Assessment Task:
You are the RM at Luxury Resorts. Mayan is the property’s DOSM and Dasha is the FOM. All you three serves on the hotel’s RM boards committee headed by the DOSM.
The hotel has 250 rooms that it can serve to customers per night stay. Last year records showed that the hotel usually has 90% occupancy for the Easter holiday season from 1st April till 8th April every year. The rooms are selling at a rack rate of $99.99 per night.
Offer 1: Dasha has been approached by Tennis Australia to block 200 rooms per day (80% occupancy) for the Easter holiday season from 1st April till 8th April. The price quoted to them is $79.99 per night.
Offer 2: Mayan has been approached by the Football Associations to block 220 rooms (88% occupancy) per day for the Easter holiday season from 1st April till 8th April. The price quoted to them is $75.99 per night.
There are two offers that currently need to be considered. The RM committee requires you to calculate differentiate explain which of their costs are fixed and variable and any recommendations to change from the variable to fixed costs or would that be better to stay as variable costs according to the cost behaviour and driver.
Luxury Resorts Australia RM Committee are planning to find out whether Dasha’s offer would be beneficial or Mayan’s offer should be considered or should they open for business as usual to operate with the forecasted 90% occupancy.
Forecasted Expenses for the period 1st April 2021 – 8th April 2021
Full time staff Salary @100% occupancy $7,000.00
Casual staff wages @100% occupancy $3,500.00
Electricity charges @100% occupancy $1,200.00
Water charges @100% occupancy $1,400.00
Guests laundry charges @ 100 % occupancy $ 380.50
Room Cleaning charges @ 100 percent occupancy $2,283.00
Phone and internet charges yearly charges @100% occupancy $7,800.00
Weekly bank charges @100% occupancy $70.00
Required:
The DOSM, head of the RM committee has asked you to prepare the following and submit a report to the RM committee with the following requirements below to decide.
Task 3A: Prepare a short 6 to 8 mins video presentation about your findings and recommendations to the RM committee of Purple Resorts. (20 Marks)
The DOSM would like to see these following in the video Presentation for the committee.
1. The Forecasted total cost and revenue for Dasha, Mayans Proposal and normal estimated occupancy (5 marks)
2. The Break-even units in rooms and dollars for 100% occupancy (5 marks)
3. Comparison of Dasha, Mayans Proposal and normal estimated occupancy and which would be yielding more? (5 marks)
4.
Your proposal Recommendation and reason (5 marks)
4.
The video presentation should be a created using a PowerPoint slide with a maximum of 10 slides.
Task 3B:
Your report should be presented in this format:
Contents Page:
A. Executive summary (2.5 marks) (250 – 500 words)
B. Body of the Report (total 25 Marks) (body of the report should comprise the following)
1. Cost Analysis (Here you must differentiate cost as fixed cost / variable cost and state the reason why they are fixed / variable related to their cost behaviours and recommendations to transform from variable to fixed costs or would that be better to stay as variable costs according to the cost behaviour and driver.) (750 – 1000 words) (5 Marks)
2. 2. Break even Analysis: (Here calculate your BEP using the BEP formula so you need your Fixed cost and variable cost per unit calculated for each room and find out what the Breakeven rooms per day and propose the committee what would be the BEP in units and dollars for 100% occupancy (5 marks)
3. Calculate and Analyse ADR, REVPAR and REVPAR index (Here you need to calculate the ADR per day and REVPAR per day with the data provided) and comment on the RevPAR index ( the market REVPAR index is stated at 91.6% (5 marks)
4. Calculate and Analyse the Revenue dollar differences both in percentage and dollars: Here Calculate and Analyse the dollar difference & % difference in her total revenue compare which offer would yield more if she agreed to take the rooms offer from Dasha or Mayan or would she be better off not taking those offers and staying with 90 % occupancy (7.5 Marks)
C. Decision / Recommendation
(Explain the reason which offer should the committee accept or be better not accepting any offers and staying off with the 90% occupancy.) (10 marks) (500 words)
D. References:
Overall Report presentation with no grammar, formatting errors, proper APA style referencing(5 Marks)