Hotel Description Location The Grand View Hotel Tourism Essay
The Grand View Hotel is a traditional hotel built in the 1950s offering traditional facilities. It is sited on the seafront at a convenient location, which is close to its competition hotels and the main shopping center. Accessibility of the hotel is high. It is less than 30 minutes from the nearest airport and supported by good road, rail and bus linking to major cities.
The Grand View Hotel is a 250 rooms establishment in which 200 are double rooms and 50 are king bedded rooms, all includes private bathroom. The rooms are of a good size, comfortable and with different decorative styles.
At present, there is a large garden and a small swimming pool in the hotel, parking space with a capacity of 120 cars is also available. On top of that, there is a restaurant which serves buffet for breakfast and lunch as well as a la carte for dinner. The lobby lounge area is fairly large which is suited to a business type of hotel. There is also a pub; however it is in poor decorative order.
There were several refurbishment programs launched which included the signs replacement, renovation and redecoration of front desk, restaurant and bar. Generally speaking, the hotel is in good physical condition except the front desk. On top of that, the hotel used to redecorate 25 guest rooms each year.
Consistent Standard of Excellence: We will consistently provide our guests with a superior quality product and make a conscious daily effort to be better than our competition.
Personalized Guest Service: We will meet the specific meet of each guest with a professional, friendly, prompt, courteous, and enthusiastic, attitude from all staff all times.
Company Goals
The purpose and values of Grand Ford are to generate a multi-faceted success.
Maintaining the financial well-being of hotel by the strict control of all costs at all times without exception.
Gain reputation by providing high quality of products and services which beyond the guests’ expectation.
Increase the quality of the entire workforces and reduce the staff turnover rate by providing better staff training & benefit.
Provide a fantastic and comfortable environment to every valuable customer in order to satisfy their needs.
Company Objectives
In order to reach our goals, several objectives should firstly be achieved:
Reduce the total labor cost from 46% to below 35% within the first year.
Reduce the cost of sales in F&B department to 35% within the first year.
Reduce the annual staff turnover rate from 102% to 50% within the first year.
Increase the average room occupancy rate from 19% to 55% within 2 years and reach the standard of 70% within four years.
Human Resources
Human Resources Policy
The hotel is able to reduce labour costs and staff turnover by hiring the right person for the right position at the right time for the price, or salary in another word. Training programs will be provided to staff mambers in order to enhance their performance thus the guest satisfaction and finally increasing profitability.
Organizational Structure
Staffing
It is known that reduction of staff can be a de-motivator, however, there will be a huge over staffing if we do not reduce any workforce on such a low occupancy. It is planned to reduce serveral staff in some particular departments such as housekeeping and front office. With the growth of business and new coming construction projects, the hotel will certainly relocate and hire a certain munber of staff in order to maintain a smooth daily operation. Staffing level will be monitored on a monthly basis in the first year operation and quarterly in the rest of the operation with high level of flexibility.
Recruitment
With the aim of having the most suitable person to be crew members who are able to generate an overall experience beyond guests’ expectations, both internal and external recruiting methods will be applied in the Grand View Hotel. Positive attitude, enthusiasm, outstanding interpersonal relationship and high standard of qualification will be required for appliances. Aiming to reach the potential pool of appliances, recruiting advertisement will be placed in industry journals and in the hotel’s official website. For the internal preparation, the hotel will review the job analysis on a regular basis to ensure that the documents best describe the job and that they are properly prepared for effective recruitment and selection process. On top of that, laws and regulations will be taken under serious consideration during the process.
Selection
In order to be fair and to get the most suitable person to fill up vacancies, a multi-hurdle strategy will be applied meaning that elimination of candidates during selection process will be based on the job specification. Interviews will be the most commonly used tool to assess a candidate. Furthermore, for external appliances, job tests will be another method that the Grand View will use to select an operational staff while group assessments will be applied for the rest. For internal selection meaning promotion and relocation of staff, potential employees’ performance and past records will be taken under consideration.
Orientations
Orientation programs are designed to provide new employees a clear direction of their job and the hotel directions. The hotel can benefited from a good orientation program in terms of higher morale in the workplace thus improving the performance and the productivity and therefore a higher “bottom line”. Regarding the above factors, orientation programs will be provided to each staff member within their probation period in the Grand View Hotel with the following elements.
Aimed to improve the skills and performance of staff members, thus enhance the customers’ comfort and satisfaction therefore raise the reputation and influence the revenue of the hotel. Training for staff in all levels is considered as the main step to achieve goals.
On the job training is one of the training methods that will be applied in the Grand View focusing on operational and entry level staff. It is effective in both cost control and performance improvements as it is conducted during business operation in actual work settings. For managerial level staff, group discussion and workshops will be useful in order to share experience and keep track of the hotel’s operation generally. All training programs will be reviewed on an annual basic. Besides on-site training, off-site training is also encouraged. The hotel will support staff to take job relevant courses organized by recognized organizations.
Staff Payroll
We intend to maintain an annual staff payroll with a maximum of 35% of total revenue. Salary of level 1 will be offered to entry level employees and level 2 for department heads for the first half year in order to control costs. However, salary levels will be adjusted according to the performance which will be reflected by the bottom line in order to motivate the staff and ecourage better performances. Salary reduction will unusually be seen in the Grand View Hotel since this will de-motivate the employees and as a result, the staff turnover rate will increase.
Environmental Scan
Political
The political environment includes such areas as government policies, political trends and internal political issues. The political environment is very stable and beneficial for the hotel meaning that the political situation supports local businesses and establishments. This is extremely beneficial for the hotel’s future because this means it can concentrate on attracting more markets meaning more variety in customers. We can also concentrate on the customer satisfaction which involves their needs and expectations. September 11th had a huge impact in the tourism in the USA. The uncertainty of political situation because of the September 11th attracts, have led potential customers to think twice about travelling abroad or within the country itself. This has a huge effect on the hotel’s business which we will also have to contain in to the analysis.
Economic
Since the main industries of the area are Distribution/ Hospitality, Banking and Finance. We intend to meet the demand in these areas by offering various services especially in the area of conferences since our target market is business costumers during the weekdays. Unemployment levels also have a big effect on the economic situation. The employment level is high especially in the areas of management/professional and clerical/secretarial work. This in return aids our hotel in the way that the environment is safer due to the high employment rate and this attracts more travelers, giving us the opportunity to catch the attention of these customers, to maximize our revenue.
Social
The employment level is very high; it is currently half of the national average. A large proportion of the populations of that employment level are in management/professional and clerical/secretarial jobs. But also the employment levels for skilled non-manual, skilled and semi-skilled manual work is also high. But that is not the case for unskilled employment. A large proportion of the population is families with the average of 2 children per family. Since one of the main industries is Banking and Finance, we will be looking to attract business travelers whose aim is to locate a convenient and appropriate property that accommodate their needs for a professional working ambience.
Technological
The continuous changing world of technology can pose a lot of threats, but if the right actions are taken at the right time it can also be an opportunity. Technology can give us the competitive edge in terms of conference and meeting equipment. Equipment is expensive, but with a large variety of suppliers and different options like buying, renting and leasing, it can become a relatively in expense way of modernizing our facilities. The hotel technologies include fast wireless internet, security cameras which ensure the safety of the guests, conference equipment, transportation, and so on. We will also try to build up and maintain good relations with our technological and safety partners to ensure that when problems do occur, that they can be solved as fast as possible.
Legal
In the United States there are 3 different kinds of legal systems. The first being Local legislation, the second State legislation and the third being Federal Legislations. There three have a huge amount of impact on how the hotel is run. The legislations meaning the laws that are imposed on the hotel include and are related to the operators of the hotel, consumers and employees. These 3 legal systems enforce various laws and regulations which include the minimum wage, health and safety laws, anti-discrimination laws, employee rights and employer rights.
Environmental
The environmental aspect is a very critical issue since it encompasses a wide range of aspects. It ranges from ecological issues to staff attitude/morale to environmental regulations. This is where we split up the environmental issues into 2 sections. They are internal and external. Internal is everything that is within the hotel that has a moderate amount of affect on the hotel. External is everything that affects the hotel coming from outside the four walls. Internal environment includes staff attitude and morale which has been low since the poor performance of the hotel which can also be seen from the high staff turnover. These will decrease tremendously due to the new regulations, training and vision of the hotel. External Environment includes environment regulations which are set by local, state and federal legislations which the hotel has to abide by.
Marketing Plan
The marketing plan is a very important guide to lead a successful establishment. Our marketing plan will be based on the company’s target market, as well as the goals and objectives of the property.
Situation analysis:
Internal environment
The guest rooms, front desk, restaurant and bar, are all in poor condition. The restaurant and the front desk were last refurbished 7 years ago. Only 25 guestrooms were redecorated each year, which demonstrates that the guest rooms are potentially not in the most desirable standard and lack of modern amenities. As the hotel is located in a popular area for conferences during both on and off seasons, there will be a very high demand of business travelers. But when considering internally, there are no conference facilities or any sort of business services in the hotel. Moreover, the guestrooms are not suitable for holding conferences or meetings. Those problems have drawn the attention of the management team, and proper investments and constructions will be conducted in the very early stage of the operation in accordance with the aforementioned.
By reviewing the information and statistical facts which were provided by the previous owner, we found that the hotel occupancy was always below the average. On the other hand, the staff turnover rate was extremely high, which means that the morale of the employees was unacceptable. The customers were all disappointed by the food, the facilities and the service quality of the hotel. As the reputation of the hotel was bad, occupancy rate will inevitably be affected.
In regards to the financial situation, it was terrible to see that the net income was growing negatively. Furthermore, there were plenty of long term debts and accounts payable, which even worsened the financial situation of the hotel. Those liabilities should be of concern by the management team as they can potentially affect the upcoming operation of the property.
Customer environment
Referring to the marketing research and statistics, we found out that there are 2 main types of customers, them being business and leisure travellers. As the local area is becoming well known in terms of conferences, it is important for us to realize that many events will be held throughout the year. Therefore, we predict that the demand for accommodation of the business travelers will increase. Besides, we can see from the statistics that 80% of the customers came for business purposes in the first quarter and more than 50% for the entire year. In addition, around 154,000 of those travelled during the weekdays according to the research provided by local Chamber of Commerce and Tourist Board, which contributed the most to the customer base. These factors and numbers provided us with significant information about the importance of investing in business and in conference facilities. Also, the hotel is located along the seafront, just 30 minutes away from the airport, therefore the leisure travelers will also be our main customers as our property can easily be accessed by the customers due to the geographical reason. Tourists nowadays are expecting more they are willing to spend more in order to get better experiences for their stay. By this, we reckon that services and facilities rank the first when it comes to choosing hotels. Therefore our upcoming investments, constructions, and strategies would be tailored for our customers in order to satisfy or even to exceed their expectations.
SWOT analysis
Strengths
Convenient location for customers because of the nearby airport and excellent transport links.
Prefect venue for conferences.
Having the biggest capacity while comparing with the competitors within the same area.
Weakness
Lack of development in terms of facilities and services.
No clear guidelines and competent management team to operate the hotel.
High turnover rate.
Poor image and reputation.
Poor and inconsistent service.
Limited financial support.
Of poor condition including the front desk, restaurants, guest rooms.
Low liquidity and high liabilities.
Opportunities
Plenty of conventions and events will be held within the area.
New technologies to reduce the operation cost.
Fast market growth
Threats
The ever-changing market trends and needs.
Government regulations and laws which may restrict expansions and developments
Economic instability
New entrants
Target Market:
The main target markets of the Grand View Hotel are Business and Leisure travelers. Special packages and facilities will also be promoted to attract the customers.
Marketing Mix: 4Ps
Product
As Grand View Hotel will be a 3 diamonds hotel, we provide different facilities to fit with the needs of the market. We guarantee that the services will be delivered with high quality and all the employees will be trained for enhancing the skills and knowledge. .
The Grand View hotel has 200 Double rooms and 50 King rooms, a restaurant, a lounge and a bar. We also provide room services, conference facilities, fitness facilities including a fitness club and a swimming pool. Furthermore, parking spaces are also available. Some of the facilities will be constructed within one year and we plan to constantly refurbishing the guest rooms and to provide more amenities and entertainment. There will be also some modifications for the restaurant so as to provide better services.
Different packages will be provided to attract more guests, such as Honeymoon packages, conference packages as well as leisure traveler packages in order to diversify our customer base.
Price
As there is high elasticity of demand in the hospitality industry, it’s a big challenge to establish the most appropriate price. Therefore, the price should be flexible to handle and fit in different target markets.
The room rate will be modified seasonally according to the demand and from the surrounding competitors as well. Special price and discount will be offered for large group and business travelers. But, the groups have to discuss with the sales department for more details. The price for the regular guests will be consistent to keep their loyalty. The leisure travelers will be upgraded for free during the low seasons and also free use of the facilities depends on the demand and season. The discount will be offered for weekends.
The price will be differentiates at different times. But, the main idea for the price is to maximize the revenue but also to satisfy our guests.
Place
The location of the hotel is fixed. The hotel is sited along the seafront, close to other hotels and a short distance from the main shopping center, and also it is near the airport and with good transport links to major cities and other resorts. Moreover, the area of the resort has become a popular location for conferences, both in and out season. It’s also the best place for holding conferences which includes conference facilities, fitness club, good infrastructure and superstructure in the city, and a fantastic sea view. We will provide shuttle bus to take customers from the airport and to the airport every 30 minutes from 6a.m to 1a.m.
Promotion
We will promote through direct and indirect distribution channels. We will approach our potential customers who are already targeted through the direct sales call and mail, to communicate with them and find out what’s best suitable for them. And then, we will also advertise in local newspapers and business press to let people know about the hotel. Moreover, we will also put the hotel on the Local Visitor Guide to attract more transient guests and place posters throughout stations and airports. Furthermore, we will pay the Public Relation Agency to find more potential customers and transient customers from all over the world. We will use different advertising media depending on different conditions for different markets. Moreover, we will set up our own hotel website so that the potential guests can have access to the hotel easier.
Competitive advantages:
As we are going to be a 3 diamond hotel, we are going to provide quality services and comfortable ambience for our customers, and re-create customers’ satisfaction and professional image. The employees are the ones to deliver the quality service so they will be trained to be professional and efficient by effective training programs.
As the employees can learn by working and training, they will be motivated and the morale will increase in order to provide and give the best services to the guests. Furthermore, the guests can also keep their memorable and happy experiences with us. These factors will contribute to our uniqueness among our competitors and gain the reputation.
The Grand View hotel will provide many different business services and facilities such as photocopying, stationary preparing, direct dial phone, fax, etcaˆ¦ Moreover, we have a fitness club, including a swimming pool, stair climbing machines, treadmills, fitness walking, etcaˆ¦ Since our hotel focuses heavily on our guest rooms, we will provide a wide range of guest amenities and entertainments. We try our best to maintain a very competitive edge and we strive to be the best amongst our competitors with our comfortable guestrooms and quality services.
Action Plan
In order to turn around the worst situation that we are facing currently, we are going to do several revolutions, investments and constructions according to the marketing plan and try to improve and gain back the reputation within the first operating year.
The first action that we are going to do is to adjust the staff numbers of different departments since effective staffing schedule can save the hotel dozen of money. In order to schedule the staff effectively due to the low occupancy, the number of staff in food and beverage, hotel service and front desk will be cut down.
The main goal for the F&B department is to maximize revenue. For that to happen, the first action that will be taken is that employees are required to participate in numerous training sessions (training program 3), which include general training for example up selling, but also on the job training and coaching which will be carried out by the supervisors and/or the F&B manager. Targets will be set for each and every employee, which they will have to achieve. If these targets or requirements are not met then some corrective actions will have to be taken, and this will be done in the form of further training and coaching sessions but also severe employee evaluations. The menu types will be shortened (Menu type 1), to ensure that we can minimize our costs but also we will find a right supplier with the right quality for the right price (Supplier type 2) to ensure that we find the perfect equilibrium between the quality of our food and the production cost and the selling price. All these decision will be in affect as soon as we reopen the hotel. Revision of Standard operating procedures will be set in place to ensure speed, quality and to satisfy guests to the fullest.
Moreover, we will do the refurbishment (level 2) of the rooms and front desk upon we start the operation in order to create better working environment to our staff and more enjoyable lodging venue to our customers. The refurbishments will include the new decorative scheme. Replace carpets, curtains, linen, light fittings, deep clean other furnishings. Paint woodwork and ceilings, wallpaper walls. We are planning to refurbish 50 rooms every year. In order to provide a better lodging experience to our customers, the in room entertainments and amenities will be added into service. Since our first mission is to attract the guests to come to our hotel and gain reputation by our excellent services and facilities.
As advertising helps to promote our hotel, therefore we are going to do our advertising in accordance with the most profitable market timely. First of all, we will do our advertising through the local newspaper, business press and direct mail in the first three months. We will focus on advertise the weekday and weekend rooms, and also the meal. Since the above media are the most effectiveness in advertise the rooms and meal, therefore we will use those media for our first advertising.
Risk Assessments and Control
Risks are inevitable. We have to identify different risks to avoid and reduce the possibility of risks occurring. Investing in insurance is essential because if these risks occur, it will cost more and at the same time affect the reputation of our hotel. Here are some risk assessments identified:
Asset & Property risks
There are some risks, such as fire, explosion, crime or natural disasters such as hurricanes, floods and tsunamis which could possibly occur and destroy our assets and property.
Legal risks
Large amount of money are being won in consumer, individual lawsuits and in class action suits. Our hotel is liable to its employees, its guests and, in some instances, to the general public.
Bomb threat
After the 911 incident, the United States has the essential risk of more terrorist attacks.
Economic Crisis threat
A loss amount of money may be happened due to the economics crisis of country. For example: the great depression.
Leakage of private and confidential information of the hotel
There are a lot of private and confidential information of the hotel and there is a risk of employees leaking out the other information which can greatly affect the business of our hotel.
Budget
1st year
Assumptions:
Room Division
Totally 50 rooms under renovation
Contribution to revenue: 65%
Food and Beverage Department
Cost percentage: 35%
Contribution to revenue: 35%
Sales
Room
4,823,174
Food&Bev
2,597,094
7,420,268
Cost of Sales
Room
353,246
Food & Bev
908,983
908,983
Payroll & Related
Room
558,495
Food & Bev
506,584
1,065,079
Gross Profit less Wages
Room
3,911,433
Food & Bev
1,181,527
5,092,960
Central Admin Payroll
154,140
Other Direct Costs
256,250
Income before Fixed Charges
4,682,570
Total Fixed Costs
674,325
Income before Taxes
4,008,245
Business Tax Paid
1,202,473
Income after Business Taxes
2,805,771
2nd year
Assumptions:
Average room rate states the same
Average occupancy increased to 55%
New facilities: in room mini bar, second bar, data point, quick check in/out, shop
business service and additional parking area
Sales
Room
5,863,284
Food&Bev
3,420,249
Other
1,465,821
9,772,140
Cost of Sales
Room
353,246
Food & Bev
1,197,087
Other
879,493
2,076,580
Payroll & Related
Room
609,450
Food & Bev
506,584
Other
34,000
1,150,034
Gross Profit less Wages
Room
4,900,588
Food & Bev
1,716,578
Other
552,328
7,169,494
Central Admin Payroll
154,140
Other Direct Costs
678,250
Income before Fixed Charges
6,337,104
Total Fixed Costs
674,325
Income before Taxes
5,662,779
Business Tax Paid
1698834
Income after Business Taxes
3,963,945
3rd year
Assumptions
Average room rate states the same
Average occupancy increased to 62%
New facilities: health club, conference and function rooms
Sales
Room
6,570,348
Food&Bev
3,832,703
Other
1,642,587
10,950,580
Cost of Sales
Room
353,246
Food & Bev
1,341,446
Other
985,552
2,326,998
Payroll & Related
Room
738,899
Food & Bev
680,428
Other
85,000
1,504,327
Gross Profit less Wages
Room
5,478,203
Food & Bev
1,810,829
Other
572,035
7,861,067
Central Admin Payroll
154,140
Other Direct Costs
1,613,625
Income before Fixed Charges
6,093,302
Total Fixed Costs
674,325
Income before Taxes
5,418,977
Business Tax Paid
1625693
Income after Business Taxes
3,793,284
4th year
Assumptions
Average room rate states the same
Average occupancy increased to 70%
Sales
Room
7,394,419
Food&Bev
4,313,411
Other
1,848,605
12,324,032
Cost of Sales
Room
353,246
Food & Bev
1,509,694
Other
1,109,163
2,618,857
Payroll & Related
Room
834,449
Food & Bev
680,428
Other
85,000
1,599,877
Gross Profit less Wages
Room
6,206,724
Food & Bev
2,123,289
Other
654,442
8,984,455
Central Admin Payroll
154,140
Other Direct Costs
1,634,000
Income before Fixed Charges
7,196,315
Total Fixed Costs
674,325
Income before Taxes
6,521,990
Business Tax Paid
1,956,597
Income after Business Taxes
4,565,393
