In this case, we only used two MPR tiers: The goal was to provide realistic targets that would take into account how long it actually takes to clean these different rooms. You therefore don’t want to be caught short-staffed and have disgruntled guests who have to wait for a long time to get service. Upholstery Cleaning. You want to offer your guests a quality experience. Don’t forget to calculate the average cost of cleaning supplies and chemicals per room cleaned, too. Knowing the average, actual costs incurred per occupied guestroom enables a manager to make more prudent pricing and marketing decisions and to monitor expenses. That’s $10,444 in savings for just one year—imagine what your hotel could save over the lifetime of the machines. Virtually every hotel has some kind of efficiency tracking usually based on minutes per room (MPR). Don’t forget to calculate the average cost of cleaning supplies and chemicals per room cleaned, including disinfectant, glass cleaner, toilet cleaner, and furniture polish. This number is achieved by adding the rooms pay, rooms expense, overhead pay and expense, and finally the owner’s expense. For limited-service hotels, amenities may cost less than $1 per guestroom; for luxury hotels, the amenity replacement costs may total $20 or more. The shift resulted in an 11-percent increase in productivity. According to Bjorn Hanson, associate professor at New York University's Tisch Center for Hospitality, the cost of cleaning a high-end of luxury room is approximately £14 per … As mentioned, you need to look at the type of hotel, how much labor will go into it, how much labor is running in the city you're in. Here are six variable costs to consider: To most accurately calculate average labor expense per occupied guestroom, take the total labor plus benefits expense for a time period and divide it by the number of guestrooms serviced. What Are Your True Variable Costs Per Occupied Room? With a Hydrofinity low-water laundry system, that cost would drop to $3,482. is the source for the most "waste" in your average hotel. How do you calculate CPOR? From economy hotels to large convention hotels and luxury resorts, our solutions fit all types of properties. Cost to clean there was $35. If you’ve already implemented a towel reuse program but are not noticing much participation, consider your messaging. How can I show the corporate office that I am on top of my labor costs? For Property B, we maintained their existing flat MPR target of 28 minutes as a control. Also utilities are charged at commercial rate. Neither hotel saw any material change in their quality scores. We have to make 14 rooms during 8-hour working day. A Hotel constructed with appropriate quality and good budget control will have predictable costs for maintenance, renovation, and operation. We recently put this recommendation to the test for tracking housekeeping productivity and saw a big change in performance. While calculating the Cost per available room , why we do not take FLP into consideration ? For limited-service hotels, amenities may cost less than $1 per guestroom; for luxury hotels, the amenity replacement costs may total $20 or more. Hi, Can we have a software/formulas designed to calculate the costing of rooms etc, as mentioned on your article, will give great help. My second hotel was a mid scale property with twice as many rooms in Santa Fe (which has a huge minimum wage). CPOR stands for Cost Per Occupied Room. At a bare minimum, each property should have separate targets for guests staying over and for guests checking out. When guests occupy a room, they turn on the lights, watch TV, take hot showers, run the heat or air conditioning, recharge electronics, and more. The executive housekeeper’s ability to control housekeeping expenses will be evaluated in terms of his/her ability to maintain the cost per occupied room expected for each category. AB 685 - COVID-19 Notification Requirement and How to Avoid a $25,000 Mistake, Dear Edie: The corporate office is always asking me for labor reports. We’ve introduced similar flexible housekeeping targets in dozens of hotels over the past year and have always seen that more specific housekeeping targets lead to better efficiency. According to … © Copyright 2020, Lodging Media, All Rights Reserved. The CPOR formula helps calculate the average cost per occupied room. He is the co-author of AHLEI’s housekeeping textbook Managing Housekeeping Operations. Hotel Effectiveness® is the only complete labor management system designed exclusively for hotels and hotel management companies. Often we find the rooms, or housekeeping, dept. Taxes, insurances, staff salary, maintenance plus most travelled steals things like remote controls, TV, keys and whatnot. Sectional Sofa – $180 to $220. I believe it is closer to $1450.00 actually- this includes gas electric, water sewage and maybe cable and internet I guess. Tracking the overall cost for cleaning for each room. Share data in real time.Eliminate overstaffing and excessive overtime.Avoid overuse of contract labor. Keep in mind that you only calculate the housekeeping labor costs for employees involved in servicing a guestroom. These costs might range from $1 to $20 per room depending on your level of service and how “luxurious” your offering is. ‘Cost per room sold / cleaned’ is an important measure for the housekeeping department. Revenue per room within particular time period. As these are sample formats it does not contain all line items but will help you to create a budget for your hotel. Based on occupancy levels, type of hotel, guest segmentation, geographic location, and brand requirements, most hotels plan to refurbish their guestrooms every four to seven years. Dr. William D. Frye is a hospitality educator, researcher, consultant, and former hotel general manager. What is the standard or range of electricity consumption in KW for a resort and city hotel…. Staff to Room Ratio is one of the critical factors that determine an optimum level of balance between permanent staff and hotel room capacity. This provides the housekeepers more time to clean rooms when there are a larger number of check-outs and less time to clean rooms when there are more guests staying over. For more information, visit www.hoteleffectiveness.com. Room attendants could work at a comfortable pace no matter what the mix of checkouts and stayovers. Both hotels were running virtually identical housekeeping metrics at 28 MPR. Calculate the average laundry costs per occupied guestroom by adding up the labor, laundry chemical, and utility costs incurred and dividing by the number of guestrooms occupied for that period. Since 2007, Hotel Effectiveness has grown into an industry leader in labor management services and tools. Sofa: (Regular Size 2 – 3 seats) From $99 to $130. Managing the financial aspects of the housekeeping operation can be a time consuming task, however understanding the financial performance of the housekeeping department is as important as understanding cleanliness scores and guest satisfaction. Because energy consumption in guestrooms is not individually metered in the United States, the utility expense per occupied room will need to be estimated. Please can I have a software on room expenses calculation. This format is given to each room attendant after their morning briefing. Therefore, a $100 guestroom will cost the hotel $3 in capital expenses per night that it is occupied. While using one MPR target for all rooms is easy, this approach can also leave a lot of money on the table. (The formula is R x O x 365 x W x 1.B / 60). Allocate an average of 3 percent of the room rate generated toward a capital expenditure budget for room renovations. Both hotels already used Hotel Effectiveness Labor Management, which includes automated reporting on the performance for each housekeeping attendant; because of this there was no additional management time for either property to track their efficiency. Back in the day, the average housekeeping department included inspectors tasked with following behind each room attendant to check every room they cleaned. https://www.hotelmanagement.net/operate/examination-hotel-labor-costs Average hotel housekeeping costs are determined as a ratio of minutes spent cleaning a hotel room divided by number of rooms in a property. However, you also do… Say at 12 cents a KW. Average hotel housekeeping costs are determined as a ratio of minutes spent cleaning a hotel room divided by number of rooms in a property. Room Attendant Daily Assignment Sheet for Housekeeping. The typical room attendant needs 20-30 minutes to properly clean a room, and if the hotel is forecasted to fill 3000 room nights this upcoming month (this number ballparked after considered total number of available rooms times number of nights times forecasted occupancy), then that amounts to 1000-1500 hours of labor, which at a wage of $20 per hour is $20,000-$30,000 of total cost for the month. This is often one of the toughest elements to deal with when running a B&B. Property B (the control hotel) was virtually unchanged MPR (28.3 minutes vs. 28.1 minutes) over the same period. Our solutions save hoteliers time and money by automating labor management and providing real-time visibility into labor efficiency benchmarked against the industry and competitors. Large Sofa (3 – 5 seats) – $130 to $180. Small deviations between actual and budgeted expenses can be expected and are not a cause for alarm but serious deviations require investigation and explanation. Similarly, the room attendant uses electricity and water when cleaning the guestroom. One of our clients has two hotels in the same market (very similar in both product and business mix). This is another KPI to measure and analyse if the operating cost for each room is reasonable. If a guestroom is occupied, the bed and bath linens will need to be laundered after the guest checks out or after a specified number of days occupancy. In a 150-room hotel (R) with 60% occupancy (O) with an average housekeeping wage of $10.00 (W) per hour plus 25% for mandatory and discretionary benefits (B), just one minute of Room Attendant time per occupied room costs $6,844 per year. The basic cost that guests use up by being on your property is the incremental cost, and for a budget hotel in America is often about $20. Property A (the test hotel) reduced their housekeeping MPR from 28.2 minutes to 26.1 minutes (7.4%) over the four month test period. It’s a luxury 5-star hotel. I work as a housekeeper in W Hotel in the center of London. To properly manage revenue for a lodging property you first need to know how much it costs you to rent a room to someone. -- Spending Hours Doing Reports, 30 MPR for cleaning a checkout guest room, 20 MPR for cleaning a stay-over guest room. Both hotels were running virtually identical housekeeping metrics at 28 MPR. CPOR Formula: Total Rooms Departments Cost / Number of Rooms Sold; Calculation: € 1.875 / 75 = €25; See Also: REVPOR; GOP; GOPPAR For limited-service hotels, amenities may cost less than $1 per guestroom; for luxury hotels, the amenity replacement costs may total $20 or more. Here's an example: Say a typical 250+ room hotel spends $13,926 a year in water and sewage costs on their in-house laundry operation. Housekeeping is a huge cost for every hotel. Hoteliers generally save up to $6.50 a day per occupied room with such programs (source: Association for Linen Management). While these are technically not housekeeping-related expenses, they are variable expenses that a hotel will incur associated with each sold guestroom and must be remitted to the hotel’s franchisor, distribution channels, and booking partners. America’s Best Franchising Names VP, Franchise Development, https://lodgingmagazine.com/wp-content/uploads/2020/08/Make-It-Work-1-Cleanliness-Lo.mp4, AHLA Forum: Experts See Recovery on the Horizon, Hotstats: U.S. Hotel Industry Breaks Even in December. We’re the only way to get hotel labor costs 100% perfect. In the above-simplified budget for this 295 room hotel, we can see all the expenses on an annualized basis is just north of $24 million. Reasons for this: Not a GM's primary skill set Scope of work can vary from room-to-room and day-to-day making it difficult to measure efficiency Hotels use dated control methods lie "minutes per room" as a way… In Property A, we introduced a flexible minutes per room target at one of the properties. We always recommend that every hotel should have multiple housekeeping targets. Determine the average cost to replace “consumable” amenity items such as soap, shampoo, conditioner, lotion, toilet paper, tissues, and coffee. Optii’s predictive clean-time technology analyzes these factors and automatically assigns the right amount of time and resources for each room, meaning increased housekeeping productivity and reduced labor costs. Trust but verify. Even so, we were still surprised by how big of a difference using flexible housekeeping targets made in this case. Revenue per room. This can be tracked as net profit or gross profit. Their innovative approach and easy to use tools have helped hundreds of hotels achieve immediate results and incredible returns. Profit per room. The first step in successful revenue management is knowing how much it costs to put someone in a room. Hotels spend about $10 per room for cleaning, according to Emma Atanasoska, a former hotel manager who publishes the industry blog HotelReader.com. In Property A, we introduced a flexible minutes per room target at one of the properties. The reason why this works is simple – when you provide specific and realistic goals, you focus your team on achieving those goals. You eliminate the easy excuses of why they cannot meet the targets. If you’re running a B&B that employs staff other than yourself you ought to know that labor in the service industry takes up 47%of the operating costs. Most hotels measure their housekeeping using one flat MPR target. In this case, we only used two MPR tiers: 30 MPR for cleaning a checkout guest room; 20 MPR for cleaning a stay-over guest room Cleaning cost per room was $26. Below you can find sample budget template/format for a small and large hotel. Don’t forget to calculate the average cost of cleaning supplies and chemicals per room cleaned, including disinfectant, glass cleaner, toilet cleaner, and furniture polish. what is the average cost to run a heating and air unit in a standard 325 square feet hotel room. Laundry sheets comforts and whatnot. Cleaning times can vary significantly depending on room size, number of guests, length of stay, stayover vs. check out, etc. Price Per Room From: $40 to $80: Price Per Living Room: $30 to $40 (Stairs)From: $2 to $4 per step. Variable costs may range from $12 per room night for a budget property to more than $75 per room night for a world-class hotel. Steam Carpet Cleaning. I would guess the average cost to run a PTAC unit in a guest room is around $35.00 per month but this is a guess using 1200watts X 8 hours of run time a day that is the A/C or heat running 20 minutes of every hour every day of the month at 12 cents per kilowatt. This KPI is calculated by dividing the overall cleaning costs with the number of rooms. Laundry expensed – Cleaning the bed and bath linens after each stay comes at a price. Here’s a simple change that most hotels can benefit from: Housekeeping is a huge cost for every hotel. An Easy Change that Reduced Housekeeping Costs by 7.4%. 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