Student no: 11032561

DTM2601

Assignment 3

Question 1

1.1 Intangibility- Tourism products cannot be seen, touched or tested before buying
them. Tourists or guests cannot eat at a restaurant or visit a hotel room before
purchasing the tourism product. They can only read brochures, watch DVDs or listen
to recommendations by people about these products. People therefore seldom take
something physical home with them once they have purchased a tourism product.
They can only take the experience or memory of the meal, accommodation or
destination with them.

Heterogeneity- Tourism services are normally rendered by people and are therefore
seldom the same. The high variability in service performance means different
experience and satisfaction levels for different consumers. Since a tourism product is
produced and consumed at the same time, the quality and experience of the product
or service can vary from producer to producer, consumer to consumer and from day
today. A patron eating at a specific restaurant on a Tuesday night and again on a
Saturday night may have two different experiences because of different staff being
on duty on each day, or even because the consumer is in a different mood on each
occasion.

Simultaneous- Manufactured products, such as a car, are first produced, sold and
then consumed, whereas tourism products, such as a night’s stay at a hotel, are first
sold, then produced and consumed at the same time. Tourism products are
produced and consumed simultaneously (at the same time) and the consumer (i.e.
the tourist), is part of the production process because he/she consumes the service
as it is being provided. A hotel guest can only experience the accommodation if the
receptionist and other hotel staff are available, and this service can also only be
offered if a guest is present.

Perishability- Since tourism products are produced and consumed at the same time
they cannot be stored and kept for consumption later. A hotel has a specific
number of rooms available and a restaurant has a specific number of tables
available. A service cannot be stored for future use like a manufactured product. A
hotel room or restaurant table not booked today is lost forever – it is therefore
perishable. Unsold tourism products are regarded as unrealized income for the
product’s owner.

Seasonality- Tourism seasonality is a fluctuation in demand at different times of the

year. Owing to the seasonal character of tourism demand, the tourism industry must
adapt its operations by scaling down or even closing some operations for certain
periods of the year or try to market products and create a demand for them during
the off season. Tourists in South Africa tend to travel to beach destinations during the
summer holiday season and generally prefer to visit game parks or other destinations
during the cooler winter months, thus creating a seasonal fluctuation indemand.

Parity- Some tourism products are essentially comparable, that is they possess
parity. Parity refers to competing businesses offering the same basic product.
Tourism businesses therefore must find ways of making their products more
unique than those of their competitors. This can be done by adding small features to
make them more appealing. A tour operator can include a complementary travel bag
in the price of a travel package. Tourism businesses are also making use of frequent
travel programmes to solve the problem of parity, by attaching various benefits to
their products such as discounted flights and class upgrades.

1.2
Service-oriented consumers regard service excellence is being of utmost
importance. These consumers would generally stay at four- or five-star establishments such
as the Westcliff hotel or eat at a renowned restaurant like Reuben’s Restaurant in
Franschhoek. These guests or tourists are willing to pay premium prices for exceptional
service delivery and have high expectations for the facilities at the establishment.

Budget-minded consumers regard service as being relative to the price paid. These
customers generally look at price first and then at the level of service and range of facilities
on offer. These guests and tourists are willing to sacrifice certain aspects of the service,
based on the relative costs. They look for accommodation at two- or three-star
establishments, such as the Formula 1 or Hotel 224, for example, or eat at places such as
McDonald’s or Ocean Basket, where they receive value for money.

Suppliers are an essential component of all hospitality organizations and provide the core
essentials to satisfy the needs of consumers or guests. Hospitality suppliers include
suppliers of labor (external and internal labor markets), equipment (mechanical and
electronic equipment), raw materials (physical products, such as fresh produce in a
restaurant) and capital (own and borrowed capital).

Question 2

2.1
(i) Revenue management
Bard (2011:153) defines revenue management as “the technique of planning to achieve maximum room
rates and the most profitable guest”. It also does calculations daily, monthly and yearly average can also
be calculated
Key calculations÷ Revenue per available room (REVPAR
Average daily rate (ADR)
Occupancy rate (OR)

(ii)Overbooking
Is the practice of accepting reservations for more rooms than may be available on a particular date. The
number of rooms that are overbooked are generally based on historical no-shows, stay overs expected,
undestays and walk-ins.

(iii) Guaranteed reservations means that the potential guest agrees to pay his/her accommodation
whether or not he/she arrives. Guaranteed reservations protect hotels from so-called “no-shows”

2.2 (i)Guest account

Is opened each time a guest checks into a hotel. This account is sometimes called a bill or a folio.

(ii)Non-resident account

Are the records of financial transactions between the hotel and non-resident guest, example ÷ guest
may walk out of the hotel without settling outstanding balances on their account.

(iii)Management account
Some hotels give their hotels managers expenses account or allowances which are know as
management account.

2.3 (i) posting room and tax charges

(ii) assembling guest charge and payments
(iii) reconciling department financial activities
(iv) reconciling the accounts receivable
(v) running the trail balance
(vi) preparing the night audit report

QUESTION 3

3.1

Management function Management function activities

PLANNING
Planning involves defining objectives,
developing strategies to accomplish them
and designing ways to complete the work on
time and in the correct manner. Planning
tools include area inventory lists, cleaning
frequency schedules, performance and
productivity standards.
Forecasting: establishing where present
course will lead
Setting objectives: determining desired
results
Developing strategies: deciding how and
when to achieve goals

Programming: establishing priorities

sequence and timing of steps

Budgeting: allocating resources

Setting procedures: standardising methods
Developing policies: making permanent
decisions on important recurring matters
ORGANISING
Organising involves developing and
grouping work tasks to structure
the department’s staff and divide the work
so that everyone receives a
fair assignment and all the work is
completed on time. Organising tools
include a departmental organisation chart,
job lists, job descriptions and job
breakdowns.
STAFFING
Staffing involves recruiting the right
employees for the job, filling vacant
positions and scheduling employees to
work.
DIRECTING
Directing involves supervising, motivating,
leading and disciplining employees in the
department.
CONTROLLING
Controlling involves implementing
procedures to protect the establishment’s
assets such as safeguarding keys, linens
and other items, as well as determining the
extent t which the organization “remains on
track” for achieving goals.
Establishing an organisational structure:
drawing up an organisational chart.
Delineating relationships: defining liaison
lines to facilitate coordination.
Creating position descriptors: defining the
scope, relationship, responsibilities and
authority of each member of the
organisation.
Establishing position qualifications: defining
the qualifications for people in each
position.
Selecting employees: recruiting qualified
people for each position.
Orientating employees: familiarising new
people with their environment.
Training: making people proficient by
instruction and practice.
Developing: improving knowledge, attitude,
and skills.
Delegating: assigning responsibilities and
exacting accountability for results.
Motivating: persuading and inspiring people
to take the desired action.
Coordinating: relating efforts in the most
efficient combination.
Managing differences: encouraging
independent thought and resolving conflict.
Managing change: stimulating creativity
and innovation in achieving goals
Establishing a reporting system:
determining what critical data are needed.
Developing performance standards: setting
conditions that will exist when key duties
are well done.
Measuring results: ascertaining the extent
of deviation from goals and standards.
Taking corrective action: adjusting plans,
counselling to attain standards, replanning,
and repeating several sequential functions
when necessary.

Rewarding: praising, remunerating or

administering discipline