Operations
As markets change and business evolves, we find more and more hotel owners faced with the challenge of remaining profitable and competitive.
Operational difficulties will range from high labor costs, high employee turn-over, unacceptable food costs, business levels that are declining, new competition encroaching on the property’s fair market share or a lack of capital.
20 years of hotel management experience provides our clients with higher levels of efficiency, stronger controls, reduced payroll and stronger bottom line results.
Service Highlights:
- Operational Audits
- Sales & Marketing Audits
- Cash Flow Analysis
- Staff Selections & Training
- Pre-opening Services
- Internal Audit & Controls
- Payroll Controls & Incentives
When we are asked to assist with an existing hotel, we approach the assignment as if our firm was the owner of the hotel. When we audit a property’s operations we frequently hear countless explanations as to why a specific issue isn’t being 
addressed and find solutions to those challenges.
Our belief is that the employee satisfaction and guest experience are EQUAL to the importance of profitability. Balance those beliefs through training, sales increases and cost reductions are a small part of the operational support we provide.
In short, we seek to discover how the hotel is operated, what guest and employee perceptions are and how to strengthen the bottom line.
A brief list of some of our operational consulting work follows:
* Holiday Inn - Cedar Rapids, Iowa
Full Service
Prior to beginning our assignment, the hotel had added an additional building to its configuration with over 10,000 square feet of banquet/meeting space, a new restaurant, kitchens and lounge. The hotel occupancy was below market level and F&B sales were under $400,000 per year. Through the development and implementation of new menus and niche position for the catering division, we increased banquet sales by an additional $230,000 at the end of the first year. At the end of year two, the Food & Beverage Revenues exceeded $3.2 million. Restaurant sales increased 400% by changing menu formats, implementing aggressive promotional and advertising campaigns and retraining the staff.
* Best Western/Days Inn- Cedar Falls, Iowa
Full Service
This independent hotel had positioned itself to cater to the demand generated by the nearby University. The property would be full or practically empty, depending on the seasonal needs from the college. By placing 100% of the sales efforts into the school, the hotel soon found that it had maneuvered itself out of the Cedar Falls market. Annual sales (rooms, food & beverage) were not enough to make debt service.
By analyzing the market situation, the competition and the customer demand, we implemented a new sales and marketing plan to reposition the property. Guest room sales increased from 54% to 73% (annual) and combined food and beverage sales increased by $220,000 to $1.9 million after the first 12 months. We also coordinated the transition of the hotel into the Days Inn franchise system. This included the capital improvements and on-site training.
* Sheraton Hotel – Cincinnati, Ohio
Full Service
This hotel had an annual occupancy that had declined to only 39%. The property desperately needed capital improvements but cash flow would not allow this. We first retrained the staff and employees to allow the hotel to provide exceptional service and an immaculately clean hotel.
An aggressive sales program was implemented to increase the segmented penetration in Individual Corporate and Group Leisure markets. 12 months after implementation, the hotel occupancy had increased 64% and the average daily room rate had increased by $18.25. Food sales were increased by approximately 82% while the food cost was reduced and maintained below 29%.
* Days Inn - La Crosse, Wisconsin
Full Service
We began our assignment at the Days Inn right after the hotel had lost over 7,000 annual room nights from one account. Even before this account was lost, the hotel was losing an average of $80,000 each year. The property was converted from a Ramada Inn. Even with the upgrades that were made, the hotel was only achieving a C- in its Quality Assurance inspection.
At the end of one year the following had occurred: Occupancy was increased. Rather than dropping 17 percentage points (impact of the lost business) the occupancy was increased by one point. The average room rate was increased by slightly over $8.90, restaurant sales increased by $145,000, banquet sales increased by $95,000 and liquor sales increased by $30,000 — with no capital improvements being made. All of the financial impact was driven by service levels and sales.
The property achieved and maintained a Superior rating status with Days Inns of America, profitability was maintained for the first time in 4 years.
* Holiday Inn – St. Paul, Minnesota
Full Service
At the beginning of our assignment, this 25-year-old hotel was in the process of being decertified as a Holiday Inn. The hotel was in disrepair, occupancy was under 40%, food and beverage revenues suffered due to a dated and not competitive. While overseeing the property for Barclays American Business Credit, we were able to implement the Product Improvement Plan and fund 100% of the refurbishments from cash flow. With aggressive sales work the occupancy was maintained at 69% and F&B sales were increased from $650,000 to $1,150,000 in the first year.
* Hilton Hotel – Minneapolis, Minnesota
Full Service
This suburban hotel was at the beginning of its decline when we began our assignment. New hotels were being introduced in the market and the Hilton was faced with few options. Knowing that our client’s goal was to sell the property for the strongest price, our focus was on maximizing the profits throughout the facility. Monthly food sales averaged $500,000 with a food cost of 26%. Labor was reduced in all departments while sales expenditures were increased. The public spaces received new wallpaper and carpet, as did the meeting rooms. In one year we were able to see the hotel generating over 24% higher net profit. In turn, the valuation increased.
* Radisson Hotel – Park City, Utah
Full Service
Our clients were unable to maintain a positive cash flow at this resort location. Once our assessment was completed we had to retrain the sales staff and realign the corporate philosophy as to the direction taken with the hotel’s market position. We expanded the sales efforts to focus on market segments previously ignored. This stabilized the annual occupancy and cash flow. Operating standards prioritized with a focus on exceeding the customer’s expectations in all outlets.
Some additional properties that we have been retained to evaluated and assist with the day to day operations include the following:
* Marriott Hotel – Salt Lake City, Utah
* Hilton Hotel – Denver, Colorado
* Radisson Hotel – Billings, Montana
* Holiday Inn – Helena, Montana
* Radisson Hotel – LaCrosse, Wisconsin
* Staybridge Suites – Madison, Wisconsin
* Sheraton Hotel – Minneapolis, Minnesota
* Wingate Inn & Hampton Inn – Kearney, Nebraska
* Embassy Suites – Lincoln, Nebraska
* Comfort Inn – Grafton, Wisconsin
* Embassy Suites – Chicago, Illinois
* Eagle Crest Resort & Golf Club – Redmond, Oregon
