Revenue Management Techniques in Hospitality Industry –

At breakeven, Q=6,658 paying customers who will be in attendance with an additional .25 x 6,658 = 1,665 comp customers.

The data collected depicts a sample size of 200, taken from that of recent customers whom have stayed at

keep an existing customer than finding new ones. A major part of the customer service, especially in a retailing

30. The manager of the local National Video Store sells videocassette recorders at discount prices. If the store does not have a video recorder in stock when a customer wants to buy one, it will lose the sale because the customer will purchase a recorder from one of the many local competitors. The problem is that the cost of renting warehouse space to keep enough recorders in inventory to meet all demand is excessively high. The manager has determined that if 90% of customer demand for recorders can be met, then the combined cost of lost sales and inventory will be minimized. The manager has estimated that monthly demand for recorders is normally distributed, with a mean of 180 recorders and a standard deviation of 60. Determine the number of recorders the manager should order each month to meet 90% of customer demand.

The difference in profitability between the two customers is a direct result of the large variance in number of orders between Customer A & B. While Customer A had 12 different orders, Customer B had 100 different orders, which cost nearly $9,000 more than the cost for Customer A. (See Number of Orders cost in section iii.)

In (Table 3) and (Table 4) we apply these allocation rates with Customers A and B to illustrate how costs are affected by the ordering habits of customers

The scope of the hospitality industry refers to the range of businesses that provide services and facilities. The hospitality economy is one of the country’s key industries with huge growth prospects in jobs. In employment terms, restaurant are easily the largest sector, closely followed by a pubs, bars and club with the hotel sector growing more slowly, and the contract food service sector holding steady .

This pricing decision aimed at limiting the number of visitors so that they could also increase their margin per ticket sold and get closer to the “willing to pay” price level. After a market survey, it became clear that guests felt that they got value for money.

Very large customers accounted for 70% of business and no single customer accounted for more than 2 %

And the maximum payoff (as per [3] above) for serving 50 customers will be (150 – 100) x 50= $2500.

1).The relationship between Hospitality and Tourism: Tourism and hospitality go hand in hand, the hospitality industry offer services like accommodation, transportation, food and beverage, recreation and leisure. Tourism is the activity by the tourists where they engage in travelling to destinations where they want to experience recreational and leisure activities and most of the time avails of accommodation, food and beverage. The hospitality industry is the supplier of the services for tourism. The meaning of hospitality is providing a safe and enjoyable environment for patrons. It also means responsibly serving liquor, to ensure that patrons do not become unduly intoxicated and subsequently a problem for management, staff and the

Noone, B. M., & Lee, C. (2011). Hotel Overbooking: The Effect of Overcompensation on Customers’ Reactions t

There is a variety of risks in the hotel industry that can be divided into four main categories:

Customers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

complex. The basic objective here is that of taking the cost of expected production operations in the