10 Hospitality Industry Terms

I have never been in the hospitality industry. Not until I’ve joined Sabre Hospitality Solution, provider of digital marketing solutions, central reservation systems and global distribution systems for the hospitality industry, just two weeks ago. Here are a list of terms that I have came across often in the industry.

1. Visit to Look and Look to Book ratio
This ratios are to measure the effectiveness of a hotel’s website and online booking engine. What it wanted to measure is the number of visitors who lands on the hotel’s website and eventually look into the room rates, thus the Visit to Look ratio. Look to Book ratio measures the number of visitors looking at the room rates and how many visitors actually make a booking.The higher the ratio means that the website and booking engine has a good conversion rate.

2. Online Travel Agency (OTA)
Agoda, Hotels.com and Expedia are some of the examples of online travel agency. These websites, or the companies operating it, typical have obtained some form of deals, directly or indirectly, with the hotels. The deal would typically allow the OTAs to list hotel room on their website available for visitors to book. Whenever there is a booking, the OTA’s would get a commission from the hotel.

3. Hotel Meta-Search Engine
Basically meta search engine would aggregate all websites to display the best rates available for a particular hotel room. Some example include TripAdvisor, Kayak and Trivago.These websites are getting popular for hotel booking since it would display the different rates of various sources for comparison.

4. Price Disparity
Price disparity means that a specific room in a specific date is showing a different rates on the hotel website and various OTAs. This usually happens when OTAs cut the price of the room to ramp up sales (as they only earn commission from the hotel only when there is a booking).

5. Average Daily Rate (ADR)
From time to time, a hotel would change the price of the room booking for various reasons. But in order not to deviate too much from their typical room rates, they would keep track of their average daily room rate. Even though room booking rates changes over time, it would be fine as long as their average daily room rate remains constant. Due to strategic reason, a hotel might want to slowly increase or decrease their average daily rate.

6. Average Occupancy Rate (AOR)
Similar to average daily rate, average occupancy rate tracks the percentage of room booked at any specific period. Hotels would strive a higher occupancy rate.

7. Global Distribution System (GDS)
Chances when you visit a travel agency, and you see the staff checking rates on the computer, they are using a Global Distribution System. It is a system created by a company to enable bookings or transactions between third parties and travel agents to offer travel-related services to the end consumers.

8. Booking Lead Time
When hoteliers plan their marketing campaign, they might want to know what is the average lead time for their guest to make a booking at their hotels. For example, if they know the average time for guests to make a booking before the stay is about 3 months. If they want to push for Valentine’s day promotion, they should start it 3 months before.

9. Derived Rate
Have you ever wonder how hotels set their price for their rooms over different period? They started off by setting a based rate. Based on the hotel’s occupancy history, occasions and some other factors, decides the room rates by indicating what we call the derived rate. Meaning to say, they might decide that this period would add another 5% or -3% to the room price.

10. Competitive Set
As the hospitality industry is a very competitive industry, very often the hoteliers would like to know how are they performing comparing with their competitors. Of course they can’t compare with any hotels as all has different target audience and unique factors. As such, they would need to craft a competitive set, meaning to define a specific group of competitors to compare.

There are much more to learn in this industry. Do you have anything you would like to add-on or something you would like to correct me?

6 things to note before traveling to America

I am asked to go to the US for a conference at Bethesda, Maryland. It is my virgin trip to the United States of America, and there are plenty of things I learnt from this trip. I thought I should write them down and let those who are also traveling for the first time to gain some basic knowledge.

1. Coins
It was quite confusing at first. There is Dime, Penny, Nickel and Quarter. I have to do some googling to know that a Dime is 10 cents. I still find it weird that the size of a Dime is actually smaller than Nickel (5 cents coin). More information on US coins.

2. Left-hand Drive
Knowing this could prevent you from trouble. Singaporeans are familiar with right-hand drive. When we cross the road, we look to the right side of the road to lookout for traffic. But it is important to look to the left side of the road instead in the US.

3. Tipping
We don’t practice tipping much in Singapore. Or at least we’re not expected to tip. In the US, especially in cafe or restaurant, they expect you to tip. In one incident when I forgot to include a tip, the waiter actually asked, politely, “aren’t you tipping us?” 🙂

It stands for Electronic System for Travel Authorization. We Singaporeans are lucky as we do not need to apply a VISA to travel to the US, but we need to apply for ESTA. You can apply for ESTA here.

5. Fahrenheit, Miles and Pounds
I know that the US is using a different measuring units than what we’re familiar in Singapore. But I thought I should remind you to familiarize with these before traveling there. It is good to know the difference and get some perspective on the weather, distance and the weight. Download an app into your phone would help before you travel.

6. Bring your own bag
Be ready to bring your own bag when you go shopping. This includes boutique store, 7-11 stores and supermarkets. They normally don’t offer shopping bags unless you ask for it and you might have to pay for it sometimes.

Are there anything else you might want to add to this list? Let me know.

Cost of owning a car in Singapore

A year ago, when I’m pondering whether I could afford a car, I realized there isn’t much concrete information. Yes, I could find some rough estimates but such are too vague.

Today, my ownership of my Mitsubishi Colt turns one year and I actually recorded all the related expenses throughout the year. I would like to share this information so that whoever considering a car could use this as a reference. Of course, use it only as a reference/guide as they doesn’t represent every car and every kind of usage.

Before the information, I thought I should cover some background of my car usage. I bought this car with only 2 year and 8 months left before the COE expires. My work requires me to drive and meet my clients at least 2 – 4 times a week. I paid for my house season parking, and I’m lucky that my company paid for my season parking at my work place.

Once you own a car, there are a few costs that, even if you don’t use the car, you would have to pay for it. Below is a list of them and how much it cost me last year.

Car Depreciation – $6,930
[ (Total cost of the car – the minimum PARF benefits) / total number of months ] x 12 months.
Insurance – $1,634
This cost varies with different cars, owner’s driving experience and many other factors.
Loan Interest – $400.08
Unless you pay the car in full cash, you would definitely incur interest for your car loan.
Road Tax – $570
Again, this costs differs based on the car models.

Next, you would need to prepare for expenditures based on your usage. This car has an average of 400km before the empty tank light/signal appear. In the past one year, I’ve driven 22,943km.

Car Accessories – $56.10
I’m sure you would buy some car accessories to “change” your car. Some might spend thousands but I’m quite easy on this.
Maintenance & Repair – $1,428.05
As the car is rather old, I’ve expected some repair work needed. I have sent my car for two regular maintenance work (each costs around $200-$300) and my air con compressor spoiled which cost me almost $500 to change and repair. This cost also include some car wash expenses.
Parking & ERP – $2,658.08
I joined this two costs together because both uses Cashcard (so recording is easier).
Petrol – $3,544.98
I pump Esso initially but after some experiments with SPC, I realised that I could drive further per tank. Esso was about 380 per refuel but SPC could last me until 400+ per refuel. SPC discount was higher too since it does not have points system like Esso; which I find it troublesome.
Traffic Offence – $119.50
Yes, traffic offence. Unless you don’t drive, but my bet is you’ll bound to break some traffic rules from time to time.

To sum up all the car expenses, I’ve spent $17,340.79 last year. That is $1,445 a month. Are you ready for such expenditure? Think again, and again…

Thinking about car cost in Singapore
© Bandu | Dreamstime Stock Photos

From networking to government grant, I’m back with more.

Four months into my new job has been a challenging period; or at least it was challenging enough to prevent me from doing what I enjoy, to write. Looking back, my last blog post was to wish everyone a happy Lunar New Year. Regretful. Especially when I’m noticing that my blog visitors have increased, but having no new content for the past four months just isn’t a wise thing to do.

My new challenge

Yes, I have a new job after the Chinese New Year holidays. I was given the opportunity to work as a Senior Account Manager of Maxias Pte Ltd. In a full digital agency, I jumped right in to what I do best: to develop and manage websites. Apart from getting used to the new company’s culture, processes and policy, I was expected to take over ongoing projects from my predecessor. The lucky thing was the chance to work again with Art Director, Farik Osman, whom we have worked together for a couple of years back in Ad.WRIGHT. Nothing beats working with someone you know, which reduces the time to understand each other’s working behavior and strength. Continue reading From networking to government grant, I’m back with more.