2 Activity

Sum up what you've learned from the text about:

1. tangible and intangible elements of hospitality indus­try that might influence the price;

2. price reductions and discounts in hotel industry;

3. the features that make the hotel trade similar to heavy and labour-intensive industries;

4. competitive advantages for industrialised countries;

5. the profound changes in the whole structure of the hotel trade;

6. economies of scales and their benefits for small hotels,

7. the functions of the accounting department;

8. the personnel of the accounting department and their responsibilities.

Give your explanation of the following:

inter-related ingredients; superficially; an all inclusive price; an inferior service; flexible payment systems; direct and indirect employment; labour-intensive industries; a competitive advantage; complementary services; the principal accommodation capacity; franchised chains; economies of scale; publicity campaigns; to post the guest accounts; to locate trouble spots; to employ an outside accountant; to eliminate the operation; overdue accounts.

3 Activity

Read the memo explaining the Grand Hotel's policy on room rates. Think of Russian equivalents for the arrangements mentioned.

From: The General Manager Date: September 3,200...

To: All Front Office Staff Subject: Pricing Policy

It's clear that some clarification of our policy on pricing and room rates is needed. We have a basic rate for all room types. However, it is common for different rates to be charged. This is because the Sales and Marketing Department negotiates special rates for different agents, corporate clients and other clients.

The basic rates are:

Standard room:-£80.00 (double)

Luxury / Executive Plus:-£115.00 (double)

Suite-Individually priced

Standard discounts:

Weekend rate (Fri / Sat or Sat / Sun):-15% discount

Weekly rate:-seven nights for the price of five

Specially negotiated rates: Most guests come as part of a tour, through a tour operation, or as a corporate guest. In this case a special rate will have been negotiated and will be on the computer for Reservations and the Front Office to access.

Free Sale Agents: Free Sale Agents are sent availability charts every two weeks. They sell rooms at an agreed rate (usually the corporate rate). They don't have to check with us, so administration costs are kept low.

Allocation Holders: Allocation Holders have a certain number of rooms which they agree to sell (usually at FIT rates). The customer pays them directly and they take commission and pass on what is left to the hotel.

For weekends they have the rooms on a 48-hour release (in other words the hotel can take them back by Thursday and resell).

If you have any more questions, please speak to the Reservations Manager or the Sales and Marketing Department

Answer the questions:

a) Who decides the rate for different agents?

2. When must a guest stay to get a 15% reduction?

3. Where does the hotel get most of its guests from?

4. Why does selling rooms through Free Sale Agents keep administration costs down?

5. What is the difference between a Free Sale Agent and an Allocation Holder?

Using the information in the memo, calculate the income for the hotel in each of these cases:

1. Three couples staying for two nights (Friday and Sat­urday) in Standard rooms.

2. One businessman staying in an Executive Plus room for three nights (not a corporate client).

3. A group of ten corporate clients each staying in a separate room (luxury) for one night.

The Sales and Marketing Department has agreed a 20% discount with this company.