Hospitality Management Quiz
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Questions and Answers

What should be the response when a guest is within 15 feet?

  • They should receive detailed information about hotel services.
  • They should be greeted with a formal handshake.
  • Their presence should be acknowledged through a smile or head nod. (correct)
  • They should be offered a complimentary drink.

What does CRM stand for in the context of hospitality management?

  • Client Review Methodology
  • Customer Revenue Management
  • Current Resource Management
  • Customer Relationship Management (correct)

Which term refers to the director responsible for sales and marketing in a hotel?

  • DOC
  • FOH
  • FOM
  • DOSM (correct)

What does FOH represent in hotel terminology?

<p>Front of House (A)</p> Signup and view all the answers

What is the main purpose of a Property Management System (PMS)?

<p>To track guest check-ins and check-outs. (C)</p> Signup and view all the answers

What does FIT stand for in hospitality?

<p>Free Independent Traveler (D)</p> Signup and view all the answers

Which KPI is represented by the abbreviation YOY?

<p>Year on Year (B)</p> Signup and view all the answers

What term refers to the fluctuations of demand and supply in the tourism industry due to temporary movements of people?

<p>Seasonality (B)</p> Signup and view all the answers

What is a negative externality in the tourism sector?

<p>Pollution caused by hospitality services (C)</p> Signup and view all the answers

What does the acronym MOM refer to in the hospitality industry?

<p>Month on Month (B)</p> Signup and view all the answers

What is the role of a Destination Management Company (DMC)?

<p>To organize and manage tourism operations in a destination (D)</p> Signup and view all the answers

What does the term parity rate indicate in tourism pricing?

<p>Consistent pricing across different distribution channels (B)</p> Signup and view all the answers

What does the break-even point represent in the context of tourism services?

<p>The point where operational costs are fully covered (B)</p> Signup and view all the answers

Which of the following factors is NOT associated with seasonality in tourism?

<p>Year-round availability of services (A)</p> Signup and view all the answers

What aspect is primarily affected by negative externalities in the tourism industry?

<p>Local environment and community health (B)</p> Signup and view all the answers

In tourism, what does 'high peak season' typically refer to?

<p>Periods of maximum tourist activity and demand (A)</p> Signup and view all the answers

What key indicator is primarily discussed in the context of hotel revenue?

<p>Revenue Per Available Room (RevPAR) (D)</p> Signup and view all the answers

What does Horst Schulze emphasize as important in addition to room revenue?

<p>Customer spending in restaurants and shops (C)</p> Signup and view all the answers

In order to assess which hotel has a better RevPAR, what condition related to total revenue is set?

<p>Total Revenue must exceed $150,000 (C)</p> Signup and view all the answers

What is the minimum Average Daily Rate (ADR) specified for one of the RevPAR assessments?

<p>$200 (B)</p> Signup and view all the answers

According to the information, which factor does NOT affect RevPAR?

<p>Customer satisfaction index (D)</p> Signup and view all the answers

What is a requirement related to the number of rooms for considering the RevPAR?

<p>Must be over 50 rooms (C)</p> Signup and view all the answers

Which period is specified for assessing both total revenue and RevPAR performance?

<p>30 days (D)</p> Signup and view all the answers

What is indicated as the preferable revenue strategy by Horst Schulze?

<p>Maximize total revenue and dollar profits (C)</p> Signup and view all the answers

What is the primary purpose of break-even pricing for firms?

<p>To determine the lowest price to charge (D)</p> Signup and view all the answers

In which situation would a firm most likely utilize break-even pricing?

<p>When tourism business experiences a slow period (D)</p> Signup and view all the answers

What does EBITDA stand for in the context of financial performance?

<p>Earnings Before Interest, Taxes, Depreciation, and Amortization (C)</p> Signup and view all the answers

Which of the following is NOT typically considered an ancillary service in the tourism and hospitality industry?

<p>Office supplies (B)</p> Signup and view all the answers

Which of the following accurately describes the supporting role of ancillaries in the hospitality industry?

<p>They enhance the main offerings and guest experience. (C)</p> Signup and view all the answers

Why might a hotel consider offering upgrades as an ancillary service?

<p>To provide guests with complementary experiences (D)</p> Signup and view all the answers

What is a potential benefit of using EBITDA as a measure of profitability?

<p>It provides a clearer picture of a company's operational efficiency. (C)</p> Signup and view all the answers

Which service is typically included as an on-site ancillary in hotel operations?

<p>Spa services (A)</p> Signup and view all the answers

What does EBITDA primarily aim to represent?

<p>Cash profit from operations (C)</p> Signup and view all the answers

Which of the following is NOT a component of cash flow?

<p>Cash flows from capital structure (D)</p> Signup and view all the answers

What is capital expenditure (CapEx) typically used for?

<p>Acquiring and maintaining physical assets (B)</p> Signup and view all the answers

What does price elasticity measure in economics?

<p>The demand changes in response to price changes (B)</p> Signup and view all the answers

What characterizes a demand that is considered inelastic?

<p>Demand remains unchanged even when prices change (A)</p> Signup and view all the answers

How does cash flow affect a company's financial assessment?

<p>It is essential for assessing liquidity and flexibility. (A)</p> Signup and view all the answers

What does a cross elasticity measure?

<p>The change in demand for one good based on price changes in another related good (A)</p> Signup and view all the answers

What distinguishes capital expenditures from operating expenses?

<p>CapEx improves future operations, while OpEx covers daily costs. (B)</p> Signup and view all the answers

What is meant by 'scarcity' in economics?

<p>The gap between limited resources and theoretically limitless wants (C)</p> Signup and view all the answers

Which of the following correctly describes cash flow operations?

<p>Money from sales and spending on expenses. (A)</p> Signup and view all the answers

What would indicate perfectly inelastic demand?

<p>A demand coefficient of 0 (B)</p> Signup and view all the answers

Which scenario is an example of capital expenditure?

<p>Purchasing a new delivery van (A)</p> Signup and view all the answers

What best describes the relationship between EBITDA and capital costs?

<p>EBITDA omits capital costs to focus on operational profit. (D)</p> Signup and view all the answers

Why is relative scarcity significant in economics?

<p>It encourages the efficient allocation of limited resources (C)</p> Signup and view all the answers

In economic terms, what does the phrase 'paucity' refer to?

<p>A condition of scarcity (A)</p> Signup and view all the answers

Which statement best describes economics?

<p>The study of human behavior concerning ends and scarce means with alternative uses (C)</p> Signup and view all the answers

Flashcards

15/5 Rule

A hospitality service standard emphasizing acknowledging guests within 15 feet with a smile or head nod, and greeting them within 5 feet with a verbal welcome.

CRM

Customer Relationship Management. A system for managing and improving interactions with guests, often used to personalize experiences and build loyalty.

PMS

Property Management System. A software system used by hotels to manage reservations, guest information, billing, and other operational tasks.

RMS

Revenue Management System. A system used to optimize pricing and inventory in order to maximize revenue.

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DOC

Director of Catering. Responsible for managing the hotel's catering operations, including events and banquets.

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DOSM

Director of Sales and Marketing. Leads the marketing and sales efforts for the hotel, attracting and converting potential guests.

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FOH

Front of House. Refers to all guest-facing areas and staff in a hotel.

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FIT

Free and Independent Traveler. A guest who plans and books their travel independently, without a tour operator.

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RevPAR

Revenue Per Available Room. A key performance indicator in the hospitality industry that measures how effectively a hotel generates revenue from its available rooms.

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RevPAR - The Limit

The concept that RevPAR is not the only factor to consider in maximizing hotel profitability. Other revenue streams and overall profit margins should also be taken into account.

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Who's got a better RevPAR?

This question highlights the importance of comparing RevPAR across hotels with varying sizes and operating characteristics. Factors such as room count, Average Daily Rate (ADR), and occupancy rate need to be considered before concluding which hotel has a better RevPAR.

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Total Revenue

The total amount of money a hotel brings in from all sources, including room revenue, food and beverage sales, spa services, and other amenities.

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Consideration Period

The timeframe or duration over which the hotel's revenue is measured. Usually, expressed in days.

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Number of Rooms

The total number of rooms available at a hotel.

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Average Daily Rate (ADR)

The average price paid for a room per night.

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Average Occupancy Rate

The percentage of rooms occupied for a given period.

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Seasonality

Fluctuations in tourist demand and supply caused by temporary factors like climate or school holidays, creating peak and off-peak seasons.

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Externality

Positive or negative effects on third parties from economic exchanges between two other parties. For example, pollution from a hotel is a negative externality affecting the environment and community health.

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Parity Rate

When a travel supplier, like a hotel, charges the same price for its services across all distribution channels.

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What is a break-even point?

The point at which total revenue equals total variable costs, meaning there's neither profit nor loss at that level of output.

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Break-even point

The point at which total revenue equals total variable costs, meaning there's neither profit nor loss at that level of output.

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Why is the break-even point important?

It's a critical metric for businesses because it helps them understand how many units they need to sell to cover their costs and start generating profits.

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Break-even Pricing

A pricing strategy where a business sets prices to cover all costs, including fixed costs and variable costs, without making a profit. This is often used during slow periods to avoid further losses.

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Ancillary Services

Additional services or products offered by a hospitality business beyond the main offering, like a hotel room. These can generate extra revenue and enhance guest experiences.

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Food & Beverage Ancillaries

Ancillary services related to food and drinks, such as room service, restaurant reservations, or a hotel minibar.

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Entertainment Ancillaries

Ancillary services related to entertainment, such as tickets to events, concerts, or local attractions.

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Tours & Activities Ancillaries

Ancillary services related to tours and activities, such as guided tours, day trips, or tickets to local attractions.

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Upgrades

Ancillary services offering better amenities or experiences, like upgraded hotel rooms or access to exclusive lounges.

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Retail Ancillaries

Ancillary services related to retail, such as purchases from hotel gift shops or other on-site retail establishments.

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On-Site Services

Ancillary services related to amenities offered within the hotel, such as spa treatments, golf courses, or fitness facilities.

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EBITDA

Earnings Before Interest, Taxes, Depreciation, and Amortization. A measure of a company's profitability that considers operating income before deducting certain expenses.

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Cash Flow

The movement of money in and out of a company. It's typically categorized as cash flows from operations, investing, and financing.

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What does EBITDA omit?

EBITDA omits capital costs, which are expenses related to acquiring, upgrading, and maintaining physical assets.

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Capital Expenditure (CAPEX)

Funds used by companies to acquire, upgrade, and maintain physical assets like property, plants, buildings, technology, or equipment. It's used for investments and new projects.

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Examples of CAPEX

Examples include repairing a hotel roof, purchasing equipment, or building a new gym. These improve the company's capacity for future economic benefit.

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Operating Expenses (OpEx)

Shorter-term expenses used for the day-to-day operations of a business, contrasting with CAPEX.

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What's the difference between CAPEX and OpEx?

CAPEX focuses on investments in long-lasting assets, while OpEx covers the costs of running the business on a day-to-day basis.

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Price Elasticity

The degree to which demand for a good changes in response to price changes. It shows how sensitive consumers are to price fluctuations.

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Inelastic Demand

Demand that remains relatively unchanged even when the price changes. The coefficient of elasticity is less than 1.0.

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Perfectly Inelastic Demand

Demand that stays absolutely constant, regardless of price changes. The elasticity coefficient is 0.

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Cross Elasticity

The change in demand for one good due to price changes in a related good. It measures how goods affect each other.

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Scarcity

The fundamental economic problem of having unlimited wants but limited resources to satisfy them.

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Relative Scarcity

A resource is scarce relative to its demand. The more costly a resource is to consume, the scarcer it becomes.

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Economics Definition

The study of how individuals and societies make decisions about how to allocate scarce resources to satisfy their unlimited wants.

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Alternative Uses

Scarce resources can be used for different purposes, requiring choices and trade-offs.

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Study Notes

Hospitality Management Firms

  • Guest lecturer: Gino Marchionna, founder of Tourismus
  • Academic year: 2024/2025
  • Course offered at Ca' Foscari University of Venice
  • In partnership with Scuola Italiana cdp of Ospitalità
  • Bachelor's Degree Programme in Hospitality Innovation and e-Tourism

Hotel Distribution

  • Key distribution channels illustrated include:
    • Online travel agencies
    • Affiliate online travel agencies
    • Leisure travellers
    • Loyal travellers
    • Business travellers
    • Travel management companies
    • Corporate self-booking
    • Tour operators
    • Wholesalers/bedbanks
    • Global distribution system
    • DHISCO switch
    • Hotel eCommerce
    • Central reservation system
    • Proprietary switch system
    • Travel agents

30 Hospitality Keywords - Part 1

  • 15/5 Rule: When a guest is within 15 feet of you, acknowledge them with a smile or a nod. Within 5 feet, greet the guest with a suitable salutation ("hello," "good morning," or "good evening").
  • CRM: Customer Relationship Management
  • PMS: Property Management System
  • RMS: Revenue Management System
  • DOC: Director of Catering
  • DOSM: Director of Sales and Marketing
  • FOH: Front of House (All guest-facing staff and areas of a hotel)
  • FOM: Front Office Manager
  • FIT: Free and Independent Traveler
  • MOM: Month on Month
  • MTD: Month to Date
  • YOY: Year on Year
  • YTD: Year to Date
  • ADR/ARR: Average Daily Rate/Average Room Rate
    • Formula: (Total Room Revenue) / (Total Rooms Sold)

30 Hospitality Keywords - Part 2

  • RevPAR: Revenue Per Available Room.
  • Seasonality: Fluctuations in demand, influenced by climate conditions, holidays, etc.
  • Externality: Positive or negative effects from exchanges between parties on unrelated third parties. Issues like pollution.
  • DMC: Destination Management Company
  • DMO: Destination Management Organisation
  • Parity Rate: Price consistency across various distribution channels for a travel supplier like a hotel.
  • Break-Even Pricing: Price setting at a point where total revenue covers total variable operational costs. Allows for ongoing operation even when demand is slow.
  • Ancillaries: Supplementary hospitality services like food, beverage, and entertainment. Includes services like tours, upgrades, and on-site retail and spa options

30 Hospitality Keywords - Part 3

  • EBITDA: Earnings Before Interest, Taxes, Depreciation, and Amortization: An alternative profitability measure that excludes non-cash items/costs.
  • Cash Flow: Money movement into and out of the company; key indicator of liquidity, flexibility and financial standing. Categorized by operations, investment and financing activities.
  • CAPEX: Capital Expenditure: Investments in fixed physical assets for future economic gains.
  • Depreciation: Accounting method for allocating the cost of tangible assets over their useful lives.
  • Real Estate: Land and improvements; types include residential, commercial, industrial, raw land, special use.
  • ROI: Return on Investment: Measures investment benefit against cost, expressed as a percentage. ROI = (Current Value of Investment - Cost of Investment) / Cost of Investment
  • Elasticity: Degree to which a variable changes in response to another; includes demand and price elasticity.
  • Scarcity: Limited resources vs unlimited wants; a core economic concept.

First Optional Assignment

  • Identify the most interesting hotel brands in Italy (consider factors like revenue, number of rooms, and specialization).
  • Submit a 1-2 slide case study by next Monday via email.
  • Include key variables, relevant highlights/news, and explain the case study's significance. The top 3 cases chosen will be presented in class on Tuesday.

Second Optional Assignment

  • Perform a SWOT analysis of hotel businesses (franchising, family-owned, or chain)
  • Submit a single JPG image of the analysis performed by next Monday, via email.

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Principles of Management of Hospitality Firms 2024/2025 PDF

Description

Test your knowledge on key concepts in hospitality management with this quiz. Learn about guest interactions, the meaning of CRM, and the roles within hotel management. Perfect for students or professionals looking to refresh their understanding of the industry.

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