1. HOTS Annual Business Plan and Budget

Each team should develop each year’s business plan along with budget (see excel spreadsheet).  In completing a business plan for each year, the following basic format should be followed.  There are eleven decision areas within HOTS, you will need to indicate what your plans are for each of the decision areas.  Some of these entries, such as menu type and food supplier may be no more than one or two sentences.  Others, such as rates, staffing, training, and advertising, will require more input.  Please refer to the example provided.

There are three sections on your business plan.

1. Mission

Mission statement should be a one-paragraph statement indicating how you want your hotel to be positioned at the end of the simulation. This mission statement will probably not change throughout the simulation, but must be included at the beginning of each annual business plan and budget report.

2. Plans for each of the decision areas.

Feel free to use tables, etc. to communicate your plans.  The eleven decision areas are:

1. Rates (Prices)
2. Revenue Management

• F&B Decisions

1. Staff
2. Training Expenditures
3. Advertising

• EMS
• Refurbishment

1. Guest Comfort
2. Extra Facilities
3. Finance

As you will learn, some of these areas may not be relevant at the beginning of the simulation.  The extra facilities decision is to expand your operations through various additions.  You will probably not be in a position to add anything at that point because of limited resources.

3. Spreadsheet (Only the budget part)

Please refer to the instructions for completing the HOTS spreadsheet.

Note. The annual business plan and budget will be submitted before the simulation except the first year.

2. HOTS Annual Report

The HOTS annual report consists of variance analysis and the previous year performance summary.

1. Variance Analysis

Starting in year 1, you will need to provide explanations as to why results are different from the goals (variance analysis).  The variance analysis criterion is $50,000 or 10%.  If a variance is greater on either of these criteria, you should provide a brief explanation or corrective actions if necessary.  Do not provide comments for any item where boxes are shaded grey.  These items are the results of other items and previous explanation should suffice.  For example, you do not need to comment on a room revenue variance as the combination of occupancy and room rate will explain a room revenue variance.

In the template, Year 0 actual numbers are given.  As required, this sheet should be updated each year.  To transfer numbers, simply copy columns from the Year 1 actual to the appropriate columns on Year 2, 3, & 4.

2. Narrative Summary and Decision Changes

Evaluate results of your decision and actions.  Provide justification for any changes and revisions in your plans for decision areas, if necessary.