Archive for the ‘Finance’ Category

Assumptions that holiday guests make

Tuesday, September 23rd, 2008

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Perhaps the most obvious assumption they make is that Wendy is Superwoman.

Contrary to the received wisdom of guests, it’s not actually possible to remake rooms the instant that the previous guests vacate them. Even if we dropped everything the moment a guest walked out the door it usually takes 30 minutes or so to prepare a room for the next guest. We have a relatively early checkin time of 3pm but others are as late as 6pm but the time from check out to check in is there to enable the owners to prepare the rooms for the next guests. A checkout time of 11am definitely doesn’t mean that you can check in from 11am too!

Of course, we are rarely in the position to drop everything anyway as we’re generally keeping the breakfast room running first thing, checking out guests, clearing up the breakfast room and checking to see if there have been any more bookings during the night. Therefore, it’s generally into lunchtime before we have most of the rooms ready.

Related to this, there is sometimes the assumption that the owners are 100% available to each and every guest. This falls down because there are more guests than there are of us and therefore we can’t be working constantly with one guest to the exclusion of all the others. Most of the time that’s fine but since we don’t have a 1:1 staff to guest ratio on (fairly) rare occasions it doesn’t when several guests want our undivided attention at the same time.

Then there’s the assumption that because we live on the premises, we’re available 24 hours a day. That one falls down because, unlike Superwoman, we need to sleep and therefore we don’t run a 24 hour reception and neither do we serve food at all hours of the day. Yet despite that we have received complaints that we wouldn’t do breakfast at 5am, that we wouldn’t spend 2 hours ferrying people to the train at 6am and that we went to bed before 2am. Clearly, there’s some flexibility in our opening hours but not to the extent that we can constantly stay open well after midnight whilst reopening for breakfast before 6am.

Then there is the assumption that because they have paid for a breakfast that everything is theirs. For example, we reuse unused jams to reduce the cost of providing the breakfast and we also don’t buy enough baguettes to enable guests to make up sandwiches for their lunch. If we were trying to cover the takeaway lunch as well we’d need to increase the breakfast price at least 50%.

There’s also the assumption that no matter how large the booking is, it’s still possible to cancel as though you were cancelling a one night booking. Group bookings are very different affairs to normal ones and it’s rarely possible to rebook the rooms that a large group leave if they cancel early and therefore different charging rules often apply.

Perhaps most interesting is the assumption that you can book on one website because the price is lower but take the advantages of the better conditions listed on another site. Thus we get people booking through systems which cost us 15% commission plus VAT whilst simultaneously looking for the 10% discount that they’d get had they booked directly with us.

Naturally, accommodation owners are all mind readers and/or fortune tellers. Somehow we are supposed to magically know how a guest will be coming, which plane or train they’ll be taking and when they’ll be getting here. Some guests have even discovered facilities to book meals on websites which are hidden to normal mortals yet oddly these facilities don’t seem to reveal to them the times that we’re open for meals.

Finally, there is the assumption that “if it’s not nailed down, it’s to take away”. We spend quite a while preparing a guidebook which we place in each room yet now and again we get people attempting to walk away with the whole thing. Similarly, we pretty much ran out of teaspoons and hand towels over the last year which, in large businesses would be called wastage, but which we call theft. Perhaps most peculiar in this area was one couple who between them managed to get through 28 toilet rolls in a week; quite how they managed to pack them all in their cases is beyond us to this day.

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Getting money from repeat customers at your holiday property

Monday, September 8th, 2008

Many places tend to treat repeat customers specially through offering discounts, extra services, or whatever.

However, they remain customers and one of the key things about that is that you need to get money off them for whatever goods or services that you sell, even if they are both a repeat customer and a large one.

One trap to fall into is to be more lax with the payment terms. Unless you habitually offer credit then you shouldn’t offer it to even the best of customers as sooner or later it’ll just cause needless friction between you and a good customer. If it’s pay on delivery for everyone else then that should be the case for even the best customers too as your sales contract probably doesn’t allow for any credit in such circumstances: a recipe for trouble collecting the cash if ever there was one.

So, yes, offer better discounts to better customers. Yes, offer, additional services to better customers. But, NO, don’t change your payment terms.

Popularity: 36% [?]

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Did you rightstock for the holiday season?

Monday, September 1st, 2008

Most people are finishing off their main guest season at this point and perhaps settling down to consider what lessons they might carry forward to next year.

One key thing is the idea of rightstocking. Whilst you don’t want to overstock perishable items over the summer you also don’t want to run out of essentials through understocking. Unfortunately, that’s not an easy balance to strike as often the end of the season comes quite abruptly.

For example, in our own case we found that this year we were running almost fully occupied right through to the final days of the season. Whilst the money coming in is obviously useful, that pattern of booking makes right-stocking very difficult indeed. All of a sudden we found ourselves dropping from almost 20 breakfasts in a morning down to four. Thus instead of going through half a box of sugar in a morning we were down to half a bowl and likewise for everything else.

That pattern is fine for things that have a fairly long shelf life but even cornflakes doesn’t come with a shelf-life of more than nine months or so thus the boxes of cereal that we have left are likely to last that little bit too long. Things like butter may only have a shelf life of a month or so which matters quite a lot eg in our case we went from using 20 butter portions a day down to just four so what we previously used in a day now lasts a week. However, even for the non-perishables such as wine you don’t want to be carrying too much stock over into the following year as it just ties up money you could use elsewhere and, of course, makes it more difficult to roll out any format changes that you might be planning.

For a change, we find ourselves almost exactly rightstocked this year with most things although more by chance than design if truth be told. In practical terms we’re lucky in that we’re small enough to be able to munch our way through the things that are likely to reach their sell-by date before any guests would get around to eating them but if we were just a little larger that wouldn’t be a runner.

Popularity: 35% [?]

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