CATEGORIES OF HOTEL SUPPLY

It’s all about perception. Japan can be a place full of Jasmine Tea, quick naps, # block, #nuo street names. Japanese couples sleep in separate beds and don’t negotiate. They expect more on price. Their culture is strict and polite and bow with 2 hands when they give a business card. Know your audience.

TYPE of Beds & Bedding/Room Type:

  • Single-1; Price/person based on room types
  • Double-2
  • TRL-3
  • Quad-4
  • Rollaway-Fold Away
  • ADR-Total $/Total Room-Nights
  • Occupancy %-Total # of occupied rooms/total # of rooms
  • Room/Night-One occupied room during one night stay
  • Family Plan-Family plan, children don’t pay for stay; Kids pay for nothing below 12 years old
  • Extra Person
  • ADR=Total$/Total Room-Nights
  • Cancellation Rate-# of canceled bookings/total bookings % (UK is 14%, about a a third, higher for countries like 55%); People like to have multiple choices
  • Average Transaction Size=Total Sales ($)/#of consumed bookings
  • Average Stay=# of Room-nights/# of bookings
  • Lead Time (LT)=The Time Between the date of reservation and date of service
  • Sold Out-The hotels has no more rooms available for a certain night; Can you think of increasing ADR
  • Over Booking=The hotel took a risk and confirmed more than available

*Look at cars parked outside of motel and number of lights on. Orlando has a standard of 2 double beds. Bed based on family relations in hotel. Room types are how many people are allowed for the money you have made and defined by local relations (usually).  Fire department in the New York District.

AMENITIES

  • Markup from Top is 100/1-10
  • Markup from Bottom is 100/10
  • Net + MU (%)=Selling Price

 

Turnkey, margins, and groups; Tizv; Offer economies of scale: Riets individual vs. FLAG BRAND CHAIN (Rate Parity); 12% TR

 

Franchise-Renting Brand

Owner/Individual 20%

Lease (Acord) 8%

Brand Contribution: Call Center, National Sales

250 years lease in Dublin, Guinness; 9,000 year lease

Hampton Brand – best in World by J.D.

 

Industry Level Accommodation

Flagged vs. Independent

Pros and Cons CHARTS EACH

FLAGGED

Pros

  • CRS
  • Loyalty
  • Brand Recognition
  • Corporate Level Experience
  • Purchases Power
  • Regional Sales, Marketing, and Revenue Management

 

Cons

  • Brand Fees (7-15%)
  • Brand Standard Requirement
  • Brand Vulnerability
  • Distribution Restrictions (BRG, LNF)

 

INDEPENDENT

Pros

  • No Brand Fees
  • No Distribution Restrictions
  • No Brand Vulnerability

 

Cons

  • No CRS
  • No Corporate Level Experience
  • Limited Purchasing Power
  • No regional team

 

INDUSTRY LEVEL OVERVIEW ACCOMMODATION

  • Central Purchasing/Economies of Scale
  • Need to meet brand standards
  • Growth only through additional Franchise purchase
  • Pay-up from fee to join franchise
  • Pay ongoing royalty as % or revenue
  • Property run by owner/manager based and brand standards
  • Buy Brand Recognition

 

Dependent on Brand Strength for sales and reputation

 

GDS-Founded by American Airlines

  • Sabre
  • Apollo
  • Worldspan

 

  • Motel-Accommodation/No service
  • Motor Inn-Parking lot
  • Inn-No parking lot
  • Hotel-Motel 6; are franchises
  • Resort-Activities; go and not have to pay; must have a pool
  • AirBNB
  • Hospitals
  • Hostels
  • Timeshare
  • Capsule Hotel
  • Campsites
  • Home away from-unit by the door; one family staying, and most numbers
  • Bed and Breakfast-More than 1 room with a breakfast
  • Business Hotel-conference facilities with at least 50 people and Hotel Definition
  • Mega Resort-More than 1,000 resorts; The largest hotel with rooms is the Venetian and MGM Grand in Vegas
  • Brand-Group of Hotels under chain that carries same name and follows least quality assurance and follows list; owned by chai
  • Hotel Chains see below

 

Hotel Chains

 

Chains always make money; owner does not always; Decrease in Franchisees and Increase in Independent Hotels

Close to 30% of Hotel Owners are Indian

Marriott (Ritz-Carlton, Farfield, Mariott), Hyatt, La Quinta (4 seasons), Motel 6, Starwood (Upscale choice is the lowest in Starwood Hotels) 9 Brands), Bestwestern, 4 seasons, Choice (Sleep Inn, Clarion), Wyndham (largest chain with 6,000 Hotels), Fairmont, Wnydham (Window, Days Inn, Howard, Travelodge, Super 8 Motels; Is an organization that manages distribution, and support more than one hotel brand

Service Facility: Laundry, Restaurant, Business Room, Wi-Fi, and Room Service

Not Service/Amenities:CTV, Shampoo, Housekeeping, and Pool

IHG 4,7000 only own 9 and the largest

  • Market capitalization: # of shares available to purchase x $ price; also known as the base company on how much money you make
  • 54 Billion on Priceline; $10.5 on Expedia

 

SPLIT

  • Hilton International/Hilton Corporation; Blackstone Brought
  • Sell Assets and be more liquid and get cash for global expansion

 

# OF HOTELS OWNED

  • Hilton – 25 Billion
  • Marriott – 21 Billion
  • Starwood – 12 Billion
  • IHG – 10 Billion
  • Hyatt – 8.6 Billion
  • NY WOLDOFF 1.95 Billion = 1.3 Million key

 

 

EVENTS, TOURS, AND SIGHTSEEING

 

Vouchers save money and time.  The top sold ancillaries is private and saved transfers. We can get discounts because of blackout dates and bus tours take profit after 10 seats. A long distance coach goes 911/day. XML connectivity shows on your system.  10% make on activities and commitments on activity.

 

 

BUSES

 

The American Bus association sets the rules and regulations for buses. An array of costs such as a Tour Guide, Driver, Bus itself and Dot (Department of Transportation Conditions such as bus cannot drive more than 14 hours/Driver 10 hours. You cannot negotiate national parks because they are government related, but you can negotiate:

  • Hotels
  • Baggage Handling
  • Activities
  • Buses
  • American Breakfast which is bigger or continental which is smaller

 

Never let suppliers win, seller (business). Buses stop at 45 because it only has that many seats.  It must have a name list and rooming list with who will be in each room whether it is a single or double. Most Bus Tours plant to operate 5-6.  Clients are willing to move because they are already planning to go unless work gets in the way.  You can change dates based on guaranteed dates. Baggage Handling-clients expect people want to check bag before loaded to moving baggage. Moving back gage from one place to another. You can always have a rollaway bed cost for a bed to bring into room.  Max is 4/person; maybe 5 for Orlando.  Variable Prices include: /person, Hotel, Meals, Attraction Tickets, Flights, and Baggage Handling

 

Round-trip is your in and out.  You do need to know diets and restaurants for people to eat at. Single Expenses only refer to accommodations.  We don’t offer insurance for tour operators; can as a variable but don’t usually cause insurance and is cheaper abroad. The American Bus Association can see new buses.  National parks are government and you cannot negotiate with them.  You can negotiate group rates on Hotels, Baggage Handling, Meals, Activities, Buses, and never let suppliers win.  You could also offer a continental small breakfast or an American bigger breakfast.

Types of Locations

  • Hotel-building with units
  • Vacation Homes-Has only been around in (500,000 units/world) 10 years
  • Air BNB-Living Family

What you see in a Contract:

Giata-Provides content/image descriptions

Occupancy-0

No Show and Cancellation policy are shown

Twin-per room type

Per unit-Homes, same rates

Click see in extranet

Board base-anything extra; breakfast

Supplements-additional charges to hotel; mandatory/optional

The lower the Cutoff, the more we cansell up until Date of arrival

Shoulder/Low Season;

CONTRACTING:

Product needs to challenge Competitors by using a harvesting strategy/steal and focusing on own hotels. They different types of contracting options are

 

  1. PRB A nightly PRB is the best rate with the best price. There is a political debate in the company. Challenge is to not loose 1 night. Cushion/Option (Allotment of Room nights for a PRB + Extra nights or no cut-off). You never get a cushion bigger than a PRB. GPE policies longer than lead time is better; red means sold out and then there is also stop sale.  Exclusive Deals- PRB’s are 1 and PRB-yellow
  1. Guaranteed Revenue Aggregator
  2. Ensures top exposure
  3. Priority within sales and marketing
  1. PPA-PPA-Preferred Partner Agreement
  • Ensures prominent exposure
  1. Flexibility in allocation and pricing
  2. Market Share Driver
  3. Guaranteed rate differentiated 10%
  1. POP: Override base on performance +/or relationships.  Can level out competitors’ deals and fix GPE.
  2. IDC:
  • Exclusive rate for Airlines/Points Redemption Programs
  1. Top Exposure for that clientele
  2. Incremental Business for the Hotel
  1. Global Distribution Partner

 

PPA, PBP-Won’t Last Forever

Winning Through Differentiation

  • Early Booking and Travel Window
  • Length of stay and promotions
  • VIP Check-In
  • Upgraded Room Types
  • Rates + Availability on Higher rating categories
  • Waived Occupancy Settlement
  • Report Fee Waived
  • Sunday Night Special

 

PRODUCT                  SALES

Distribution                  Product Line

US                                PRB

Exclusive                     Diverse Product

AA, Emirates               Prepaid $ Up Front

 

MULTIPLE:

  •        Rate War
  •        Limited Time Communication
  •        $ Goes to set # of hotels
  •        Convincing hotels to change

Cutoff/Release

 

SMALL: Connecting with something else

April, May, and June rates for FIT

9 Months to renew contract; why sits on list; they think we can renew easily; this a CRM problem

Take out outlier: Cache’s or not

 

Extranet-allows supplier to come in and make changes

Isynergy is the QA system for contract data entry

QC-loss on both sides

Low permissions means they can only go down and benefit Tourico; more rooms

High permission they can go up and down on the allotment

Channel managers; hoteliers website pages; Rate Tiger, SiteMinder, TravelClick is a Channel Manager, etc.

Gross Cancellation Module

Ghost Card-Paying chains with credit card

 

 

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