Hospitality industry is thought to be the backbone for the economy of any country. This industry includes a wide array of services. Among all the services, hotel industry enjoys a prime position. This is perhaps one of the toughest business segments, as hotels not just provide accommodation facilities; rather restaurants, cuisine lines, bars, etc. are the attached peripherals to this business. Hence, assessing the profitability of this business involves assessing the profitability of each peripheral separately. Taiwan is one of the most renowned countries around the globe that is known for its diverse cultural settings. One of the prime attractions of this beautifully structured country is its hotels and motels. Regent Taipei is one such attraction.
When assessing the success ratio that is attached with the hotel industry, it is important to realize that it can only be meant if the business has the potential to meet the needs of its target clients, while offering a desirable ambiance and a wide range of services that satisfy the aesthetic, financial, and emotional needs of the subjects. In an attempt to discuss the gross profit of a hotel’s restaurant and bar operations, Regent Taipei offers valuable insight. Technically, gross profit is a measure for assessing the profitability of any operation. Gross profit is a residual profit that is obtained by subtracting the revenues from the cost of goods sold . This measure is a worthy insight for the management of Regent hotel as it provides them with a reason of whether or not to continue their operations; or if not seizing, then what are the areas where they are lagging behind, optimizing which can bring profits to the business. Seat turnover is another instrumental measure for assessing the success of any business. This affects the management decision making as restaurants only make profit when it can seat people up to their full potential and those clients order high priced items. If it is not the case, then the management will need to review their operations to see where the lag exists. This measure, just discussed, also influences the price strategies of the restaurant and bar segment . If the price structure is too high or too low, putting it other way, if the price structure is not adjusted keeping in view the target clients that can hinder the profitability thus inviting corrective actions from the management decision-making end.
Comment on Post 1:
I appreciate that you been successful in providing a detailed and in depth analysis of the situation going on in hotel. This also reflects that you have been successful in performing his duties to the high degree of professional ethics. I agree with almost all the theory that is stated in the above post. Only one thing that I would like to add is that no business can flourish without the ingredient of honesty. Therefore, buying a bottle of wine for $13 and selling it for $60 may undermine the quality and ethical consideration. What is your take on that?
Comment on Post 2
The above post has accurately highlighted the importance of business strategies for a business hotel. One of the thing that really excites me in this post is the fact that most of the food served is home based. This strategy not just ensures price stability but also strengthens the quality aspect of food.
References
Hazzard, P. (1992). Managerial accounting in the hospitality industry. New York: Nelson Thornes.
Jagels, M. (2006). Hospitality management accounting. Chicago: John Wiley and Sons.
