Wednesday, July 14, 2010

Three Weeks Past…

It has been exactly three weeks since we arrived on the East Coast. Today was our last day of lecture. The morning was spent learning about business computing and even putting together a payoff matrix, which is just as complicated as it sounds, but easy to do once you know all the steps. After all we have done in class, I feel so accomplished! We have done so much with Excel, Word and PowerPoint that I cannot wait to come back home and teach everyone what I have learned.

In the afternoon, we had a very interesting lecture as we learned about “hospitality on steroids” or the casino industry where it is all about the money.

We learned about the Cherokee casino is a very unusual property. It has an average occupancy of 98%, does not sell alcohol, and has an average daily rate of $6 per room because it gives away most of its rooms for free. However, the Cherokee averages about $565 per room, through foods sales and gambling. 

For learning purposes, we tried an experiment in class. Reneta called the Cherokee requesting a room for this Saturday night. She anticipated a declined offer because the Cherokee saves most of its available rooms for its high spending reward member gamblers, and just like expected, they said they were sold out, and offered her a room at a neighboring hotel. We called again, just to check and sure enough, the same thing happened again. The is the real life learning that I find to be incredibly entertaining and engaging. It is one thing to read about common hotel practices, but it is another to watch it play out and analyze it afterwards.

After class and a class picture, my group decided to stay in the computer lab and work on our project. We worked for about 2 hours and then I headed back to Appel for dinner where I met up with Alex, Andrew G. and Chris. Unfortunately, my time was limited and I had to rush back to the computer lab so that my group could begin working on our project a little bit before office hours. We were very productive today, as always, and we finished a lot but there is still much to do.

Tomorrow, we have five hours of office hours in the morning and two additional hours in the evening. It’s going to be a busy day!


  1. this is fascinating stuff, Beilul!
    Ms K

  2. Beilul,

    Before Las Vegas and Reno became family oriented, it was pretty easy to get a comped room with free or dirt cheap buffets and even comped drinks.

    As you saw with the Cherokee Hotel and Casino, they feel they can make their profit with the gambling, food and drink. Comping the rooms for their clientele that they know will spend serious money there is only good business.

    At Las Vegas and Reno, though, they transformed the town so now their business is conventions where the conventioneers bring their whole family. While momma and daddy may play a game or two, they want to do something with the family.

    The bottom lie is that the bottom line for the hotels is now less dependent on the gaming part of the facility than it used to be.

    Also, the nature of conventions is that someone else is usually going to pay for the rooms and the meals. When the conventioneer has to dip into his own pocket, he’s less likely to pay top dollar for a room or a meal. When he’s working off of an expense account, though, he’s more forthcoming with the funds.

    Knowing this, why should the hotels comp the rooms when they can get full dollar for them?

    Also, back in the days when gambling was the business of Las Vegas, the hotels might have 500 rooms. Now they might have 5,000 rooms. If you do the math you can quickly see how fast your vaults might fill up even without the gaming.

    But then they have the gaming, too. And these facilities couldn’t afford to be as swanky or slick if they weren’t making money.

    It’s all calculated.

    While not all hotels include gaming, that’s a niche market in the hotel business just like the cruise line business which is just a big hotel in the water. On a cruise line it’s actually run as two separate businesses: there’s the transportation end (the ship) and then there’s the hotel. They work independently of each all the while working side by side.