In the next 3-5 years to come, the management is purposed to position the hotel closer to a 3-star hotel. Positioning the hotel as a 3-star hotel means that the management has to work on the following core values for improved efficiency and performance.
- Integrity - the hotel will continue to be honest to all the stakeholders with whom we interact.
- Exceptional hotel services - services to the guests to be made outstanding compared with company's competitors.
- Continued improvement - the management will be committed to creativity on our products, services, and management techniques.
- Teamwork - the hotel is having a committed and a passionate team that is dedicated to bringing their expertise and passion towards the success of the hotel.
According to Milohnic and Grzinic (2010), small hotels competitiveness advantage is based on their qualifying offer. At this moment, the hotel's competitive advantage will be based on the quality of our services. Further, hotel competitive advantage will be based on the cost affordability, teamwork, unique quality and services, effective communication channels within and outside the hotel, creativity, and innovation, and employees' development to retain the best workforce for extemporary services.
For the first quarter, January, February, and March, financial results were as follows;
Table 1: 1st Quarter Analysis
|Market share (rooms)||20.82%||29.29%||18.25%|
The market share concerning rooms sold was 20.82%, 29.29%, and 18.25% respectively. It can be noted that the market share concerning rooms sold increased in February by 8.47% but declined in March by 11.04% from February. Further, gross operating profit in January, February, and March was 32.18%, 13.1%, and 44.07% respectively. GOP declined in February by 19.08% and improved again in 30.97%. Moreover, ROE for the hotel was positive for January and March and negative in February. This indicates that, in January and March, the hotel was profitable and made a loss in February.
During the first quarter, the hotel management fees increased in each month; in February compared with January and in March compared with the two prior months. In this respect, financial result in February was poor compared with the other two months. This was due to the limited resources as indicated by the decline in the management fees in February.
Table 2: 2nd Quarter Analysis
|Market share (rooms)||19.52%||18.56%||20.95%|
Table 2 above showcase financial results for the hotel in the second quarter that runs from April to June. Market share regarding rooms sold in May declined compared with the same in April from 19.52% to 18.56%. The hotel reported an increasing market share regarding rooms sold in June to 20.95% from 18.56% in May.
Besides, GOP shows an increased performance in May compared with April, but it reported a decline in June compared with May. Net profit shows an upward trend in the entire quarter from April to June which is also evidenced by the ROE and the management fees incurred monthly. The hotel did not make any loss in the second quarter of the year. The hotel hired expertise in the management which resulted in the increase in the financial performance and consequently the management fees.
In essence, the hiring of the experienced and commitment to quality products and services has resulted in improved performance in the second quarter compared with quarter 1. Also, the hotel has been dedicated to advertising its services vigorously over various platforms, especially, in the social media. The company is also looking forward to reducing operating expenses to improve its profitability by adopting new technologies in running its operations.
Milohnic, I., & Grzinic, J. (2010). Quality competitive advantage of small hotels in Croatia. Original Academic Papers, 56(5/6), 44.
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