Hospitality Operations

2488 Words Apr 13th, 2011 10 Pages
Contents page
Title page.....................................................................................................................................PG.1
Contents page .............................................................................................................................PG.2
Summary .....................................................................................................................................PG.3
Introduction .................................................................................................................................PG.4
Pricing and profitability concepts;
Pricing of product or service
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Below are a few factors that have to be considered before the product/ service is verified;
1. Location; the accessibility and convenience, freedom from noise and other nuisances
2. Facilities; differentiating form other competitors offering a unique service, which include, restaurants, tennis courts etc.
3. Image; the way Premier Inn portrays and the way in which it is perceived, factors such as, atmosphere, name, word of mouth and most importantly what Premier Inn says about itself.
4. Price; the value given by the hotel
There are vary elements of customer perception of the business, a recent example is a person may regard location and accept the basic facilities as long as the price is within a limit to which a customer is willing to pay.
Pricing is the key ingredient to repeat business if not analysed or maintained correctly; existing customers will eventually leave and move to a competitor, this will result into a bad reputation and not appeal to potentially new customers.
• Charging too much – people will not buy
• Charging too little – will not make a profit (Marco Van Dyk sessions slides)

In order to price the new central reservation system in Premier Inn is more practical to use a cost oriented approach also in some circumstances the market orientated approach. A cost orientated
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