Perpustakaan Digital ITB

Yield management is a popular application of total revenue maximization tactics in service industry. Airlines, clubs, and hotels are using this pricing strategy to maximize the total revenue generated from the service operations. Just like other hotels around the world, Hotel ABC, a reputable hotel in Bandung, already implemented the yield management strategy in order to maximize its income in this service industry with an intangible yet perishable inventory. Yield management is a very important aspect for a hotel to be financially successful. A great yield management will help the hotel to pay off the cost occurred every day and selling all the perishable inventories. Hotel ABC first implemented this in 2008 and had never assessed the effectiveness of the implementation. By using the matrix created by Bernard McEvoy and financial results comparison, the analysis of effectiveness of the implementation is being assessed. The results of the analysis will help the hotel to assess the current strategy’s effectiveness and improve the strategy of yield management. The analysis was done with three type of methods, demand plotting, Bernard McEvoy's matrix and financial statements comparison. This analysis requires the data of financial statements, daily statistical room sales, and some other data that are confidential so will not be attached in a detailed manners. For a high/low cut off comparison, Horwath HTL, a subcompany of Horwath International, provided the facts and figures of financial excerpt of Bandung hotels in 2008 that is printed in 2009 via Horwath Indonesia Hotel Industry 2009, and Bandung hotels in 2007 that is printed in 2008 in Horwath Indonesia Hotel Industry 2008. The outcome of the analysis shows that the demand for superior, deluxe rooms in weak season and executive rooms in peak season are elastic, while the other rooms couldn’t be categorized. In overall, Hotel ABC has implemented an effective yield management implementation, proven by its highest revenue increase compared to previous years' increase. Further analysis shows that after the implementation of yield management, Hotel ABC could increase its revenue from sales room in a significant amount, and is higher than the increase of revenue of Bandung hotels'. However, Hotel ABC also increased its operating expenses while in the same time, Bandung hotels' decrease it. From a further analysis, it is found that Hotel ABC that the increase in expenses derived from the increase in employees' salary, which shows that Hotel ABC had chosen to invest more in its people. In order to improve its efficiency, Hotel ABC should cut its operating expenses, in other words, they should operate in more efficient way.