How to control guest amenity expenses in your hotel?

Guest amenity expense can play a major role in the profitability of the rooms department. In this tutorial we will learn how to analyse and control guest amenity expense in your hotel.

Read the transcript.

Next time you look at the Profit and Loss report, look at a line called guest amenities. That line will have the expenses of all the money you spent on items in a guest room.

Controlling guest expenses will help you make the hotel more profitable.

In this video, let us look at a few key items that contribute to the guest supplies cost in a hotel and what you can do to reduce it.

So first let us look at what are the key areas of expense in guest supplies. If you do your analysis, you will note what are the most expensive items in your hotel. Typically it will be the shaving kit, dental kit, soap, drinking water, and tea coffee-making supplies.

Check what is the top expense for your hotel. Make a list in excel, of how much you spend on each item and what is the cost per occupied room as well as the cost per available room.
Now that you have a basic understanding, ask yourself what can you do to reduce the cost for each line item.

Remember every action may have unintentional consequences so you will need to conduct experiments. What do I mean by unintentional consequences?

Let me explain. For example, we find that the dental kit is the most expensive item, so we do not keep it in the room and make it available on guest request. If you do that, your team member may have to stop work and deliver these to guests on request. On a busy day, you will only be running to deliver the guest request. So you need to think about it properly when you decide on an action.

An easier solution in the case of dental kits will be to monitor inventory carefully and avoid the wrong usage.

For fruits in the room, the solution might be to keep local seasonal fruits to take advantage of the pricing.

So it is up to you to keep doing these experiments and see how much you can reduce the guest amenities expense. Even though it is a small amount, because of the volume involved, you can save lots of money with proper analysis and action.

At the end of every month calculate your expenses per room occupied and available. In a few months, you will get the benchmark figure that you can compare. If you work in a hotel chain, ask your finance manager to get you comparative figures from other hotels so that you can learn from the best practices of what others are doing to save costs and improve profitability for your hotel.

Keep taking action every month and track the changes. This can also help you to understand changes in guest satisfaction scores and make changes if required.

For deeper understanding of the finance and how it affects your hotel enroll and learn this course

Hope you liked this tutorial.

One Comment

  1. Melku Shiferaw says:

    No I want now how to calculate cost, ordering level etc

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