Assignment 2 : Costing And Pricing

In relation to hospitality and catering, the non-commercial or “public” sector exists in the form of hospitals and institutes of education. Organisations in the commercial sector are privately owned and exist solely to find a niche to exploit to make money. While money-making is still a factor in the private sector, it is not the main goal. With the primary goal, demographic and expectations of the target audience, along with location and budget, all taken into account, different areas of the hospitality and catering industry begin to differ widely.

3. Andy is trying to decide which one of two job offers he will accept.

1. One reason for the high turnover rate of hospitality staff is the fact that many hospitality jobs do not pay well. Personnel usually begin at a lowest wage rate or below which does not fascinate top eminence long-term employees because these employees are always looking for a better paying position. Situations that pay below tiniest net depend entirely on customer satisfaction and liberality. “Tips”. Around the world, the average beginning wait staff personnel is paid $2.15 per hour by their employer. The rest of their revenue is based pay on the urge of their customers. Monetary turn-downs mean fewer consumers, which in turn shrinkage is wage potential. Add this to the fact that many hospitality positions are seasonal and it is not hard to see why hospitality staff turnover can reach high rates quickly.

The hotel increases it revenue through offering its catering services to conferences, meetings, events and weddings. The outside catering segment of the business has enabled the hotel to cover its expenses and generate adequate revenue for the business. The hotel has acquired transportation facilities and outside catering equipment to ensure that the business continues to attract new customers. The mobile catering unit is advertised using the media and posters about the company in the market. The hotel has also employed sales agents to market the company in the local market. The agents are paid on commission basis making the organization save on basic pay (Markman, 2010).

Be Our Guest is a growing firm specializing in providing high-end equipment and services to catering firms. The company is considering its financial needs and appropriate capital structure to ensure available funding for growth and flexibility as well as to meet the day-to-day needs of its highly seasonal business. This paper attempts to analyze the key success factors of the firm and assess the appropriate funding levels from both the company?s perspective as well as that of the bank.

Moreover, financial benefit can be made on any price that is above the direct cost, which in this instant is the €25 variable cost, signifying benefit on any price above €25. With most hotels, and from the financial statements, we know that the Terminus hotel makes a profit from the restaurant business. This as well should be included in determining the Average Daily Spend for a guest, over and above the room rate.

1. Suppose the price of coffee beans increases by $0.20 per pound. What is the effect of this raw material price increase on the demand for roasted coffee? If one pound produces 50 cups of coffee, would the price of a cup of coffee rising by $0.01? Explain.

Finance in the hospitality industry is one of the most, if not thee most important role inside the industry. The finance keeps the entity alive, keeps the business afloat. Without the finance department, the business would never know where they money was going, if they were positive or negative with other accounts payable. Finance is the management of large amounts of money. With this definition, finance is important because inside the hospitality industry they take in and push out large amounts of money. Without the role of finance, an industry would never know where the money is going, how to balance the money, and also in which areas the income should be spent. Functions, benefits, and growth of the company can solidify, but with the positives come the negatives in the role of finance inside the hospitality industry.

price and the extra 68 cents goes to the bottom line Up-selling. In the hospitality industry, more emphasis is placed on training employees to become better sales people. The waiter, hostess, and bar-at tender become extensions of their sales and marketing team. Now up-selling has become the industry standard, as side dishes, appetizers, desserts and drinks all help in building a higher average cheque per customer. Your server is trained to ask if you want to add mushrooms or prawns to your steak dinner, or to try a specialty coffee with your dessert. Some restaurants expect their servers to suggest bottled water or Perrier when you ask for water, and offer a bottle of wine instead of the two glasses you asked for. The best servers take every opportunity to up-sell you on an item. I had to say, “No thanks”, at least a half dozen times during our last restaurant experience so as to be able to go back home with some money

The following equation -- Beginning finished goods + cost of goods manufactured - ending finished goods -- is used to calculate cost of goods sold during the period.

In recent years, numerous tools such as activity-based costing, the balanced score card and target costing have gained prominence in the business community. Nonetheless, traditional management accounting continues to be prevalent in practice. One example is standard costing, which has been used on a wide front during the last century.

Currently, TVD offers up-market fast food with average service and not a very high quality of food. To achieve a higher standard of performance, TVD should look at one of the most successful restaurants throughout the UK according to customers’ feedback – Nando’s. In twelve years, Nando’s has grown rapidly to operate more than 120 restaurants within the UK. The main reason for Nando’s success is their high quality of food and customer service. By analyzing the reasons for their success, TVD could learn from an organisation that is at the “leading edge”.

This is an assignment on the general overview of the front of house and house keeping services in different types of hospitality businesses. I have chosen to talk about a B & B and a luxury 5 star hotel, the roles and responsibilities of these departments and the legal statutory requirements for room division operations.

In order to understand the effects of opening the catering business, I looked at variable and absorption costing to figure out which method would be better suited for internal and external reporting in the past and future. In addition, I delved deeper to understand the cost breakdown of the new products which helped form a capital budget that will help us determine the validity of opening the catering business.

Erin should notify Smart Worx of the postponement as it is consistent with ethical principles of integrity and professional competence. As Erin is complying with these codes of ethics, she has nothing to lose or suffer as she followed the guidelines of the code and therefore cannot be