Hotel Front Office Management, 3rd Edition

END OF CHAPTER QUESTIONS 157CASE STUDY 501Margaret Chu, general manager of The Times Hotel,and Ana Chavarria, front office manager, are in theprocess of developing a policy on overbooking. Thecurrent policy prohibits the reservations managerfrom booking more than 100 percent of the availablerooms. Reservations are composed of 60 percentconfirmed and 40 percent guaranteed.In the past six months, about 5 percent of the confirmedreservations have been no-shows, resulting ina financial loss of about 500 room nights. No analysisof the confirmed reservations that resulted in noshowshas been made because Ms. Chavarria has nothad time to organize such a study. This loss of$42,500 (500 rooms $85 average room rate) hasforced management to consider developing an aggressiveoccupancy management program.Offer some suggestions to Ms. Chu and Ms. Chavarriaconcerning the following related concepts: thelegality of overbooking, the need to maintain an accurateaccounting of the financial impact of noshows,and the management of the different reservation/occupancycategories that make up the hotel’sroom sales (confirmed reservations, guaranteed reservations,stayovers, understays, and walk-ins).CASE STUDY 502Use the following data to prepare a rooms forecastfor the first week of May for The Times Hotel:Number of rooms available 600Number of rooms occupied on April 30 300May 1:Departures 200 roomsArrivals 200 rooms (70 percent confirmed, 30percent guaranteed)Walk-ins 40 roomsNo-shows 0.02 percent of expected arrivalsMay 2:Departures 50 roomsArrivals 100 rooms (60 percent confirmed, 40percent guaranteed)Walk-ins 10 roomsNo-shows 0.02 percent of expected arrivalsMay 3:Departures 200 roomsArrivals 100 rooms (50 percent confirmed, 50percent guaranteed)Walk-ins 20 roomsNo-shows 0.02 percent of expected arrivalsMay 4:Departures 50 roomsArrivals 100 rooms (20 percent confirmed, 80percent guaranteed)Walk-ins 10 roomsNo-shows 0.01 percent of expected arrivalsMay 5:Departures 300 roomsArrivals 70 rooms (30 percent confirmed, 70percent guaranteed)Walk-ins 25 roomsNo-shows 0.0143 percent of expected arrivalsMay 6:Departures 50 roomsArrivals 175 rooms (92 percent confirmed, 8percent guaranteed)Walk-ins 10 roomsNo-shows 0.04 percent of expected arrivalsTLFeBOOK