Academy
What a sold room actually costs, and where the margin goes between commissions, payroll and suppliers. Management accounting for hotels that have no controller, and still need to know which departments earn their keep.
Hotel management accounting: margin by department
4 articles
The hotelier arrives at the bank with the last two sets of accounts and the builder’s quote. Across the table the request is a different one: the month-by-month cash budget, the forecast of receipts and outgoings. Not yesterday’s numbers — tomorrow’s.
An independent hotelier has more data than ever before, yet the simplest question — how much did I really make on rooms last month, and why — goes unanswered until the following spring. What is missing is almost never the data. It is someone whose job is to turn it into decisions.
Every spring the hotelier receives a document stating, with impeccable precision, that the year closed with an eighty-thousand-euro profit. The figure is correct. It answers none of the questions that matter.
How can you sell more rooms than last year, at higher rates, and end up with less margin? It looks like an accounting question. It is really a question of method — and the statutory accounts were never built to answer it.