FIXING ROOM TARIFF AND TYPES OF ROOM RATES

Price is one of the major elements involved in the marketing and positioning of a product or service. The price of goods and services of a hotel should cover the cost of production and overheads, and include a fair amount of profit, so that the hotel business remains sustainable and profitable. The room of a hotel generates the maximum revenue, so an accurate and competitive room rent is one of the prerequisites for running a successful hospitality business. The rate of a hotel room is based on the competition, cost, standard of services and amenities offered by the hotel, the guest profile, location of the hotel, location of the room etc.

Three common approaches to deciding room tariff are given as below:

Market based Pricing: Market based pricing is setting a price based on the value of the product in the perception of the customer. The concept is based on an idea of what the ultimate consumer of goods and services, i.e the guest is willing to pay and then use this as a starting point. In this case, the hotel works backwards as it first makes an accommodation product available at a price that a guest is willing to pay rather than first readying the product and then deciding its tariff on the basis of costs involved.

This approach is common sense approach. Management looks at comparable hotels in the geographical market and sees what they are charging for the same product. The thought behind this is that the hotel can charge only what the market will accept, and this is usually dictated by the competition.

There are many problems with this approach, although it is used very often. First, if the property is new, construction costs will most likely be higher than those of the competition. Therefore the hotel cannot be as profitable as the competition initially. Second, with the property being new and having newer amenities, the value of property to guests can be greater. The market condition approach is really a marketing approach that allows the local market to determine the rate. It may not tale fully into account what a strong sales effort may accomplish.

Close observation of market trend approach further divides it into four types:

•         Competitive Pricing : Charge what the competition charges
•         Follow the leader Pricing : Charge what the dominant hotel in the area charges
•        Prestige Pricing : Charge the highest rate in the area and justify it with better product,                 better service levels, etc
•            Discount pricing : Reduce rates below that of the likely competitors without considering            operating costs

The Rule of Thumb: The rule of thumb approach sets the rate of a room at Rs. 1 for each Rs. 1000 spent on the project cost per room, assuming 70 % occupancy. In case the occupancy percentage is expected to be more than 70% then the rate of a room can be less than Rs. 1 and on the contrary if the occupancy is expected to be less than 70 % then the rate can be more than Rs. 1. For example, assume that the average construction and furnishing cost of a hotel room is Rs. 30,00,000/- the average rack rate of hotel room in this hotel using thumb rule will be Rs. 3000, as illustrated below.

1000:               1

30, 00,000:      3000

The inflation cost is kept in mind while fixing the rack rate. For example if a hotel was built 50 years ago at the cost of Rs. 50,000/- per room than as per the rule of thumb the rack rate per room will be Rs. 50/- only which is not a financially viable rate option. To find out the current rack rate either the present asset value is evaluated or the net present value of Rs. Invested 50 years ago is calculated, keeping in view the inflation and the resultant devaluation of currency.

The rule of thumb approach to pricing rooms also fails to consider the contribution of other facilities and services provided by the hotel in generating revenue. As hotel generates revenue from sources like food and beverage, conference, laundry, telephone etc so it must be a part of calculation while deciding room tariff for the hotel.

The Hubbart Formula :   The Hubbart formula, which is a scientific way of determining the room rent , was developed by Roy Hubbart in America in the 1940s. It resolves all the problems of the rule of thumb approach.

                                              ROI + Operating expenses- Non room revenue

                                                         Projected rooms sold per day X 365

The following steps are involved in calculating the room rent according to Hubbart formula :

  

•     Calculate the desired Return on Investment by multiplying the desired rate of return by the capital investment.
•             Calculate the desired profit after deducting the income tax.
•           Calculate fixed expenses and undistributed operating expenses including depreciation, interest, insurance, Human resources, marketing, maintenance, electricity, general expenses etc
•     Estimate non room revenue. Non room revenue department includes Food and beverage, conferences, health club, laundry etc
•         Give average projected room occupancy for a day and multiply it by 365 to find the projected number of rooms sold per year.
•            Calculate the average room rate by solving the equation of the formula.

Illustration:

Hotel ‘XYZ’ having 40 rooms is constructed at a project cost of Rs 10 crores. The owner’s capital is Rs. 6 crores on which he is expecting 20 % ROI while the remaining capital is arranged through a bank loan at an interest rate of 15% per annum. The income tax rate is 30 % and the hotel is expected to make 60% occupancy. The operating expenses are estimated to be Rs. 2 crores while the hotel is expecting Rs. 1 crore as non room revenue in the first year of its operation. Calculate Average rack rate with the use of Hubbart formula

Solution: Desired ROI- Rs. 60000000 x 20 % = 12000000

Total room nights = 24 x 365 = 8760

Total expenses = Rs. 20000000 + 6000000 ( bank interest) = 26000000

Non room revenue = Rs. 10000000

Pre- tax income -     30 x 12000000      = 5143857

                                           70

5142857 + 12000000 = 17142857 /-

                                    17142857 + 26000000 - 10000000

                                                           8760

=    Rs. 3783 /-   is estimated as average rack rate for the hotel as per Hubbart formula. 

RESERVATION

RESERVATION

 Introduction

Reservation in the hotel industry is defined as ‘blocking a particular type of guest room (e.g., single room, double room, deluxe room, executive room, suite, etc.), for a definite duration of time (i.e.,number of days of stay), for a particular guest’.

The reservation section of the front office department of a hotel is responsible for receiving and processing reservation queries.

Layout of the Reservation Section:  The location of the reservation section depends upon the size of hotel and the volume of business of the hotel.

 

 Importance of reservation

  

Advance booking of rooms is known as room reservation. Its importance for the guest and for the hotel is discussed as below:

 

For the guest

1. Guarantees availability of accommodation
2. Saves time in search and in check-in
3. Helps in budgeting for the travel
4. Removes anxiety and gives a feeling of safety

 

For the Hotel

n  Helps in planning

n  Useful in yield management

n  Important for duty- rosters and staff leave scheduling

n  Improves service and enhances guest satisfaction

 Modes and sources of reservation

In common language mode refers to ‘how’ the reservation is received and source refers to ‘from whom’ the reservation is received.

Modes of reservation

Ø  Telephone                         

Ø  Fax

Ø  Telex

Ø  Internet

Ø  E.Mail

Ø  Letter

Ø  Telegram

Ø  In-person 

•          The process of reservation begins with an inquiry. A guest may contact a hotel for reservation either through:

–        Written Mode

–        Verbal Mode

–        Reservation requests may also be made through oral communication known as verbal mode of reservation request

–        The advantage of oral communication is that it is fast, convenient, and generates immediate response or feedback; and one can get the complete information and clear any doubts through oral communication.

–        The disadvantage is that it does not provide a permanent record.

–        The various modes of verbal reservation request are as under:

–        Telephone

–        In person

–         

Written Mode

•          When a reservation request reaches the hotel in writing, the mode is classified as a written mode of reservation.

•          The advantages of the written mode of reservations are that they are clear, unambiguous, and provide a written record for the hotel, which can be referred to in case of any miscommunication or confusion. The correspondence with the guest is filed for future reference.

•          The various written mode for reservation request are as under:

–        Letter

–        Fax

–        Telex

–        E-mail

Sources of room reservation

·         Direct                  

·         Travel Agents

·         Corporates

·         Airlines

·         Embassies

·         GDS

·         CRS

·         RSO

·         Inter-sell Agencies

·         Referral Hotels

 

• Direct: Reservation is given to the hotel directly by the guest

• Travel Agent : Travel agents give room bookings to the hotel on a commission basis

• Corporate: Corporate or companies are a major source of business in the form of their executives travelling as business travellers and also the substantial conference business given by them.

• Airlines: Airlines give room business to hotels in the form of their crews and layover passengers. Specifically applicable for airport hotels.

• Embassies: Embassies are a source of business for hotels as they host cultural shows, business delegations, festivals, etc.
• GDS: Global Distribution system or GDS is a software system which brings together the room inventories of different hotels and other travel services together on one platform. Reservations booked by GDS have a direct interface with hotel’s PMS (Property Management Software) to provide real-time room inventory, rates and availability.

Major Global Distribution System companies are as follows:

Ø  Galileo Central Reservation Systems

Ø  Amadeus Computer Systems

Ø  Sabre Computer Systems

Ø  Trust International

Ø  SMART - Scandinavian Multi Access Reservation for Travel Agents

        CRS: Central Reservation System (CRS) is the internal reservation network of chain hotels and their franchised hotels. Eg.TRN or Taj Reservation Network.

• RSO: Regional Sales Offices (RSO) are responsible for sales and marketing of chain/individual hotel in a specific region. They are also a source of reservation for the hotel.
• Inter-sell agencies: They are two or more business organizations, like Airline and Hotels, promoting each other’s business for mutual gain. Hotels and car rental companies may also be inter-sell partners.
• Referral groups: They are an informal or sometimes formal association of hotels who refer guests to each other in case of sold-out status or if a guest is travelling to another city where the hotel does not have a branch.

 Types of reservation

 Reservations can be categorised as per the following two criteria:

·         Nature or the number of people travelling together

·         Status of the reservation

 

Nature or the number of people travelling together

 ·    Individual reservations - Bookings for FIT’s for one or more rooms

·    Groups - Bookings for a group of persons travelling with the same itinerary

 

·    Conference - Room bookings for guests using the hotel’s conference facilities (guests may or may not be travelling together).

Status of the reservation

Confirmed reservation - A booking in which a guest is committed a room and a confirmation number and letter has been sent.

Non-guaranteed reservation - It is a confirmed reservation for which the hotel has still not received a guarantee of payment incase of a cancellation/ no-show. Internationally, the room is held till 1800 hrs on the date of arrival, after which it may be released in favour of another reservation. Therefore, these reservations are also known as 6pm confirmed reservation.

Guaranteed reservation - It is a confirmed reservation which the guest has ‘guaranteed’ by making an advance deposit or by providing a credit card authorization, ‘bill to company’ letter or travel agent voucher which clearly state the client will pay incase of a cancellation/no-show. It guarantees the hotel will recover at least one night’s room charge even if the guest does not come. The room is held till 12 noon the next day from arrival date.

 

•          A guaranteed reservation is a confirmation that the hotel will hold the reserved room for the guest and not release it to any other guest even if the guest doesn’t arrive on time.

•          This requires the guest to make an advance payment (part or full, depending on the hotel policy and the hotel occupancy for the requested stay dates), irrespective of whether the guest avails the reservation or not, unless the reservation is cancelled according to the hotel’s cancellation procedures.

•          The guaranteed reservation can be obtained through one of the following ways:

–        Pre-payment

–        Contractual agreement

–        Allotment

Pre-Payment

•          A guaranteed reservation requires the payment of the room rent or a specified amount in advance, known as pre-payment. As the hotel holds the room for the guest even after the cancellation hours, pre-payment protects the hotel from any loss of revenue in case of a last moment cancellation or a no-show.

•          Pre-payment can be made by sending demand draft or depositing cash at the hotel.

•          Cash deposit is the most preferred mode of accepting guaranteed reservation

 

 

Contractual agreement

•          A hotel may have a contract with an individual or a company for providing guaranteed reservations. According to such a contract, the hotel confirms the reservation for the individual or a person referred by the company on a guaranteed basis, and the person or the company agrees to pay for the reservation, even in the case of a no-show. Hotels may have contractual agreement with the following:

•          Travel agencies/Tour operators

•          Corporate houses

•          Travel Agencies/Tour Operators: Travel agencies and tour operators make bulk purchases of rooms at a relatively low contracted price. They guarantee the hotel a minimum number of room nights in a particular period and agree to pay the room charges even if they are unable to fill the number of rooms as per their agreement with the hotel.

•          Corporate Houses: In this case, a company or a corporate body may enter into a contract with a hotel, whereby the company guarantees payment for its employees or sponsored guests and accepts the financial responsibilities for any no-shows.

Waitlisted reservation - If rooms are not currently available the request can be put on the ‘waitlist’. It means that as soon as the rooms are available, the hotel will inform the caller of the status, in which case it may get converted into a confirmed/ guaranteed reservation. They do no impact room availability.

Tentative reservation - The booker has ‘blocked’ accommodation (usually a large number of rooms) in anticipation of a movement in future. Such reservations normally have a ‘cut-off period’ within which they have to be guaranteed failing which the hotel can release accommodation. These reservations are called ‘non-deduct’ reservations i.e. they do not deduct rooms from the availability. 

Time-limit in reservation

Time-limit is applicable in case of non-guaranteed reservation. It is usually 6 hrs from the time of check-in. As hotels generally follow a 12 noon check-in time, it is also referred as 6 pm confirmed reservation. In this case, 6 hrs is the maximum time given for check-in failing which hotel may release the room to any walk-in guest

8.5 Systems of Reservation

 

Depending on the needs of the hotel and the volume of business, a hotel may adopt either:

•          Manual System : In a manual system, all the reservation records are maintained manually. This old system of reservation is suitable for a small property, where the number of rooms is less and the volume of reservation requests is also low.

•          Automated System: Automated reservation systems are computerized reservation systems that are used to store and retrieve room status information and conduct transactions.

•          The information stored in the automatic system is the same as in a manual system. However, the processing of reservation request does not require manual study of bed room journals, density charts, or conventional charts.

•          The reservation assistant can check the availability of rooms by clicking on a link on the computer.

•          In this system, the reservation information is keyed into the electronic format of the reservation form, and this information is transferred to the central server where the room status is updated automatically.

Manual System of Reservation

The hotel may use the following in a manual reservation:

•          Diary system of reservation: As the name suggests, in this system a daily diary is kept, in which the reservation agent lists all arrivals due on a particular day.

Ø  It is usually kept on a loose-leaf basis.

Ø  The top page represents arrivals on the current date; this is removed and sent to the front desk for receiving the guests.

Ø  The hotel booking diary may be hard bound also. The diary system of reservation is only suitable for very small properties.

 

Whitney system of reservation: This system of room reservation, developed by the American Whitney Duplicating Check Company, is suitable for small and medium properties–with up to 150 rooms. It is based on the use of standard size slips, known as Whitney slips or Shannon slips, which can be held on a metallic carrier on Whitney racks.

•          The advantages of using Whitney system are as under:

Ø  Bookings can be kept in order of the date of arrival.

Ø  Booking records may be arranged in alphabetical order.

Ø  The racks and carriers can be used over and over again. The running expense is only of the slips.

Ø  The Whitney racks are placed vertically, saving storage space

Whitney slip

Name of guests                Number of people

Arrival date         Departure date

Room tariff         special requirements

Address               Telephone number

 Process of Reservation

Steps in handling reservation are listed as below:

• Step I. Request for advance booking is received through any mode of reservation
• Step II. Take down the details in a structured format known as Reservation Form
• Step III. Transfer the information to PMS (Property Management System) which is hotel management software. Update the relevant fields in the page ‘create new reservation’
• Step IV. Send a letter of confirmation/ waitlist/regret to guest.
• Step V. Keep all correspondence related to reservation inside the reservation form which is like an envelope.
• Step VI. File the reservation form as per date of arrival. There is one file for each future date (usually for next 90 days).Forms are filed in an alphabetical order of the guest name (last name first eg. Mr. Sharma Rajesh) in the file for that date.

Reservation Confirmation:

The hotel should communicate guests by telephone, telex, mail, or e-mail a Letter of Confirmation, which confirms the important points of the reservation agreement. This very letter might be shown at the registration process in order to accelerate the pace of registration and prove that the guest has the right to have a room at the hotel. The Hotel shall send a confirmation letter to all reserved potential guests, whether their reservations are guaranteed or non-guaranteed. Below are the main points that should be communicated in a confirmation letter:

a) Name and address of the guest

b) Date and time of arrival

c) Room type and rate

d) Length of stay

e) Number of persons in a group, if any

f) Reservation type [guaranteed or not]

g) Reservation confirmation number

h) Special requests, if any

Sample format: Reservation Form

Hotel XYZ

Name of the Guest

Designation

Company/Travel Agent

Confirmation number

Date of             Arrival

No. of Nights

Date of departure

Number of rooms/type of rooms

No. of Persons

Expected time of arrival

Airport pick up details ·         YES/NO ·         Flight number: ·         Exp.Time of Arrival

Special instructions/Remarks

Billing  Instructions

Mode of payment

Given by

Contact details

Received by

Time and date

Reservation status

How to handle a reservation call from a guest

1. Call opening

Hotel ABC International , Reservations, Greetings.

You are speaking with XYZ. How may I assist you?

 

2. Address guest concern and confirm guest name.

Eg. I will assist you with that. May I know who am I speaking with?

Confirm spelling and pronunciation if name is not understood

 

3. Confirm identity if required

Is this reservation for your self?

 

4. Take details of hotel name, dates, rooms, occupancy, and children and check availability

Advise child policy as required.

 

5. Previous stays and purpose of visit

“While I check availability may I enquire if….

a) Business or leisure”

b) If International guest, on a planned visit to India check planned destinations and offer assistance / recommend itinerary / special offer

Resort – “Is this, a leisure trip for you or are you traveling for a special occasion”

c) Previous stay in the hotel

 

6. Share availability (not category)

Situation 1: If rooms are not available

Do you have alternate dates or would you like me to process a waitlist reservation.

Or, would you like me to check the availability of any other hotel / resort?

 

Situation 2: If rooms are available proceed with the reservation

 

7. Room Category Description

Introduction of room types (dependent on previous stays)

Up selling of room types can be done here

 

8. Share Rates - All public rates with inclusions restrictions, supplements, taxes

 

9. Cancellation and Guarantee Policy

If no guaranteed “I am afraid the reservation will be on waitlist and will be confirmed on the receipt of guarantee, subject to availability at that time”

 

10. Loyalty Programme

Are you an ABC International Privilege Program Member?

If Yes – Check for membership no. and feed in system ; If No – Inform about the program

 

11. Reservation Details

“Could you please spell your name, last name first” (if not spelt earlier, verify phonetically)

“May I have your contact number and email address”. Verify all contact details

 

“May I have your credit card details?” (type, no. and expiration and verify all)Room Preference: “Would you have any preferences towards the room like a smoking or non smoking room

 

12. Arrival Assistance

Transport assistance – intercity/airport/station

Expected time of arrival and travel details

Check –in, check out time

 

13. Recap

“I would like to verify the reservation details. The reservation is for... Guest name, hotel name, dates, number of rooms and occupancy, rates, preferences. This reservation stands (Confirmed / requested) with reference number

 

14. Confirmation

I have sent you an email confirmation for the reservation which you will receive shortly

 

15. Call Closing

Mr. /Ms. XYZ, would you like me to provide you with some information about the hotel?

You were speaking to (Agent name) Thank you for calling  Hotel ABC International Reservations, have a nice day / afternoon.

 

Billing instructions during reserving a room

 

This is important information, which needs to be ascertained at the time of reservation and noted in the reservation form. There are various modes of payment through which a guest can settle his bill at the end of his stay with our hotel.

 

Guests can pay us in any of the following ways:-

 

Direct:

When a guest would himself settle the bill at the end of his stay for the room and the facilities of the hotel as used, it is termed as direct payment. He could settle either by cash or credit card.

·    Cash: A guest can pay in either Indian rupees or in foreign currency. The foreign currency is changed to Indian rupees before a settlement can be done. This conversion is done using an encashment form.

·    Credit Card: Hotels accept many credit cards such as Master, Visa, American Express and Diners Club. It is important to remember the cards that are not accepted by your hotel. While taking the details of the credit card one must definitely note down the credit card number and the expiry date.

 

Bill to company

Based on the volume of business and the credit worthiness of a company, a committee in the hotel decides upon a list of companies that can be given credit and for what period. On receiving a request for Bill to Company, one needs to ask for an authorization letter from the respective company, which needs to be attached to the correspondence. Always ask bookers to be specific when they ask for bills to be sent to a company. Many companies do not pay for personal expenses like liquor and tobacco. Other versions of bill to company include:

·    Travel Agent: A similar negotiation as above is done with the Travel Agents for extending them a facility of credit. In case of travel agencies, a ‘voucher’ is received from them, which authorizes the hotel to forward the bills to their office for payment of the mentioned services. Each such voucher itself carries all the information of the negotiated agreement with the hotel and also has all the details of the guest stay.

·    Redemption vouchers: Schemes are launched from time to time and the guests avail themselves of the facilities. Sometimes, a guest stay may be settled on a redemption coupon or voucher. In such cases there is a time period specified during which a guest could redeem the facility and mostly it is during the off season.

 

 Group Reservation

 

Groups constitute a substantial chunk of the hotel business. Resorts, in particular, rely heavily on this segment. Now-a-days, conference groups are an important segment for business hotels as well. Group reservation, essentially, follows the same process as in an FIT (free individual traveler) but there are some points of difference in the process which are discussed as below:

 

Steps in group reservation

 

• Step I. Generally, tour operator or group organizer visits the hotel in person as group reservation involves rate negotiations and an agreement on facilities to be offered.
• Step II. The reservation assistant checks the availability of rooms before rates are negotiated.
• Step III. Rooms are, initially, blocked on a tentative basis. It is confirmed only after a contract is signed and payment conditions are finalized.
• Step IV. A cut-off-date is decided before which organizer must make an advance payment and submits the rooming-list, failing which room block is released for other guests.
• Step V. Food and Beverage department is informed much in advance about the meal plan and number of pax to help them plan menu compilations.

 

Conducting a reservation request for a group shall be treated differently than accommodating a reservation of individual guests (i.e. Frequent Independent Traveler). The main reason is that individual reservation requests are treated by the reservation department, while group reservations are initiated by the Sales & Marketing division, and finalized through a careful coordination of the reservation from one hand and the marketing from the other.

• Below is a detailed procedure of how group reservation, in a typical hotel, is conducted:

 

1. A group representative, a member of the travel agency or the tour operator, not individuals, shall communicate group reservations' request to the hotel's marketing department

 

2. Upon availability, the hotel's reservation department shall block the requested number of rooms for this very group

 

3. The Hotel shall give a deadline for the group, in order to receive their final list. That deadline is called Cut-off Date

 

4. After receiving the final list, the reservation department shall change the desired number of rooms' status from blocked to booked (or reserved) rooms, and release the remaining rooms (if any left) as vacant

 

1. If the hotel did not receive the final list by the cut-off date, then the reservation department has all the right to cancel the group reservation and release all the initially booked rooms into vacant rooms. However, management shall use this right with precautions especially when it comes to groups reserving from travel agencies and tour operators of which the hotel is frequently operating.

Rooming-list

Rooming list is provided by group operators before group’s arrival. It has names of all the guests along with their passport details (for foreigners) and details of type of room to be allotted along with the name of the sharer. It is an important tool for blocking of rooms and saves considerable time during group check-in.

 

Blanket reservation

Blanket reservation is a block -reservation without individual names of the guests. Eg. 60 hotel rooms blocked for a marriage party.

Cancellation and Revision

 Steps in cancellation/amendment of a reservation

• Step I. On receiving cancellation request, fill-in a cancellation/amendment form.
• Step II. Update the information in PMS.
• Step III. Take out the original reservation form and mark it cancelled. Keep the cancellation form inside the reservation form and file it back for reference.
• In case of a revision/amendment of  reservation the form is accordingly updated and the reservation form is kept as per the new date of arrival ( if a change in date of arrival is requested)

Selective overbooking

Overbooking or capacity management is a yield management tool which means booking more rooms than the actual capacity. Hotels overbook to off-set potential losses due to No-show, under stay and last minute cancellations.

While overbooking following points are considered by the Front office managers:

·         Past history of No-shows, Cancellations and understays

·         Ratio of Guaranteed and non-guaranteed reservation

·         Ratio of Groups and FITs

·         Status of reconfirmation of the booking

·         Difference between the date when the reservation was given and the date of arrival, known as lead time.

·         Past experience with the guest in terms of the materialisation of his reservation.

Reservation Reports

The reservation department compiles many reports for the use of all departments. Some of the most commonly used reservation reports include:

•          Reservation transaction report: The reservation transaction report is the summary of the daily activities of the reservation department.

•          Commission agent report: This report includes the amount payable by the hotel to the different commission agents

•          Turn away or refusal report: At times hotels have to ‘turn away’ guests due to unavailability of rooms.

•          Revenue forecast report: The revenue forecast report is a projection of the volume of business that the hotel will be generating in a specified duration.

•          Expected arrival list: The list of names and surnames, along with the respective room types, of the guests who are expected to arrive the next day.

•          Stayover list: The list of names and surnames, along with the respective room numbers, of the guests who are expected to continue to occupy their rooms the next day.

•          Expected departure list: The list of names and surnames, along with the respective room numbers, of the guests who are expected to depart the next day.

Let us Sum up

Advance booking of hotel rooms is known as Reservation. Front office department has a separate section for this purpose which is situated in the back office. Modes of reservation refers to the how a hotel can receive reservation such as in person, letter, telephone, etc. Sources of reservation refer to ‘from where’ hotels may receive reservations such as from corporate, airlines, travel agents, central reservation systems, etc.

Hotels follow a manual, semi automatic or fully automatic system of reservation. Manual system includes booking diary method, semi-automatic system includes whitney system, while a fully automatic system is a computerized reservation system with hotel management software, known as PMS. 

Reservations are of different types including guaranteed reservation, non-guaranteed reservation, waitlisted reservation etc. Group reservation differs from FIT reservation in the form of negotiations on rate at the time of receiving the reservation. It has a concept of cut-off date rooming list and blanket booking