Case Study : Finance Of The Hospitality Industry

Reducing the big increases in owners' pay is another way Be Our Guest can improve its cash position. Ultimately, the company must devise a plan for funding its growth long term. While refinanced bank loans for now may be adequate to finance the company, it should consider raising funds, from selling equity for example. Proceeds from such a deal might be invested in a business that generates revenue during Be Our Guest's slow seasons and eases the firm's reliance on credit for working capital. The company "needs a game plan". Such an outline will forecast its financial needs and how to achieve them. It also would help Be Our Guest's principals decide to what extent they even want their business to expand. The owners say that they want to grow, but that is not necessarily always a good thing. With growth bigger problems will occur, bigger challenges will need to be faced, but at the same time bigger profits might be in place

This company, a retail clothing store with three suburban locations in Atlanta, Georgia, is incorporated, with each of the three Boudoir sisters owning one-third of the outstanding stock. The company is profitable, but rapid growth has put it under severe financial strain. The real estate is all under mortgage to an insurance company, the inventory is being used under a blanket chattel mortgage to secure a bank line of credit, and the accounts receivable are all being factored. With total assets of $7 million, the company now needs an additional $450,000 to finance a building and fixtures for a new outlet.

In Task 2, the owner is correct in his need to move away from a sole proprietorship and into an entity where his personal assets will be shielded in the event of a business failure. There seem to be three major ways to remove this liability, which include a C-Corp, S-Corp and LLC. For this situation, I would recommend an LLC for the business owner and will explain why it will benefit him in the issues of liability, continuity, income taxes, profit retention and control.

Hugh is at an age where borrowing debt for investing into a business that offers no guarantee of profits is probably not a good idea. He can invest his savings with the bank at guaranteed annual interest rates that will provide him with a secure income combined with his pension. The Leeds Livery operates in a competitive and unstable industry and it has failed to fain attractive profits in the recent past years. There is a lot of work required to increase the profitability of the business which might give Hugh a hard time especially when he is borrowing money to invest in the business.

We determined the WACC of the Lodging business to be 9.70% by using the same method of analysis.

It is clear at first glance of the cash budgets that if the projections prove to be accurate, the firm will remain in good shape. It is important to note that the cash budgets provided assume a loan from the bank of $200,000 at 15%. A loan of $200,000 was chosen because it is always better to over-finance the business than to under-finance it especially in its first year of operations where sales and expenses are so volatile and could prove to be quite inaccurate. If a loan of only $150,000 or even $100,000 is secured by Robert & Alex, they should still be able to stay afloat, although they will have a harder time paying off some of the principal of the loan in the opening

In the year 2000, The Ritz-Carlton Hotel Company paired with luxury real estate developer Millennium Partners to build a $225 million hospitality complex in the heart of Washington DC. This 300-room hotel was set to be the first out of a six-hotel deal between these two companies. The structure of the deal was that Millennium Partners would be the owners of the properties and The Ritz-Carlton would manage them.

Our team chose the hotel industry in the United States for our economic analysis. The hotel business has existed since the earliest times, and has influenced the development of the economy since the founding of this country.

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.

One of the main tasks of the enterprises of various forms of ownership and spheres of activity - the search for effective ways to manage labor to ensure the activation of the human factor and achieve the best production results. The company «Hyatt Hotels Corporation» is today one of the leading companies offering hotel services. The company, headed more than 500 hotels all over the world, is of great interest as an object of study of the corporate culture, because it includes a huge number of employees (more than 30 thousand people). Hyatt Hotels and Resorts are distinguished unsurpassed quality of services precisely because of its staff. At the heart of the corporate principles of the company have the task to give our employees

Marriott International envisions itself to be the world’s lodging leader. Its mission is to provide the best possible lodging services experience to customers who vary in backgrounds, language, tradition, religion and cultures all around the world. Marriot is committed to environmental preservation through using environment-friendly technology and engages in social responsibility and community engagement.  We value our shareholder’s so we will only take steps that will ensure our growth. Most importantly, through our “spirit to serve”, we emphasize the importance of Marriott’s people and recognize the value they bring to the organization’s growth and success. It aims to increase revenues by 9% every year, to increase

The Marriott Corporation, an American firm, was founded in 1927 by J.Willard Marriot.The company began as a small beer stand and soon began to sell food and provided lodging that expanded rapidly. With the help of his wife Alice, the family owned business had 45 restaurants in nine states by 1940 and grew into one of the leading service companies. The Company has three major lines of business: lodging, contract service and restaurants.

Corporate financial decision is a crucial component of strategies that firms adopt to access funds in the external capital market to undertake new investment, for dividend payments, to maintain capital structure, for acquisition purposes, cash savings as precaution, among others. UniHost Corporation; the largest motel and hotel franchise in Canada is faced with a requirement to raise capital. UniHost is involved in the development, syndication, franchising and management of motels and hotels in Canada of which most are flagged under the Quality and Comfort brands. There are several options that the corporation can apply to raise capital ranging from debt financing, convertible bonds and high yield debt (DeThomas, 1992). The strengths of these financial options are outlined and the reasons for their recommendation in this situation are outlined in the succeeding paragraphs.

Wynn Resorts Limited (Wynn) is high-end developer and operator of resort-style casinos. Wynn offers hotel rooms and suites, gambling, fine-dining, spas, and boutiques. Founded in 2002 by American business magnate Steve Wynn, the company currently has two locations in Las Vegas, Nevada and two locations Macau, China. In 2016, Wynn plans to open Wynn Palace, a 1,700 room hotel and casino in Macau. The company is publicly traded on the NASDAQ Global Select Market under the ticker symbol WYNN.

1. An international bank loaned money to an emerging country a few years ago. Because of the nonpayment of interest due on this loan, the bank is now negotiating with the borrower to exchange the loan for Brady bonds. The Brady bonds that would be issued would be either par bonds or discount bonds with the same time to maturity.