Sales controls

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Sales controls

  1. 1. Sales Controls
  2. 2. Cont.. Pricing have a impact on total sale. High price high sale with low volume but it may impact guest choice Low price high sale volume. Pricing is an art.
  3. 3. Pricing Factors  Total project cost  Return on investment.  Competitors price  Food Cost  Overheads  Labour cost  Guest ability to pay  Condition of Economy
  4. 4. Selling Determined by General Manager Chef Food and Beverage Manager Sales Manager Purchase Manager
  5. 5. Pricing Can be Based on Total Capital Invested Returned Desired Competition in Market Total Cost Profit Desired
  6. 6. Pricing Methods Reasonable price: The manager or owner uses his own perspective in fixing the price of the menu / dish. The guests thinking are not considered even how this pricing will reflect on profit.
  7. 7. Highest price guest can pay The management anticipates what maximum a guests can pay. A slight reduction in the management’s decision of the price is the final price. The reduction is done to give allowance for the mistakes made by the management in judging the guest’s ability to pay for a dish.
  8. 8. Aggressive selling  A few dishes are priced aggressively low to attract the guests.  The price of a few dishes may be as low as cost price or lower than the cost price.  These few dishes prices are crowd / guest pullover.  Management tries to recover this loss from the sale of other dishes and beverages.  In other way the hotel tries to improve the sales mix.
  9. 9. Food Cost  In India, it is the most common method of fixing price.  Hotel decides to maintain a certain food cost.  Before fixing the price, the portion size and the food cost of the dish is calculated. After knowing the food cost then the selling price is decided.
  10. 10. Competitive Price The price fixed by the management is similar to the price fixed by other similar hotels / restaurants. The management tries to control all cost (food cost / variable cost, semi-variable cost and fixed cost).
  11. 11. Mark Up Price This is applicable in case of products which are not prepared by the hotel / restaurant but are traded by the restaurant like cold aerated drinks, alcoholic drinks, cigarettes, etc. Management decides to charge 30 percent more than the purchase price of the items.
  12. 12. The Ratio Price Method  The previous year’s food cost and selling price’s ratio is analyzed and management keeping that as a benchmark decides the selling price for future.  While changing the price the elasticity of demand should be studied. By increasing or reducing the price the effect of sale must be analyzed and decided whether to change price or not, if yes, then how much? So that it helps in improving the profitability.
  13. 13. Calculation of selling price  Expected Profit + Food Cost (Variable Cost) + Semi Variable Cost + Fixed Cost = Selling Price.
  14. 14. Cashier's Sales Summary Sheet/ Restaurant Sales Summary Sheet  cashier maintains the complete record of restaurant sales  prepared in duplicate  accounts department and control department.  In case guest settle his bill in cash then the amount received is shown in the cash column and discount allowed is shown in the discount column.  In case the guest settle his bill by signing (either as a hotel resident or as a credit card / debit card holder) then the total amount is shown in the ledger column and in the remarks column the Room Number, Name of the Guest, Credit Card Number / Debit Card Number and other details are entered.  Cashier then signs in the signature column.

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