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The Front Office Department

Chapter 7. The Front Office Department. The Front Office Function. Front Office: the area within the hotel responsible for guest reservations, registration, service and payment. Front desk: the area within the hotel used for guest registration and payment.

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The Front Office Department

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  1. Chapter 7 The Front Office Department Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  2. The Front Office Function Front Office: the area within the hotel responsible for guest reservations, registration, service and payment. Front desk: the area within the hotel used for guest registration and payment. FOM: the hotel industry term for a Front Office Manager. Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  3. Front Office Responsibilities Duties of the Front Office: • Management of the PMS PMS: the hotel industry term for a “Property Management System.” 2. Guest Services 3. Accounting Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  4. PMS Management Every PMS records: • Who is coming to the hotel • What they spend when they are there • The form of payment used upon departure Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  5. PMS Management Back-up System: redundant hardware and/or software operated in parallel to the system it serves. Used in times of failure or power outages, these are often operated by battery systems. Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  6. Guest Services Front office employees’ responsibilities: • Transportation to and from airport • Handling luggage • Providing directions to area attractions • Taking guest messages • Routing mail • Newspaper delivery • Management of safety deposit boxes • Arranging wake-up calls • Guest security by careful dissemination of guest-related information • Handling guests’ concerns and disputes Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  7. Accounting and Data Management Night Audit: the process of reviewing for accuracy and completeness the accounting transactions from one day to conclude or “close” that day’s sales information in preparation for recording the transactions of the next day. Night Auditor: the individual who performs the daily review of all hotel guests’ financial transactions recorded by the front desk. Folio: the detailed list of a hotel guest’s room charges as well as other charges authorized by the guest or legally imposed by the hotel. Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  8. Accounting and Data Management Even simple computerized PMS systems know: • The date of the guest’s last stay • The guest’s address, telephone number, credit/debit card information • The room rate paid and room type occupied by the guest during their last stay Room Type: the term used to designate specific configurations of guest rooms. Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  9. Accounting and Data Management Even simple computerized PMS systems know: • A history of the guest’s prior folio charges • The form of payment used by the guest to settle his or her account with the hotel • The guest’s company affiliation • The guest’s room type preferences Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  10. Forecasting Demand “How many rooms will the hotel sell tonight?” Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  11. The Effect of Demand on ADR RevPar: Short for “Revenue Per Available Room;” the average revenue generated by each of a hotel’s guest rooms during a specific time period. Occupancy (x) ADR = RevPar Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  12. The Effect of Demand on ADR Forecasting demand is important because: • Hotel rooms can be sold for a higher price when the hotel knows that demand will be high • Increased demand for rooms means that more rooms will be sold, thus increasing both occupancy and ADR Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  13. Estimating Demand Sell-out: 1. A situation in which all rooms are sold. A hotel, area, or entire city may, if demand is strong enough, sell out. 2. A period of time in which management must attempt to maximize ADR. Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  14. Estimating Demand Proper forecasting of demand requires: • Accurate historical records to understand past demand and its possible impact on future demand • Knowledge of special events or circumstances that will affect future room demand Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  15. Use of the PMS in Forecasting Demand If a PMS is effective: • Information will be easily accessible Historical data: information related to the stays of past guests. Collectively, this information details the history of all past hotel guests. Guest History: information related to the past stay(s) of one guest. Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  16. Use of the PMS in Forecasting Demand If a PMS is effective: 2. Compatible with Windows Office Products • Word • Excel • Access www.microsoft.com 3. Internet Connectivity Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  17. Use of the PMS in Forecasting Demand If a PMS is effective: 4. Strong Revenue Mgmt. Component Revenue Management (RM): The process and procedures used to maximize RevPar. Revenue Manager: an individual whose major task consists of forecasting room demand so the hotel can maximize RevPar. Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  18. Establishing Room Rates Yield Management Rack Rate: the price at which a hotel sells its rooms when no discounts of any kind are offered to the guest. Often shortened to “Rack.” Over booking: a situation in which the hotel has more guest reservations for rooms than it has rooms available to lodge those guests. Sometimes referred to as “oversold.” Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  19. Establishing Room Rates Walked: A situation in which a guest with a reservation is re-located from the reserved hotel to another hotel because no room was available at the reserved hotel. A hotel that has walked a guest should pay for: • Transportation to/from an alternative property • Telephone calls made by the guest to inform others of new accommodations • The cost of the first night’s room charges at the alternate hotel Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  20. Establishing Room Rates Hotels might overbook: • As an error when reservations are not properly recorded in the PMS • In anticipation that one or more of the guests who have reservations will be a no-show No-show: a guest who makes a room reservation but fails to cancel the reservation or to arrive at the hotel on the date of the confirmed reservation. www.mastercardmerchant.com Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  21. Establishing Room Rates Transient Rates Transient: individual guests that are not part of a group or tour booking. Corporate Rate: the rate a hotel charges to its typical business traveler. This rate is normally 5-20% below the hotel’s rack rate. Non-yieldable: a discounted room rate that continues to be offered even when a hotel has implemented a Yield Management strategy. Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  22. Establishing Room Rates Group Rates Group: individual guests that are part of a larger, multiple traveler booking. For example, those in a leisure tour bus, wedding party, sports team, and the like. In the great majority of cases, group room rates are 100% yieldable. Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  23. Reservations Reservations come from: • Hotel Direct Inquiry • Central Reservation System • Internet Booking Site Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  24. Hotel Direct Inquiry Critical aspects of selling via telephone: • Telephone etiquette • Qualifying the guest • Describing the property • Presenting the rate • Overcoming price resistance • Upselling: tactics used to increase the hotel’s average daily rate (ADR) by encouraging guests to reserve higher-priced rooms with better or more amenities. • Closing the sale • Recapping the sale Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  25. Hotel Direct Inquiry Walk-ins: a guest seeking a room who arrives at the hotel without an advance reservation. Curb Appeal: the term used to indicate the initial visual impression the hotel’s parking areas, grounds, and external buildings create for an arriving guest. Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  26. Central Reservation System Confirmation Number: a series of numbers and/or letters that serve to identify a specific hotel reservation. Cancellation Number: a series of numbers and/or letters that serve to identify the cancellation of a specific hotel reservation. Room Nights: the number of rooms used times the number of nights these rooms are sold. Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  27. Central Reservation System Information to be supplied to the call center: • Room availability • Black-out dates: specific day(s) in which the hotel is “sold out” and/or is not accepting normal reservations. • Room rates • Seasonality of rates • Room types • Distances to local attractions • Hotel amenities and services offered • Directions to the property • Rating and ranking information Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  28. Central Reservation System By connecting to GDS, one can: • Identify all hotels located in the city • Select those hotels with rooms available on the desired night • Compare room rates • Evaluate each hotel’s location and features • Make the reservation • Receive a confirmation number Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  29. Internet Booking Sites www.choicehotels.com www.marriott.com www.travelocity.com www.hotels.com www.orleanscasino.com Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  30. Reception and Guest Service Pre-Arrival: Registration (Reg) Card: a document that provides details such as guest’s name, arrival date, rate to be paid, departure date, and other information related to the guest’s stay. Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  31. Reception and Guest Service Arrival and Stay: Five-step process to correctly register a guest: • Greeting the guest • Confirming the information on the reg card • Securing a form of payment Authorize: to validate. 4. Room assignment • Issuance of keys Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  32. Reception and Guest Service Departure: In normal check-out, staff must: 1. Settle the guest’s bill 2. Re-book the guest for a future stay Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  33. Guest Accounting Post: to enter a guest’s charges into the PMS, to create a permanent record of the sale. Possible charges include: • Room charges • In-room safe charges • Pay-per-view movies/games • Telephone calls  Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  34. Data Management Interfaced: the term used to describe the process in which one data generating system shares it data electronically with another system. Call accounting: the system within the hotel used to document and charge guests for their use of the telephone. PBX: short for “Private Branch Exchange.” The system within the hotel used to process incoming, internal and outgoing telephone calls. www.mitel.com Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  35. Night Audit The Night Audit Function: • Posting the appropriate room and tax rates • Verifying the accurate status of all rooms in the PMS • Posting any necessary adjustments • Verifying that all legitimate, non-room charges have been posted Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

  36. Night Audit The Night Audit Function: 5. Monitoring guest account balances to determine if any are over the guest’s credit limit 6. Balancing and reconciling to Front Desk’s cash bank 7. Updating and backing-up the electronic data maintained by the Front Office 8. Producing, duplicating and distributing all management mandated reports Hayes/Ninemeier: Foundations of Lodging Management. (C) 2006 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved.

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