External and Internal Impacts on a Hotel

External and Internal Impacts on a Hotel Price is the sum of the values consumers exchange for the benefits of having or using the product or service and is the only marketing element that produce revenue. Therefore managers must have an understanding of price in order to formulate their pricing strategies. Pricing strategy integrates marketing and finance in an attempt to create mutual satisfaction to both buyer and seller. The product or service attributes must be combined with price to provide enough value to satisfy customers while enabling the firm to cover costs and make an adequate profit. There are several factors that the hotel must consider when setting the prices. These factors are categorized in two groups: internal and external factors. Internal factors: Marketing objectives: the hotel must select a product strategy before establishing the price. The strategic decisions on market positioning have a major influence on price thats why the hotel should be clear about its objectives in order to set the prices easier. These objectives are: Survival is used when the economy slumps or a recession is going on. The hotel in this case can cut the rates to create the best cash flow. Current profit maximization: many companies want to set a price that will produce the maximum current profit, cash flow and seeking for financial outcomes rather than long-run performance. Market-share leadership: when companies believe that a company with the largest market share will eventually enjoy low costs and high long-run profit, they set low opening rates and strive to be the market-share leader. Product-quality leadership: hotels like Grecotel chain charge a high price for their high-cost products to capture the luxury market. Other objectives are: stabilize market, create excitement for new product and draw more attention. Marketing mix strategy refers to the coordination of price with product design, distribution and promotion decisions in order to form an effective marketing program. A hotel should consider all marketing mix decisions together when developing a marketing program. Costs: all companies set their prices in order to cover their costs and to make profit. The hotel needs to charge a price that covers its costs for producing, distributing and promoting the product. Costs take two forms, fixed and variable costs. Fixed costs are costs that remain the same no matter of the sales level of a hotel, such as depreciation, insurance, interest, rent, salaries, and wages. Variable costs are costs that change with the level of production, such as raw material, distribution costs, energy usage and labor. Organizational considerations: management should decide who within the hotel should set the prices. Usually in small hotels the top management is the one who will take the decisions about the prices. On the other hand, large hotels have a revenue management department and its responsibility is to set the prices and to coordinate with the departments that influence price. External factors: Nature of the market and demand: costs set the lower limits of prices and the market and demand set the upper limit. Consumers and buyers use to balance the products price against the benefits it provides and this is the reason why the marketers before setting the prices must understand the relationship between price and demand for a product. Marketers before setting the prices should consider also the following elements that are related with market and the demand: The hotel can use cross-selling, which is the encouragement of a customer who buys a product to buy a related or complementary product. Up-selling is another technique that the hotel can use and in order to do that the hotel must train the sales and reservation employees to offer continuously a higher-priced product that will better meet the customer needs, rather than setting for the lowest price. Consumer perception of price and value: it is the consumer who decides whether a products price is right. When setting prices, the hotel must consider how customers perceive price and the ways that these perceptions affect customers buying decisions, that means that the price must be buyer oriented. The price decision requires a creative awareness of the target market and recognition of the differences between the buyers. Analyzing the price-demand relationship: the higher the price for a product or service is, the lower the demand for this product. Price elasticity of demand: the hotel must understand how responsive demand will be to a change in price. If demand hardly varies with a small change in price, the demand is inelastic, if demand changes greatly, the demand is elastic. Buyers are also less price-sensitive when the product is unique or when it is high in quality. Consumers are also less price-sensitive when substitute products are hard to find. In case that the demand is elastic the sellers tend to lower the prices in order to produce more revenue. There are several factors that affect price sensitivity: Unique value effect: creating the perception that your offering is different from those of your competitors avoids price competition. Substitute awareness effect: lack of the awareness of the existence of alternatives reduces price sensitivity. Business expenditure effect: when someone else pays the bill, the customer is less price-sensitive. End-benefit effect: when the price of the product accounts for a large share of the total cost of the end benefit, the consumers are more price-sensitive. Total expenditure effect: the more you pay for a product, the more sensitive you are for the products price. Sunk cost effect: purchasers who have an investment in products that they are currently using are less likely to change for price reasons. Price quality effect: consumers usually equate the price with the quality of a product, especially in case that the buy the product for first time. Competition: the hotel should consider the prices and offers that the competitors have before deciding its own pricing. The hotel should make a research and collect information for the existing hotels and other hospitality establishments in the area, as concern their prices and the products that they offer. Other environmental factors: economic factors such as inflation, boom or recession and interest rates affect pricing decisions. Meeting new government regulations can cause costs to increase or governments can streamline processes, reducing costs. Companies set prices by selecting a general pricing approach that includes the following: Cost Based Prices Competition Based Pricing Prestige Pricing Market-Skimming Pricing Market Penetration Pricing Product Bundle Pricing Volume Discounts Discounts Based on Time of Purchase Discriminatory Pricing Explain briefly the different strategies with examples from the hospitality industry. Cost based pricing is a method in which a fixed sum or a percentage of the total cost is added to the cost of the product to arrive at its selling price. For example, in hotels the F B manager use this method in order to decide the selling price for wines. They usually multiply the cost of the wine by 3 to make its selling price. A wine that is cost 20à ¢Ã¢â‚¬Å¡Ã‚ ¬*3=60à ¢Ã¢â‚¬Å¡Ã‚ ¬ à ¢Ã¢â‚¬  Ã¢â‚¬â„¢ is the price that the hotel is going to sell the wine. Competition based pricing is a price set by a company for a product to compete other companies pricing, with less attention paid to own costs or the customer demand. The hotel may charge the same, more or less than its competitors. An example here is same category hotels which offer similar products and services, compete each other by offering better prices in order to attract more guests. Prestige pricing is a pricing strategy in which prices are set at a high level, recognizing that lower prices will slow down the sales but on the other hand consumers will associate a high price for the product with higher quality. High quality hotels and restaurants use this method of pricing in order to support their position as luxurious and elegant and these establishments usually targeted in a higher level market which interested in superior services. In case that the establishment lowers its prices, there is a great possibility to lose its customers. Market skimming pricing is a pricing approach which is setting a high price when the market is price-sensitive to attract buyers with a strong desire for the product and the resources to buy it. This pricing method is used more in industries with high research and development costs such as computer firms. An example in hospitality industry is the hotels in Araxova during the winter season. In that period, hotels are setting higher prices because the demand for snow activities is higher, knowing that the strong desire for these activities will lead the consumers to pay. Market penetration pricing is a method which is setting lower initial price to penetrate the market quickly and deeply, attracting many buyers and winning a large market share. For example a new hotel can open with lower prices than its competitors in order to attract more guests. Product bundle pricing is a strategy in which various products sold to a customer together and are offered in a price less than the sum of the prices of the products sold individually. An example here is when a hotel sells weekend packages in special prices which include room and meals. Volume discounts is a method used most from the hotels in which hotels have special rates to attract customers who are likely to purchase a large quantity of hotel rooms, either for a single period or throughout a year. For example, hotels usually offer special prices to corporate meeting planners. In such cases hotels can give the rooms with lower rates or make a deal with the meeting planner in every 20 rooms booked one is free. A discount based on the time of purchase is a price reduction to buyers who purchase goods when the demand is lower. For example a hotel offers seasonal discounts in periods where the demand is lower in order to keep demand steady during the year. Discriminatory pricing often involves discrimination on the bases of race, religion, age or gender. Segmentation of the market and pricing differences based on price elasticity characteristics of the segments. In discriminatory pricing the company sells a product at two or more prices, although the difference in price is not based in cost. It maximizes the amount that each customer pays. For example a hotel can sell the same room in different prices depend on several facts: if a guest is a repeater usually the hotel offer a lower price for the room, if a guest book a room for first time may the hotel charge the room in a higher price, if a guest book two or more rooms the hotel usually gives better prices for the room. In the hospitality industry we have numerous examples of price discrimination.

Marissa Nunez Essay

1.Marissa Nunez had been working for two years at McDonald’s when she wrote â€Å"Climbing the Golden Arches†. This experience had many effects on her. For example; she learned many things like you have to start from the bottom to work your way up to the top. She learned this because from working at McDonald’s, there are many things that need to be done. Sometimes, you have to fill in for someone, even if that isn’t your position so it is best to know all of the jobs at the business . 2.Marissa found many work experiences to be useful for situations in the future. For example; many customers can be very rude and mean. One customer called her a name, and told her to mind her own business when all Marissa was trying to do was help her. Even though the customer called her a bad name and was giving her trouble, she kept quiet and got the manager to deal with the situation. If she said something to the customer, she would have gotten into trouble. This shows that she knows how to handle situations and sometimes it is best to keep your mouth closed because its not worth losing your job over. 3.By working at McDonald’s, Marissa hopes to become a manager at McDonald’s. To achieve this goal, Marissa plans on continuing to attend the class that is required. In this class she gets observed on how well she deals with customers, and then gets a grade on how well she does. Marissa also has to take an exam to become a manager. By doing all of these things, Marissa can achieve her goal of being manager. Words and Figures of Speech: 1.Marissa puts â€Å"battle of the sexes† in quotation marks because it is the name of a game. 2.In connection with restaurant work, the word station means a part of the restaurant. For example; in the reading a station is the grill, then the cash register. 3.The word â€Å"Arches† in the essay title, means that someone’s career goals have many ups and downs leading to the goal but you have to work through it to be successful. â€Å"Golden† means the good things that happen while you’re working your way up to the top to your goal. 4.In this essay, Marissa defines â€Å"fun† as the store being closed for remodeling, and the grand opening was about to happen. Another example of  Ã¢â‚¬Å"fun† to Marissa was having a â€Å"battle of the sexes† at work. This shows that she really loves work, and the people that she works with.

Suffolk County Legislators

Today, we are in an age where local government is extremely important. Each county of every state has elected legislators that represent town throughout that county. I have selected two legislators which are both republican. The first is Cameron Alden a 49 year old man that represents the greater Bay Shore Area. He is also on the Conservative and Independence lines. The second legislator is Angie Carpenter, a very nice lady, that represents West Islip. Cameron Alden was born on August 28, 1950, in Bay Shore and grew up in Islip, Long Island, New York. He graduated Islip High School in 1968, where he played varsity football, basketball and baseball. Mr. Alden graduated from Suffolk County Community College in 1970 with an AA degree. He was a member of the SCCC varsity baseball team. Mr. Alden graduated from Dowling College in 1974. He was a member of the Pi Alpha Sigma Honor Society and played varsity basketball and golf Mr. Alden attended Tuoro Law School, graduating in 1990 with a Juris Doctor. He was admitted to the New York State Bar in 1991. (www.co.suffolk.ny.us) Prior to attending Law School he was a local Bay Shore business owner. A catering/grocery store and school bus companies were among those he owned. (www.co.suffolk.ny.us) Alden chose community-development work after undergoing a mastectomy during a bout with male breast cancer in law school, which â€Å"totally changed my focus† to an interest in public service.(Interview) He practiced law at the Town of Islip Community Development Agency, which provides affordable housing and economic development projects in the Town of Islip. He is a former Assistant Town Attorney for the Town of Islip. Cameron Alden was elected to serve as a Legislator for the Tenth District and sworn into office January 2, 1998. Legislator Alden has been selected by his colleagues to serve as Vice-Chairman of the Parks/Land Preservation and Planning Committee. In addition Legislator Alden is a member of the Energy/Environment and Transportation, Health and Human Services, Public Works, and Finance Committees. (www.co.suffolk.ny.us) The 10th Suffolk County Legislative District (L.D.) serves Islip, East Islip, Bay Shore and Brentwood. There are 52 election districts (E.D.s) with 33,058 registered voters. (www.co.suffolk.ny.us) Alden says his primary focus would be to ease the burdens on taxpayers. A critic of the LILCO-LIPA deal, Alden admits he does not yet have many specific legislative initiatives but says he is the better candidate because his fiscal policies would be more conservative. (Interview) Currently Cameron is working on a proposed bill that would support the elimination of taxes on clothing in Suffolk county. This proposed bill would enable signs 6to be erected throughout Nassau asking consumers to come shop in Suffolk due to its no lax bill as long as the clothing items are under one hundred and ten dollars. He has also worked on such other bill like trying to raise the salaries of Suffolk county legislators because he fells they are underpaid. Mr. Alden does not really receive a large amount or Pac money from anyone but he does have many supporters. These supporters include the Police and other safety bureaus and also many factory unions. (Interview) Angie Carpenter was born on Long Island in the mid fifties and is currently happily married and a mother of two. (Interview) Angie's dedication to the community is what led to her nomination to run for the Legislature, a position she has held since February 1993. (Interview) Legislator Angie M. Carpenter is founder of ACT Communications Group, a full-service advertising and marketing company specializing in multi-media graphic design and printing. The business is currently run by her sons Richard and Robert enabling her to devote her attention full-time to her duties as an elected official in Suffolk Government, but still affording her the opportunity to remain sensitive to the concerns of the business community. (www.co.suffolk.ny.us) Angie continues to devote her time and efforts to her community and constituents. As former Chairman of the Legislature's Economic Development and Education Committee, Angie Carpenter worked to bring the Touro School of Health Services to downtown Bay Shore which is opening early in 1999. She has worked tirelessly to increase aid to Suffolk Community College, and led the fight to cut tuition costs so that the college is affordable for all of our residents. (www.co.suffolk.ny.us) She continues in her role as an avid supporter of the college and is extremely proud of the fact that the fastest growing campus of Suffolk County Community College is in her legislative district. Angie worked from the beginning, to see the construction of the $54 million-dollar Health and Technology Building scheduled to be completed in the Fall Semester of 2000 (Interview). Angie has almost served every committee during her tenure on the Suffolk County Legislature. Currently Angie is serving as the Legislature's Budget Committee Chairman, and Vice Chairman of the Public Safety Committee. She continues to serve as a member of the Economic Development and Education Committee, Budget Committee, Consumer Protection, Labor and Investigations, and Veterans and Seniors, as well as the Public Safety Committee, Parks, Planning and Land Preservation Committee, the Health and Human Service Committee, Sports Committee, and the Public Works Committee. (www.co.suffolk.ny.us) In the past, Angie has helped in implementing a mass transportation public information program for Suffolk County, enacted a linked Deposit Program to promote local business expansion, directed the County Health Department to provide free testing for prostate cancer and cosponsored a resolution to provide environmentally safe golf course management to help protect our groundwater and hopefully help reduce the risk of breast cancer. (www.co.suffolk.ny.us) She has made efforts to invest in the county†s Timber Point Golf Course to maximize its economic potential and preserve jobs for the county workers employed there. (Interview) Most recently, Angie co-sponsored legislation to rollback sales tax on clothing and shoe purchases under on hundred and ten dollars per item. Angie has also sponsored a resolution to â€Å"boot† the vehicles of deadbeat parents that are not complying with the child support payments. This â€Å"booting† of cars is huge lock that goes over the tire and wheel and makes automobile impossible to drive. A resolution that Angie sponsored last year now requires the Suffolk County Health department to hold annual Public Hearing and Health Fair. This gives government an opportunity to hear first hand from our residents about the County†s health care delivery system and also raises public awareness or what is available. (Interview) Over the years, Angie's commitment to her community has been recognized time and again with honors from Islip Town, Boy Scouts of America, Loyal Order of the Moose, The American Legion, Pronto, Zonta International, the West Islip and Bay Shore School Districts and Suffolk County Arts Council, to name a few. She has been involved in the community as President and founder of the Chamber Council of Islip Town, President of the West Islip Chamber of Commerce, Vanderbilt Museum Trustee, Board of Our Lady of Consolation, Salvation Army, Youth Enrichment Services and ASK US (an after school care program in West Islip). (www.co.suffolk.ny.us) Angie has dedicated her efforts to the growth and expansion of business here in Suffolk. She has brought education to the forefront as one of the many issues addressed under her leadership, and continues her unwavering commitment to her family, community, and those she was elected to serve. (www.co.suffolk.ny.us) She receives her support from many people including the Police, the Suffolk County UNE, and many other unions countywide. (Interview) Legislators, Cameron and Angie are very willing to do what their people are asking for and sacrifice a lot of their time to make their residents happy. In my own opinion I think Angie Carpenter is a better Legislator than Cameron Alden because I feel Angie had sponsored and produced more bills than he has and in my eyes she is a nicer and more heart worthy person.

The Scale Of Global Climate Disruption Essay - 1591 Words

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