_O__L

HOTE
L
_A_P_N_
CAMPING
H__L_H _P_S
HEALTH
SPAS
__C_M_O__T__N
ACCOMMODATION
Accommodations
- Chapter VI -
 Accommodation
is all about making room — it can mean a
room or place where you will stay or an
agreement about sharing something.
 HISTORY OF THE
ACCOMMODATIONS OR
LODGING INDUSTRY
 - History of the Accommodations or Lodging Industry

• The lodging industry developed because of the need to provide

accommodations for travelers. Early roadside inns were mentioned in
several instances in both the Old and New Testaments.

• The history of the hotel in its present form goes back to the Middle
Ages. In the thirteenth and fourteenth centuries, German and English
literature made frequent reference to the inn. The development of the inn
in the late medieval period was due to the improvements in security in
many European societies. It had become safe to travel.
 - History of the Accommodations or Lodging Industry

• During the height of the Industrial Revolution in the 1700s and early 1500s, there was
a greater demand for accommodation as people migrated to the cities to work.

• By middle of the seventeenth century, the public stagecoach had appeared. In the next
200 years, the lodging industry was influenced by the development of road transport.

• With the rapid development of the automobile industry led to the establishment of the
roadside hotel. With the construction of highways and expressways, the lodging
industry responded to the needs of the motorist. Thus, the motor hotel or motel
emerged.
 TYPES OF
ACCOMMODATION
1. HOTELS
 Can be a 10-room boarding house or a building that
has a thousand or more rooms, convention and
meeting facilities, recreation facilities such
swimming pools and tennis courts, 24-hour room
service, with several restaurants and bars and various
types of entertainment.
 Have been designed and built to meet almost any
kind of budget or comfort level that the traveling
public might want.
2. MOTELS or MOTOR
HOTELS
 Normally, motels offer rooms
only and free parking to guest.
 These are often found along
busy highways and cater
primarily to transient and cost-
conscious travelers.
3. RESORT
HOTELS
Are intended for vacation travelers. These,
hotels range from budget to luxury and can
accommodate these travelers and even
convention delegates.

 These are usually located near beaches and

offer more amenities, shops and recreation
opportunities.
4. PENSIONS
 are found principally in Europe.

 are usually family owned accommodation

facilities.
 In German speaking parts of Europe, a
pension is also called Gasthaus.
 Pensions and Gasthaus usually offer
continental breakfast but do not have
facilities for other meals.
 Pensions are known for their informal family
atmosphere.
5. PARADORS
 are generally old castles, convents, or monasteries that have
been converted into hotels by the government and are
operated by the government.

6. CONDOMINIUM HOTELS
 are a recent innovation.
 are often hotels with apartments (condominium) instead of
basic rooms.
 Condominium units are sold by the hotel developers to
individuals who are given a title to the physical real estate.
7. CAMPGROUNDS
 Camping is a popular form of overnight
accommodation in both Europe and
North America.
 Campgrounds usually appeal to families
who travel in recreational vehicles RVs.
 Campgrounds and RVs stopping spots
are often found in government parks and
forests.
8. Bed and Breakfast
 is a form of lodging which originated in Europe.

 This form of accommodation provides a bed for

the night and breakfast the next day.

 It was only in the 1970s that the idea was brought

to the United States.

 Retired and semiretired people with large houses

have contributed much to the growth of these
establishment.
9. TOURIST INNS

 are lodging establishments that cater to transients.

 These don’t normally meet the minimum requirements of
an economy hotel.

10. APARTMENT HOTELS (Apartels)

 are buildings which contain several independent and

furnished or semi-furnished apartments.
 are leased to tourists and travelers on a long-term basis and
offer basic services to its tenant, similar to hotels
11. HEALTH SPAS
 are hotels and resorts which cater people who go to spas
or mineral springs for medical treatment or weight
reduction.
 The idea of visiting health spas originated in Europe.

12. PRIVATE HOMES

 is the earliest form of overnight lodging for travelers.
 it provides lodging to tourists who cannot be
accommodated in hotels and motels during peak vacation
periods.
13. Time-sharing
 is a more recent unique type of
accommodation.
 it started in Europe in the 1960s when people
found it difficult to make reservations every
year in popular hotels during summer.
 is the selling of vacation lodging, usually
condominiums, for a specific week or weeks
over a given number of years.
14. Hostels
 provide basic amenities such as
bunk bed and a commonly
shared toilet and bathroom.
 The traveler provide his or her
own bedding.
 Hostels appeal primary to
young travelers.
 - Classification of Hotels -
There are several different ways of classifying hotels such as;
1. Location
 hotels may be center-city, suburban, airport or highway.

2. Type of Guest
 hotels are classified as commercial, conventions, or resort.

3. Price
 hotels are categorized as economy, standard, first class, or
deluxe.
 - Rating Systems -
The following are used to rate hotels, motels, inns, resorts, and
guest ranches:

1-star = Good, better than average

2-star = Very good
3-star = Excellent
4-star = Outstanding
5-star = One of the best in the country
 - Organization of Lodging Industry -
A hotel organization can be large and complex. A typical hotel has seven
major divisions, namely:
 Personnel Division recruits new employees and administers policies and
employee benefits for the company.
 Engineering and Maintenance Divison makes the necessary repairs and
implements the hotel’s energy management program.
 Accounting Division handles the financial activities of the operation which
include payment of bills, sending out statements, payroll, and compiling
monthly income statements.
 - Organization of Lodging Industry

 Security Division provides protection for both employees and guests.

 Food and Beverage Divison are responsible for the food and beverages
that are served.
 Marketing and Sales Division is responsible for selling the rooms and
food service. It is involved in advertising, development of promotional
materials, and making direct contacts with prospective clients.
 Room Division is responsible for the front desk, telephone, reservations,
and housekeeping department.
Figure 3. Typical Hotel Organization Chart
Management Methods
 - Management Methods

1. Franchising
 Hotels that are franchised are usually owned and operated by the same
person or company. The hotel operator or franchisee signs a contract with the
franchisor to maintain certain operating standard and to use the franchise
name on the hotel or motel.
 The franchisee receives benefits such as:
a. Extra business as a result of the franchisor’s national or international
advertisements;
b. The use of franchisor’s operating and accounting system; and
c. A line into the franchise chain’s reservation system.
 - Management Methods

2. Management Contracts
 Hotel management contracts are a recent phenomenon. Although the first
management contract was signed in 1946 by the International Hotels, it
was only in the 1970s that management contracts became widespread.
 Under a management contract, the hotel management company does not
have a financial interest in the hotel’s land and building.
 Under a management contract, the investment rent is transferred from the
operator to the property owner.
 - Chain Accommodation
Operations -
Most hotels and motels are part of a chain operation. The individual units in the
chain may all be owned by one large company, be partly owned and partly
franchised, or may all be franchised.

 Referral Groups have become popular because the individual owner or

operator can remain independent while achieving many of the benefits of a
chain group. This is through voluntary membership in the referral
organization.
 - Hotel Terminology -
Room rates for hotels are quoted in terms of what meals are included in
the price.
 European Plan (EP) means that there are no meals included. This is
the most commonly used room rate quoted by North American
hotels.

 American Plan (AP) means that breakfast, lunch, and dinner are
included in the quoted price. In Europe, AP is also known as full
pension. Meals are usually a fixed menu with little or no choice.
 - Management Methods

 Modified American Plan (MAP) includes breakfast and dinner but not lunch or
breakfast and lunch but not dinner. In Europe, this is known as demi pension.
 Continental Breakfast is offered by most European hotels and is included in the
room rate. In Europe, this type of plan is known as hotel garni or pension garni
which consists of rolls, coffee, and sometimes juice.
 The Bermuda Plan (BP) is offered by hotels in Bermuda and some other places. It
includes both a room and a full English or American type of breakfast. Bed and
breakfast hotels operated on a Bermuda Plain in Britain and the United States
and on continental breakfast plan in continental Europe.
Room
Rates
 - Room Rates

 The maximum rates that hotels charge for a room normally

depend on the number of people occupying it. These rates are
called:
• Rack Rates. These are posted on the inside of the
entrance door of each guest room. The rack rate is not
always the rate that is paid for a room. Hotels, like
airlines, have a system of discounted prices.
 - Room Rates

 The revenue that is not obtained for a guest room is gone and cannot be
recovered. Thus, hotels offer discounted rates to special classes of people
to encourage them to stay in the hotel. For example, there are special
rates for business travelers, government employees, airline employees,
and other similar groups.

 For conventions and conferences, hotels compete with one another by

offering the lowest room rate. Profits on banquet meals and sales of liquor
make up for the discounted room rates.
 Hotel
Profitability
 - Hotel Profitability

Room Occupancy
 is a simple measure of a hotel’s profitability.
 It is obtained by dividing the number of rooms occupied by guests
on any night by the number of rooms in the hotel and by multiplying
the result by 100 to determine the occupancy on a percentage basis.
 For instance, if a 125-room hotel has 75 rooms occupied on a
particular night, its occupancy will be:

× 100 = 60%
 - Hotel Profitability

 Occupancy can also be determined for a week, a month, a year, or any other
period of time. In this case, the numerator is the number of rooms occupied for
that period and the denominator is the number of rooms available during that
period, that is, the number of rooms in the hotel times the number of days in the
period. For example, if we want to know that occupancy for a week in a 125-
room hotel in which 463 rooms were occupied during that week, the occupancy
percentage would be:

× 100 = (463/875) × 100 = 52.9

 - Hotel Profitability

 During peak season, a hotel may have 100% occupancy or

close to it. However, occupancy can be very low at other
times of the year. In general, hotels are considered profitable
if they can operate with an average annual occupancy of 65%
or higher.
 - Hotel Profitability

Double Occupancy Rooms

 Double occupancy is determined by dividing the numbers of guests
accommodated during a certain period by the total number of guest rooms
during that same period. For example, if 463 rooms were occupied by 713
guests during a week, the double occupancy is:

= 1.54

 The 1.54 double occupancy ratio means that 54% of the rooms were doubled
occupied.
 - Hotel Profitability

Average Rate Per Room Occupied

 Another way of measuring maximization of revenue is the average rate per
room occupied. The average rate will increase if more expensive rooms are
sold or if more rooms are double or triple occupied. The average room rate is
obtained by dividing the revenue for a period by the number of rooms
occupied during that period. For example, if a hotel had 463 rooms occupied
during a week and a room revenue of $37,640 for that week, the average
room rate is:

= $81.30
 - Hotel Profitability

Average Daily Rate Per Guest

 Another useful statistics is the average daily rate per guest. This is obtained
by dividing total room revenue for a period by the total number of guests
accommodated during that period. For instance, if the total revenue for the
week was $65,529 for a hotel occupied by 1,050 guests, then the average daily
rate per guest for the week is:

= $62.40
 - Hotel Profitability

Average Length of Stay

 To maximize revenue and increase room occupancy,
hotels try to increase the length of stay of customers
through advertising and other marketing methods. If
customers can be motivated to stay and extra day or two,
this will mean more revenue for the hotel.
 - Breakeven Point -
 Hotels are often interested to know their breakeven point. It is that point at
which a business will make neither a profit nor a loss. The equation for
determining it is:

 Fixed costs are those that stay the same regardless of the volume of business.
 Contribution margin is defined as the average room less the variable costs of
having a room occupied.
 - Breakeven Point

 Variable costs are those that change according to the number of guests in a
hotel. The variable costs for a hotel room are primarily the costs of
housekeeping such as maid wages, linen, laundry, and supplies.
 For example, if the fixed cost of a 125-room hotel is $1,950 for a year, its
average room rate is $80, and the variable cost per room occupied is $20, its
breakeven point would be:

= $1,950,000/$600,000 = 32, 500

 - Breakeven Point

 The 32, 500 rooms to be occupied during the year can be converted into an
occupancy figure as follows:

 This means that the hotel must average 71.2% occupancy during the course of
the year.
 A breakeven analysis is an important managerial tool because it shows
the percentage of occupancy that a hotel must have to cover expenses.
Accommodation
Reservation
 - Accommodation Reservation

Registration Cards
 Accommodation establishments use the guest registration card
as a marketing tool.
 A guest registration card provides information about the guests
such as his or her name, address, geographical origin, and other
facts.
 The guest registration card information can also be used to
produce a typical customer profile.
 - Accommodation Reservation

Hotels and Airlines

 At present, there is a natural link between airline companies and hotels. This is due to the changed
nature of transportation. One of the first links was Pan Am which tied in with the International Hotels
in the 1940s.
 According to Lane (1994), there are three major reasons why airline companies link with
hotels. These are:
1. Their desire to protect insisting business and develop future business, thus increasing their
profits.
2. The expectation that hotel ownership will boost tourism development in their home
countries.
3. The desire to expand national culture.
 The links between hotels and airline are not always formed by ownership or merger. They can
also be partial ownership or a working agreement.
 - Accommodation Reservation

Frequent Flyer Links

 Many of the frequent flyer programs of airline are also
linked to hotel usage. This means that airlines grant
airline passengers extra mileage points for staying in
participating hotels.
Accommodation
Promotion
 - Accommodation Promotion

 Most accommodation establishments promote their properties to members of

the travel trade as well as to tour wholesalers and travel agencies.

 They provide the travel trade with printed promotional literature and invite
them as guests on familiarization trips.
 They offer discounted room rates to representatives of the travel trade when
they stay in hotels but are not on a familiarization trip.
 Large hotel chains install promotional booths at travel trade expositions
and advertise in travel trade publications.
 - Accommodation Promotion

 Hotels use the direct mail approach to groups who would like to hold meetings,
conventions, or conferences in the hotel.
 Hotels also offer corporate rates to large companies from which they would like to
get guest room business.

 Accommodation establishments also use newspapers for promotions.

 They also advertise on radios and televisions, on highways and airport billboards, on
city magazines or directories, and on telephone directories.
 Resort hotels advertise on magazines, on television, and by direct mail.
 Some accommodation entities feature the hotel’s president or general manager on
their advertisements. They may also feature the chef in their restaurant advertising.
These classification of hotel are
classified as commercial,
conventions, or resort.
TYPE OF GUEST
 In rating a hotel or any type of
accommodation, how many star is
considered one of the best in the
country?
5-STAR
 This major division is responsible for
the front desk, telephone, reservations,
and housekeeping department.
 ROOM
DIVISION
 Give one type of an
Accommodation Promotion.
 - Direct Mail Approach
- Newspaper
- Magazine
- Radio
- Television Advertisements
- Billboards
This refers to providing a place to
stay or live temporarily
ACCOMMODATION
 w
Eo
m

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