote and maximize the revenue include enabling the customer loyalty membership
card that support the customers and guests to avail the additional discount on the services
(The Ritz-Carlton Rewards, 2016). However, it also support the customers in enhancing
the image of Ritz-Carlton among the customers that often result in revisiting the hotel for
having pleasant stay.
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c) Evaluation of usage of forecasting and statistical data in room division (4.3)
In order to succeed in the future it is essential for Ritz-Carlton management to use the
forecasting and statistical data tool in room division as it support in estimating and predicting the
future sales of the room through measuring past records of the hotel. Therefore, it can be stated
that with the help of forecasting tool in room division hotel management can easily estimate the
room demand required in the peak season. The key use of forecasting and statistical data is that I
support the accommodation department in planning and storing the items and supplies so that in
future there will be no wastage and surplus. However, with the help of statistical data they can
also examine and predict the number of visitors who may prefer to visits their hotel in the future
area. For instance; Ritz-Carlton statistical data of august to December month states that sales of
the luxurious suites is quite low. Therefore, in the next year within the particular time period
hotel will keep lower their prices so that customers get attracted towards the services.
d) Calculation of performance indicators used to measure the success of accommodation services
(4.4)
The main strategic objective of Ritz-Carlton is to increase the sales of the rooms and
accommodation services so that it may lead to generate the higher profit ratio. With the help of
calculation of performance indicators it is beneficial for them in measuring and analysing the
performance of Ritz-Carlton in the hospitality industry.
 Room occupancy percentage- The percentage is being calculated by analysing the total
numbers of rooms occupied y the customers with the total number of rooms available
within the Ritz-Carlton (Anthonisz, 2014).
 Double room occupancy percentage- The percentage has been calculated by assessing the
double rooms occupied by the customers with the total number of double rooms in Ritz-
Carlton.
 Satisfaction level of guests- The satisfaction level of the customers is generally evaluated
by the ensuring or rendering the quality accommodation and front offices services to the
guests and customers who visited their hotel.
Rooms Beds Occupancy
75 Single rooms 75 55 occupied
60 Twin rooms 120 50 occupied by the
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two people, 5 occupied
by one person
80 Double rooms 160 30 occupied by the
two people, 40
occupied by one
person
Total- 215 Rooms 355 180 rooms let (260
sleepers)
Room occupancy percentage- 180/215 * 100 = 83.72%
Double occupancy percentage- 70/80 * 100 = 87.5%
Sleeper occupancy percentage- 260/355 * 100 = 73.23%
CONCLUSION
From the above report it has been concluded that room division is the important operation
within the hospitality organization that focuses on smooth functioning of hotel in the long run.
the report has also measure key aspects of regulation and legislation that the enforced by the
government so that hospitality organization can perform the rooms division operations in the
effective manner. However, the learning will also focuses on evaluating the diverse range of
services that are offered by the room division with the main emphasis on accommodation and
front office department.
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REFERENCES
Books & Journals
Anderson, C. K. and Xie, X., 2010. Improving hospitality industry sales twenty-five years of
revenue management. Cornell Hospitality Quarterly. 51(1). pp.53-67.
Anthonisz, A., 2014. Assessing the future of housekeeping operations in Dubai’s five-star hotel
industry – room for innovation?. Worldwide Hospitality and Tourism Themes. 6(4). pp.352
– 3.
Blomme, R. J., Van Rheede, A. and Tromp, D. M., 2010. The use of the psychological contract
to explain turnover intentions in the hospitality industry: a research study on the impact of
gender on the turnover intentions of highly educated employees. The International Journal
of Human Resource Management. 21(1). pp.144-162.
Boella, M. and Goss-Turner, S., 2013. Human resource management in the hospitality industry:
A guide to best practice. Routledge.
Chen, L. C. and Lin, S. P., 2015. Job Standardization and Organization-Based Self-Esteem in the
Hospitality Industry: A Perspective of Socialization.International Journal of Business and
Information. 10(4).
Gayar, E. F. N., 2011. An integrated framework for advanced hotel revenue management.
International Journal of Contemporary Hospitality Management. 23(1). pp.84 – 98.
Hai-yan, K. and Baum, T., 2006. Skills and work in the hospitality sector: The case of hotel front
office employees in China. International Journal of Contemporary Hospitality
Management. 18(6). pp.509-518.
Huang, Z. and Ji, Y., 2013. Design and demonstration of room division multiplexing-based
hybrid VLC network. Chinese Optics Letters. 11(6). pp.060603.
Hussain, H., 2012. Hotel Room Division Management: An Evaluation Study. Lap Lambert
Academic Publishing.
Ingram, H., 2004. Developing Hospitality Properties and Facilities Hospitality management.
Butterworth-Heinemann.
Koide, T. and Ishii, H., 2005. The hotel yield management with two types of room prices,
overbooking and cancellations. International Journal of Production Economics, 93,
pp.417-428.
O'Fallon, M. J. and Rutherford, D. G., 2010. Hotel Management and Operations. John Wiley &
Sons.
Ransley, J. and Ingram, H., 2012. Developing hospitality properties and facilities. Routledge.
Verma Ph D, R., Walsh Ph D, K. and Siguaw, D. B. A., 2010. Cases in Innovative practices in
hospitality and related services: Set 3.
Wood, R. C. and Brotherton, B., 2008. The SAGE Handbook of Hospitality Management. SAGE.
Online
Finn, A., 2014. Ideas for Hotel Revenue Management. [Online]. Available through:
<http://smallbusiness.chron.com/ideas-hotel-revenue-management-14431.html>.
[Accessed On 4th February 2016].
Key roles and functions in hospitality enterprises, 2011. [Online]. Available through:
<http://hsc.csu.edu.au/hospitality/hosp_240/comp_units/SITHIND001B/4372/
key_roles.htm> [Accessed On 4th February 2016].
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The Ritz-Carlton Rewards. 2016. [Online]. Available through:
<http://www.ritzcarlton.com/en/Rewards/Default.htm>. [Accessed on 4th February 2016].
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