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Dr Hassan Sherif 1 TOUR 102 Introduction to Hospitality Dr. Hassan Sherif

Dr Hassan Sherif 1 TOUR 102 Introduction to Hospitality Dr. Hassan Sherif

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Page 1: Dr Hassan Sherif 1 TOUR 102 Introduction to Hospitality Dr. Hassan Sherif

Dr Hassan Sherif

1

TOUR 102Introduction to Hospitality

Dr. Hassan Sherif

Page 2: Dr Hassan Sherif 1 TOUR 102 Introduction to Hospitality Dr. Hassan Sherif

Dr Hassan Sherif

2

Close Look at the Hospitality Industry

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C1

The Hospitality Industry

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Requirements for Tourist Destinations• Natural resources

– Attractive climate, water access, plants and animals, beautiful scenery

• Infrastructure– Systems for utilities, roads, airports, railroads,

communications, and other services• Superstructure

– Lodging properties, restaurants, entertainment facilities, and other attractions

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Characteristics of Hospitality Services

1. The nature of the product is different2. Customers are more involved in

production3. People are part of the product4. It's harder to maintain quality

control standards5. Services can't be inventoried6. The time factor is more important7. Distribution channels are different

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Careers in Hospitality• Pluses

– More career options than most industries– People-oriented work– Highly flexible hours– Room for long-term career growth– Perks

• Minuses– Long hours– Nontraditional schedules– Pressure– Low starting salaries

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Economic Impact of Hotels• Hotels provide substantial direct and

indirect economic impact to the communities in which they are located.

• The indirect impact of the ripple effect

– this is where money is spent by the employees (wages and salaries) of the hotel in the community.

– It is also money used by the hotel to purchase all the items to service the guests.

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C2

Managing Hospitality Operations

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Classification of Hotels• U.S. lodging industry consists of 50,800 hotels

and motels

• Hotels may be classified as to location, price, and type of services offered

• Star Rating & AAA Diamond Award:– Inspecting and rating hotels since 1977– Less than 2% are 5 Diamond– AAA uses descriptive criteria to evaluate the hotels

that it rates annually in the United States, Canada, Mexico, and the Caribbean

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Types and Locations of Hotels• City center: Meets the needs of the traveling public for

business or leisure reasons

• Resort: Inclusive and diversified in accommodations

• Airport: Guest mix consists of business, group, and leisure travelers; generally in the 200- to 600-room size and are full-service

• Freeway hotel and motel: A convenient place to stay, reasonably priced, and with few frills

• Casino: Coming into the financial mainstream; casinos make more money from the gaming than from the rooms

• Convention: Provides facilities and meets the needs of groups attending and holding conventions

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Types and Locations of Hotels• Full-Service: Offers a wide range of facilities, services,

and amenities

• Economy/Budget: Reasonably sized and furnished rooms without the frills

• Boutique: Unique architecture, style, decor, and smaller in size

• Extended-Stay Hotels and : Majority of guests are long term. Additional space in the form of a lounge and possibly kitchenette

• Bed & Breakfast Inns: Accommodations with the owner, who lives on the premises or nearby, providing a clean, attractive accommodation and breakfast

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Vacation Ownership• Began in the French Alps during the late 1960s

• For a one-time purchase price and payment of a yearly maintenance fee, purchasers own their vacation either in perpetuity (forever) or for a predetermined number of years

• Provide the flexible use of accommodations in multiple resort locations

• Average cost to consumer between $14,800 and $18,500

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Sustainable or Green Lodging

• By using local materials, a new hotel or resort can save money on the cost of materials plus the cost of transporting them

• The cost of energy has increased so much that lodging construction now incorporates ways of using natural lighting and building energy-efficient buildings

• Energy-efficient buildings require far less air conditioning because they use materials such as darkened glass and lower-wattage lighting that produces lower temperatures

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Organization of Hotel Functions

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What are typical revenue centers?

•Front office

•Food and beverage outlets

•Room service

•Telephone

•Laundry

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What are typical support centers?

•Housekeeping

•Accounting

•Engineering and maintenance

•Human resources

•Laundry

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front-of-the-house

•Front office

•Restaurants

•Lounges

back-of-the-house

•Housekeeping

•Engineering &

maintenance

•Accounting

•Human resources

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Entry-Level Careers in the Lodging Industry

• Bellperson

• Room attendant

• File clerk

• Warewasher

• Checker

• Busperson

• Counter server

• Supply clerk

• Vegetable preparer

• Steward

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Skilled-Level Careers in the Lodging Industry

• Accounting clerk

• Bell captain

• Front desk agent

• Administrative assistant

• Baker

• Food server

• Salesperson

• Night auditor

• Pastry Chef

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Managerial-Level Careers in the Lodging Industry

• Executive housekeeper

• Marketing & Sales manager

• Front office manager

• Controller

• Executive Chef

• Executive steward

• Catering director

• Restaurant mgr

• Beverage mgr

• Purchasing

director

• General mgr

• Chief engineer

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Factors Influencing Guest Wants and Needs

• The object of the visit

• The guest’s concept of value

• Absolute price

• Social/economic factors

• Demographics

• Ethnic or religious background

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C3

Management Contracts & Franchising

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Management Contracts• Responsible for the hotel industry’s rapid boom since

the 1970s

• Little or no up-front financing or equity involved

• Provides operational expertise, marketing, and sales clout, often in the form of a centralized reservation system (CRS)

• Allows the hotel company to manage the property for a period of 5, 10, or 20 years

• The company receives a management fee (a percent of gross and/or net operating profit—usually 2–4.5% of gross revenues)

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Management Contract Provisions

• Operating term• Fee structure• Reporting requirements• Approvals• Termination• Operator investment• Operating expenses• Other provisions

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Franchising• Began in 1907 by The Ritz Carlton• A concept that allows a company to use other

peoples’ money for growth rather than financing • Franchising is used to rapidly expand businesses• The franchisee is granted the rights to use

trademarks, operating procedures, and other business procedures

• Fees for lodging are generally 3–4% of room revenue

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Advantages for Franchisees Site-selection assistance

Credit

Construction expertise

Fixtures and equipment assistance

Training

Opening support

Promotional assistance

Economies of scale

Ongoing support

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Disadvantages for Franchisees

• Restrictions

• Unwanted products or procedures

• Unwanted advertising

• Unprotected territories

• Cancellation

• Inadequate training

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Advantages for Franchisors

Little or no capital required for expansion

Quick expansion possible

Franchisees shoulder investment risk

Unit owners connected to local community

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Disadvantages for Franchisors

They give up the profits generated by the franchise units

They give up some control

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Referral Associations

• Similar benefits to properties as do franchises–albeit at a lower cost

• Shared centralized reservation system and a common image, logo, or advertising slogan

• May offer group buying discounts to members, as well as management training, and continuing education programs

• Each independent hotel refers guests to each of the other member hotels– Hotels and motels pay an initial fee to join a referral

association

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C4

The Rooms Division

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The Departments – Rooms Division

• The rooms division director is held responsible by the GM for the efficient and effective leadership and operation of all the rooms division departments.

• The Rooms Division is comprised of the front office, reservations, housekeeping, concierge, guest service, security, and communications.

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Departments – Front Office

• The main duty of the Front Office manager is to enhance guest service by developing services to meet guest’s needs. He/she supervises Guest Service Associates (GSAs), who interact directly with the guest during check-in, check out, etc.

• Often, the front office is described as the hub or nerve center of the hotel. The guest relies on the desk for information and service throughout his/her stay.

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The Guest Cycle

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Departments – Front Office• The main functions of the front office are: (a)

to sell rooms, (b) to maintain balanced accounts, (c) to offer services such as handling mail, faxes, messages, and local and hotel information.

• In selling rooms, the front office attempts to achieve 100% occupancy.

• Revenue management can help increase room sales. The interaction of supply and demand also impacts the ability to sell rooms.

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Departments – Night Auditor• A hotel must balance its accounts on a

daily basis. At approximately 1:00 am, when the hotel has “quieted” down, the night auditor begins the task of balancing the guest accounts receivable.

• The daily report contains a key operation ratio – Room Occupancy % (ROP). This is calculated by dividing the number of rooms occupied by the number of rooms available. 150 / 200 = 75%

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Departments – Night Auditor

• The Average Daily Rate (ADR) is, together with the occupancy percentage, one of the key operating ratios that indicates the hotel’s performance.

• ADR is calculated by dividing the total of rooms revenue by the total number of rooms sold. BD 9000 / 150 = BD 60

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Revenue Management• Revenue management is used to maximize

room revenue at the hotel. It is based on the economics of supply and demand, which means that prices rise when demand is strong and drop when demand is weak.

• Although management would like to sell every room at the highest rack rate, this is not possible. Conventions, groups, and organizations are often granted a reduced room rate as an incentive to stay at a particular property.

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Revenue Management

• Revenue per available room, or REV PAR, was developed by Smith Travel Research. It is calculated by dividing room revenue by the number of rooms available. For example, if room sales are BD 9000 in one day for a hotel with 200 available rooms, then the

• REV PAR formula is BD 9000 / 200, or a REV PAR of BD 45.

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Revenue Management

• Hotels use REV PAR to see how they are doing compared to their competitive set of hotels. Hotel operators use REV PAR as an indicator of a hotel’s revenue management program.

• REV PAR also determines the feasibility of expansion.

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Revenue Management

• Energy management systems can reduce energy consumption by switching off when the guest is out of the room.

• They also can keep tabs on room occupancy, lighting, minibar, smoke detectors, locks, and guest amenities.

• Call accounting systems (CAS) are systems that can track guest room phone charges working in conjunction with PBX and PMS and offer different rates for guest calls.

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Revenue Management• Global distribution systems are electronic

markets for travel, hotel, car rental, and attraction bookings.

• A central reservation system (CRS) houses the electronic database in the central reservation office (CRO).

• With such a system, hotels can avoid overselling rooms by too large a margin. A CRS can also provide yield management information for a hotel.

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Billing Guests

• Billing guests has become much easier with the aid of computers.

• PMSs aid large hotels to make faster transactions and provide a more efficient service to their guests.

• These systems help the hospitality associates bill their guests within seconds.

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Reservations• The Reservations Manager is the head of the

reservations department. He/ she reports directly to the Rooms Division Manager. This department is often the first one that a prospective guest has contact with and therefore impressions made are lasting. Quality service and attention to detail are critical.

• The reservations department is responsible for selling hotel rooms for the maximum dollar amount.

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Reservations

• The corporate central reservations system interfaces with hotel inventory and allows reservations by individual hotel reservations personnel.

• Once a reservation has been made, the room is immediately deducted from the inventory of rooms for the duration of the guest’s stay.

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Methods of Advance Reservation

• Toll-free and direct telephone numbers

• Hotel representatives (independent business firms)

• Property-to-property reservations

• Mail

• CRS

• Internet

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Communications CBX or PBX• The CBX or PBX includes in-house

communications, guest communications, voice mail, messages, and emergency centers.

• It is a profit center for the hotel because hotels generally add a fee of 50% to all long distance calls and charges fees for local calls.

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Uniformed Services• The guest service staff has the unique opportunity

to make or break that first image of the hotel and the experience the guest will have.

• Door attendants greet guests, assist with the opening and closing of doors, handling luggage, and providing information.

• The bell person is responsible for escorting the guests and transporting luggage to their rooms. He must have knowledge about the area as well as the hotel and its services.

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Concierge• Arranging tickets to popular events/shows in

town, making reservations at restaurants, providing advice on local activities, reserving airline tickets and reconfirmation of flights, and special requests such as shopping.

• The concierge must have excellent knowledge of the hotel, the city, and national details. It is a definite strength if the concierge is able to speak several foreign languages.

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Housekeeping• The housekeeping department employs the

largest number of employees in the hotel. The executive housekeeper is the head of the department.

• The executive housekeeper is responsible for a substantial amount of record keeping. In addition to the scheduling and evaluation of employees, an inventory of all guest rooms and public area furnishings

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Green Hotel Initiatives• Environmentally conscious companies are

helping to avoid environmental degradation and are saving money while being good corporate citizens.

• Ecoefficiency, also generally termed green, is based on the concept of creating more goods and services while using fewer resources and creating less waste and pollution.

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Security/Loss Prevention

• Hotels are responsible for the safety of their guests. Protection of guests and their property is a key element of hotel operations.

• Security/loss division is responsible for maintaining security alarm systems and implementing procedures aimed at protecting property of guests, employees, and the hotel itself.

• Systems include surveillance systems, electronic door locking systems, and in-room safes.

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Occupancy Ratios Computed from Room Statistics

• Occupancy percentage

• Multiple (double) occupancy percentage

• Average daily rate

• Revenue per available room (RevPAR)

• Average rate per guest

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C5

The Restaurant Industry

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Full-Service Restaurants

Price Luxury, high-priced, mid-priced, low-priced

Menu Steak and seafood houses, ethnic, regional, vegetarian

Atmosphere Result of architecture, decor, and setting

Quick-Service Restaurants

Narrow selection of food

Focus on convenience—speedy preparation and delivery

Limited service

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Restaurant Industry Segments

• Lodging operations• Transportation market• Recreational market• Business and industry market• Educational market• Health care market• Retail market• Corrections food service• Military food service• Contractors

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Types of Commercial Foodservices

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Organization Chart for a Full-Service F&B Division

(pg. 83)

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Classic (French) Organization of a Kitchen (Kitchen Brigade)

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Primary Departments and Functionsof a Large Hotel F&B Division

• Catering

– responsible for banquets and special functions

• Culinary operations

– responsible for food production• Stewarding

– responsible for warewashing, clean-up, and (in some operations) purchasing

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Primary Departments and Functionsof a Large Hotel F&B Division

• Beverage

– responsible for production and service of beverages

• Restaurant operations

– responsible for food service in all outlets, including room service

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Keys to Success in Food Service

• The Five E’s

–Excellent environment/ambience

–Excellent service

–Excellent food and beverage products

–Excellent value

–Excellent management controls

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Restaurant Ambiance

Decor

Lighting

Furnishings

Tableware

Menu

Service methods

Servers and other employees

Other guests

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Why Restaurants Fail

Lack of business knowledge

Lack of technical knowledge

Lack of sufficient working capital

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Overview of Foodservice Processes

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Rules for Creating Menus

Give guests what they want

Use standard recipes

Take staff’s abilities into account

Take equipment into account

Provide variety and balance

Take the season into account

Keep nutrition in mind

Use food wisely

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Menu Categories

Fixed (static)

Cyclical

Breakfast

Lunch

Dinner

Specialty

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Food Cost Control Cycle

Menu planning

Forecasting

Purchasing

Receiving

Storing

Issuing

Producing

Serving

Customer payment

Food cost analysis

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Menu Planning: Focus on the Guests

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Five Special Concerns in Procurement

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C6

Managing Human Resources

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Human Resources Division’s Mission

• Attract, develop, train, and maintain qualified management and staff

• Minimize losses by reducing labor charges, liability, and employee turnover

• Monitor the property to ensure that property policy and standards are followed

• Ensure that the property complies with state and federal laws

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Demographic Trends

Population changes

Middle-aging

More women workers

A geographically shifting work force

Rise in education levels

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What Causes Turnover?

1. Inefficient hiring systems

2. Limited advancement opportunities

3. Lack of training and supervision

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Selecting a Job Applicant

Receiving and processing

applications

Interviewing applicants

Evaluating applicants

Checking references

Hiring the selected person

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Motivating Employees

Remove the fear of failure

Pay a fair wage

Offer incentives and rewards for

performance

Operate with an open-door policy; keep

everyone informed

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Orientation Program Components

• Introduction to the job and property

• Wage concerns

• Benefits

• Working conditions

• Tour of the property

• Review of safety and fire procedures

• Review of conduct and grievance procedures

• Question and answer period

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C7

Accounting & Finance,Property Operation &

Maintenance,Hotel Security

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Accounting

Presenting results of operation in financial form.

• Profit and Loss Statement

• Balance Sheet

• Statement of Cash Flow

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Advantages of Following a Uniform System of Accounts

A Uniform System of Accounts:– Standardizes formats and account

classifications– Guides accountants in the preparation

and presentation of financial statements– Allows the comparison of financial

position and operational performance between similar properties

– Explains line items on financial statements

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Typical Responsibilities of a Purchasing Department

• Assess the quality and quantity levels of needed items

• Select suppliers

• Negotiate prices, arrange and expedite deliveries, and arrange payment terms

• Maintain records, control inventories, and inspect products

• Obtain information, study the needs of the property, and estimate trends for future product availability, prices, etc.

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Engineering and Maintenance Systems

• Engineering

–Electrical–Plumbing–HVAC (heating, ventilation, air

conditioning)–Refrigeration

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Engineering and Maintenance Systems

• Maintenance

– General maintenance and repair

– Preventive maintenance

– Renovation

• Water management

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Criteria for Evaluating Water Quality

• Hardness

• Taste/odor

• Color

• Turbidity (cloudiness)

• Corrosion

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Hotel Security

External Components of Physical Security

–Perimeter protection

–Exterior lighting

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Internal Components of Physical Security

• Internal Components

– Layout and design

– Burglar and fire alarms

– Emergency plans

– Well-trained staff

– Communications systems

– Closed-circuit TV

– Well-protected storage

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Human Resources Divisional Security Responsibilities

• Screen and orient potential employees

• Interview employees

• Conduct employee security training

• Make sure employees return keys, uniforms, and other property

• Develop written policies on substance abuse

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Engineering Divisional Security Responsibilities

• Maintain and repair security devices and systems

• Respond to emergencies

• Control keys and key-making machines

• Keep track of tools and equipment

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Rooms Divisional Security Responsibilities

• Practice property guestroom key control• Report suspicious people or

circumstances• Act as command and/or communication

center during emergencies• Maintain regular procedures for handling

checks and credit cards• Advise guests to lock valuables

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Rooms Divisional Security Responsibilities

• Identify and remove luggage to secure areas

• Instruct guests about security devices, fire escapes, emergency phone numbers, etc.

• Refuse to admit people to rooms without proper identification

• Protect equipment

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Food and Beverage Divisional Security Responsibilities

• Use purchasing, receiving, and storage controls

• Control consumption

• Monitor food sales and preparation

• Check garbage for lost and misplaced items

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Marketing and Sales Divisional Security Responsibilities

• Pass along the security concerns of guests

• Help maintain the property’s positive image in the event of an emergency or accident