Hospitality Order Guide Development & Product Rationalization

If bank accounts were never-ending and resources were not scarce, then product rationalization and order guide development for the hospitality industry would be a pointless task.  How do you create the happiest guests?  Just buy the most expensive products and serve them at your current price point!  The problem with this, of course, is that resources are scarce and every decision to spend money on one product or service is a decision not to spend those resources in other areas.  With this basic understanding, then, the question is not "is this a good product that I am buying," but rather "is the added expense of this product going to create more satisfied guests than if I were to spend that money in other areas.  We all understand this in our personal lives, but sometimes we lose sight of it at our hotels.  For example, can a family rationally say that spending money on a modest vacation if they haven't been on one if five years is a reasonable expense?  This would seem rationale...there are all kinds of reasons one could come up with why this is a good expense--health, enjoyment of the family, experience for the kids, etc.  But if we look at this question as it relates to other expense, than things might change.  If going on this vacation meant the family would return without electricity because they couldn't pay the utility bill, then in terms of prioritization, while a vacation may be reasonable, it is better to allocate that money elsewhere.  This is exactly how hotel operators should look at expenses--not just in terms of whether the product is a reasonable purchase, but rather, will the expense of that product provide a greater value to the guest than if a different expenditure was made.  For example, a hotel may believe that having custom branded sugar packets is important for their image--and maybe it is--but depending on how the property is operating in other areas, it is possible that the savings from a non-custom sugar packet could be spent in an area that will have a greater guest impact.


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