Pearson New International Edition International pcl tp indd 1

IT’S MORE THAN JUST THE OCCUPANCY RATE!
It takes more than a high occupancy rate (i.e., number of rooms sold divided by total
rooms available) to make a hotel successful. For example, hotel managers should factor
RevPar into their definition of financial success. Recall that RevPar means revenue per
available room or occupancy percentage multiplied by average daily rate. Selling many
rooms at a low rate or just a few rooms at a very high rate can yield financial disaster!
Is the group that provides a full-service hotel with the highest RevPar always the
“best?” Maybe, but maybe not. Some groups, but not all, require extensive banquet ser-
vices that can be very profitable. Histories of groups that do not hold banquets may indi-
cate that they generate smaller revenues in the hotel’s à la carte dining and beverage
operations than do groups that hold banquets. Revenues from all sources—restaurant
sales, beverage sales in the lounge, parking fees, in-room movie sales, telephone tolls,
and so forth—must be considered when room rates are negotiated with groups, and as
the financial worth of a proposed meeting or group contract is evaluated.
In the example just discussed, the director of sales and marketing used PMS
reports related to rooms forecasts. Other PMS reports frequently used by this man-
ager include these:
•
Group pickup report
•
VIPs in house
•
In-house groups list
•
Group revenue-generated summary
•
Thirty-day occupancy forecast
•
Cutoff date review
•
Comp room reports
Staff members of the front office and marketing and sales departments also inter-
act frequently. They may discuss room assignments for VIPs and arrangements for spe-
cial amenities for guestrooms. Additional areas of interaction may include the in-house
marketing of special promotional packages sold from the front desk, the placement and
total room pickup of guests who have established negotiated rates, and long-term occu-
pancy forecasts.
Another interaction of front office and marketing and sales personnel involves
groups that are pre-keyed. For example, consider tour groups and sports teams that
have tour guides, chaperones, or coaches escorting them. Rooms for these guests may
be prepaid and, at the group leader’s request, access to outgoing telephone calls,
pay-per-view television channels, and minibar purchases may be restricted or
eliminated. When these guests arrive, they can be escorted to a meeting or lobby area
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