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Chapter 8: Food and Beverage Hotel Operations Management, 1/e Hayes/Ninemeier © 2004 Pearson Education Chapter 8: Food and Beverage Hotel Operations Management, 1/e Hayes/Ninemeier © 2004 Pearson Education Pearson Prentice Hall Upper Saddle River, NJ 07458

Similarities: Hotel & Restaurant Foodservices Planning issues Plan by focus on menu Menu focus Similarities: Hotel & Restaurant Foodservices Planning issues Plan by focus on menu Menu focus on guests’ wants, needs & preferences Menu impacts operational factors - layout / equipment - labor for production, service & clean-up - F&B products for purchase Emphasis on consumers Marketing concerns Repeat business important to financial success Hotel Operations Management, 1/e Hayes/Ninemeier Financial concerns All foodservice operations must assess financial status - Operating budget - income statement / balance sheet / cash flow statement Cost control procedures Necessity for standard operating procedures - Purchasing / receiving / storing / issuing / pre-preparation / serving / service © 2004 Pearson Education Pearson Prentice Hall Upper Saddle River, NJ 07458

Standard Operating Procedures: Cycle of F&B Product Control Step 1: Purchasing Step 2: Receiving Standard Operating Procedures: Cycle of F&B Product Control Step 1: Purchasing Step 2: Receiving Step 3: Storing Step 4: Issuing Step 5: Pre-Preparation Step 6: Preparation Step 7: Serving Step 8: Service Hotel Operations Management, 1/e Hayes/Ninemeier © 2004 Pearson Education Pearson Prentice Hall Upper Saddle River, NJ 07458

Cycle of F&B Product Control (continued…) Step 1: Purchasing Step 2: Receiving Develop purchase Cycle of F&B Product Control (continued…) Step 1: Purchasing Step 2: Receiving Develop purchase specification Supplier selection Purchasing correct quantities No collusion between property and supplier Evaluation of purchasing process Development of receiving procedures Completion of necessary receiving reports (e. g. , addressing financial and security concerns) Step 3: Storing Effective use of perpetual & physical inventory systems Control of product quality Securing products from theft Location of products within storage areas Step 4: Issuing Product rotation concerns Matching issues (issue & usage) Purchasing as inventory is depleted Hotel Operations Management, 1/e Hayes/Ninemeier © 2004 Pearson Education Pearson Prentice Hall Upper Saddle River, NJ 07458

Cycle of F&B Product Control (continued…) Step 5: Pre-Preparation Step 6: Preparation Step 7: Cycle of F&B Product Control (continued…) Step 5: Pre-Preparation Step 6: Preparation Step 7: Serving Step 8: Service Hotel Operations Management, 1/e Hayes/Ninemeier Mise-en-place Minimizing food waste / maximizing nutrient retention Use of standardized recipes Use of portion control Requirements for food and employee safety Timing of incoming F&B orders Portion control Revenue management concerns Revenue control concerns Serving alcoholic beverage responsibly Sanitation and cleanliness F&B server productivity © 2004 Pearson Education Pearson Prentice Hall Upper Saddle River, NJ 07458

Personnel Requirement Similarities: & Restaurant Foodservices Hotel Practice of empowerment Transferring some decision-making responsibility Personnel Requirement Similarities: & Restaurant Foodservices Hotel Practice of empowerment Transferring some decision-making responsibility and power to front-line employees Enhancing service to guests and increasing profits for the organization To meet unanticipated guest needs effectively Staff must be trained in standardized procedures. Managers must provide clear direction to employees. Managers must provide necessary resources. Hotel Operations Management, 1/e Hayes/Ninemeier © 2004 Pearson Education Pearson Prentice Hall Upper Saddle River, NJ 07458

Profitability Differences: Hotel & Restaurant Foodservices Profitability = Revenue - Expenses Profit amounts generated Profitability Differences: Hotel & Restaurant Foodservices Profitability = Revenue - Expenses Profit amounts generated by restaurant F & B is relatively easy to calculate. The process of allocating revenues and expenses applicable to F & B services in a hotel is more difficult. Costs of F & B sales is generally higher in a restaurant than in hotel. Hotel’s “bottom line” profit from F & B sales is likely to be lower than a restaurant’s. Payroll costs (or fixed labor costs) are higher than in a restaurant. Hotel Operations Management, 1/e Hayes/Ninemeier © 2004 Pearson Education Pearson Prentice Hall Upper Saddle River, NJ 07458

Marketing-related Differences: Hotel & Restaurant Foodservices Location within the community Restaurants: locations easily accessible Marketing-related Differences: Hotel & Restaurant Foodservices Location within the community Restaurants: locations easily accessible to potential guests Hotels: locations most accessible to guests desiring lodging accommodations Location within a hotel Restaurants: locations easily accessible to potential guests Hotels: locations most accessible to guests desiring lodging accommodations Menu Hotel Operations Management, 1/e Hayes/Ninemeier For hotels, F& B service is viewed as an amenity or secondary (sale of guestrooms is primary objective) © 2004 Pearson Education Pearson Prentice Hall Upper Saddle River, NJ 07458

Room Service Operations: Profitability Concerns Why lose money? Relatively few properties generate profits from Room Service Operations: Profitability Concerns Why lose money? Relatively few properties generate profits from room service Very high labor costs High expenses incurred for capital costs - delivery carts / warming devices Why offered? Service to guests - some guests select hotels based on room service availability Impacts hotel rating How to offset losses? High expenses incurred for capital costs - Delivery carts / warming devices Offer hospitality suite business Provide hosted events Hotel Operations Management, 1/e Hayes/Ninemeier © 2004 Pearson Education Pearson Prentice Hall Upper Saddle River, NJ 07458

Room Service Operations: Menu Planning Factors Quality Concerns Cross-Selling Menu Language Less likely to Room Service Operations: Menu Planning Factors Quality Concerns Cross-Selling Menu Language Less likely to oversee room service food quality Must offer products maintaining quality during holding and transportation to guest room (example: problems with omelet & French fries) Advertising availability of other hotel services - dinner menu providing info about Sunday brunch Language barriers for international guests - uses of pictures and multi-lingual menu descriptions Clearly state ordering-requirements - minimum order charges / mandatory tipping policies Hotel Operations Management, 1/e Hayes/Ninemeier © 2004 Pearson Education Pearson Prentice Hall Upper Saddle River, NJ 07458

Room Service Operations: Operating Issues An inaccurate room service order cannot be corrected quickly. Room Service Operations: Operating Issues An inaccurate room service order cannot be corrected quickly. A minor problem in room service may impact guest’s perceptions about the entire lodging experience. Communication Guest placing order / order taker / room service productionservice staff / room service staff Abbreviations should be clearly understood by order taker and food production staff Technology Improving the accuracy of room service orders - electronic cash register (ECR) / point-of-sale terminal / remote printer Upselling Technique Opportunities for upselling are overlooked Upselling increases guest check average Hotel Operations Management, 1/e Hayes/Ninemeier © 2004 Pearson Education Pearson Prentice Hall Upper Saddle River, NJ 07458

Room Service Operations: Within-Room Service Training issues for room service attendants Explaining procedures to Room Service Operations: Within-Room Service Training issues for room service attendants Explaining procedures to retrieve room service items Asking guests where room service meal should be set up Presenting guest check and securing payment Opening wine bottles (where applicable) Providing an attitude of genuine hospitality Hotel Operations Management, 1/e Hayes/Ninemeier © 2004 Pearson Education Pearson Prentice Hall Upper Saddle River, NJ 07458

Banquet Operations: Profit Opportunities Well-planned banquets can be profitable! Banquet menu has higher contribution Banquet Operations: Profit Opportunities Well-planned banquets can be profitable! Banquet menu has higher contribution margin. - banquets frequently celebrate special events Forecasting & planning production, service and labor are relatively easy. - formal guarantee is made - less likelihood of overproduction of food with subsequent waste Beverage sales from hosted or cash bars increase profit. - capable of increasing alcoholic beverage sales Increasing market share of the community’s banquet business Hotel Operations Management, 1/e Hayes/Ninemeier Increasing property’s profitability © 2004 Pearson Education Pearson Prentice Hall Upper Saddle River, NJ 07458

Banquet Operations: Menu Planning Factors / concerns for planning banquet menus Guest preferences Ability Banquet Operations: Menu Planning Factors / concerns for planning banquet menus Guest preferences Ability to deliver desired quality products Availability of ingredients required to produce the menu Production / service staff with appropriate skills Equipment / layout / facility design issues Nutrition issues Sanitation issues Peak volume production / operating concerns Ability to generate required profit levels Hotel Operations Management, 1/e Hayes/Ninemeier © 2004 Pearson Education Pearson Prentice Hall Upper Saddle River, NJ 07458

Banquet Operations: Service Styles Butler service Appetizers and pre-poured champagnes can be served by Banquet Operations: Service Styles Butler service Appetizers and pre-poured champagnes can be served by service staff at a reception while guests stand. Buffet service Quantities of food are pre-arranged on a self-service line; guests pass along the line and help themselves Family style (English style) Platters and bowls of food are filled in the kitchen and brought to guests’ tables French service Meals are prepared or finished at tableside by service staff: (e. g. , tossing Caesar salad / flambéing entrée) Platter service Production staff plate food in the kitchen; service staff bring it to the table to place individual portions on guests’ plates Plated service (American service) Production staff pre-portion food on plates in kitchen; service staff serve to guests Hotel Operations Management, 1/e Hayes/Ninemeier © 2004 Pearson Education Pearson Prentice Hall Upper Saddle River, NJ 07458

Banquet Operations: Beverage Functions Various ways to charge for beverage Individual drink price Bottle Banquet Operations: Beverage Functions Various ways to charge for beverage Individual drink price Bottle charge Collecting cash or a ticket when each drink is sold Charging on a by-bottle basis for each bottle consumed / opened Per-person charge Charging a specific price for beverages based on attendance at the event Hourly charge Charging the host a specific price for each hour of beverage service Specific perevent charge Using hours of beverage service; charging number of drinks / hour X number of guests Hotel Operations Management, 1/e Hayes/Ninemeier © 2004 Pearson Education Pearson Prentice Hall Upper Saddle River, NJ 07458

Banquet Operations: Banquet Room Set-Up Size Timing Determined by : Becomes critical when: the Banquet Operations: Banquet Room Set-Up Size Timing Determined by : Becomes critical when: the same room to be used same day for different functions number of expected guests local fire safety codes / ordinances types and sizes of tables, chairs, other equipment number of seats per table required space for aisles, dance floors, band stands, other entertainment, head tables, etc. Two critical concerns when large evening event precedes following day’s large breakfast event in same room reception / buffet tables Hotel Operations Management, 1/e Hayes/Ninemeier © 2004 Pearson Education Pearson Prentice Hall Upper Saddle River, NJ 07458

Banquet Operations: Banquet Contracts & Billing Policies Topics in banquet contract Last date that Banquet Operations: Banquet Contracts & Billing Policies Topics in banquet contract Last date that banquet space will be held without signed contract Time by when a guarantee of attendance must be received Cancellation policies Guarantee reduction policy Billing: amount & schedule for guest payment Information about service of alcoholic beverages Other information applicable to specific event Hotel Operations Management, 1/e Hayes/Ninemeier © 2004 Pearson Education Pearson Prentice Hall Upper Saddle River, NJ 07458

Alcoholic Beverage Service in Hotels Good training protects guests, public and hotel from tragedies Alcoholic Beverage Service in Hotels Good training protects guests, public and hotel from tragedies and lawsuits Responsible service & consumption of alcoholic beverage is an integral part of the responsibility of all F & B managers in all types of operations. Train for all staff in the hotel (i. e. including non-F&B positions, e. g. front desk, housekeeping, maintenance and/or security staff ) to recognize and respond to visible signs of guests’ (nonguests’) intoxication. Develop and implement ongoing training for responsible service of alcoholic beverages. Hotel Operations Management, 1/e Hayes/Ninemeier © 2004 Pearson Education Pearson Prentice Hall Upper Saddle River, NJ 07458