Case Study on Revenue Management

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The answer should be in the excel sheet as per the instructions in the pdf file

1

PROJECT OUTLINE

Assessment title: Case Study on Revenue Management

Programme: MEIHM

Course name: Revenue and Pricing Management

Course number: M 9116

Faculty responsible: Ms. Montero

Hand out date: 4th January 2023

Due date: 22nd January 2023, 23:59hrs.

Weighting: 60%

Project Overview: The students should answer a case study on Revenue Management

provided by the faculty. The students will need to provide a report with

the answer to exercises about RM recommendations and reports.

Overall aim: To enable students to demonstrate their understanding of the importance

and function of Revenue Management.

Learning outcomes:

1. Identify the principles of revenue and yield management.

2. Discuss, demonstrate and apply demand management strategies, pricing, capacity
management, discount allocation, forecasting and other associated procedures essential

to successful Yield Management.

Organization and methodology

• Write the answers of the case study on revenue management in report template

provided by the faculty. The report has to be in Excel format.

• Deliver the project in the section provided in Moodle before the deadline. If you have
any problem with the submission in the platform, make sure that you send a copy by

mail to your teacher ([email protected]) before the deadline.

2

Include:

1. RGI: calculate all the KPIs for all the hotels with the given data. After that provide a
brief analysis explaining results of my hotel 1 and my hotel 2, positioning strategy of
these hotels and if it is correct, in the space provided in the documents.

2. PROYECTION EXERCISE: you need to answer the questions in the given space and in
the “Projection Data” sheet you need to fill in the grey columns doing a projection of
the given month using your knowledge about the use of pick-up.

3. DEMAND CALENDAR: according to the scenario given in the calendar you need to
explain what your positioning strategy would be to improve the performance of the
month of January. Please answer in the space given and use the template given to
provide your price suggestions.

Assessment tasks & weighting:

▪ TASKS: Written project 90%

▪ English Skills 10% (Rubric over page)

Assessment
Tasks

Excellent Very good Good Pass Fail Zero Weight

100% 85% 70% 60% 40% 0% %

exercise 1

All results
correct and
coherent
supported
explanation.
Correct use
of excel.

numerical
results
correct but
weak
analysis, too
theoretical
approach.
Correct use
of excel.

results with
slight
mistakes, but
good
analysis.
Incorrect use
of excel.

Right
calculations
but with
wrong use of
data

Wrong
results and
wrong
answers

No answers
included

25%

exercise 2

All results
correct and
coherent
supported
explanation.
Correct use
of excel.

numerical
results
correct but
weak
analysis, too
theoretical
approach.
Correct use
of excel.

numerical
results
correct but
weak
analysis, too
theoretical
approach.
Incorrect use
of excel.

calculations
with good
use of
formulas but
with slight
calculation
problems
that
influence
analysis

Major errors
and wrong or
non-existent
analysis.

No answers
included.

37%

exercise 4

Coherent
strategy
supported by
data

Coherent
strategy with
slight error in
supporting
data

Coherent
strategy with
weak support
of data

Good
strategy with
no support

wong
strategy with
wrong
support

No answers
included

25%

English

Fulfils the
requirements
and follows
an
acceptable
style in the
correct
manner

Fulfils most
of the
requirements
and follows
an
acceptable
style in a
generally
correct
manner.

Attempts to
follow an
acceptable
style and
fulfils most of
the
requirements

Generally,
attempts to
conform to
requirements
and
adequately
executed

Does not
meet a
number of
key
requirements
and fails to
follow an
acceptable
style.

No
references

and
disastrous

presentation.

10%

3

Professional
presentation

Fulfils the
requirements
and follows
an
acceptable
style in the
correct
manner

Fulfils most
of the
requirements
and follows
an
acceptable
style in a
generally
correct
manner.

Attempts to
follow an
acceptable
style

Generally,
attempts to
conform to
requirements
and
adequately
executed

Does not
meet a
number of
key
requirements
and fails to
follow an
acceptable
style.

disastrous
presentation.

3%

Common skills: assessed (bold) or developed (italics):

MANAGING AND DEVELOPING SELF
1.Manages
own role and
responsibilities

2. Manages
own time in
achieving
objectives.

3.Undertakes
personal and
career
development

4. Transfers skills
gained to new
and changing
situations and
contexts.

5.Uses a
range of
thought
processes

WORKING WITH AND RELATING TO
OTHERS

6.Treats
others’ values,
beliefs and
opinions with
respect

COMMUNICATING

9.Receives
and responds
to a variety of
information

10.Presents
information in a
variety of
visual forms

11.Communicates
in writing

MANAGING TASKS AND SOLVING
PROBLEMS

13.Uses
information
sources

15.Identifies and
solves routine
and non-routine
problems

English Skills Full Achievement

100%-85%

Good

84%-75%

Reasonable

74%-65%

Adequate

64%-60%

Fail

59%-0%

Coherence/Structure/Flow
Writing is structured
Has a beginning & end
Ideas are well connected
Clear flow – easy to read

Effectively organised.
Well-structured with
good flow

Generally well
organised.
Sometimes ideas
are not linked
together.

Structure could be
better with clearer
development for
better reading

Shows some
organisation – just
enough to pass

Not clearly
organised
Difficult to follow

Relevant Use of Language
Writing uses specific language
used in hospitality asked for by
assignment

Minimum errors –
wide range of
appropriate
vocabulary

Good range of
appropriate
vocabulary

More than adequate
range used

Uses limited variety
of terms, and is often
repetitive

Poor use or no
use of specific
terms

Appropriate Tone
Required use of either formal or
informal style of writing

Appropriate tone
throughout and
reflects assignment
requirements

Tone on the whole
appropriate

Some inconsistent
use of language

Not always
appropriate therefore
not entirely
successful

Inappropriate
tone used in
most of the task

Clarity & Accuracy
Writing is clear with no
confusing areas

Extremely clear
Well developed &
expanded upon

Slight confusion due
to minor inaccuracy.
Ideas on the whole
developed well.

Occasional confusion
due to ideas not
being clear but
message is given.

At times, difficult to
follow and/or
repetitive

Difficult to read
due to
inaccuracies.

Impact/Effectiveness on Reader
Impact on reader

Excellent

Very Positive

Positive

Satisfactory – just a
pass

Poor effect on
reader

4

BECOMING NUMERATE AND USING
TECHNOLOGY

16.Applies
numerical
skills and
techniques

Special instructions:
Ensure all tasks are complete by the deadlines indicated. If the task is not in the platform by

the deadline date, the grade will be a 0.

Plagiarism
Plagiarism is the act of presenting another’s ideas or words as one’s own. Cheating includes,

but is not limited to, the intentional falsification or fabrication of any academic activity,

unauthorized copying of another person’s work, or aiding and abetting any such acts.
Particular care must be taken when presenting information that has been obtained from an

internet site. Should this information not be correctly referenced, then you are guilty of
plagiarism and will be penalized accordingly.

With respect to projects/assignments, faculty reserves the right to randomly call upon any

student and ask them to defend their work orally.
Any assignment/exam which is found to contain plagiarism will automatically be awarded a

grade of 0, and an e-mail will be sent to the student or the student’s parents/tutors/sponsors.
Depending on the circumstances, additional penalties could be imposed (see LRM Academic

Regulations, Section 11).

Statement of authorship
Following the title page of your assignment there should be a page on which you sign a
statement that the work included in the assignment is your own work except where
appropriately referenced. The following statement should be used:

Statement of authorship
I certify that this assignment is my own work and contains no material which has been
submitted as part of an assignment in any institute college or university. Moreover, to the best
of my knowledge and belief, it contains no material previously published or written by another
person, except where due reference is made in the text of the assignment.

Signed…………………………………………..
Student number………………………………..

1. RGI

This is a template to manually calculate the RGI in a city where we have hotels. Calculate all fields based on the date given. Explain the results including the postitioning strategy of “MY HOTEL 1” & “MY HOTEL 2”.
Month OCTOBER
Year 2020
ANALYSIS:
HOTELS av. Rooms av. Month FMS room occ Occ % MS MPI ARR Total Room Revenue ARI RGI
hotel 1 120 68.92% 72.67
hotel2 146 62.99% 50.18
hotel 3 148 77.65% 54.16
hotel 4 86 78.10% 40.40
hotel 5 176 39.15% 66.28
MY HOTEL 1 245 59.17% 64.06
hootel 6 124 85.50% 55.00
hotel 7 133 74.09% 64.96
hotel 8 179 41.62% 84.38
hotel 9 117 84.05% 56.60
hotel 10 93 72.40% 55.76
MY HOTEL 2 162 70.37% 50.46
Total

FMS hotel 1 hotel2 hotel 3 hotel 4 hotel 5 MY HOTEL 1 hootel 6 hotel 7 hotel 8 hotel 9 hotel 10 MY HOTEL 2 MS hotel 1 hotel2 hotel 3 hotel 4 hotel 5 MY HOTEL 1 hootel 6 hotel 7 hotel 8 hotel 9 hotel 10 MY HOTEL 2

2. PROJECTION EXERCISE

The hotel to be analysed is a 4* Urban hotel. It counts with infrastructure to attrack groups and events, clients going to the airport and a mix of leisure and business travellers.
Hotel room inventory 149
Days of the month 31
We are about to start the new month of March 2020. The situation of the hotel in shown in “Proyection data”.
Answer the questions that appear in the box below, including the correspondent formulas in the cells.
What was the pick up variation in terms of RN and ADR (RN & ADR) during the current month in 2019, from the beginning to the end of the month?And What was the % of growth?
RN ADR
% %
What is the % of occupancy and RevPar that the hotel did obtain last year in the given month?
% OCC REVPAR
To achieve the existing revenue budget objective given, what ADR should we achieve in the pending rooms to be sold for the rest of the month?
Comparing last year results and the current year budget, what is the % of revenue growth stablished in the budget when we compare both data?
Do a forecast proposal in the grey cells in the “Proyection data” sheet. You can use formulas where you feel convenient, and show % occupancy, accumulated ADR and resulting rooms revenue.
% OCC ADR ROOMS REV.
What is the % of completion of the given revenue budget that is expected, according to your forecast? Would you reach, exceed or fail to achieve the objective?
Explain in brief the reasons why the budget will be met or not. Do you think that you should have required more information than the one given for your forecast, explain why.
Taking into accoun the current OTB situation and the rest of the information provided in the document, Do you think that the strategy of sales could have been improved? Why?
If your answer is yes, explain the main aspects that should have been taken into account to apply such a change of strategy and its main repercussions.

Projection data

HOTEL INVENTORY 149 Fill in the grey columns with your forecast.
DAYS OF MONTH 31 We are in the last days of February and these data correspond to March.
Room Nights ADR REVENUE
OTB SM LY ACTUAL LY (final result) OTB FORECAST BUDGET (objective) OTB SM LY ACTUAL LY (Final result) OTB FORECAST BUDGET OTB SM LY ACTUAL LY (final result) OTB FORECAST BUDGET (objective)
BAR 351 978 490 1,000 133.44 € 130.82 € 143.75 € 142.00 € 46,837.65 € 127,946.33 € 70,435.05 € 142,000.00 €
DISCOUNTS 218 275 138 150 99.01 € 101.09 € 118.50 € 118.00 € 21,583.70 € 27,800.77 € 16,352.74 € 17,700.00 €
TACTICAL 0 0 0 0 – 0 € – 0 € – 0 € – 0 € – 0 € – 0 € – 0 € – 0 €
PACKAGES 10 11 10 15 74.50 € 71.34 € 63.67 € 63.50 € 745.00 € 784.74 € 636.65 € 952.50 €
LOYALTY PROGRAMS 43 45 18 35 35.60 € 39.09 € 39.51 € 42.00 € 1,530.76 € 1,759.24 € 711.20 € 1,470.00 €
NEGOTIATED 233 808 389 969 106.18 € 104.02 € 94.55 € 95.31 € 24,740.17 € 84,048.88 € 36,781.52 € 92,355.39 €
NET 393 438 244 375 77.20 € 77.84 € 87.13 € 85.00 € 30,340.63 € 34,095.93 € 21,258.54 € 31,875.00 €
Subtotal Transient 1,248 2,555 1,289 2,544 100.78 € 108.19 € 113.40 € 112.56 € 125,777.91 € 276,435.89 € 146,175.70 € 286,352.89 €
MICE 617 1,084 805 1,170 101.94 € 103.40 € 115.40 € 116.41 € 62,894.36 € 112,080.89 € 92,896.66 € 136,198.53 €
TOUR GROUPS 185 205 0 0 74.61 € 73.95 € – 0 € – 0 € 13,801.99 € 15,159.12 € – 0 € – 0 €
LEISURE GROUPS 313 313 151 151 85.82 € 84.63 € 91.21 € 88.49 € 26,861.43 € 26,488.15 € 13,772.97 € 13,361.99 €
CREWS 0 0 0 0 – 0 € – 0 € – 0 € – 0 € – 0 € – 0 € – 0 € – 0 €
Subtotal Groups 1,115 1,602 956 1,321 92.88 € 95.96 € 111.58 € 113.22 € 103,557.78 € 153,728.16 € 106,669.63 € 149,560.52 €
OTHERS 0 9 3 10 – 0 € 56.58 € 140.59 € 81.30 € – 0 € 509.19 € 421.77 € 813.00 €
Subtotal Others 0 9 3 10 – 0 € 56.58 € 140.59 € 81.30 € – 0 € 509.19 € 421.77 € 813.00 €
COMPLEMENTARY 0 0 0 0 – 0 € – 0 € – 0 € – 0 € – 0 € – 0 € – 0 € – 0 €
Subtotal Non Revenue 0 0 0 0 – 0 € – 0 € – 0 € – 0 € – 0 € – 0 € – 0 € – 0 €
TOTAL 2,363 4,166 2,248 3,875 97.05 € 103.38 € 112.66 € 112.70 € 229,335.69 € 430,673.24 € 253,267.10 € 436,726.41 €

3. DEMAND CALENDAR

This is an urban hotel that receives leisure and business clients.
The current month is January. As it is low season, this is a difficult month in the city. Yet, there are some dates where the demand is higher.
Competitors:
HOTEL A The best hotel in the city.
HOTEL B Different product style but same category than yours.
HOTEL D Small hotel but with good product.
What price positioning strategy could you use in this scenario to improve your performance? Give your price suggestions below in the template given, including a brief explanation of why you change.
COMPETITORS DATA
DESCRIPTION TRIPADVISOR RANKING LOCATION % OCC JANUARY Last Year
HOTEL A Best hotel in the city 1/250 center 50.00%
HOTEL B Different product style but same category than ours 50/250 outskirts 45.00%
HOTEL D Small hotel but with good product 35/250 close to center 60.00%
MY HOTEL 4* Business hotel 20/250 in front of city’s convention venue 56.44%
205 rooms inventory
1/1/21 period starts
1/31/21 period ends
1/5/21 report retrieved
1/15/16 1/4/20 Pick Up 2021 last 7 days 1/5/21 COMPETITOR’S PRICES
Tot % OCC Def +tentatives ARR total room revenue tentatives Def % OCC Def Ind Grp Tot ARR Total room revenue definite Ind Grp Tot % OCC Def + tent ARR total room revenue tentatives definite % OCC Def Ind Grp EVENTS 2021 price HOTEL A HOTEL B HOTEL C HOTEL D HOTEL E HOTEL F
01/01/2021 150 73.17% 90.48 13,572 0 150 73.17% 150 0 0 0.00 0 0 0 0 140 68.29% 96.94 13,572 0 140 68.29% 140 0 NEW YEAR DAY 124 186 104 121 175 CLOSED 75
02/01/2021 179 87.32% 87.18 15,606 0 179 87.32% 179 0 0 0.00 0 0 0 0 168 81.95% 92.89 15,606 0 168 81.95% 150 18 124 119 172 121 160 189 75
03/01/2021 82 40.00% 95.94 7,867 0 82 40.00% 82 0 0 0.00 0 0 0 0 91 44.39% 86.45 7,867 0 91 44.39% 91 0 124 109 172 109 104 104 75
04/01/2021 66 32.20% 80.15 5,290 0 66 32.20% 66 0 5 112.94 565 5 5 0 66 32.20% 81.38 5,371 0 66 32.20% 66 0 124 119 104 89 104 89 75
05/01/2021 57 27.80% 80.87 4,610 0 57 27.80% 57 0 8 109.76 878 8 8 0 66 32.20% 83.15 5,488 0 66 32.20% 46 20 124 99 104 89 94 89 82
06/01/2021 53 25.85% 72.91 3,864 0 53 25.85% 53 0 7 97.02 679 7 7 0 53 25.85% 85.72 4,543 0 53 25.85% 53 0 FOOTBALL MATCH 124 99 114 89 114 109 82
07/01/2021 81 39.51% 69.70 5,645 0 81 39.51% 81 0 13 84.70 1,101 13 13 0 81 39.51% 83.29 6,746 0 81 39.51% 81 0 100 99 104 98 104 154 82
08/01/2021 56 27.32% 82.25 4,606 0 56 27.32% 56 0 8 82.65 661 8 8 0 63 30.73% 83.61 5,267 0 63 30.73% 63 0 100 99 105 89 104 94 75
09/01/2021 40 19.51% 90.16 3,606 0 40 19.51% 40 0 9 85.96 774 9 9 0 53 25.85% 82.64 4,380 0 53 25.85% 52 0 100 99 105 89 94 94 75
10/01/2021 38 18.54% 47.36 1,800 0 38 18.54% 38 0 9 102.46 922 9 9 0 39 19.02% 69.79 2,722 0 39 19.02% 39 0 100 99 105 89 96 89 75
11/01/2021 93 45.37% 61.05 5,678 0 93 45.37% 93 0 15 89.22 1,338 15 15 0 93 45.37% 75.44 7,016 0 93 45.37% 93 0 110 99 CLOSED 109 116 119 75
12/01/2021 114 55.61% 60.55 6,902 0 114 55.61% 114 0 20 83.12 1,662 20 13 7 114 55.61% 75.13 8,565 0 114 55.61% 107 7 115 145 CLOSED 89 125 120 85
13/01/2021 195 95.12% 68.05 13,269 0 195 95.12% 195 0 14 83.62 1,171 14 14 0 195 95.12% 74.05 14,440 0 195 95.12% 108 87 145 160 130 109 150 125 90
14/01/2021 59 28.78% 70.60 4,165 0 59 28.78% 59 0 7 102.27 716 7 7 0 59 28.78% 82.73 4,881 0 59 28.78% 59 0 110 99 95 89 136 85 75
15/01/2021 55 26.83% 74.81 4,115 0 55 26.83% 55 0 5 112.94 565 5 5 0 56 27.32% 83.56 4,679 8 48 23.41% 48 0 104 99 95 89 126 89 75
16/01/2021 35 17.07% 86.65 3,033 0 35 17.07% 35 0 7 108.30 758 7 7 0 40 19.51% 94.77 3,791 0 40 19.51% 40 0 104 99 95 89 175 89 75
17/01/2021 38 18.54% 55.17 2,096 0 38 18.54% 38 0 6 116.33 698 6 6 0 35 17.07% 79.84 2,794 0 35 17.07% 35 0 104 99 95 89 106 85 72
18/01/2021 176 85.85% 78.90 13,887 10 166 80.98% 166 0 3 114.88 345 3 3 0 176 85.85% 80.86 14,231 20 156 76.10% 156 0 129 150 115 105 140 104 80
19/01/2021 182 88.78% 76.51 13,925 20 162 79.02% 162 0 4 106.44 426 4 4 0 182 88.78% 78.85 14,351 20 162 79.02% 162 0 ESSMA SUMMIT 135 160 130 105 145 114 80
20/01/2021 134 65.37% 71.91 9,636 20 114 55.61% 114 0 0 0.00 0 0 0 0 128 62.44% 75.28 9,636 10 118 57.56% 118 0 ESSMA SUMMIT 125 130 115 89 120 104 72
21/01/2021 36 17.56% 86.41 3,111 0 36 17.56% 36 0 2 116.24 232 2 2 0 38 18.54% 87.98 3,343 0 38 18.54% 38 0 115 99 107 89 116 85 72
22/01/2021 57 27.80% 61.25 3,491 0 57 27.80% 57 0 3 112.22 337 3 3 0 45 21.95% 85.06 3,828 20 25 12.20% 25 0 109 99 107 89 116 85 72
23/01/2021 56 27.32% 72.60 4,066 40 16 7.80% 16 0 4 98.61 394 4 4 0 52 25.37% 85.77 4,460 20 32 15.61% 32 0 109 99 107 89 126 85 75
24/01/2021 50 24.39% 69.01 3,450 40 10 4.88% 10 0 4 90.88 364 4 4 0 51 24.88% 74.78 3,814 20 31 15.12% 31 0 109 99 107 89 94 80 72
25/01/2021 61 29.76% 72.31 4,411 40 21 10.24% 21 0 4 89.44 358 4 4 0 67 32.68% 71.17 4,768 0 67 32.68% 67 0 115 99 107 89 136 85 72
26/01/2021 98 47.80% 79.80 7,821 0 98 47.80% 98 0 4 96.53 386 4 4 0 107 52.20% 76.70 8,207 0 107 52.20% 107 0 125 99 113 89 94 89 72
27/01/2021 99 48.29% 83.90 8,306 0 99 48.29% 99 0 3 102.95 309 3 3 0 114 55.61% 75.57 8,615 0 114 55.61% 114 0 125 99 113 89 104 98 72
28/01/2021 99 48.29% 73.39 7,266 0 99 48.29% 99 0 3 92.49 277 3 3 0 98 47.80% 76.97 7,543 0 98 47.80% 98 0 TRENDS FAIR 120 99 113 89 104 80 72
29/01/2021 66 32.20% 48.79 3,220 10 56 27.32% 56 0 4 75.37 301 4 4 0 56 27.32% 62.89 3,522 0 56 27.32% 56 0 TRENDS FAIR 109 99 107 89 146 103 72
30/01/2021 54 26.34% 44.24 2,389 10 44 21.46% 44 0 5 98.66 493 5 5 0 44 21.46% 65.51 2,882 0 44 21.46% 44 0 TRENDS FAIR 109 99 107 98 146 98 72
31/01/2021 43 20.98% 48.89 2,102 0 43 20.98% 43 0 1 63.70 64 1 1 0 34 16.59% 63.70 2,166 0 34 16.59% 34 0 TRENDS FAIR 109 99 107 89 84 76 72
2,602 40.94% 74.10 192,803 190 2,412 37.95% 2,412 0 177 94.77 16,774 177 170 7 2,604 40.98% 80.30 209,094 118 2,486 39.12% 2,353 132
current price new price Why? BUDGET LY 2020 OTB LY 04/01/20
01/01/2021 124 RN 3690 3587 2,602
02/01/2021 124 ARR 74 72.92 74.10
03/01/2021 124 REVENUE 273,060 261,564 192,803
04/01/2021 124
05/01/2021 124
06/01/2021 124
07/01/2021 100
08/01/2021 100
09/01/2021 100
10/01/2021 100
11/01/2021 110
12/01/2021 115
13/01/2021 145
14/01/2021 110
15/01/2021 104
16/01/2021 104
17/01/2021 104
18/01/2021 129
19/01/2021 135
20/01/2021 125
21/01/2021 115
22/01/2021 109
23/01/2021 109
24/01/2021 109
25/01/2021 115
26/01/2021 125
27/01/2021 125
28/01/2021 120
29/01/2021 109
30/01/2021 109
31/01/2021 109

explain here general positioning strategy.

statement of authorship

Statement of authorship
I certify that this assignment is my own work and contains no material which has been submitted as part of an assignment in any institute college or university. Moreover, to the best of my knowledge and belief, it contains no material previously published or written by another person, except where due reference is made in the text of the assignment.
Signed…………………………………………..
Student number………………………………..

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