Revenue Center Forecasting

It is designed to aid management in accurately projecting short-term future business volumes for food, beverage, and retail revenue centers. The group, contract, and transient segment projections, as well as the resulting guest counts, have a direct impact on revenue center forecasts. These forecasts are developed by determining a revenue center's capture ratio of available guests (in-house guests minus in-house guests not available to the revenue center) and assessing historical data (volumes). Information is organized so that volume trends and the relationships between available guests and revenue center volumes can be identified. The projections that can be made from an accurate forecast form one of the cornerstones of high quality, cost effective service. By knowing how many guests are to be served and at what time they will require service, management can properly plan the use of labor and supplies for the revenue centers.

Revenue center forecasting involves three primary concepts. The first deals with an analysis of history. The history is analyzed so that the trends are highlighted and understood. The trends may then be analyzed by comparing them to the size of an available market. An available market is the number of guests that may be served in or by a revenue center. At times, this market simply consists of the number of guests in the hotel. However, if there are banquet and/or meeting functions, the size of the market may be affected by the activity in these areas. For example, a room guest attending a banquet function may no longer be available to a food revenue center. A non-hotel guest attending a meeting in the hotel may be available to the food, beverage, and retail revenue centers. Thus, the size of the available market is usually different from the number of hotel guests.

RMS

provides a standard feature for available guest calculations (e.g., hotel guests attending a banquet breakfast can be subtracted from the breakfast available guest market). However, 

RMS

adjusts the available guest market by revenue center and meal (or time) period using any factors that are appropriate to your property.

By constantly analyzing the relationship between the available market and the revenue center volumes, it is possible to determine what part of the available market historically uses a revenue center on or during any given day, meal, or time period. This relationship of covers or revenue to available guests may be further analyzed by segmenting the data into ranges of available guests.  

However, because certain revenue centers receive the majority of their business from local clientele rather than from property guests, 

RMS

forecasts a revenue center as if it were a freestanding operation. The program will then only use trends and averages to develop a forecast for the revenue center and exclude the relationship between covers or dollars and available guests.

The third concept addresses the need to organize the history by day of the week and meal (or time) period. Understanding that each day and period has unique characteristics, one must compare a given day and period with other occurrences from the same day and period. Thus, one Tuesday breakfast must be compared with other Tuesday breakfasts, as guest behavior on a Tuesday will tend to differ from guest behavior on a Saturday. In like manner, a Sunday in the gift shop must be compared to other Sundays.

RMS

automatically completes this process.

Organizing revenue center history according to these three concepts enables 

RMS

to produce a statistical projection. The projection is based on a numerical analysis of the history. It may then require adjustment based on the manager's knowledge of circumstances not accounted for by the data.

RMS

allows the manager(s) to make final adjustments in the final revenue center option. As each day and meal period occur, data from these occurrences is fed back into the system to be used in future forecasting.