The Lodging IndustryThe Lodging Industry

Understanding LodgingUnderstanding Lodging

The lodging The lodging industry in the industry in the United States United States

has always been has always been strongly strongly

influenced by influenced by changes in changes in

transportation.transportation.

Mid-1600sMid-1600s Stage coach routes establishedStage coach routes established Coaching inns became popular Coaching inns became popular

resting places for travelersresting places for travelers Expected a bed and a meal for the Expected a bed and a meal for the

eveningevening

1794-18281794-1828 1794 City Hotel in 1794 City Hotel in

New York City opensNew York City opens The first building in The first building in

the US designed the US designed specifically as a hotel.specifically as a hotel.

1828 The Tremont 1828 The Tremont House, first grand House, first grand hotel, was built in hotel, was built in Boston.Boston.

First hotel to offer First hotel to offer private rooms with private rooms with locking doors.locking doors.

The RailroadThe Railroad Inns, taverns and foodservice facilities Inns, taverns and foodservice facilities

located near railway stations began to located near railway stations began to grow.grow.

Famous resorts because of the railway Famous resorts because of the railway include Hotel del Coronado near San Diego include Hotel del Coronado near San Diego and the Greenbrair Resort in West Virginia. and the Greenbrair Resort in West Virginia. Yellowstone was also a railway resort. Yellowstone was also a railway resort.

Conrad HiltonConrad Hilton A banker in New Mexico purchased A banker in New Mexico purchased

his first hotel around 1900. It was in his first hotel around 1900. It was in Cisco Texas.Cisco Texas.

This began his chain of hotels.This began his chain of hotels. Other hotels around this time: Ritz Other hotels around this time: Ritz

Carlton in Boston and the Plaza in Carlton in Boston and the Plaza in New York City.New York City.

1950’s1950’s Increased availability and popularity of the Increased availability and popularity of the

automobile and a new interstate freeway automobile and a new interstate freeway system made cross country vacations a system made cross country vacations a popular option.popular option.

Motels sprang up along highways offering Motels sprang up along highways offering travelers a place to bathe, sleep and eat.travelers a place to bathe, sleep and eat.

The Airline IndustryThe Airline Industry 1958 commercial airlines became popular.1958 commercial airlines became popular. Builders moved toward airports for hotels Builders moved toward airports for hotels

and restaurants.and restaurants.

Lodging Operations OrganizationLodging Operations Organization

Front of the house: employees who have Front of the house: employees who have direct contact to the publicdirect contact to the public

Back of the house: supporting operations, Back of the house: supporting operations, behind the scenesbehind the scenes

OROR Administrative Departments: Manage Administrative Departments: Manage

business (accounting, human resources, business (accounting, human resources, training, marketing, sales)training, marketing, sales)

Service Departments: responsible for Service Departments: responsible for serving guests directlyserving guests directly

Administrative DepartmentsAdministrative Departments General Manager (GM)General Manager (GM) Accounting and Accounting and

Financial Management Financial Management (Controller)(Controller)

Human ResourcesHuman Resources Marketing and SalesMarketing and Sales

Service DepartmentsService Departments Front Office Front Office HousekeepingHousekeeping Engineering and Engineering and

Facility Facility MaintenanceMaintenance

SecuritySecurity Food and Beverage Food and Beverage

(F & B)(F & B)

Leisure TravelersLeisure Travelers On vacationOn vacation Shopping, fine dinning, sightseeing, Shopping, fine dinning, sightseeing,

sports events, relaxsports events, relax May provide activities for children, May provide activities for children,

on-site recreation or health facilitieson-site recreation or health facilities

Business TravelersBusiness Travelers Looking for well lit work spaces, Looking for well lit work spaces,

telephones, modems, copiers, fax telephones, modems, copiers, fax machines.machines.

Meeting facilitiesMeeting facilities 24 hour service - valet parking, 24 hour service - valet parking,

secure lodgingsecure lodging

AmenitiesAmenities RestaurantsRestaurants Parking GaragesParking Garages BoutiquesBoutiques Barber shopsBarber shops Dry CleanersDry Cleaners FloristsFlorists Swimming poolsSwimming pools Room serviceRoom service

Cable TelevisionCable Television Pay per viewPay per view BathrobesBathrobes Gift shopsGift shops KitchensKitchens Computer modemsComputer modems SpaSpa Recreational Recreational

activitiesactivities

Types of PropertiesTypes of Properties Full ServiceFull Service LuxuryLuxury EconomyEconomy Mid-pricedMid-priced All-suiteAll-suite ResortsResorts Bed and BreakfastBed and Breakfast

Terms to KnowTerms to Know FolioFolio CRS Central CRS Central

Reservation SystemReservation System Room InventoryRoom Inventory BlockBlock Rooms ForecastRooms Forecast No-ShowsNo-Shows OverbookOverbook UnderstaysUnderstays Yield ManagementYield Management Rack RateRack Rate

Hubbart FormulaHubbart Formula Helps managers set ratesHelps managers set rates

Operating expenses + Desired return on investment-Other IncomeOperating expenses + Desired return on investment-Other Income______________________________________________________________________________________________________________

Projected room salesProjected room sales

==Room RateRoom Rate