Look at how what you have learned in the classroom is applied in real scenarios. Talk to a manager in the hospitality industry and find a form or procedure that controls costs.
If this is not available to you, you may find a current event from a hospitality publication.
Write a 2-3 page paper on how it is used, how it controls costs, and what would happen if it was not utilized properly.
Please highlight any terms defined in the class power points.
You should be able to use a minimum of 5 throughout the paper.
Attach a copy of the form (you may black out any proprietary information) or a manager’s business card.
Your paper should have a cover sheet, standard margins, 12 pt. Times New Roman Font.
Sample Solution
The hospitality industry is a complex and ever-evolving landscape with an array of different processes and procedures that need to be implemented in order to ensure operations are running smoothly. One such procedure that has become a standard part of the industry over the years is cost control, which is essential for businesses to remain profitable. Cost control provides guidance on how resources should be allocated and used most effectively, allowing managers to make decisions based upon whether it will result in increased profitability or not.
Sample Solution
The hospitality industry is a complex and ever-evolving landscape with an array of different processes and procedures that need to be implemented in order to ensure operations are running smoothly. One such procedure that has become a standard part of the industry over the years is cost control, which is essential for businesses to remain profitable. Cost control provides guidance on how resources should be allocated and used most effectively, allowing managers to make decisions based upon whether it will result in increased profitability or not.
Cost control comes in many forms, but one of the most widely utilized methods within the hospitality industry is Activity Based Costing (ABC). This method requires managers to identify all activities related to providing a particular service or product, measure their costs associated with those activities, then assign responsibility for these costs according to who performs them. As an example, if a manager needs to determine how much it costs for food production for a restaurant they would take into account labor hours needed for prepping ingredients as well as energy expenses from equipment needed during the process. By assigning responsibility through ABC methods, managers have better visibility into what areas may require additional investments or can be decreased due to being more expensive than other alternatives.
Not properly utilizing cost control measures can have severe implications on any business’s bottom line and could easily put them out of business if left unchecked. For instance, if an establishment does not track its food expenses correctly they may find themselves spending too much money on ingredients or inventory compared with their competitors causing them financial harm since their prices may no longer be competitive yet doing so still incurs similar overhead expenses like staffing needs etc.. Additionally, failing to implement proper cost control measures can also lead companies down paths where they invest too little in certain areas leading them shortchange customers deciding against investing in quality products or services resulting in unhappy patrons thus further hurting profits as potential repeat customers decline dramatically due to bad experiences at said businesses .
Overall by understanding how activity based costing works within hospitality establishments along with being aware of its importance including how lacking proper implementation has consequences it allows owners/managers alike gain greater insight into their budgets resulting in wiser decision making regarding expenditures ultimately helping businesses grow while decreasing chances of failure due unforeseen financial issues arising down road because proper procedures weren’t taken care off initially .
