ACCOMMODATION OPERATIONS AND MANAGEMENT

COURSE DESCRIPTION:

This course introduces students to the essential skills, knowledge, and techniques needed to manage
and maintain accommodation departments across various hospitality operations, whether public or
private. Students will learn about front office and reservation systems, including an introduction to
computerized reservation systems. A significant focus is placed on gaining practical operational
experience through required work placements at commercial properties. Additionally, the course offers
an overview of managing the interrelationships among different hotel departments.

Course Objectives:

This course is designed to provide the students with a general understanding of the dynamics of the
lodging industry, and specifically the operations and management of today’s modern hotels.
By completing this course, the student should be able to:

• Equip students with practical skills and knowledge for effective lodging management, including
operational, strategic, and staff management in Rooms Division.
• Provide insight into the domestic and international lodging industry, including common
terminology and basic hotel organizational structures.
• Analyze operational issues in both front and back of house areas and understand the
relationship between various hotel departments.
• Evaluate lodging operations using national and global classification systems and understand the
significance of front office accounting and the night audit process.
• Teach the stages of the guest cycle (reservation, registration, checkout) and the crucial roles of
the housekeeping department.

Introduction
The word "hospitality" is derived from the Latin word hospitare, which means "to receive as a guest."
This phrase implies that a host is prepared to meet a guest's basic requirements while the guest is away
from home. The requirements of a guest in these circumstances are food, beverages, lodging, or shelter.

Hospitality is the act of kindness in welcoming and looking after the basic needs of customers or
strangers, mainly in relation to food, drink and accommodation. Hospitality today is understood as the
interaction between a guest and a host. When we mention the "Hospitality Industry," we're referring to
businesses or organizations that offer food, beverages, and/or lodging to individuals who are away from
their usual home environment.

Four Core/Component of Hospitality and Tourism Industry

The tourism and hospitality industries are closely linked and often regarded as one large sector, referred
to as the tourism and hospitality industry. This industry comprises four key components: food and
beverage services, lodging services, recreation services, and travel-related services. These elements
form a network, meaning they are interconnected, with businesses that may be independent and
competitive yet also interdependent. This interdependence is particularly strong in countries where
tourism and hospitality play a vital role in economic growth. While the industry evolves due to factors
like labor and opportunity, the tourism and hospitality network will remain a dominant global industry.

There are two main business sectors in the hospitality industry:

• Accommodation - refers to a room or space offered to temporary guests for dwelling, lodging,
or sleeping, complete with furnishings and other amenities, in a facility that is not a campground,
hospital, nursing home, emergency shelter, or a community mental health or substance abuse
treatment center.

• Food and beverage – refers to the services can be found in a wide range of locations, such as
theme parks, schools, colleges, hospitals, senior living facilities, prisons, halfway houses, and
shelters for the homeless.

THE ACCOMMODATION SECTOR

The accommodation sector of the hospitality industry is concerned with providing customers with a place
to stay, on a temporary basis it also caters to local people seeking a short break from their everyday
routine, or those who require temporary accommodation for almost any other purpose.
Scope and Significance

Both business travelers and leisure travelers staying in hotel accommodation tend to spend high while
they are away from their home. Therefore, hotels not only meet the basic requirement of shelter for the
guests but also add value to the experience by providing supplementary services and products. Hotels
also have the advantage as hosting guests has the potential to generate additional revenue from food
and beverage services.

Classification of Accommodation Establishment

Types of Accommodation

The hotel industry deals with all types of guest accommodation. In fact, the hotel industry not only relates
to luxury hotels and resorts, but it also includes overnight accommodation in guesthouses, motels, inns,
and hostels as short-term types of accommodation.

Types of accommodation used by travelers and their respective characteristics:

• City Hotels - These hotels are located within the heart of a city. The type may vary greatly from
business, suites, residential, economy, mid-scale to luxury.

• Suburban hotels -Suburban hotels tend to be smaller properties which usually provide full-
service and locate in suburban area.

• Airport Hotels - These hotels are designed especially to accommodate air travelers. They offer
a mix of facilities and amenities. The majority offer customers transportation to and from the
airport

• Highway hotels or Motels - They are designed for overnight stays for car travelers, often with
very basic facilities. The rooms usually have direct access to an open parking lot. They are often
smaller than most hotels. They are located on the outskirts of towns and cities.

• Convention hotels - These hotels can provide a large quantity of rooms. In addition to
accommodation, they provide extensive meeting and function space for holding conventions.
There are banquet areas within and around the hotel complex. Most of them provide an in-house
laundry, a business center, airport shuttle service, and 24- hour room service. They are often
near convention centers and other convention hotels.

• Resort Hotels - These hotels are in picturesque, sometimes remote settings. Customers travel
long distance to resorts. Usually, they tend to stay longer.
 • Spa Hotel - They are in resort-type settings or as part of city spa hotels. They provide
accommodations, spa treatments, and cuisine. They may include relaxation/stress
management, fitness, weight management, and Pilates/yoga.

• Casino Hotel - They have gambling operations which are the major revenue centers. They also
provide live entertainment. A wide variety of luxury amenities, hotel services including fine and
casual dining and shopping centers are typically available on site.

• All-Suite - The guest rooms in these hotels are larger than normal hotel rooms, with separate
areas for working, sleeping and relaxing. A living area or parlor is typically separated from the
bedroom, and some properties offer a kitchen set- up in the rooms.

• Boutique Hotels - Boutique hotels differentiate themselves from traditional hotels by providing
personalized accommodation and services/facilities. They are sometimes known as "design
hotels" or "lifestyle hotels".

• Historic Conversion- These properties have historic significance. They have been converted
into lodging establishments with retention of their historic character.

• Extended Stay Hotels Or Serviced Apartments - These properties cater to customers who
stay for an extended period. They usually offer full kitchen facilities, shopping services, business
services and limited housekeeping services.

• Bed And Breakfast - They are private homes whose owner lives on or near the premises and
rents out rooms to overnight customers. The paid accommodation typically includes breakfast.

• Guest Houses / Villa - hey range from low- budget rooms to luxury apartments. They are self-
catering accommodation in a private bungalow, usually rented to customers.

• Hostel - They are very cheap accommodation. The sleeping arrangements are usually in
dormitory style and there may also be self-catering facilities on site

• Cabins - They are bedrooms on a ship or train for passengers.

Specialized Hotels

• Ice Hotels - Ice hotels are mainly built using snow and ice. The first ice hotel is located in Sweden
and its concept has been followed by Canada and some other European countries in building
their own ice hotels to attract visitors.

• Cave Hotels - Originally these caves were used by people in the past to avoid the disturbance
and attack.

• Capsule - This type of hotel originated in Japan and provides small, bed-only cabinets for its
guests. The cabinet size is roughly 2m x 1m x 1.25m and they are mainly designed for local
citizens who look for cheap accommodation when traveling back to their homes is not an option.

• Underwater Hotels - The hotel concepts associating with water have contributed to the
development of innovative hotels with their rooms being built under the water.

The Accommodation Product

Accommodation is the core product of a hotel and is always one of the largest revenue sources in a
hotel operation. Accommodation products refer to rooms and other related products or services that
hotel guests will consume/use during their stays.

Front line staff, especially receptionists and reservation staff, should be equipped with product
knowledge which enables them to recommend or explain to their guests what is being offered by the
hotel.

Receptionists and reservation staff should be familiar with differences in room grading and common
types of room so that a perfect guest-to-room fit can be achieved.

Room Types
Hotel room types vary widely based on their classification, features, and purpose. Rooms are typically
categorized into three grades.

Differences in Room Classification

These grades depend on factors such as in-room amenities, the view, and additional features or
services that enhance the guest's overall experience.

TYPE OF ROOM VIEWS AMENITIES EXTRAS

Average, garden Basic, pine furniture, bed and

Standard Room None.
view blanket, disposable slippers.

Upscale, rosewood furniture,

Superior, sea view, Complimentary
Superior Room bed and comforter, cloth
city view. newspapers, breakfast
slippers.
Express check-in,
welcome drinks,
Magnificent, sea Grand, antique furniture, bed complimentary
Deluxe Room view, high floor, and feather comforter, breakfast, free Wi-Fi,
attraction view. leather slippers. access to executive,
lounge, limousine pick-
up.

Types of Room

TYPE OF ROOM DESCRIPTION

• A room that sleeps only one person and has
Single Room been fitted with a single, double or queen-
size bed.

• A room that can accommodate two people

Twin Room
with two twin beds.
• A room that can accommodate two people
Double Room
with a double or queen-size bed.
 • A room that can accommodate two to four
Double-Double Room
people with two twin, or two double beds.
• A room that can accommodate three
persons and has been fitted with three twin
Triple Room
beds, one double bed and one twin bed or
two double beds.
• A room that is fitted with a sofa bed or a Murphy
bed (i.e. a bed that folds out of a wall or closet).
Studio/ Murphy Room • The room can then be transformed from a bedroom
at night
time to a living room in the daytime

Suite • A room with one or more bedrooms and a living

space. The
bedrooms might be singles, doubles or twin doubles
• A room that can accommodate two persons with
two twin beds joined together by a common
headboard.
Hollywood Twin Room • Medium tariff and budget hotels tend to provide
many of these
room settings which cater both couples and parties
in two.
• This room type is mainly designed for disabled
guests and it is required by law that hotels must
provide certain number of accessible rooms to avoid
discrimination.
• Common features include safety bars and
Accessible Room emergency buttons in the bedroom and bathroom,
touch floor lamps, fire alarm lights, and outward
opening door for bathroom, etc.
• The rooms should always be located at ground or
at lower
floors and should be near to the elevators for easier
accessibility of disabled guests
Balcony Room • A room with a balcony.

• A room located at the ‘executive floor’ which

Executive Room enables convenient access to the executive lounge.
• Besides, some hotels also provide ‘female
executive floors’
with their rooms assigned to female guests only due
to safety and security reasons.
 • This room type can be found in service apartments
and hotels which target for long stay guests. Open
kitchens or cooking equipment are usually available
Extended Stay Room in the room.
• Some would also provide housekeeping services
(e.g. once
a week) on a regular basis.
• Rooms close by or across the corridor, but are not
Adjacent Room side by
side.
• Rooms that are side by side, but do not have a
Adjoining Room connecting
door between them.

• Two rooms that are side by side and have a

Connecting Room
connecting door
between them.
• Many hotels provide both smoking and non-
smoking rooms for their guests. In order to minimize
Smoking/Non Smoking the effects of secondhand smoke exposure on non-
smoking guests, some hotels group all smoking
rooms in certain floors and separate them from non-
smoking rooms.
• The most expensive room provided by a hotel.
Usually, only one president suite is available in one
single hotel property.
President Suite • Similar to the normal suites, a president suite
always has one or more bedrooms and a living
space with strong emphasis on grand in-room
decoration, high quality amenities and
supplies, and tailor-made services.
• A special form of accommodation which can be
found in some resort hotels. It is a kind of stand-
alone house which gives extra privacy and space to
hotel guests.
Villa • A fully equipped villa contains not only bedrooms
and a living room but a private swimming pool,
Jacuzzi and balcony. It is
suitable for couples, families and large groups.
Types of Hotel Guests

Hotel guests can be classified according to their:

• • Trip purpose – pleasure or business travelers

• • Numbers – independent or group travelers

• • Origin – local or overseas travelers

1. Leisure Travelers
They are individuals who travel to engage in leisure activities, outdoor recreation, relaxation, visiting
friends and relatives or attending sports or cultural events.

2. Corporate Business Travelers

They are individuals whose frequent bookings are usually made by enterprises with reduced room rates.
Business travelers travel to conduct business, attend business meetings or workshops, and engage in
selling or purchasing products.

3. Free Independent Travelers (FITs)

They are sometimes referred to as "foreign independent travelers ". FITs are international tourists who
purchase their own accommodation and make their own travel arrangements.

4. Group Inclusive Tours (GITs)

Tourists who travel together on package tours with accommodation and sometimes meals which are
booked through travel agents. Group tourists tend to spend less and budget their spending allowance.

5. Domestic Tourists

They are local residents who stay at a hotel for special occasions and functions.

6. Conference Participants

Individuals who travel to attend conference and whose accommodation is usually reserved by
himself/herself, his/her enterprise or a conference organizer before their arrival.

7. Very Important Persons (VIPs)

Very important persons may include celebrities, frequent-stay guests, guests in expensive rooms,
guests with security risks and top executives from enterprises.

8. Incognito

They are guests who stay in a hotel with concealing identities so as to avoid notice and formal attention.

18

Types of Guest Requests

1. Guests with Special Needs

• Wheelchair; and
• Facilities for the disabled.

2. Business Travelers

• • Broadband Internet service;

• • International direct dialing (IDD) service;

• • Local & international newspapers;

• • Laundry/valet service;
 • • Shoes polishing service;

• • Other business facilities, e.g. business center, executive floor, fax machine,

laptop computer, conference and meeting facilities.

3. Leisure Travelers and Holiday Makers

• • Rollaway bed/ baby cot;

• • Connecting rooms;

• • In-room movies;

• • Sports facilities, e.g. gymnasium, swimming pool;

• • Spa facilities for beauty and health treatments, e.g. massage, hydrotherapy,

facials and intensive foot and hand therapies;

• • Babysitting service.

4 Other Requests

• • In-room dining (Room service);

• • Doctor service;

• • Smoke-free guest room;

• • Room make-up service;

• • Alteration & mending service;

• • Repair and maintenance service;

• • Food & beverage enquiries, e.g. hours and location of meals.

CHAPTER 2 INTRODUCTION TO HOTEL OPERATIONS

The Hotel Industry

The role of the hotel industry stems from a long history and development in the field of hospitality
provision. In many countries hotels have evolved as extensions of domestic hospitality; though typically
they are more often larger establishments (particularly in developed countries)

Hotel Ownership

Another way to classify hotels is by their ownership, which can be:

a. Private
An independent hotel owned by a person/partnership/private enterprise, e.g. Shamrock Hotel.

b. Local Group

Several hotels owned by a local enterprise, e.g. Harbour Grand Hong Kong, The Kowloon Hotel,
Harbour Plaza Hong Kong, Harbour Plaza Metropolis, Harbour Plaza North Point and Harbour Plaza
Resort City are all owned by Harbour Plaza Hotels & Resorts.

c. International Group
A hotel which is part of an international chain of hotels, e.g. JW Marriott Hotel Hong Kong is part of the
Marriott International, Inc.

Modes of Hotel Management

Hotels can be operated in one of the following ways:

1. Independently Owned and Operated

These can be independent hotels, with no affiliation, that are being managed by the owners of the
properties.

2. Management Contract

Management contracts are hotel management enterprises which operate properties owned by other
entities. In some cases, the hotel owners may arrange to run their properties through a management
contract with an enterprise that specializes in managing hotels.

The reason for this is that the owner may not:

• Have the necessary expertise; or

• Desire to become involved in the operation of the hotel.

3. Franchising

Some investors prefer to use the franchising concept in running the hotel. Franchising in the hospitality
industry is a concept that:

• Allows interested investors to use an enterprise’s (the franchisor) name and business format;

• Is made up of properties where the franchisees agree to run the hotel in accordance with the strict
guidelines set by the franchisor; and

• Allows an enterprise to expand more rapidly by using others’ capital.

4. Referrals

Referral associations, e.g. Leading Hotels of the World (LHW), offer hotels similar benefits as
franchising, but at a lower cost. Some hotels choose to become a referral property. This means that the
property is being operated as an independent hotel in association with a certain chain. These hotels
refer guests to one another's properties and share a centralized reservation system, a common logo,
image, or advertising slogan.

Hotels pay an initial fee to join a referral association and further fees are based on services
required. As the property has already been physically developed, the owner may want assistance only
with marketing, advertising, management or reservation referrals.

In addition, guests may find more variation among the referral properties as size and appearance
standards are less stringent than those in a franchise agreement. However, every hotel is assessed and
checked regularly to ensure that it maintains the highest standards.

Classifications of Hotel Departments

Instead of segmenting a hotel structure into departments according to their functions, some hotels would
also group their departments or units into different categories:

These types of classification are known as:

• Revenue centered and cost centered Departments

• Front-of-the-house and Back-of-the-house Departments.

1. Revenue Centered and Cost Centered Departments

Revenue centers refer to those departments or units which generate direct income to the hotel through
the provision of goods and services to guests, e.g. front desk, restaurants, room service, gift shop and
business center.

Cost centers, which are also interpreted as support centers, mainly assist the functioning of revenue
centers with no generations of any direct income for the hotel, e.g. human resources, purchasing,
accounting and engineering departments.

This classification is particularly useful for the accounts department when summarizing the
performances of different units under these two main categories.

2. Front-of-the-house and Back-of-the-house Departments

Front-of-the-house refers to those departments or areas which are accessible and visible by guests,
e.g. front desk counters, restaurants, concierge and bell services. They are the points of service
encounters where service staff usually have direct contact and interaction with guests.

Back-of-the-house refers to those departments or areas which rarely have staff-to-guest interactions,
e.g. kitchen, human resources and engineering departments. It should be emphasized that some back-
of-house positions would have limited interaction with guests, e.g. housekeeping.

Organization and Function of Hotel Departments

The day-to-day operations of a hotel are the key factors determining the success or failure of its service.
It is necessary to understand the structure of hotels in order to get an overview of how the organization
fits together.

Regardless of the size of a hotel, the organizational structure will be basically the same. It is usually
divided into several distinct departments, each responsible for a particular area of work. The larger the
hotel is and the more facilities that are offered, the more

specialized the departments become. For example, the front office and housekeeping department are
under the control of the director of rooms.
One effective way to examine how a hotel can be operated is by studying the organizational structure
and the functions performed by the different departments. Hotel executives should have knowledge and
experience developing and managing hotels throughout the hospitality industry.

The Duties of Key Executives

1. The head executive in a hotel would be the General Manager (GM).

The main responsibilities of the general manager would include the following:

• Providing leadership to the management team.

• Coordinating the work of all departments.

• Participating in the formulation of hotel policies and strategies.

• Leading hotel staff in meeting, financial, environmental and community responsibilities.

• Assuming full responsibilities for the overall performance of the hotel.

2. Another key hotel executive is the Resident Manager. He/she is on-call any time of day or night
and their purpose is to assist the General Manager with the smooth and profitable running of the
hotel. Resident Managers sometimes live on-site.

The main responsibilities of the resident manager include the following:

• Responsibility for developing and executing plans developed by the owner, general

manager and other members of the management team.

• Checking on operations, providing feedback and offering assistance when needed.

Completing, reviewing and summarizing statistical reports and sharing them with
the general manager.

• Assuming responsibilities for the daily operations and management of the hotel.

Functions of Major Hotel Departments

A hotel’s different departments all play a crucial role in ensuring the success of the business. While each
department has its own functions, they must all work together to provide a positive experience to the
hotel guests.

Two major hotel departments are engineering, responsible for all hotel mechanical systems and security,
responsible for protecting the safety and security of the hotel, the guests, visitors and employees.
a. Security

The security department is responsible for implementing procedures which aim at protecting the safety
and security of hotel guests, visitors, hotel employees and the hotel itself.

Examples include monitoring surveillance equipment, patrolling the hotel premises and maintaining
alarm systems.

b. Engineering

The engineering department is responsible for maintaining the physical plant machinery of the hotel
such as electricity, plumbing, air conditioning, heating and elevator systems.

Engineering also oversee all the mechanical and technical conditions of the hotel.

c. Human Resources

The human resources (personnel and training) department is responsible for hiring, orientation, training,
wages and benefit administration, labor relations, employee relations, and staff development.

d. Food and Beverage

The food and beverage (F&B) department provides food and beverage services to the hotel guests and
visitors through a variety of outlets and facilities/services.

Examples include lounge, bar, coffee shop, restaurants, banquet service, room service (also called in-
room dining) and cake shop.

e. Accounts

The accounts department is headed by the financial controller who, as a key member of the
management team, can guide the hotel to an increasing profitability through better control and asset
management. In addition, this department is responsible for monitoring all of the financial activities of a
hotel. Examples include overseeing accounts receivable, accounts payable, payroll, and cost control
systems of the hotel; keeping records of assets, liabilities and financial transaction of the hotel; preparing
the monthly profit-and-loss statement, coordinating with purchasing department and information
technology department, and handling guests s’ inquiries about billing.

f. Sales and Marketing

The main functions of the sales and marketing department involve generating new businesses for the
hotel, coordinating advertising, as well as sales promotions and public relations activities aiming at
enhancing the hotel’s image

g. Rooms Division

The rooms division comprises departments and personnel essential to providing the services guests
expect during a hotel stay. In most hotels, the rooms division generates more revenue than other
divisions.

Introduction to Rooms Division

‘Rooms’ as the core products of a hotel business are managed by the department of ‘rooms division’.
However, not all hotels, particularly some small-scaled ones have rooms division due to their limited
room numbers and human resources.

Organization of the rooms division usually comprises two major departments – front office and
housekeeping. But a typical structure of the rooms division also comprises other sub-units as shown
below:

Sometimes, the three departments (reservations, telephone and uniformed service) are grouped under
the front office for simplicity reason.

In general, the rooms division comprises two major departments, the front office and housekeeping,
which are involved in the sales or services of rooms to guests.

On the other hand, there are some reasons why hotels would prefer to combine the front office and
housekeeping departments into one single division. As front office depends heavily on housekeeping
for their cleaning of rooms before they can be sold to the guests, there are always conflicts and pressure
among staff of the two departments.

Director of Rooms

The position of director of rooms division helps solve this problem as he/she is the only one who
manages both departments. The position requires the manager to have solid experience in both front
office and housekeeping who will have a better understanding of the operations and strategies in
handing the conflicts between the two departments.

The director of rooms is responsible to the general manager for the effective leadership and smooth
operation of all the departments and staff that make up the rooms division.
CHAPTER 3 FRONT OFFICE OPERATIONS

1. Front Office Department

The front office is the nerve center or hub of a hotel. It is the department that makes the first and last
impression on the guests, and the place that guests approach for information and service throughout
their stays.

The three main functions of the front office are as follows:

1. Selling rooms;
2. Maintaining balanced guest accounts; and
3. Providing services and information to guests.

Organization of Front Office Department

The attached image shows an organizational chart for the front office of a large hotel.

This illustrates the structure and lines of communication which operate within the front office
department.
Duties of Key Positions

1. Front Office Manager

The front office department is headed by the Front Office Manager (FOM) whose main duty is
to enhance guest services by constantly developing services to meet the needs of guests...

The front office manager performs the following duties:

• Monitoring reservation status
• Looking over market mix and preparing occupancy forecasts
• Determining rate structures and supervising policies
• Reviewing occupancy and average room rate
• Reviewing arrivals and departures daily
• Making staffing adjustments needed for arrivals and departures
• Reviewing, checking, and meeting VIPs and entertaining them

2. The Assistant Manager represents the management in handling the daily operations and
functions of the hotel and may directly report to the general manager in some hotels.

The main duties of the assistant manager include:

• Responsibility for developing and executing plans developed by the owner, general
manager and other members of the management team
• Checking on operations, providing feedback and offering assistance when needed.
• Completing, reviewing and summarizing statistical reports and sharing them with the
general manager.
• Assuming responsibilities for the daily operations and management of the hotel.

3. The Guest Relations Officer reports directly to the assistant manager. They review the hotel
arrivals list daily and attend to customer inquiries and assist them with their needs.

Duties for the guest relations officer can include:

• Greeting all arriving individual guests, especially those under commercial accounts
• Provide local information for guests
• Promoting in-house functions, facilities and services
• Assisting front desk staff when they are busy and assisting guest to check out

4. The telephone department is headed by the telephone services manager. The telephone
supervisor and telephone operator process all incoming and outgoing calls through the hotel
switchboard. Staff in this department generally possesses good language and communication
skills.

In order to provide better service, some hotels have introduced the “one-stop service” with all
guest requests being carried out through the telephone department.
Phone department members need to:
• Provide general information regarding the hotel or local attractions to guests
• Place international calls, morning calls and wake-up calls as required by guests
• Administer the paging system of the hotel, which provides a communication service
between certain hotel staff and management staff
• Administer the in-room movie system of the hotel
• Stay familiar with the names of Very Important Persons (VIPs) in the hotel
• Protect guest privacy by not disclosing room number or guest information
• Communicate with management, engineering, security and guests
• Perform the role of communications center in the event of emergency

One-Stop Service

For example, if a guest called in and wanted to place a booking with the co9ee shop, the
line would be transferred by the telephone operator to the co9ee shop.

5. Reservation

a. The reservations manager takes charge of this section and makes decisions on
whether room reservations/bookings should be accepted when the hotel is fully
booked. That is, to stop taking room reservations or to allow overbooking of rooms.

b. The reservations supervisor will monitor closely all the room reservations taken and
report to the reservations manager when abnormal situations happen. For example,
there is a larger number of room cancellations than usual.

c. The reservation clerk will handle all reservations and should be aware of the different
sources that reservations may originate from.

Duties include:
• Handle reservation requests and prepare reservation confirmation slips
• Request guests to confirm or guarantee their room reservations
• Keep records of each reservation and the number of room reservations taken
• Provide the front desk with details of reservations due to arrive the next day
• Prepare VIP lists
• Update guest history records
6. Front Desk (Reception)

The front desk is headed by the front desk manager whose main duty is to ensure that the hotel
achieves the highest possible level of room occupancy and the maximum revenue.

Assisting and reporting to the front desk manager is the front desk clerk.

Duties of the Front Desk Manager may include:

• Overseeing the smooth running of the front desk
• Compiling staff duty roster
• Greeting important guests, VIPs
• Assigning rooms to guests
• Dealing with group arrivals
• Handling guest requests and complaints

Duties of the front desk clerk include:

• Greeting the guest
• Providing information and promoting hotel facilities and services to guests
• Checking in the guest
• Maintaining guest account
• Checking out the guest
• Administering the safe deposit system of the hotel
• Providing foreign currency exchange service to guest

7. Concierge. The concierge comprises of a large group of uniformed staff, including:

• Chief Concierge;
• Airport Representative;
• Driver;
• Parking Attendant;
• Door Attendant;
• Baggage Porter; and
• Baggage Supervisor.

a. Chief Concierge - the overall in charge of this section. He/she normally works at a desk
in the main foyer.

The following guest services are provided by the concierge:

• Providing information/advice on hotel products/services
• Confirming airline passages and purchasing airline tickets
• Reserving tables at restaurants and tickets to shows
• Arranging the hire of the hotel limousine or other transportation services
• Handling guest requests and inquiries
b. Airport Representative

Duties include:
• Greeting hotel guests at the airport
• Arranging hotel transportation for guests from the airport to the hotel
• Answering inquiries from guests
• Taking hotel room bookings
• Assisting departing guests at the airport
• Liaising with airlines for special arrangements for guests

c. Hotel Drivers

Duties include:
• Taking guests to and from the airport
• Upon request, acting as a personal driver for a guest

d. Parking Attendant

Duties include:
• Parking cars for guests
• Assisting the door attendant in ensuring that traffic flow at the hotel main
entrance is free flowing

e. Door Attendant (works outside the hotel’s entrance)

Door duties include:

• Greeting all new arrivals
• Providing door service to guests
• Summoning baggage porter to assist arriving guests
• Calling taxis and providing the hotel address card for guests
• Paying taxi fare on behalf of the hotel guests who do not have local
currencies
• Directing traffic and parking of vehicles at the main entrance

f. Baggage Supervisor (Bell Captain)

Duties include:
• Answering telephone calls from guests regarding baggage pick up from
rooms
• Assigning baggage porters to handle the guest baggage
• Receiving guest deliveries
• Handling guest requests for postal services
 g. Baggage Porter (Bell Attendant)

Duties include:
• Handling guest baggage
• Escorting guests from the front desk to their rooms
• Running errands for the executive office and hotel guests
• Delivering mail/messages to guest rooms
• Handling storage of guest baggage/belongings for late check-out

h. The Executive Floor Manager

The executive floor manager oversees the smooth operation of the executive floors and
business center.

Many hotels provide a business center to both their business and leisure guests. Business
travelers who require an environment in which to conduct business with comfort and privacy
may choose the executive floor for an additional fee.

The executive floor is usually the top floor of a hotel. Guests of the executive floor will enjoy a
range of complimentary exclusive privileges and benefits which vary from one hotel to another.

Examples are as follows:

• Express check-in and check-out services on the executive floor
• Complimentary breakfast buffet, afternoon tea, and all-day refreshments in the executive
floor’s lounge
• Complimentary in-room local calls and high-speed Internet access
• Garment ironing service
• Complimentary use of the hotel’s fitness center and boardroom
• Personalized business and concierge services

The range of services and facilities provided may include business equipment, presentation
supplies, computers, meeting and function space with wired or wireless Internet access,
secretarial and translation services.

THE GUEST CYCLE

Guest cycle refers to the distinct stages of guest interaction between the hotel and guests. On the
basis of the stage of interaction and activities involved, the Guest Cycle is broadly, classified into
four main stages based on the activity type.

The four different phases of the guest cycle are:

• Pre-arrival - The stage where the guest makes a reservation.

• Arrival - The point when the guest arrives at the hotel.
• Occupancy - The period during which the guest stays in the hotel.
• Departure - The point when the guest checks out and leaves the hotel.
Pre-arrival
It is the stage when the customer is planning to avail
an accommodation in the hotel. In this first stage, the
customer or the prospective guest enquires about the
availability of the desired type of accommodation and
its amenities via telephonic call or an e-mail. The
customer also tries to find out more information about
the hotel by visiting its website.

At the hotel end, the front office accounting system captures

the guest’s information such as name, age, contact
numbers, probable duration of stay for room reservation and
so on.

Arrival
The front office reception staff receives the guest in the reception. The porters bring in the guest
luggage. For the guest with confirmed reservation, the front office clerk hands over a Guest
Registration Card (GRC) to the guest and requests the guest to fill in personal information
regarding the stay in the hotel. The clerk then registers the guest in the database thereby creating
a guest record and a guest account along with it. Later, the clerk hands over a welcome kit and
keys of the accommodation. After the procedure of registration, the guest can start occupying the
accommodation.

Occupancy
During occupancy, a front office accounting system is responsible for tracking guest charges
against his/her purchases from the hotel restaurants, room service, bar, or any outgoing
telephone calls made via the hotel’s communication systems. The front office staff is responsible
to manage and issue the right keys of the accommodations to the right guests. On guests’
request, the staff also makes arrangement for transportation, babysitting, or local touring while
the guest is staying in the hotel.

Departure
During guest departure, the front office accounting system ensures payment for goods and
services provided. If a guest’s bill is not completely paid, the balance is transferred from guest to
non-guest records. When this occurs, collection becomes the responsibility of the back office
accounting division.

At the time of guest departure, the front office staff thanks the guest for giving an opportunity to
serve and arrange for handling luggage. In addition, if the guest requires airport or other drop
service, the front office bell desk fulfils it.
FRONT OFFICE - RESERVATION

Reservation of the hotel accommodation is one of the important responsibilities of the front office
department. A potential guest contacts a hotel for availability of the desired type of
accommodation and any allied services that the hotel offers. The front office department needs
to react to the enquiry of the guests.

For a guest, reservation increases the chances of a better deal for assured accommodation on
arrival. For a hotel, reservation can enable a better management of guest experience during usual
as well as peak seasons. Reservation procedure varies depending on the size and brand of the
hotel and the reservation system employed.

The Type Of Reservation Are As Follows:

1. Guaranteed Reservations

For guaranteed reservations, the hotel will hold the room for the guest overnight or during the
guaranteed period as the guest has prepaid for the room but no refund will be given if the guest
does not show up.
In order to guarantee a reservation, guests might opt for one of the following methods:

a. Prepayment Guaranteed Reservation – the hotel request the prospective guest to

either send the complete deposit or a partial deposit and on receiving, makes the
booking for the prospective guest.

b. Credit Card Guaranteed Reservation – in this case the prospective guest gives his
credit card number and details to the hotel. The hotel confirms the room from the
credit card guarantee and then claims from the credit card company, if the guest
does not occupy the room on the said date.

c. Travel Agent Guaranteed Reservation – some travel agents have arrangement with
hotel chains to book room for their clients and executives travelling to various
destination. The travel agents are solely responsible for the reservation; they are
billed after the guest’s stay is completed.

d. Voucher or Miscellaneous Charge Order [MCO] - this is a special arrangement

designed to attract return guest or new business. This is usually provided by the
hotels themselves for their prospective guests.

e. Corporate Guaranteed Reservation – in this case the corporation or company takes

the responsibility for booking for their executives, visitors etc.
 2. Non-Guaranteed Reservations

A non-guaranteed reservation means that the hotel will hold the room until a stated
cancellation time, normally up to 6 p.m. on the arrival date and then release the room for
sale if the guest does not arrive.

Reservations may originate from different sources, including:

1. Travel and Tour Organization

2. Airlines
3. Companies and Commercial Business role uses
4. NGOs and INGOs
5. Embassy and consulate offices
6. Universities and other Educational Institutions
7. Ministries and Government offices
8. UN organization and Banks
9. Free Individual travelers (FIT)
10. Chain Hotel and Referable from other hotels
11. Global Distribution System (GDS)
12. Central Reservation System (CRS)
13. Meeting planners
14. Walk-in.

Note: Walk in guest are also regarded as wind flow business or chance guest. Because hotel
don’t have any prior information about such guest due to which they can process or forecast.
Normally in walk in condition all the activities of registration and reservation are conducted on the
spot where as the guest is only taken in if he/she is in a fit condition to be taken and is ready to
pay advance deposit.

Mode of Reservation

Mode of reservation generally refers to the ways of receiving the accommodation booking
through various communication system. The following modes of reservation are encircled in front
office operation.

1. Fax/ Facsimile:
The word facsimile derived from Latin facsimile, “Make similar” i.e. “Make a copy.” is a tele-
communications technology used to transfer copies of documents especially using affordable
devise operating over the telephone network.
2. E-Mail:
It is most commonly abbreviated email is a method of exchange digital messages across the
internet that is very essential to operate input/ output operation for reservation of rooms.
3. Telephone:
The telephone is a telecommunication device that transits speech by means of electric
signals. It is one of the most common mode of reservation which is very easy to handle.

4. Internet:
Hotel industries offer online reservation services through their internet sites. The variety of
potential guests accessing internet sites to place reservation has prompted travel and hotel
to simple reservation procedure.

Reservation Process and Procedure

Within the Front office the reservations section is responsible for taking guest enquiries and
turning them into reservations. A person working in this section needs a sound knowledge of the
room types, room rates and packages the hotel has available. The reservations staff member will
constantly be referring to availability for every reservation enquiry they take.

1. Take reservation and enter the appropriate information:

• Determine the guest's arrival and departure dates

• Confirm room type and room rate
• Obtain the guest name and related details
• Identify how many guests will be staying
• Determine how guest will pay for room
• Describe related house policies (cancellation policy, check-in, check-out times,
late arrivals etc.)
• Process payment
• Send reservation confirmation.
• Pick up details.
• Any other Details or special remarks.

2. Determining the room availability:

The second most important step in reservation is determining the room availability. In this
process one can check the
demand of guest encoded during
the first step. The availability can
be checked by referring to
forecast chart, conventional chart
or density chart. In fully
automated system you can begin
checking the same availability by
computerized system or
software.

Room-Forecast-Chart
3. Reservation Acceptance

A reservation can either be accepted or denied or turned away based on the availability of
rooms in the day(s) in question. An acceptance would lead the receptionist into the
confirmation phase, while a denial or turn away could cause a series of other options to be
exercised like for example recording the turn away reason etc.

When a reservation request is accepted, the details of the room reservation will be recorded on
a reservation form and in the computer. Reservation information details include the following:

• Guest name
• Length of stay
• Room type and rate
• Method of payment
• Guest contact information and special requests.

4. Reservation confirmations

All reservations require confirmation to the person making the reservation. Confirmation is usually
made using the same method as the reservation. This means that if the reservation is made by
phone try if possible to confirm the reservation to the guest while the guest is on the line. Whatever
method is used, reservations should be confirmed within 24 hours of the booking request.

When confirming a reservation, it is important to reiterate the following:

• The arrival and departure dates

• The room type booked
• The rate
• Any special requests of the guest
• Your property's guaranteed check-in time, i.e. The time the room should be ready
for the guest
• Your property's check-in and check-out time

Change or Cancel Reservations

• Locate original reservation

• Verify original information with the guest
• Identify required changes adding suggestions if necessary
• Check availability and/or make cancellation
• Confirm changes or offer alternatives
• Identify any charges for cancellation according to house policy and inform the
caller (if applicable)
• Thank caller.
Reservation Record

Each reservation department shall prepare a reservation record, which depicts the various
personal and financial data of guests, for each reservation transaction. The aim is to identify
guests and their occupancy needs before guest’s arrival. Moreover, the hotel can personalize or
customize guest services and better schedule staff accordingly.

In order to create a reservation record, the following details are needed:

a. Guest name (and group name, if applicable)

b. Guest’s home or billing address
c. Guest’s telephone number, including area code
d. Name, address, and telephone number of guest’s company, if appropriate
e. Name and other pertinent information about the person making the reservation, if
not the guest
f. Number of people in the group, and perhaps ages of children, if any.
g. Arrival date and time
h. Number of nights required or expected departure date,
i. Reservation type [Guaranteed versus Non-guaranteed]
j. Special requirements [i.e. infant, disabled guest, or no smoking accommodation]
k. Additional information, if needed [i.e. late arrival, method of transportation, flight
number, room preferences, etc.]

At the reservation process, reservation agents shall keep in mind that a rate quoted and
confirmed must be honored. Moreover, reservation clerks should be aware of the following:

a. Supplementary charges for extra services or amenities

b. Minimum stay requirements, if any, for dates requested
c. Special promotions in effect for dates requested, if any
d. Applicable currency exchange rates, if quoting rates to an international tourist
e. Applicable room tax percentages
f. Applicable service charges or gratuities

CRS – Central Reservations System

CRS stands for: Central Reservations System. It is a computerized reservation software used to
maintain the hotel information, room inventory and rates, to manage the reservation and process.
A CRS provides hotel room rates and availability for many different distribution channels such as
the GDS, IBE, OTA, 3rd party websites etc.

Essentially speaking it is an application with various functionalities to manage a hotel’s

distribution / bookings. It can also be called a database distribution system, since the CRS of a
hotel transfers data to the distribution channels. This way hotels are able to reach travelers and
travel managers on a global scale. Bookings are made via multiple sources (OTA, travel
agencies, the IBE on the hotel’s own website), and all reservations sources will appear in the
system via interfaces.
Major hotel brands view the CRS as their core technology - providing the core hotel distribution
and channel management infrastructure to succeed in a hyper-competitive industry. One of the
top reasons to use a CRS is to gain better exposure on distribution channels. A CRS links your
rates and availability to a multitude of online and offline channels. These channels include online
travel agencies like Booking.com and Expedia, brick-and-mortar travel agencies, independent
travel agents, the booking engine on your own website, your reservations call center, metasearch
sites like Kayak and Trivago, and global distribution systems (GDS). With a CRS, you can easily
sell rooms on many different channels, which increases your exposure to potential bookers.

Its main functions are: Administration of room allocations (of single properties and hotel chains)
as well as control and monitoring of rates and availability in the distribution channels.

A CRS is beneficial for a hotel because it allows reservations to be checked and booked with a
simple search. It also allows revenue managers or front office managers to easy adjust the prices
corresponding to demand for multiple distribution channels and platforms at the same time. It is
kind of a mission control software for hotel distribution.

Information commonly stored in a CRS:

• Room Rates
• Room Allotments
• Room availability
• Reservation information
• Room Types
• Generic hotel information (address, phone number, fax number)
• Geocode information
• Nearby IATA cities and airports
• Room and hotel features
• On-site or nearby restaurants, bars, attractions, and recreational activities
• Hotel cancellation, deposit, and minimum stay information

Property Management System

PMS stands for: Property Management System. It is a local hotel administration system used for
reservation, availability and occupancy management, check-in/out, images, guest profiles, report
generation etc. This application is used in-house (in an individual hotel) to control the onsite
property activities.

The PMS can be connected with other applications such as the hotel point-of-sale (POS) or the
CRS. The interface to a CRS is an additional option in order to transfer availability, reservations
and guest profile information.

Additionally, various interfaces are available to create further links to internal and external
systems such as room key systems, restaurant and banquet cash registers, minibar, telephone
and call centers, revenue management etc.

PMS is also known as Hotel Operating System (Hotel OS).

FRONT OFFICE – GUEST REGISTRATION

Most hotels allow their guests to check-in at 2 p.m. or after. The registration procedures
performed by receptionists should be efficient and accurate. These contribute to a positive first
impression to guests upon their arrival.

Greet the Guest

Receptionists should always be attentive

to the presence of guests at the front door and
lobby areas. They should give warm greetings to
the guests when they approach the front desk.

1. Verify the Guest’s Identity

Ask if the guest would like to check-in.

Verify the guest’s identity by checking
his/her passport, booking voucher and
confirmation number
2. Present the Registration Form to the Guest

Confirm booking information printed in the registration form with the guest. For example,
room type, room rate, length of stay and special requests if any. Ask the guest to complete
and sign the registration form if he/she agrees with the terms of accommodation
arrangement.

3. Confirm the Method of Payment

If a credit card is used, check the guest’s name, the card’s validity and its date of expiry.
For guests who prefer paying cash, make sure they have paid in advance with cash deposit.
Guests should also be reminded that they will not be allowed to post any charges to their
guest accounts if no credit card is provided at the time of checking-in. Procedures of
handling other types of payment, e.g. personal checks or direct billings should also be
handled with extra care.

4. Check and Update the Guest’s Information

Check if any mail, message or article is received before the guest’s arrival. Select and assign
a suitable room to the guest according to his/her booking information.

5. Issue Room Key and Give Further Information

While issuing the room key and giving directions to the guest, staff should also take the
chance to provide more information on the hotel. For example, the breakfast arrangements;
the operation hours of the hotel’s outlets and facilities and; how to contact the hotel’s staff for
assistance during the stay, etc.
 6. Escort Guest to the Room

Ask if the guest needs assistance from the baggage attendant who can take the guest’s
baggage and escort the guest to their room.

Variations of Registration

The registration procedures of group guests (e.g. tours and event attendees) are different from
the general procedures of checking-in an individual guest.

In order to speed up the service process and prevent guests from waiting too long in the lobby,
the following procedures are usually performed by staff at the hotel reception desk.

Pre-registration

• Some preparation works can be performed by receptionists before group guests’

arrivals, including the confirmation of room numbers and number of rooms available for
groups.

• Key cards are always prepared by receptionists in advance according to the room lists
provided by travel agents or event organizers.

Group Registration

• Some hotels have group check-in counters which specifically serve group guests. Tour
escorts or event organizers check-in at the group check-in counter without the need of
checking-in each guest individually.

• Some hotels would also set up a tour assembly point for large groups by using meeting
rooms if necessary. Such a practice can control the traffic of hotel lobby and enhance
the comfort of guests upon their arrivals.

During the process of registration, the front desk clerk will request to see the guest’s identity card
or passport, for verification purposes. When all formalities are completed, the front desk clerk will
issue the room key to the guest. The baggage porter will then take the guest’s baggage and
escort the guest to the guest room.

It is also common practice for hotel staff to obtain a deposit or credit card before checking a guest
into the hotel.
Figure shows a sample
registration form. During
the process of registration,
the front desk clerk will
request to see the guest’s
identity card or passport to
check if the guest is an
alien, for verification
purpose. When all
formalities are completed,
the front desk clerk will
issue the room key to the
guest. The baggage porter
will then take the guest’s
baggage and escort the
guest to the guest room.

Note: Guests who arrive at

the hotel without having
made a reservation are
known as walk-ins. It is a
common practice for hotel
staff to obtain from the
guest a substantial deposit
or credit card imprint before
checking the guest into the
hotel.

Check-out Procedures

The standard hotel check-out time is usually set at 12 p.m. or before, although this can vary by
hotel and location. The check-out procedures are as important as check-in since guests would
expect they can leave with no troubles on their bills.

Important issues that the reception staff should put into focus are payment collection, customer
assistance and to create a positive parting impression to guests.
The standard check-out procedures that should be followed by reception staff at the front desk, include
the following:

1. Greet the Guest

Same as the check-in procedure,

through greeting, reception staff can
take the chance to ask the guest for
his/her comments on their stay.

2. Check Guest Details

It is important to check guest’s details,

e.g. the guest’s name and room number.
Double check with the guest so to make
sure satisfactory services were provided
to the guest during their stay. Also ask
the guest to return the room key.

3. Check for Late Check-out Charges

Normally, hotels would request their guests to check-out before 12pm. Receptionists
should follow the hotel’s policy for handling the cases of late check-out. Some hotels would
charge 50% of the daily room rate for those who check-out before 6pm and a full rate is
charged after 6pm.

4. Double-Check the Hotel Charges

Produce guest folios (guest bills) for guest inspection and master folios (master bills) for
tour escort’s inspection. The receptionist should print and present the bill to the guest for
his/her checking before settlement. It is the responsibility of the receptionist to explain the
charges to the guest and if he/she has any queries, make corrections if necessary.

5. Settle the Guest Account

Re-confirm the method of payment. Some guests, especially business travelers and tours
would like to split their bill into two different bills:

• Master folios (master bills), include room and breakfast charges only, which should be
paid by enterprises to cover the necessary expenses of their travelling staff or; by travel
agents which have already received the payments from tourists included in packaged
prices beforehand.
• Incidental folios contain personal expenses, such as telephone, spa, and in-room
movies, would be put into the incidental bills as guests’ own responsibilities.
 6. Offer Assistance

Ask if the guest needs any assistance with bell service, shuttle bus or arrangement of
other transportation. Some may request the front desk to keep their baggage for a certain
period before their departure. Staff should also take the chance to help guests in making
future reservations upon request.

7. Update Room and Guest History Record

After checking out the guest, make sure to update the room status ((i.e. from OD to VD)
to facilitate room cleaning and make the room available for sale as efficiently as possible.
Through the help of new information technology, guest-history profiles can be automatically
created and updated upon check-out by the property management system (PMS).

Handling Overbooking

Overbooking occurs when a hotel takes more reservations than the number of rooms available.
It is a common practice of hotels which contributes to a higher chance of full house while reducing
the loss of no-shows and last minute cancellations. Major problems of overbooking should be
noted, which include the loss of reputation, increase in guest dissatisfaction and complaints, etc.

Generally, receptionists should be able to anticipate overbooking and take appropriate actions
prior to the guests’ arrivals. Sometimes, it is possible to find additional rooms available for sale in
the hotel property. For example, check whether OOO rooms can be fixed immediately by the
engineering department and any ‘double up’ reservations have been made, i.e. two reservations
under the same person are made by mistake.

If no rooms are available, prioritize expected arrivals for room assignment according to hotel
policy, e.g. put VIPs, guests with guaranteed reservation and frequent guests at top priorities.
Contact and reserve rooms in sister hotels or hotels nearby before guests’ arrivals.

For those who cannot get a room upon arrival, the hotel will have no choice but ‘walking the
guests’. It means that the hotel has to reject guests even they have made reservations. By
turning a guest away who is supposed to get his/her room reserved, the hotel has breached the
contract which can lead to legal actions of guests. Therefore, ‘walking the guests’ should only be
handled by experienced receptionists or front desk managers.

The proper procedures include the followings:

a. Apologize to the Guest

As it is the hotel’s own fault of overbooking, hotel staff should apologize to the guest with
no excuse.
 b. Provide Alternatives
Compensations are always provided by the hotel to please the unhappy guests which
generally involve:

• Free room for the 1st night of stay in an alternate hotel;

• Free transportation to the alternate hotel;
• Free long distance calls;
• Fruit plates;
• Free room upgrade for future purchase; or
• Discount coupons for food and beverage consumptions, etc.

In case the guest has reserved more than one night in the hotel, try to invite him/her to come back
in the remaining nights during the conversation if rooms are known to be available.

c. Provide Baggage Assistance and Transportation

Once the guest agrees with the hotel’s arrangements, receptionist should ask the bell
person to take care of the guest’s baggage and arrange transportation to the designated
hotel.

d. Follow-up Services
Call the designated hotels to pay special attention to the unhappy guests. Some hotels
would request their duty managers or front desk managers to give personal calls to the
unhappy guests so to make sure that they have no problems with their rooms in the
alternate hotels.

Revenue from Room Sales and Sales Indicators

1. Revenue from Room Sales

Room sales normally contribute to the majority of a hotel’s revenue, followed by sales in the food
& beverage sections.

Variations on revenue contribution of different units occur in different types of hotels. Small-
scaled hotels with no restaurant outlets mainly depend on their revenue in room sales for survival.

Example:

The revenue of casino hotels are mainly

from the gambling units, while charges in
rooms and catering services are relatively
cheap or even subsidized in order to attract
more guests.
Convention hotels and those which target
events would also have higher income from
banqueting and meeting facilities when
compared with other hotels
2. Sales Indicators

Sales indicators refer to how hotels count and measure their business performances.

Some basic indicators which are applied by hotels include the following:

Ø Occupancy Rate

The Occupancy rate is a common sales indicator which tells how well the hotel has fully utilized
the room resources to maximize profit. It is always the objective of hotels to achieve full-house,
i.e.100% occupancy, when all the rooms are sold out for the night.

The formula for occupancy rate is shown below:

Occupancy Rate = Number of Rooms Sold ÷ Total Number of Rooms in a Hotel x 100%

Ø Guests per Occupied Room

This gives the ratio between guests staying in the hotel and the quantity of occupied rooms.
Regardless of the room types available in the hotel, it gives a general idea of how many guests
are being staying in each room. The information is useful for different departments, e.g.
housekeeping can refer to the guest ratio to estimate the consumption rate of guest supplies.

The formula of guest per occupied room is shown as below:

Ø Average Daily Room Rate (ADR)

While occupancy rate tells the ‘quantity’ of businesses, top management are also interested to
know about the ‘quality’, i.e. how much they charge for a hotel room. The ‘average daily room
rate’ is calculated which gives a general estimate of the average room charge received by a
hotel, regardless of the differences in room types and rates.

The formula of average daily room rate is shown as below:

 Ø Revenue per Available Room (REVPAR)

This is similar to the Average daily room rate in indicating the hotel’s performance. The only
difference between REVPAR and ADR is the denominator. Instead of just considering the actual
number of rooms sold, hotels tend to use all rooms available in calculating the REVPAR, i.e. to
include all vacant rooms, out-of-order rooms and rooms for ‘house use’ in the calculation. The
value is always smaller than the ADR which serves as a good means to check the ability of
management in utilizing all room resources to maximize the hotel revenue.

The formula of REVPAR is shown as below:

Front Office – Accounting

A front office accounting system is an essential process designed to monitor and chart the
financial transactions of guests and non-guest at the hotel during each stage of the guest cycle.
An effective guest accounting system includes tasks performed during each stage of the guest
cycle:

• During the pre-arrival stage of the guest cycle, a guest accounting system captures data
related to the form of guarantee for a reservation, and tracks pre- payment and advance
deposits.
• When the guest arrives at the hotel, a guest accounting system documents the
application of room rate and tax at registration.
• During occupancy, a guest accounting system is responsible for tracking guest charge
purchase.
• During guest checkout, a guest accounting system ensures payment for goods and
services provided.
• After guest check out- if a guest’s bill is not fully paid at checkout, the balance is
transferred from guest to non –guest records. When this occurs, collection becomes the
responsibility of the back office accounting division.

So, the specific functions of a front office accounting system (FOAS) are to:

• Create and maintain an accurate accounting file for each guest or non-guest account
• Track financial transactions throughout the guest cycle
• Ensure internal control over cash and non-cash transaction
• Obtain settlement for all goods and services provided
 The front office’s ability to monitor and chart guest and non-guest transaction will directly affect
its ability to collect outstanding balances. Incomplete of inaccurate monitoring may lead to
difficulties in settlement.

Accounts

An account is a form on which financial data are summarized. An account may be imagined as
a bin or a container which stores the results of various business transactions. The increases and
decreases in an account are calculated and resulting monetary amount is the account balance.
Any financial transaction that occurs in a hotel may affect several accounts. Front Office
accounts are recordkeeping devices to store about guest and non-guest financial transactions.

In its simplest written form, an account resembles the letter T:

In the domain of front office accounting, the charges are entered on the left side of the ‘T’. They
increase the account balance. The payments are entered on the right side of the ‘T’. They
decrease the account balance.

Basic Front Office Accounting Formula:

Net Outstanding Balance = Previous Balance + Debit – Credit

Where debit increases the outstanding balance and credit decreases it.

Most of the contemporary hotel businesses employ automated accounting system.

Types of Accounts

There are following typical accounts in hotel business dealing with customers −

• Guest Account
• Non-guest or City Account
• Management Account

GUEST ACCOUNT *CITY ACCOUNT

It is the record of financial transactions It is the record of financial transactions
between the guests and the hotel. between the non-guests and the hotel.
 It is created at the time of reservation or It is created when a guest fails to settle the
registration. bill completely at the time of check-out.

It is maintained by the front office It is maintained by the Accounts section in

completely. back office.
It records all financial transactions of a guest It records financial dues not paid or partially
from check-in till check-out. paid by the guests at the time of check-out
from the front office to the back office.
Guest account is compiled on a daily basis. City account is compiled on a monthly basis.

*Non-Guest Account.

A hotel may extend in-house charge privileges to local businesses or agencies as a means of
promotion, or to groups sponsoring meetings at the hotel. The front office creates non-guest
account to track such transactions. These accounts may also be called house accounts or city
accounts.

Management Account

Some hotels allow the managers to entertain the guests’ queries or grievances, or any possibility
of acquiring a business deal over a brief interaction with the guests. For example, if a guest has
some problem about the hotel policy, the manager calls the guest for interaction over a coffee or
a drink and tries to resolve the same. The expenses towards this interaction are then recorded on
the management account.

Folios and Types

A folio is a statement of all transaction that has taken place in a single account.

The front office staff records all the transactions between the guest and the hotel on the folio. The
folio is opened with zero initial balance. The balance in the folio then increases or decreases
depending upon the transactions. At the time of check-out, the folio balance must return to zero
on settlement of payment.

Types of Folios

There are basically four types of folios used in front office accounting. They are:

1. Guest folios:- accounts assigned to individual persons or guest rooms

2. Master folios: accounts assigned to more than one person or guest room; usually
reserved for group accounts.
3. Non-guest or semi-permanent folios: accounts assigned to non-guest businesses or
 agencies with hotel charge purchase privileges.
4. Employee folios: accounts assigned to employees with charge purchase privileges.
Executives like Sales and Marketing Director, Front Office Manager may charge the
hotel for travel and entertainment to promote the business

Postings and Types

The process of recording the entries on the folio is called ‘Posting’ of transactions. There

are two basic types of postings −

1. Credit − they reduce the guest’s outstanding balance. These entries include complete or
partial payment, or adjustments against tokens.

2. Debit − they increase the outstanding balance in the guest account. Debit entries include
charges under restaurant, room-service, health center/spa, laundry, telephone, and
transportation.

Front Office Management - Night Audit What is

Night Audit?
It is the process of auditing where the night auditor reviews all financial activities of the hotel that
has taken place in one day.

The auditing process for the day is generally conducted at the end of the day during the following
night, hence the name ‘Night Audit’. It can be performed by the conventional method of using
papers, receipts, vouchers, coupons, and files. But performing audit using modern PMS systems
is easy, fast, and efficient.

Basic Activities during Night Audit

The night auditor performs the following steps during night audit activity −

• Posting accommodation and tax charge

• Accumulating guest service charges and payments
• Settling financial activities of various departments
• Settling the account receivables
• Running the trial balance for the day
• Preparing the night audit report

The Need for Night Audit

The objective of night audit is to evaluate the hotel’s financial activities. Night audit not only
reviews guest accounts by checking credits and debits but also tracks the credit limits of the
 guests and tallies projected and actual sales from various departments. Night audit reviews daily
cash flow into and out of the hotel’s account.

Night audit has a large significance in hotel business operations. The management body refers night
audit report to plan future goals and control the expenses. The managers can react immediately on the
acquired information. Responsibilities of a Night Auditor

Apart from the basic audit activities listed above, the night auditor carries out the following
responsibilities −

• Taking over from the last shift.

• Checking-in or checking-out the guests after 11:00 pm at night.
• Registering the guests.
• Allocating accommodations to the newly checked-in guests.
• Settling transactions in the newly created guest accounts.
• Verifying guest folios.
• Verifying room status report.
• Balancing all paperwork with the accounts in the PMS.
• Remaining liable for security of the premises.
• Handling guest accommodation keys.
• Taking backup of the PMS generated reports.
• Preparing lists of expected guest arrivals for the next day.
• Closing financial activities for a day.
• Starting financial activities for the next day.
• Receiving and recording bank deposits.

Front Office Management - Communication

The front office is the center of guest

transactions in a hotel and so often acts as the
center for collection and distribution of guest
information.

Such information may help other

departments in providing the best service to
guests throughout the different stages of the
guest cycle.

1. Front Office and Housekeeping

The housekeeping department requires the following information from the front desk:

• Check-in, occupied and check-out rooms in order to organize room cleaning

• Special requests from guests, such as baby cot or extra blanket, etc., so that extra
amenities and services can be provided to guests
In return, the housekeeping department will provide the actual room status to the front desk for
comparison with the computer record which ensures that the front desk has the correct room
status. Any discrepancy found will be double checked by the Assistant Manager.
2. Front Office and Engineering

The engineering department is responsible for maintaining properly the hotel facilities under the
care of the front office department such as the proper of functioning of the guest lift.

3. Front Office and Security

The front office needs to provide guest information to the security department in the event of
emergency; such as fire alarm, power failure and so on. When guest reports loss of property to
the front office, security department will be informed to handle the case together with front office’s
assistant manager.

Other departments who benefit from information provided by the front office also include the
following:

4. Front Office and Human Resources

The human resources department provides staff training and recruitment service to the front
office. It also sets up the staff grooming and discipline standard for staff to follow.

5. Front Office and Food and Beverage Department

The front desk will provide the food and beverage department with a guest room special
amenities request form. The food & beverage department then arranges for item such as
welcome fruit baskets, chocolates and wine to be placed in the guest room.

For groups, the food & beverage department will need the front desk to provide information on
meal arrangements so as to reserve seats in the outlets or conference rooms for guest meals.

6. Front Office and The sales and marketing department

The sales and marketing needs to work closely with the front desk and reservations department
when dealing with corporate bookings or for the reservations of groups/tours.

The front desk will also provide the sales and marketing department an updated rooming list, with
guest room numbers upon the arrival of large tours or groups.

7. Front Office and Accounts Department

Information concerning advance deposits received by the reservations department and payments
received by the front desk must be recorded and passed to the accounts department which is
responsible for monitoring guest accounts, checking credit limits and seeking settlements of
guest accounts.
The accounts department is responsible for compiling a list of credit-approved enterprises, which
is needed by reservations and front desk when receiving bookings