Empowering Catering Sales Managers with Pricing Authority

In the hotel business, catering sales managers often encounter potential clients who expect to negotiate for items such as room rental fees, audiovisual charges, and bartending fees. This article addresses both the advantages and disadvantages of empowering sales managers with the authority to reduce or waive these charges. Thus, hoteliers are advised to extend a structured yield management mindset into the hotel’s function-space area.

Hotel Human Resources Directors Identify Ethical Issues

Hotel human resources directors report that the most important ethical issues they face are a lack of work ethic, drug use, and employee theft. When asked about ethical problems experienced in their own hotels. Managers’ report that employees' lack of respect for each other, racial and gender conflicts, guest abuse, dishonesty, and homosexual issues are the biggest problems. The author discusses these ethical dilemmas and suggests ways they can be addressed.

Determinants of Mid-scale Hotel Brand Equity

The traditional brand management in the hotel industry is facing a great challenge as numerous brands provide many choices to hotel guests. In such competitive environments, hotel firms realize that capitalizing on one of the most important assests they own- the brand- is critical to achieve a premier growth goal not only rapidly but also in a cost- effective way. THe purpose of this study is to examine the determinants of cutsomer-based hotel brand equity for the mid-priced U.S. lodging segment by assessing the impacts of four-widely accepted brand equity dimensions: brand awareness, brand associations, percieved quality and customer loyalty. 277 travelers participated in this study at the airport in a Midwestern city. Perceived quality, brand loyalty, brand associations were found to be the core components of brand equity, while brand awareness, a seemingly important source of brand equity, did not exert a significant influence on building brand equity of mid-priced hotels. The result of this study sheds insight about how to create, manage, and evaluate a distinctive and successful hotel brand.

Pricing in the Hospitality Industry: An Implicit Markets Approach

The authors apply economic theory to an analysis of industry pricing. Data from a cross-section of San Francisco hotels is used to estimate the implicit prices of common hotel amenities, and a procedure for using these prices to estimate consumer demands for the attributes is outlined. The authors then suggest implications for hotel decision makers. While the results presented here should not be generalized to other markets, the methodology is easily adapted to other geographic areas.

Planning Buy-Sell Agreements In The Hospitality Industry

In the article - Planning Buy-Sell Agreements In The Hospitality Industry - by John M. Tarras, Assistant Professor, School of Hotel, Restaurant and Institutional Management at Michigan State University, the author initially observes: “The vast majority of hospitality firms (restaurants, hotels, etc.) would be considered closely-held corporations. As such, they have unique planning problems compared to large, publicly-traded hospitality firms. One area of special concern to the closely-held hospitality firm is the planning and adoption of a buy-sell agreement.” The above thesis statement outlines the heart of the article; the buy-sell agreement in regard to smaller [closely held, as Tarras calls them] corporations. The theory is narrow and pro-active, spanning the gap between personal-to-corporate stock manipulations. “The primary purpose of a buy-sell agreement is to contribute to the orderly transfer of a shareholder's stock in a hospitality firm upon some future incident [typically retirement, withdrawal of a shareholder, disability, or death], as Tarras defines the concept. “The hospitality firm or the other shareholders would be committed to purchase the departing shareholder's stock at an agreed upon price and method, and to ensure that ample cash will be obtainable for such an impending sale. The buy-sell agreement provides a market for the shareholder or the shareholder's estate for the sale of otherwise illiquid stock,” the author further provides as canons of buy-sell agreements. In defining the buy-sell agreement with restrictive clauses, Tarras demonstrates, “…many closely-held hospitality firms desire to limit ownership to those individuals, either family or principal corporate employees, who are essential to the well-being of the firm.” Tarras says, another element of the buy-sell agreement is to furnish the departing shareholder with liquidity. “…there typically is some form of cash down payment with the remainder denoted by an interest-bearing promissory note [usually 5 to 15 years],” he informs. “The departing shareholders may require that the hospitality firm pledge the assets of the firm and that the remaining shareholders personally guarantee the promissory note.” “…the most frequent reason for establishing buy-sell agreements is for estate planning purposes,” Tarras says. There are tax advantages and liabilities for both the seller and buyer of stock via the buy-sell agreement, and the author enumerates many of these. One, big advantage of the buy-sell agreement is that it provides for the running of the company with a minimum of disruption through the stock-cash transition process, Tarras offers.

An Industry View of Experiential Learning

With the downsizing of hotel companies in the 1980s and 1990s. internships became a way of supplementing staff during peak seasons and auditioning students for full-time positions upon graduation. The authors surveyed corporate directors of human resources on specific activities and tasks associated with experiential learning in the guest services areas of hotels.

Mobility of General Managers as Lodging Size, Service Vary

Hotel Managerment has usually been viewed as a single labor market which allows considerable movement between properties of different sizes and service levels. The authors question this assumption and support the hypothesis that general managers in one type of hotel will have spent a large majority of their careers in hotels of the same type.

File Control: The Heart Of Business Computer Management

In his study - File Control: The Heart Of Business Computer Management - William G. O'Brien, Assistant Professor, The School of Hospitality Management at Florida International University, initially informs you: “Even though computers are an everyday part of the hospitality industry, many managers lack the knowledge and experience to control and protect the files in these systems. The author offers guidelines which can minimize or prevent damage to the business as a whole.” Our author initially opens this study with some anecdotal instances illustrating the failure of hospitality managers to exercise due caution with regard to computer supported information systems inside their restaurants and hotels. “Of the three components that make up any business computer system (data files, programs, and hard-ware), it is files that are most important, perhaps irreplaceable, to the business,” O’Brien informs you. O’Brien breaks down the noun, files, into two distinct categories. They are, the files of extrinsic value, and its counterpart the files of intrinsic value. An example of extrinsic value files would be a restaurant’s wine inventory. “As sales are made and new shipments are received, the computer updates the file,” says O’Brien. “This information might come directly from a point-of-sale terminal or might be entered manually by an employee,” he further explains. On the intrinsic side of the equation, O’Brien wants you to know that the information itself is the valuable part of this type of file. Its value is over and above the file’s informational purpose as a pragmatic business tool, as it is in inventory control. “The information is money in the legal sense For instance, figures moved about in banking system computers do not represent dollars; they are dollars,” O’Brien explains. “If the record of a dollar amount is erased from all computer files, then that money ceases to exist,” he warns. This type of information can also be bought and sold, such as it is in customer lists to advertisers. Files must be protected O’Brien stresses. “File security requires a systematic approach,” he discloses. O’Brien goes on to explain important elements to consider when evaluating file information. File back-up is also an important factor to think about, along with file storage/safety concerns. “Sooner or later, every property will have its fire, flood, careless mistake, or disgruntled employee,” O’Brien closes. “…good file control can minimize or prevent damage to the business as a whole.”

Protecting Your Assets: A Well-Defined Credit Policy Is The Key

In - Protecting Your Assets: A Well-Defined Credit Policy Is The Key – an essay by Steven V. Moll, Associate Professor, The School of Hospitality Management at Florida International University, Professor Moll observes at the outset: “Bad debts as a percentage of credit sales have climbed to record levels in the industry. The author offers suggestions on protecting assets and working with the law to better manage the business.” “Because of the nature of the hospitality industry and its traditional liberal credit policies, especially in hotels, bad debts as a percentage of credit sales have climbed to record levels,” our author says. “In 1977, hotels showing a net income maintained an average accounts receivable ratio to total sales of 3.4 percent. In 1983, the accounts receivable ratio to total sales increased to 4.1 percent in hotels showing a net income and 4.4 percent in hotels showing a net loss,” he further cites. As the professor implies, there are ways to mitigate the losses from bad credit or difficult to collect credit sales. In this article Professor Moll offers suggestions on how to do that. Moll would suggest that hotels and food & beverage operations initially tighten their credit extension policies, and on the following side, be more aggressive in their collection-of-debt pursuits. There is balance to consider here and bad credit in and of itself as a negative element is not the only reflection the profit/loss mirror would offer. “Credit managers must know what terms to offer in order to compete and afford the highest profit margin allowable,” Moll says. “They must know the risk involved with each guest account and be extremely alert to the rights and wrongs of good credit management,” he advocates. A sound profit policy can be the result of some marginal and additional credit risk on the part of the operation manager. “Reality has shown that high profits, not small credit losses, are the real indicator of good credit management,” the author reveals. “A low bad debt history may indicate that an establishment has an overly conservative credit management policy and is sacrificing potential sales and profits by turning away marginal accounts,” Moll would have you believe, and the science suggests there is no reason not to. Professor Moll does provide a fairly comprehensive list to illustrate when a manager would want to adopt a conservative credit policy. In the final analysis the design is to implement a policy which weighs an acceptable amount of credit risk against a potential profit ratio. In closing, Professor Moll does offer some collection strategies for loose credit accounts, with reference to computer and attorney participation, and brings cash and cash discounts into the discussion as well. Additionally, there is some very useful information about what debt collectors – can’t – do!

An Examination of Stock Performance: The Three Top-Performing Lodging Firms August 1987 - January 1990

A study published in the Fall 1988 issue of the FIU Hospitality Review revealed that the top three lodging stock performers during the period July 1982 to January 1988 were Prime Motor Inns, Inc., Marriott Corporation, and Hilton Hotels Corporation. The author has completed a follow-up study in an attempt to determine how selected lodging firms have fared since the summer rally of 1987 (which preceded the stock crash of October 19, 1987) until more recent times.

Travel Marketing: Industry Relationships and Benefits

In the discussion - Travel Marketing: Industry Relationships and Benefits - by Andrew Vladimir, Visiting Assistant Professor, School of Hospitality Management at Florida International University, the author initially states: “A symbiotic relationship exists among the various segments of the travel and tourism industry. The author has solicited the thinking of 37experts and leaders in the field in a book dealing with these relationships and how they can be developed to benefit the industry. This article provides some salient points from those contributors.” This article could be considered a primer on networking for the hospitality industry. It has everything to do with marketing and the relationships between varied systems in the field of travel and tourism. Vladimir points to instances of success and failure in marketing for the industry at large. And there are points of view from thirty-seven contributing sources here. “Miami Beach remains a fitting example of a leisure product that has been unable to get its act together,” Vladimir shares a view. “There are some first class hotels, a few good restaurants, alluring beaches, and a splendid convention center, but there is no synergism between them, no real affinity, and so while visitors admire the Fontainebleau Hilton and enjoy the food at Joe's Stone Crabs, the reputation of Miami Beach as a resort remains sullied,” the author makes a point. In describing cohesiveness between exclusive systems, Vladimir says, “If each system can get a better understanding of the inner workings of neighboring related systems, each will ultimately be more successful in achieving its goals.” The article is suggesting that exclusive systems aren’t really exclusive at all; or at least they shouldn’t be. In a word – competition – drives the market, and in order for a property to stay afloat, aggressive marketing integrated with all attendant resources is crucial. “Tisch [Preston Robert Tisch, currently – at the time of this writing - the Postmaster General of the United States and formerly president of Lowe’s Hotels and the New York Visitors and Convention Bureau], in talking about the need for aggressive marketing says: “Never...ever...take anything for granted. Never...not for a moment...think that any product or any place will survive strictly on its own merits.” Vladimir not only sources several knowledgeable representatives in the field of hospitality and tourism, but he also links elements as disparate as real estate, car rental, cruise and airlines, travel agencies and traveler profiles to illustrate his points on marketing integration. In closing, Vladimir quotes the Honorable Donna Tuttle, Undersecretary of Commerce for Travel and Tourism, “Uniting the components of this industry in an effective marketing coalition that can compete on an equal footing with often publicly-owned foreign tourism conglomerates and multi-national consortia must be a high priority as the United States struggles to maintain and expand its share of a rapidly changing global market.”

Selection Of Students For Hotel Schools: A Comparative Study

In the discussion - Selection Of Students For Hotel Schools: A Comparative Study - by William Morgan, Professor, School of Hospitality Management at Florida International University, Morgan’s initial observation is: “Standards for the selection of students into schools of hospitality management around the world vary considerably when it comes to measuring attitudes toward the industry. The author discusses current standards and recommends some changes.” In addition to intellectual ability, Professor Morgan wants you to know that an intangible element such as attitude is an equally important consideration to students seeking curriculum and careers in the hospitality field. “…breaches in behavior or problems in the tourist employee encounter are often caused by attitudinal conditions which pre exist the training and which were not able to be totally corrected by the unfreezing, movement, and refreezing processes required in attitudinal change,” says Morgan. “…other than for some requirements for level or grade completed or marks obtained, 26 of the 54 countries sampled (48.1 percent) had no pre-selection process at all. Of those having some form of a selection process (in addition to grades), 14 schools in 12 countries (22.2 percent) had a formal admissions examination,” Professor Morgan empirically provides. “It was impossible, however, to determine the scope of this admissions examination as it might relate to attitude.” The attitude intangible is a difficult one to quantify. With an apparent sameness in hotels, restaurants, and their facilities the significant distinctions are to be found in their employees. This makes the selection process for both schools and employers a high priority. Moreover, can a student, or a prospective employee, overcome stereotypes and prejudices to provide a high degree of service in the hospitality industry? This query is an important element of this article. “If utilized in the hotel, technical, or trade school or in the hiring process at the individual facility, this [hiring] process would provide an opportunity to determine if the prospective student or worker is receptive to the training to be received,” advises Professor Morgan. “Such a student or worker is realistic in his aims and aspirations, ready in his ability to receive training, and responsive to the needs of the guest, often someone very different from himself in language, dress, or degree of creature comforts desired,” your author further counsels. Professor Morgan looks to transactional analysis, role playing, languages, and cross cultural education as playing significant roles in producing well intentioned and knowledgeable employees. He expands upon these concepts in the article. Professor Morgan holds The International Center of Glion, Switzerland in high regard and cites that program’s efforts to maintain relationships and provide graduates with ongoing attitudinal enlightenment programs.

Manager's Perceptions of Alcohol Server Staffing and Training Methods

Over-consumption of alcoholic beverages is a concern of managers of hotels and motels with a club/lounge, restaurant, and tavern. The authors surveyed members of two industry associations in Oklahoma to ascertain alcohol server training methods and managers' perception of the value of such programs.

An Analysis of Stock Market Performance:The Dow Jones Industrial Average and the Three Top Performing Lodging Firma: 1982-1988

In their dialogue - An Analysis of Stock Market Performance: The Dow Jones Industrial Average and the Three Top Performing Lodging Firms 1982 – 1988 - by N. H. Ringstrom, Professor and Elisa S. Moncarz, Associate Professor, School of Hospitality Management at Florida International University, Professors Ringstrom and Moncarz state at the outset: “An interesting comparison can be made between the Dow Jones lndustrial Average and the three top performing, publicly held lodging firms which had $100 million or more in annual lodging revenues. The authors provide that analytical comparison with Prime Motor Inns Inc., the Marriott Corporation, and Hilton Hotels Corporation.” “Based on a criterion of size, only those with $100 million in annual lodging revenues or more resulted in the inclusion of the following six major hotel firms: Prime Motor Inns, Inc., Marriott Corporation, Hilton Hotels Corporation, Ramada Inc., Holiday Corporation and La Quinta Motor Inns, Inc.,” say Professors Ringstrom and Moncarz in framing this discussion with its underpinnings in the years 1982 to 1988. The article looks at each company’s fiscal and Dow Jones performance for the years in question, and presents a detailed analysis of said performance. Graphic analysis is included. It helps to have a fairly vigorous knowledge of stock market and fiscal examination criteria to digest this material. The Ringstrom and Moncarz analysis of Prime Motor Inns Incorporated occupies the first 7 pages of this article in and of itself. Marriot Corporation also occupies a prominent position in this discussion. “Marriott, a giant in the hospitality industry, is huge and continuing to grow. Its 1987 sales were more than $6.5 billion, and its employees numbered over 200,000 individuals, which place Marriott among the 10 largest private employers in the country,” Ringstrom and Moncarz parse Marriott’s influence as a significant financial player. “The firm has a fantastic history of growth over the past 60 years, starting in May 1927 with a nine-seat A & W Root Beer stand in Washington, D.C.,” offer the authors in initialing Marriot’s portion of the discussion with a brief history lesson. The Marriot firm was officially incorporated as Hot Shoppes Inc. in 1929. As the thesis statement for the discussion suggests the performance of these huge, hospitality giants is compared and contrasted directly to the Dow Jones Industrial Average performance. Reasons and empirical data are offered by the authors to explain the distinctions. It would be difficult to explain those distinctions without delving deeply into corporate financial history and the authors willingly do so in an effort to help you understand the growth, as well as some of the setbacks of these hospitality based juggernauts. Ringstrom and Moncarz conclude the article with an extensive overview and analysis of the Hilton Hotels Corporation performance for the period outlined. It may well be the most fiscally dynamic of the firms presented for your perusal. “It is interesting to note that Hilton Hotels Corporation maintained a very strong financial position with relatively little debt during the years 1982-1988…the highest among all companies in the study,” the authors paint.

Does Financial Performance Depend on Hotel Size? Analysis of the Financial Profile of the U.S. Lodging Industry

This research presents a financial profile of the U.S. Lodging Industry based on an analysis of 2,091 financial statements (fiscal year 2011) for individual hotels ranging in asset size of $500 thousand to $250 million. The study analyzes summary results of the financial position and profitability of hotels based on a common size analysis of Balance Sheets and Income Statements. Furthermore, the study analyzes 10 key performance benchmarks as measured by Liquidity, Solvency and Operating Ratios. The results of the study show a divergence in the hotel industry’s financial performance based on the size of the hotel and by upper, median and lower quartiles of the study sample.