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Hotel Industry Overview - August 2007 - Industry Terms

LMSB-04-0807-054

"This document is not an official pronouncement of the law or the position of the Service and cannot be used, or cited, or relied upon as such."

Industry Terms

 

Industry Term

Definition or Explanation

ADJOINING ROOMS

Guestrooms located side by side without a connecting door between them.

AFFILIATE RESERVATION SYSTEM

A hotel chain's reservation system in which all participating properties are contractually related. Each property is represented in the computer system database and is required to provide room availability data to the reservation center on a timely basis.

AFFILIATED HOTEL

A hotel that is a member of a chain, franchise, or referral system. Membership provides special advantages, particularly a national reservation system.

AMENITY

Service or item offered to guests or placed in guestrooms for the comfort and convenience of guests, and at no extra cost. Examples are various guest services (such as in-room entertainment systems, automatic check-out, free parking, concierge services, and multilingual staff) in addition to an array of personal bathroom items offered by most hotels and motels. Amenities are designed to increase a hotel's appeal, enhance a guest's stay, and encourage guests to return.

ATRIUM

A guestroom floor configuration in which rooms are laid out off a single-loaded corridor encircling a multistory lobby space; also the multistory lobby space, usually with a skylight.

AVERAGE OCCUPANCY PER ROOM

A ratio that shows the average number of paid guests for each room sold. Calculated by dividing number of paid room guests by number of rooms sold. Measures management's ability to use the lodging facilities. 

AVERAGE ROOM RATE

 

A ratio that indicates average room rate, and to what extent rooms are being up-sold or discounted; calculated by dividing rooms’ revenue by number of rooms sold. Also called average daily rate or ADR. 

BANQUET

A meal prepared for a particular group, for which the number of guests and the menu are predetermined. Most properties offering banquet service have special facilities for banquet food production and service.

BARTER

The trading of merchandise instead of paying cash. (e.g. advertising)

BED &

BREAKFAST (B&B)

A small inn or lodge that provides a room and a breakfast. Often a B&B is in a residential home setting and/or a historic building converted to a quaint lodging facility.

BILLING CLERK

The person responsible for charging to hotel guests all vouchers representing food, beverages, room service, and merchandise purchases.

CALL ACCOUNTING

SYSTEM

A system that is part of the telephone equipment that prices telephone calls made by hotel guests and sends the information to the property management system (PMS) for billing.

CASINO HOTEL

A hotel that features legal gambling, with the hotel operation subordinate to the gambling operation.

CENTRAL RESERVATION OFFICE

Part of an affiliate reservation network. A central reservation office typically deals directly with the public, advertises a central (usually toll-free) telephone number, provides participating properties with necessary communications equipment, and bills properties for handling their reservations.

CHAIN OPERATING COMPANY

A firm that operates several properties, such as Holiday Inn Worldwide or Hilton Hotels Corporation. Such an operator provides both a trademark and a reservation system as an integral part of the management of its managed properties.

CHECK-IN

The procedures for a guest's arrival and registration.

CHECK-OUT

(1) The procedures for a guest's departure and the settling of his or her account.
(2) A room status term indicating that the guest has settled his or her account, returned the room keys, and left the property.

COMMERCIAL HOTEL

A property, usually located in a downtown or business district, that caters primarily to business clients.

COMPLIMENT-ARY ROOM

A complimentary or "comp" room is an occupied room for which the guest is not charged. A hotel may offer comp rooms to a group in ratio to the total number of rooms the group occupies. One comp room may be offered for each fifty rooms occupied, for example.

CONDOMINIUM HOTEL

A hotel in which an investor takes title to a specific hotel room, which remains in the pool to be rented to transient guests whenever the investor is not using the room. The investor expects to receive a gain from the increase in value of the hotel over time, as well as receive ongoing income from the rental of his or her room.

Cooperative advertising

Any arrangement by which a product or service is brought to public notice over the names of both the supplier and any intermediary who comes between that supplier and the ultimate purchaser.  The intermediary may be a retailer who buys a product for resale, a distributor who sells to retailers or other form of intermediaries.  This arrangement results in consumer advertising as well as other forms of promotion.   The cost of the promotion may be shared by the supplier and the intermediary, or the supplier may pay all costs.  The process commonly involves reimbursing retailers for advertising they create and place.

CORPORATE HOTEL CHAIN

Hotel organization that has its own brand or brands, which may be managed by the corporate chain or by a conglomerate.

GENERAL MANAGER

The chief operating officer of a hotel.

HOSPITALITY INDUSTRY

Lodging and food service businesses that provide short-term or transitional lodging and/or food.

HOTEL

A large lodging facility, generally a hotel is full service and a multi-story building with interior entrance guest rooms.

INDEPENDENT HOTEL

A hotel with no chain or franchise affiliation. It may be owned by an individual proprietor or a group of investors.

LATE CHARGE

Charged purchase made by a guest that is posted to the guest's folio after the guest has settled his or her account.

MID-PRICE/ EXTENDED-STAY HOTELS

Hotel that caters mostly to persons who must be in an area for a week or longer. The guestrooms of mid-price/extended-stay hotels have more living space than regular hotel guestrooms, and may also have cooking facilities. Guestrooms in these hotels tend to be less expensive than guestrooms in full-service or all-suite hotels.

Occupancy

The percentage of available rooms occupied for a given period.

POINT OF SALE SYSTEM (POS)

Computerized systems that retail outlets such as restaurants, gift shops, etc, enter orders and maintain various accounting information. The POS generally interfaces with the property management system (PMS).

PROPERTY 

MANAGEMENT

SYSTEM (PMS)

A computerized front desk system that manages hotel room inventory, guest billing and interfaces with various other systems such as telephone, call accounting, point of sale (POS), entertainment, etc.

PROPRIETARY BOOKING ENGINE

A internet reservation system that is owned and operated by an individual hotel or group of hotels to allow them to take reservation on their own website without paying a fee to the GDS, third party booking engines or franchise reservation systems.

RACK RATE

The current public rate quoted for each accommodation as established by the property's management.  However, most rooms are discounted. (i.e. rented at less than the rate rack)

RESERVATIONS

A guestroom that being held under an individual or business' name at a particular hotel for a specific date or range of dates.

RESORT HOTEL

A hotel, usually located in a desirable vacation spot, that offers fine dining, exceptional service, activities unavailable at most other properties, and many amenities.

ROOM OCCUPANCY SENSOR

A device that uses infrared light or ultrasonic sound waves to sense the physical occupancy of a room. Sensors have the ability to turn on devices and appliances such as lights, air conditioning, and heating whenever a guest enters a space, and to turn these devices and appliances off when the guest leaves.

ROOM RACK

A card index system that is constantly updated to reflect occupied and vacant rooms. In the evening, the room rack contains forms for only those registered guests remaining for the night who are to be charged for rooms. A daily room report can be prepared from the room rack.

ROOMS MANAGEMENT MODULE

A front office application of a computer-based property management system. The module (a) maintains up-to-date information on the status of rooms, (b) assists in the assignment of rooms during registration, and (c) helps coordinate various guest services.

SERVICE CHARGE

A percentage of the bill (usually 15% to 20%) added to the guest charge for distribution to service employees in lieu of direct tipping.

THIRD PARTY 
BOOKING
ENGINE

An internet site that provides a booking engine where a traveler can search a large number of lodging facilities for availability and reserve a room. The lodging facilities are not affiliated with the site and pay a fee for the business that the third party site generates. Examples of third party sites include: hotels.com, priceline.com.

Transient Occupancy Tax

City or County tax added to the price of a hotel room.

WATERPARK HOTEL

A hotel that offers large recreational water elements such large pools, multiple pools, slides or other water related venues.

Chapter 3 | Table of Contents  | Chapter 5

Page Last Reviewed or Updated: 05-Nov-2014