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== Operating review ==
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An operational review is an in-depth look at the big picture, addressing in this case especially the financial elements so to
== All results ==
make the choices, costs, revenues and results clearly visible.<br>
The annual results of your hotel are stated in the operating review, will be created ''automatically'' by the accountant at the end of each year. You just have to analyse the results, you do not have to calculate them yourselves. Of course, when making decisions and incurring costs, you will make some assumptions and calculations predicting occupancy and profit. After each year ends, they will be ready for you via your secret Team File link.
In the administration of Emerald Forest Hotel, as we use it, no [[VAT]] Value added tax is visible. Not in the revenues, neither on the cost side. There is no record on the [[liquidity]], balance sheets (opening nor end of the year) nor an investment plan.
We consider the revenues and the costs to be without any VAT, and all revenues and costs to be paid at the date they occurred. There are no doubtful receivables.
== All Revenues ==
The operating review consist of a number of crucial elements, whcih each have their own page:
*''Rooms revenues'' comprise the average (sales) prices the hotel had decided to choose, times the number of booked rooms (occupancy rate). <br>
*The overview of the [[Operating review]]
*''F&B revenues'': all food and beverages are considered to be caused by these hotel guests: so the higher the occupancy rate, the more revenues the hotel gets from food and beverages.<br>
*The [[Revenues]]
*''Banqueting and other revenues'' are a separated revenue unit in the hotel. The sales prices of banqueting arrangements in the past, varied from a minimum of € 25 to a maximum of € 30 per person. On the [[Banqueting]] page, you can find some more info, pictures, and videos on banqueting. The 'other revenues' in this group are additional sales, renting out bikes, upgrades, cancellation fees e.g. Altogether a bit more than 8% of the total revenues. <br><br>
*The [[Costs]]
*The [[Net profit]]
*The [[Key metrics]]
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[[Image:results_revenues_2018_new.jpg|thumb|600px|center| <center>''Revenues overview history and projection on the coming four years. <br> We focus on the History now.''</center>]]<br>
Underneath you'll find an overview which gives some more insights into the revenue structure, as far as information is available in the Bergman's administration. This all reflects the year before you take over, the history will be your starting position, the other years just give you an indication of what might happen. You are going to decide on that yourselves.<br>
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== Operating review ==
An operational review is an in-depth look at the big picture, summarizing the financial effects of your management choices: costs, revenue and results.<br> The results in this overview will be made automatically depending on
* your evaluations by your coach (so the quality of your arguments)
* your competitors
* your decisions
The occupancy rate is the crucial element in all this. The total overview will be visible in your Team File after each year <br>
In the administration of Emerald Forest Hotel, as we use it, no [[VAT]] Value Added Tax is applicable. That is, not in the revenues, neither on the cost side. Furthermore, there is no record of the [[liquidity]], balance sheets (opening nor end of the year) nor an investment overview. We consider the revenues and the costs to be without any VAT, and all revenues and costs to be paid at the date they occurred; there is no debtors or creditors.
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== Net profit ==
<table border=1 cellpadding=8>
Of course, the net profit per year is very interesting. The total costs will be deducted from the total revenues. If there is a bonus (something which turned out much better than expected) or a fine (e.g., tax), this is added or deducted from the profit leading to the net profit. <br>
<tr><td> Banqueting and other revenues </td><td> Banqueting and other revenues </td><td> € 231,636</td><td> 8.09%</td><td> 8.09%</td></tr>
The situation below is just an example of the projections of costs for the coming four years. Again, the situations as you take over is the history (coloured gray) the rest are predictions. <br>
[[Image:results_costs_2018_02.jpg|thumb|600px|center| <center> Costs overview during four years.<br> We focus on the History now.''</center>]]<br>
Underneath you'll find an overview which gives further insights into the cost structure as far as information is available in the Bergman's administration. This all reflects the situation as you take over, this will be your starting position. Especially the Cost on Management Team Decisions are missing in the relevant year History. The four test year are just a basic testing in what this could bring. For now, in the history these are all zero. These management team decisions is what has been lacking, the last few years: you cannot do without anymore.<br><br>
Of course, the net profit per year is very interesting. The total costs will be deducted from the total revenues.
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Upon taking over the net profit is: <br>
<tr><th> '''Costs in history'''</th><td>'''Source'''</td><td>'''Amount'''</td><td>'''Percentage'''</td><td>'''Sub total'''</td></tr>
- Total revenue € 2,861,896 <br>
<tr><td> '''Costs: fixed'''</td><td> Depreciation costs of existing assets </td><td> € 525,187</td><td> 34.64%</td><td></td></tr>
The operating review shows the profit in any individual year and the total of net profit (all years added up). Again, in the example a number of predictions for future additional costs have been made. More on this on the [[Net profit]] page.
<tr><td> '''Total all costs'''</td><td></td><td> '''€ 2,430,595''' </td><td> </td><td> '''100%'''</td></tr>
</table>
More info on costs:
[[Image:results_profit_2023_01.jpg|thumb|600px|center| <center>''Net profit as you take over in grey 'year 1' column, plus examples in the following years; year 4 is not completed.<br> We will focus on year 0 now.</center>]]
* the [[fixed costs]] have stayed the same during all four years, the fixed depreciation costs are one of them.
* the [[variable costs]] depend on the occupancy rate like laundry: the more rooms occupied the more laundry.
* the [[Costs Management Team Decisions]], will depend the [[Decisions|decisions]] made by the new management team.
== Net profit ==
Of course, the net profit per year is very interesting. The total costs will be deducted from the total revenues. If there is a bonus (something which turned out much better than expected) or a fine (tax e.g.) this is added or deducted from the profit leading to the net profit. <br><br>
[[Image:results_profit_2018_04.jpg|thumb|600px|center| <center>''Net profit as you take over in grey headed 'history'. <br> We focus on the history now.</center>]]
In this example on taking over: <br>
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- Total revenues were € 2,861,896<br>
== Analysis ==
- Total costs € 2,430,595<br>
So the net profit upon taking over, in the example above, seems to be 15.07% of the revenue, with 84.93% being costs. This seems to be a good and interesting result, but it is up to you to put this in (a real) perspective of the industry. Because management did not make enough [[investments]] over the recent years, depreciation costs have been rather low. There is no problem with liquidity at all. <br>
- Net profit € 436,301<br><br>
Furthermore, the [[Bergman family|Bergmans]] did not really consider themselves to be staff, so there have been hardly any wages for them in the staff costs, which distorts the numbers. Their income mainly originated from the net profit which they, partly, took out of the company, being the entrepreneurs.
The operating reviews show the profit of any individual year and the total of the net profit (all years added up). Again, in the example a number of predictions for additional costs in the future have been made. More on this on the page [[Net profit]].
== Key metrics ==
== More numbers ==
Some key metrics and ratios on the operations of the hotel in this section. <br><br>
Check [https://setupmyhotel.com/train-my-hotel-staff/front-office-training/187-fixed-cost-and-variable-cost-in-hotels.html basic set-up of costs groups] in hotels to have some reference on the numbers. <br>
[[Image:key metrics team3.jpg|thumb|550px|center| <center>''Key metrics of the History as the new management team takes over. <br> We focus on the history now.''</center>]]
Of course, any situation is different, any time frame (think of the [[Covid]] period), the ownership, the state (quality) of the premises etc. The file, though, might give some ideas from a calculation perspective.
More on this on the page [[Key metrics]].
== Running a hotel ==
== Past ==
In the file [[Running a hotel]] we've gathered some benchmarks, examples of cost overviews, operating reviews etc. from different organisations. Of course, any situation is different, any time frame (think of the [[Covid]] period), the owners ship, the state (quality) of the premises etc. The file, though, this might give some ideas from a calculative perspective.
When your assignment is managing one of the new establishments, these will be the benchmarks you start with, and you refer to. So, you will start in your new venue, as a point of reference, with all the same set-up of costs and decisions as in the past. At the time you take your own decisions, you can roll out your new ideas, and concepts in full.
<br><br>
== Analysing ==
''→ Go! Following the Introduction to the Hotel? Step 10/10 is the page [[Staff|Staff page, click here.]]''
So the net profit on taking over, seems to be 15.21% of the revenues, a good and interesting result. Though, the management did not make enough [[investments]] over the recent years, so the depreciation costs have been kind of low. There is no problem with liquidity at all. <br>
<hr></div><br>
Furthermore, the [[Bergman family|Bergmans]] did not really consider themselves to be staff, so there hardly have been any wages for them in the staff costs, which distorts the numbers. Their income mainly originated from the net profit which they, partly, took out of the company, being the entrepreneurs.
<br>
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''→ Go! Following the Introduction to the Hotel? Step 10/10 is the page [[Staff]]''
<hr>
''→ GO! [[#top|Top of this page]]''
<center><small>''Emerald Forest Hotel'' offering an <font color="green">'''emerald''' </font color="green">hotel experience!
| Run your own hotel in this management simulation.</small></center>
The annual results of your hotel are stated in the operating review, will be created automatically by the accountant at the end of each year. You just have to analyse the results, you do not have to calculate them yourselves. Of course, when making decisions and incurring costs, you will make some assumptions and calculations predicting occupancy and profit. After each year ends, they will be ready for you via your secret Team File link.
The operating review consist of a number of crucial elements, whcih each have their own page:
An operational review is an in-depth look at the big picture, summarizing the financial effects of your management choices: costs, revenue and results. The results in this overview will be made automatically depending on
your evaluations by your coach (so the quality of your arguments)
your competitors
your decisions
The occupancy rate is the crucial element in all this. The total overview will be visible in your Team File after each year
In the administration of Emerald Forest Hotel, as we use it, no VAT Value Added Tax is applicable. That is, not in the revenues, neither on the cost side. Furthermore, there is no record of the liquidity, balance sheets (opening nor end of the year) nor an investment overview. We consider the revenues and the costs to be without any VAT, and all revenues and costs to be paid at the date they occurred; there is no debtors or creditors.
Net profit
Of course, the net profit per year is very interesting. The total costs will be deducted from the total revenues. If there is a bonus (something which turned out much better than expected) or a fine (e.g., tax), this is added or deducted from the profit leading to the net profit.
Of course, the net profit per year is very interesting. The total costs will be deducted from the total revenues.
Upon taking over the net profit is:
- Total revenue € 2,861,896
- Total cost € 2,430,595
- No fine or bonus € 0,0
- Net profit € 431,301
The operating review shows the profit in any individual year and the total of net profit (all years added up). Again, in the example a number of predictions for future additional costs have been made. More on this on the Net profit page.
Net profit as you take over in grey 'year 1' column, plus examples in the following years; year 4 is not completed. We will focus on year 0 now.
Analysis
So the net profit upon taking over, in the example above, seems to be 15.07% of the revenue, with 84.93% being costs. This seems to be a good and interesting result, but it is up to you to put this in (a real) perspective of the industry. Because management did not make enough investments over the recent years, depreciation costs have been rather low. There is no problem with liquidity at all.
Furthermore, the Bergmans did not really consider themselves to be staff, so there have been hardly any wages for them in the staff costs, which distorts the numbers. Their income mainly originated from the net profit which they, partly, took out of the company, being the entrepreneurs.
More numbers
Check basic set-up of costs groups in hotels to have some reference on the numbers.
Of course, any situation is different, any time frame (think of the Covid period), the ownership, the state (quality) of the premises etc. The file, though, might give some ideas from a calculation perspective.
Past
When your assignment is managing one of the new establishments, these will be the benchmarks you start with, and you refer to. So, you will start in your new venue, as a point of reference, with all the same set-up of costs and decisions as in the past. At the time you take your own decisions, you can roll out your new ideas, and concepts in full.
→ Go! Following the Introduction to the Hotel? Step 10/10 is the page Staff page, click here.
→ GO! Top of this page . . . Emerald Forest Hotel offer an emerald hotel experience! Run your own hotel in this management simulation . . .
