Chapter 4 - Reservations

Question 1

What is the main objective of the reservations process?

Answer 1

To provide the highest occupancy and room revenue possible.

Question 2

What does processing reservations involve?

Answer 2

1.Formulating the reservation inquiry
2.Determining room rate and availability
3.Creating the reservation record
4.Confirming the reservation record
5.Maintaining the reservation record
6.Producing reservation reports

Question 3

What is a revenue manager responsible for?

Answer 3

A revenue manager is responsible for forecasting demand for each market segment a hotel seeks to attract as well as determining the guest room rates that will provide sufficient room revenues and occupancies.

Question 4

With which departments should a revenue manager coordinate with?

Answer 4

The revenue manager must coordinate efforts with the reservations, front office and sale departments to ensure a common base of operational information.

Question 5

What does revenue management entail?

Answer 5

Revenue management entails gathering forecasted sales information and using it to determine room rate strategies.

Question 6

What is the primary source of reservations for a hotel?

Answer 6

The sales department, however many hotels currently view the reservations as part of the sales department.

Question 7

What is the job of a sales agent in the sales department?

Answer 7

To familiarise local businesses and travel agencies with the features and benefits of the hotel. If the company agrees to provide the hotel with a specific amount of business, it is often given discounted rates.

Question 8

Why should sale objectives and incentives be related to the total revenue a sales manager generates?

Answer 8

To prevent sale managers from selling guest rooms at low rates just to meet room-nights sold quotas.

Question 9

Describe the reservation sales planning process?

Answer 9

-During the annual budgeting process the mix of group and transient reservations a hotel accepts is discussed as this affects the total room revenue.
-Hotels are generally focused on group sales and allocates a specific number of group rooms to sell (group allocation).
-The sales department is allowed to sell the rooms within the group allocation, however if they desire to sell more rooms then set aside they then need the approval of the hotel’s sales director.
-The reservations manager is usually the person who evaluates these requests and reports on their potential financial impact to room revenue forecasts.

Question 10

What two categories can reservations be categorised as?

Answer 10

Guaranteed or Non-guaranteed

Question 11

Explain what a guaranteed reservations is?

Answer 11

A guaranteed reservations assures that the hotel will hold a room. The guest, in return, guarantees to pay for the room, even if it is not used, unless the reservation is cancelled according to the hotels cancellation policies and procedures.

Question 12

What is meant by the term no-show?

Answer 12

A no-show is situation in which a guest makes a reservation but does not register or cancel the reservation.

Question 13

Name the five types of payment options for guaranteed reservations?

Answer 13

1.Prepayment
2.Payment Card
3.Advance Deposit
4.Voucher or MCO
5.Corporate

Question 14

Explain a prepayment guaranteed reservation?

Answer 14

A prepayment guaranteed reservation requires that a payment in full be received prior to the guests day of arrival at the hotel.

Question 15

Explain a payment card guaranteed reservation?

Answer 15

Unless a credit or debit card guaranteed reservation is properly cancelled before a stated cancellation hour, the hotel will charge the guests payment card account for one nights room rate + tax; the card company will then bill the cardholder.

Question 16

Explain an advance deposit guaranteed reservation?

Answer 16

An advance deposit guaranteed reservation requires that the guest pay the hotel a specified amount of money prior to arrival. The deposit amount is typically one nights room rate + tax. if a guest fails to register or cancel the reservation, the hotel may retain the deposit and cancel the reservation for the remainder of the guests stay.

Question 17

Explain a voucher or MCO guaranteed reservation?

Answer 17

With travel agency vouchers and MCO’s, the guest has prepaid the deposit to the travel agent. The agent forwards a voucher or MCO to the hotel as proof of payment and a guarantee that the prepaid amount will be sent to the hotel when the voucher is returned to the travel agency for payment.

Question 18

What is a MCO voucher?

Answer 18

Miscellaneous Charge Order (MCO). The MCO is a voucher that is issued by the Airline Reporting Corporation (ARC). ARC guarantees payment if the travel agency defaults on payment.

Question 19

Explain a corporate guaranteed reservation?

Answer 19

A corporation may sign a contractual agreement with the hotel that states that the corporation will accept financial responsibility for any no-show business travellers the corporation sponsors.

Question 20

Explain non-guaranteed reservations?

Answer 20

In the case of a non-guaranteed reservation, the hotel agrees to hold a room for the guest until a stated reservation cancellation hour on the day of arrival. If the guest does not arrive by the cancellation hour, the hotel can release the room for sale. If the guest arrives after the cancellation hour, the hotel will accommodate the guest only if a room is available.

Question 21

What is reservation inquiry?

Answer 21

A process in which a reservation agent or website collects information about a potentials guests stay.

Question 22

Name the six distribution channels that reservation inquiries may come through?

Answer 22

1.Property Reservations Department (Property Direct Reservations)
2.Central Reservations System
3.Cluster Reservations Office
4.Global Distribution System (Airline and Travel Agent Network)
5.Intersell Agency
6.Internet Distribution Systems

Question 23

What is the reservations department main task?

Answer 23

The reservation department handles direct requests for accommodations, monitors any communication links with central reservations systems and intersell agencies and maintains updated room availability information.

Question 24

What is one important quality of a successful reservations office?

Answer 24

The create a positive image of the hotel and instill a desire on the part of the caller to make a reservation, therefore the reservation agents are trained to sell the hotel instead of being merely order-takers.

Question 25

Describe a brief overview of the reservations agents sale process?

Answer 25

Most hotels have specific sale procedures for reservations agents to use when taking a reservation from a caller. For example: 1.Greet the caller 2.Identify the callers needs 3.Provide an overview of the hotels features and benefits, based on the callers needs 4.Propose a room recommendation and adjust it according to the callers response 5.Close the sale 6.Gather the reservation information 7.Thank the caller

Question 26

What is a central reservation system?

Answer 26

Majority of hotels belong to one or more central reservations systems. A central reservations system or CRS is responsible for maintaining a room availability inventory for each property participating in the system.

Question 27

What are the two basic types of central reservations systems?

Answer 27

Affiliate networks and Non-affiliate networks.

Question 28

What is an affiliate reservation network?

Answer 28

An affiliate reservation network is a hotel chain reservations system in which all participating properties are contractually related.

Question 29

What is a non-affiliate reservation network?

Answer 29

A non-affiliate reservation network is a subscription system designed to connect independent or non-chain properties.

Question 30

What is the main task of central reservations offices (CRO)?

Answer 30

Central reservations offices typically exchange room availability information with member hotels and communicate reservation transactions as they occur. In this way, reservations information is immediately transmitted between the central reservations system and the hotels property management systems.

Question 31

What is a cluster reservations office?

Answer 31

Chain hotels in the same geographic area may opt to establish a single cluster reservation office. The CRO serves one specific destination area instead of the entire company.

Question 32

What is a global distribution system?

Answer 32

GDS provides a platform for selling hotel reservations worldwide. Most central reservation systems connect with one of the global distribution systems.

Question 33

What is a intersell agency?

Answer 33

An intersell agency is a reservation system alternative to a GDS that contracts to handle reservations for more than one product line e.g car rental companies.

Question 34

What is an internet distribution system?

Answer 34

Many hotels offer online reservation services through an internet distribution system. IDS enables travellers to use desktop and mobile devices to reserve hotel rooms.

Question 35

How do distribution channels receive revenue?

Answer 35

Central reservation offices either charge a fixed rate per night per room or a transactions fee based on the reservation activity, or both. GDS and IDS receive revenues through commissions.

Question 36

What is the main objective of using various distribution channels for the hotel?

Answer 36

The objective is to offset associated commissions and other fees with an increase in occupancy and overall room revenue.

Question 37

Describe a brief overview of group reservations process?

Answer 37

-When a group selects a hotel the groups representative deals with the hotels sale's or reservations department. -There will be an agreed upon number of guest rooms which is called a block. -A contract will be created specifying the exact amount of rooms required and the quoted rates. -As group members reserve the rooms in the block, the reserved room is referred to as booked. -Unreserved rooms in the block may be released to the hotel at the groups reservations cut-off date.

Question 38

What is the difference between a definite group and a tentative group?

Answer 38

A definite group is a group that has signed a sales contract. A tentative group is a group that has not yet signed or returned the contract to the hotel.

Question 39

What is city-wide conventions?

Answer 39

City-wide conventions is when conventions take rooms at many hotels in a city. The convention and visitors bureau try to accommodate all attendees by coordinating hotel availabilities with reservations requests.

Question 40

Explain the purpose of Attendee Management and Housing System softwares?

Answer 40

The software allows the group leader to create a special website that provides information about the group event and reservations availability. The attendee management application focuses on meeting registration activities while the housing application is designed to handle guest room reservations.

Question 41

Explain the overbooking strategy?

Answer 41

Overbooking is a strategy aimed at helping the hotel to achieve 100% occupancy by hedging against guests who do not arrive or cancel their reservations. Depending on the hotels no-show reservation history, management may allow the reservations system to overbook.

Question 42

What is the biggest advantage of an automated reservations system?

Answer 42

Front desk transactions involving no-shows, early departures, or walk-ins will immediately update the room availability. This is important as it provides sales managers with the occupancy and room-rate information they need to help them achieve revenue objectives.

Question 43

What is a reservation record?

Answer 43

Reservation records identify guests and their occupancy needs before the guests arrival. The records enable the hotel to personalise guest service and schedule staff more accurately.

Question 44

What is the purpose of a reservation confirmation number?

Answer 44

The reservation confirmation number provides both the guest and the hotel with a unique reference for the reservation record.

Question 45

Why is the confirmation notice an important channel of communication for disabled guests?

Answer 45

It assures these guests that their special needs are understood and the accommodation they need will be ready. Hotels often categorise guest rooms that are specially equipped for disabled guests in a separate inventory classification for improved control.

Question 46

What is the purpose of a reservation cancellation number?

Answer 46

In the event of any future misunderstandings, the assignment of a reservation cancellation number can prove that the hotel received the cancellation within policy guidelines.

Question 47

What is a reservation transaction report?

Answer 47

This report summarises daily reservations activity in terms of reservation record creation, modification and cancellations.

Question 48

What is a commission agent report?

Answer 48

This report tracks the amounts the hotel owes for business booked at the hotel to each agent with a contractual agreement.

Question 49

What is the difference between regrets and denials reports?

Answer 49

Regrets are recorded when guests choose not to make a reservation. Denials are recorded when the hotel is unable to accept a reservation request.

Question 50

What is a revenue forecast report?

Answer 50

This report projects future revenue by multiplying predicted occupancies by room rates.

Question 51

How does expected arrival and departure lists impact the front desk?

Answer 51

Front desk agents depend on having expected arrival information to facilitate a efficient guest registration process. Similarly, expected departure information can be used to anticipate guest account settlement and check-out.

Question 52

Why are promotional packages considered a bargain and convenience?

Answer 52

These packages always include the guest room plus optional features. Therefore, guests don't have to arrange to separately purchase the items and activities offered in the package.

Question 53

Explain mobile bookings?

Answer 53

A majority of hotels now have a mobile website that contains location awareness features. The application is capable of providing the hotel application with auto-identification via the GPS position of the device and communicate information to existing or prospective hotel guests.

Question 54

Explain what e-commerce is?

Answer 54

E-commerce is the hotels presence in multiple distribution channels and its direct access to the consumer through the internet. The difficult part of e-commerce is knowing which sites provide the best distribution opportunities.

Question 55

What is single image inventory?

Answer 55

Single image inventory means that all reservation distribution channels draw from the same room availability, rate rules, services and amenities information. When using single image inventory, all sellers base transactions against identical information.

Question 56

Explain the merchant model?

Answer 56

The merchant model, also called the markup model, is a hotel e-commerce strategy for an online intermediary, such as an IDS.The participating hotel is asked by the online seller to provide rooms at a discount below the rate normally charged for.

Question 57

Explain the wholesaler model?

Answer 57

With the wholesaler model, the hotel tends to maintain greater control over its room price, as a commission is paid to the wholesaler based on a percentage of the hotels net rate. The hotel sets the selling price and the wholesaler receives an agreed upon sales commission.

Question 58

Explain how opaque sites function?

Answer 58

Opaque sites often work on an auction basis. Potential guests may specify a rate they are willing to pay and the site then works with available inventory within the guests specified quality rating and price range. With opaque website the brand of the hotel and its features are hidden from the buyer until the transaction is completed.

Question 59

Explain how transparent sites function?

Answer 59

As with opaque sites, rooms at transparent sites are classified based on room rate or star ranking. But transparent sites reveal the identity of hotels before buyers make a purchase.

Question 60

What is a guaranteed rate program?

Answer 60

A guaranteed rate program applies to all distribution channels except opaque sites and assures the traveler that the lowest online rate appears on the hotel website. Should a traveler find a lower rate for the same room for the same date, the hotel will compensate the traveler.