The Role, Cost, and Management of Hospitality Facilities

The hospitality industry consists of travel companies, hotels, resorts, transportation, and restaurants, whom all provide over-lapping comforts. Gradually, the hospitality industry has increased its focus on creating more and more facilities for their customers. Hospitality facilities management and design is a book that is dealing with management of different facilities in the hospitality industry. This is a classic book that has dealt with all aspects of hospitality management. David M. Stipanuk is the author of this book. The first chapter of this book entails The Role, Cost and Management of Facilities in the hospitality industry.

The role of a hospitality facility is to provide an appealing visual environment, over all ambiance, experience, and comfort. Facilities also becomes an attraction itself, it should engage and entertain guests. A hospitality facility should also provide comfort, they provide warmth and protection. It should also provide the the structure to provide their guests with all of their necessities. These needs would include laundry, food, entertainment and many more. And last, facility acts as an identifier to guest. Example: A toddler cannot read, but knows what a Wendy’s Restaurant looks like.

The Cost of Obtaining and Maintaining a hospitality facility is very expensive. One would have to consider the costs of Design and Development and Construction. Construction costs varies, and it depends on a number of things;

Type of facility
Complexity
Luxury level

In order to provide a return on investment, a facilities must be operated and maintained to maximize Operating profit potential and Real estate appreciation. One would have to decide the “who, what, when and where” for how they are going to obtain the working capital to get started. The cost of land, building and site improvements, other soft costs, Furniture, Fixtures and Equipment will most definitely follow. The proper design, quality, and budget control lead to predictable costs such as; Maintenance, Renovation and Operation. Following construction, one would have to consider the ongoing costs of operation, the Property operations and maintenance (POM) and the facilities’ utilities. The POM is connected with the initial construction cost in that the more you spend to build, the more you will have to spend to maintain. Property operations and maintenance (POM) costs:

Labor and benefits
Supplies
Contract costs
Utilities costs:
Electricity
Fuel
Steam
Water
Some of the contributing factors would include occupancy, weather, the usage of the system, the age of the facility, the types of building systems, local utility rates, local labor rates and the differences in construction.

Some businesses may have already considered the distinction between their core business and non-core business (Example; security and maintenance versus cleaning) as part of the motivation to produce and achieve greatest value and customer satisfaction. Because of the fact that running costs account for an important part of yearly expenses, second only to payroll, there will be pressure to look for savings in non-core business areas. Cutting operating budgets may be an attractive, or financially expedient, short-term measure but may not foster the business’ long-term development. Since the running of a hospitality facility involves complex, co-ordinated processes and activities, it is of utmost importance for management to take an integrated view.

Management must make it possible for hospitality facilities to offer maximum support to core business activities, the management team must, therefore, recognize that cost and quality are linked and should not be considered separately. Facilities management can be defined as creating the optimal environment for the organisation’s primary functions, taking an integrated view of the business infrastructure, and using this to deliver customer satisfaction and best value through support for and enhancement of the core business. Facilities management is something that will: deliver effective and responsive services; enable changes in the use of space in the future; make its assets highly cost effective; create competitive advantage for the business’ core business; and enhance the business’ culture and image.