Decisions

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The Team File, with a private login link, is crucial to your team for running the hotel. In this Team File you will find four tabs:

• Year 0 tab is when you start, this is where you make all the strategic choices, introduce your hotel, targetgroups etc.
• Year 1-2-3-4 tab is where you take your decisions each year and give explanations each year, after your year 0 (strategic choices)
• dashboard tab is where you can find an overview of the most important financial results
• results tab is where you will find an operating review and other details on results and costs after each year

After a year has passed, the new dashboard and the results will only be visible after being released by your coach.
There is a Demo Team File you can check, with a filled out Team File at the end of an example Game.
Each competition is setup in a specific way: so check your competition's assignment and timeline for details.

Emerald Forest HotelTeam File tabs

Working on your decisions

Jill Jandal and Christina Bergman have decided that they only want to be informed of the high points of your choices; therefore the number of items you can make decisions on is limited. These decisions need to be filled out on the Decisions tab, each year. The history of the year before you take over, so Jill's last year, is available. She did not spend any money on some of the expenditure groups, like marketing costs. So you will see the indication N/A not available or 0.

There are rules regarding the decisions and further information on their limitations. You might have an brilliant plan, but it has to stay within these limitations. For all decisions try to calculate what the effect will be. The algorithm, in the end, will make up your final, new operating review.

- Please take into account that your hotel has 364 days and nights per year (52 weeks * 7 nights)
- The basic occupancy rate of your hotel was 50%
- The number of rooms in your hotel is 100
- The weekend days are 43% of the total number of nights (rounded up)
- The weekdays are 57% of the total number of nights (rounded up)
- The average number of guest in a room on weekend days is 1.7
- The average number of guest in a room on weekdays is 1.0
- We completely refrain from (adding) VAT and or other taxes on profit for now
- You cannot change the number of rooms in your hotel
- You cannot sell the property
- You cannot 'spend' or use profit (or cash flow) or make investments different or larger than indicated
- The effects of all of your decisions only last for one year (unless it is an investment)!

Decisions list

Below you will find the list of ten financial decisions you will have to make each year in your Team File; there might be some small differences in your competition. Adapt the decisions to your new plans and strategy each year.
The explanations of your decisions are very important and account for the biggest part of your occupancy and thus results. And they contribute heavily to your mark. Also make calculations in your explanations, to justify your choices.

• Ranges

In all decisions made there are a few ranges built-in to make it possible for you to make your decisions appropriately and to prevent you from going bankrupt. Running this hotel consists of more than just filling out numbers in a spreadsheet; therefore you have to explain things in the Team File. We encourage you to behave like an entrepreneur throughout the entire game.

• Price systems, rates

You can use psychological pricing, flex prices, dynamic pricing, revenue management or whatever system you want to use in your decisions. The better your explanations in your Team File (and especially your calculations), the better your company's results will be, the higher your business coach mark, and the more customers you get by a higher occupancy rate. In hospitality, we see the concept of 'rates' more frequently than prices.

• Euros

Only make your decisions in whole euros, don't use cents or other currencies. In filling out the amounts in the Team File, do not use decimals! Not in the prices and not in costs.

Five Team decisions on (sales) prices, creating revenues

As you can see in the example: if you mouseover the description of the decision (like cell B8 in this example) you will get more information regarding what the decision is all about. You are allowed to fill out the pink cells according to the instructions.
You will have to decide what prices you will charge (per room per night) for weekdays or weekends which serve the markets. In the pages under room prices, you can read a bit more on the history. Depending on your performance as a team and your choices made, you will get a certain occupancy rate and corresponding number of guests. These guest prices will bring your revenues in each of the five revenue categories, depending on the prices decided upon and this occupancy rate. So setting the prices too low (think of your cost price), even with a very high occupancy rate, might bring in revenue, but hardly any profit or even losses.
We offer you just 5 possibilities in prices to decide on; we realize that there are many, many more. But, to keep things logical and in line, you will have to do with these five. You cannot influence how many people will stay in the room.

Example decisions on prices. Mouseover in row B gives you more info on the decision. You will also get an alert if the input is not okay. Be sure to explain in depth, with sources, arguments, and preferably calculations. When a year has passed, it will become greyed-out.

→ Limitations
Strongly recommended: Never change any of the five prices more than + or -20% per year to protect your hotel from high impact of too extreme changes.

• 1. Weekend last-minute room price (or rate) per night
  

In the past, the average price was € 80. The last-minute price is the minimum price you will accept to fill up the empty rooms, the gaps in your occupancy.
The revenues after each year, comprise the number of booked rooms (occupancy rate) at the weekend, times the average (sales) prices: so (last-minute and rack rate) divided by two.

• 2. Weekend rack rate room price (or rate) per night
  

In the past the average price was € 100. The rack rate is the highest price you will get.
The revenues after each year, comprise the number of booked rooms (occupancy rate) in the weekend, times the average (sales) prices: so (last-minute and rack rate) divided by two.

• 3. Weekday last-minute room price (or rate) per night
  

In the past the average price was € 100. The last-minute price is the minimum price you will accept.
The revenues after each year, comprise the number of booked rooms (occupancy rate) during weekdays, times the average (sales) prices: so (last-minute and rack rate) divided by two.

• 4. Weekday rack rate room price (or rate) per night
  

In the past the average price was € 140. The rack rate price is the highest price you will get.
The revenues after each year, comprise the number of booked rooms (occupancy rate) on weekdays, times the average (sales) prices: so (last-minute and rack rate) divided by two.

• 5. Banqueting and other activities price (or rate) per person per day

In the past the average price was € 28. You can not skip this activity totally, so price 0 is not allowed. The occupancy rate of the rooms also has an impact on the numbers of booked banqueting arrangements and other activities.

• Other ideas

Of course there are many other possible prices and price systems, apart from last-minute and rack rate. Though, we focus on the total of five price settings; explain them more in depth and find benchmarks for this and give links arguing why you chose these prices for these targetgroups.
If you think a specific, different price is absolutely necessary, use the marketing costs, or other costs, to promote this. Use the row Extra Information to explain your plan to your coach. Then be sure to make calculations on costs and revenues and predicted additional revenues compared to the normal situation. Your coach might reward this with a bonus, if consistent, well-thought-out etc. If so, you could find additional results from this at the bonus or fines (row 51-52). This will always be profit or losses, not revenues. But please (first) focus on the regular opportunities, there are plenty.

Five Team decisions to be made on costs

Of course, you cannot influence the Fixed costs which are in your operating review, nor can you influence the variable costs; they are set by your occupancy rate.
Other things you will have to make decisions upon are decisions 6 - 10. This will create costs you decide on and which will be visible directly in your operating review after any year. On mouseover in the file you'll get more info on these choices. All these decisions bring extra costs compared to the past, as Christina did not spend money on these elements. Try to explain, for each form of cost what you expect it to bring you. So, how will you earn back these costs and what will they bring additionally? All costs will have an effect, but only in the year you make them. For maximum effect you will have to repeat them in subsequent years.
In case you think you have an idea like this, please also explain this to your coach at the end of your Team File.

Example decisions to be made on costs. Mouseover in row B gives you more info on the decision. You will also get an alert if the input is not okay. Be sure to explain in depth, with sources arguments, and calculations. When a year has passed, it will be greyed-out.

Impact

Check the impact of changing the Sales price, on these pages.
Or check Revenue per room to get even more information.

• 6. Marketing costs

No costs for this in the past: 0 or N/A means not available.
This is the total spending for all paid marketing actions in the past: maybe this is on the low side? There was very little going on at the Emerald Forest Hotel, especially nothing on social media or affiliates and there was also not negotiating with distributors and partners. You could also include costs related to clean air, to green energy, to social responsibility, ecological footprint etc. So, this is probably a decision you cannot afford to leave out.
→ Limitations
You can use any amount between € 0 and € 200,000 per year, to protect your hotel from the high impact of too extreme changes.

• 7. Staff development costs

No costs for this in the past: 0 or N/A means not available.
Apart from the salaries, extra costs can be incurred here, such as spendings on necessary skills and resources to support the staff member's career goals and the organization's business needs. This will be things like training, developing skills or for instance courses on hospitality.
→ Limitations
You can use any amount between € 0 and € 100,000 per year, to protect your hotel from the high impact of too extreme changes.

• 8. New investments

No costs for this in the past: 0 or N/A means not available.
You can choose to spend a maximum of € 900,000 each year on additional investments. This investment is the number you should fill out in your Team File decisions. The depreciation costs related to NEWLY planned investments will be visible after each year in your results, as depreciation costs of new investments. And, as you can see on the footage available, the hotel is in need of some additional investments in the rooms, facilities etc.
Check the specific investments page on this. In your decisions you fill out the investment itself: You will find the corresponding depreciations on your operating review. All your investments will be linearly depreciated in 4 years without any residual value; there is no choice in this, so you fill out the investment itself. The depreciation costs during all four operational years will be calculated by the program. There will be no other costs of new investments, like interest. For the rest see the max numbers in the table underneath. So if you want to invest € 900,000 in year 1, fill this out and the system will create € 225,000 (row 44 in the results tab) in year 1 as depreciation costs, as well as in subsequent years. Investments have a direct effect in the year they are made, so you can make them in any year of the Game, including the last year. So an investment will have effect during more years: four to be precise.
The costs of equipment and furniture bought in hospitality are totally different from what you would buy privately (at a furniture store like the Ikea): realize that. There are standards for safety, usability, long-wearing, cleaning, and many other reasons to buy professional material.

→ Limitations
You can make any investment with a maximum of € 900,000 each year. So over four years you can invest a maximum of 4 x € 900,000 = € 3,600,000. The costs of this will be the depreciation, automatically calculated and always linear over four years (a simplification, no residual value, no interest, but still). The maximum is built in to protect your hotel from too extreme changes and costs.

• 9. Market research package costs

No costs for this in the past: 0 or N/A means not available.
These are the costs of buying information from Top Research which will be analysing the past year which will be visible, if bought, on your results tab after any year. It will give you a benchmark on the prices asked in the market ('S', small package) as well as the costs incurred in the market ('L', large package).
→ Limitations
You can use chose the amount from the choice box so € 0 buys you no information, € 25,000 buys you the 'S' small package and € 50,000 gets you the 'L', large package. Elements not paid for will show up in your operating review as 'Not bought'. Make sure you explain very clearly in your explanations why you think buying this will benefit your company. The company Top Research will carry out the research and report to you.

• 10. Other costs

No costs for this in the past: 0 or N/A means not available.
This could be anything apart from the groups mentioned above. So things like supporting the distributions chain, cooperation with partners, maybe legal costs. Maybe a contribution to tourist information offices activities.
Make additional calculations explaining the profit it might bring. If you explain the pros and cons and the costs and the results and the expected additional profit of a specific action, your coach might reward this with a bonus. A bonus is net, it is directly added up to your profit in any year.
→ Limitations
You can use any amount between € 0 and € 100,000 per year, to protect your hotel from the high impact of too extreme changes.

Impact

Check the impact of these additional costs on your Cost price and so Sales prices, on these pages.
Or check Revenue per room to get even more information.

Overspending

If you would choose the maximum available for all options, you would spend an additional € 1,350,000. This is next to the variable costs and the fixed costs. These are additional costs, the so called costs of your team decisions.

• Next to this, you have these regular variable costs depending on the occupancy rate, and
• fixed costs which you can not influence (only the occupancy rate does so with the variable costs).
  

So, keep an eye on the net profit which is around € 450,000 as you take over, to keep things in balance.

No decisions or no explanations

If any team fails to deliver the decisions or explanations before the deadline this is a serious problem. This could end in a fine or a low marking from your coach: This will also jeopardize your occupancy rate. You might also get fined.

Quality of decisions and assignment

Check the occupancy rate page, to get more information on how this is built up. The quality of your decisions, explanations and assignments play a major role in this.
After all, your argument is assessed by the coaches, who create your dashboard. You will only see the results after the coach has 'released' them.

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Emerald Forest Hotel offer an emerald hotel experience! | Run your own hotel in this management simulation.