MANAGE CASH AND STOCK

LEVELS

Emil Milewski

THE EIGHT METHODS OF PAYMENT ACCEPTED BY HOTELS Cash

Cash payment will typically be made in the currency of the country where the transaction takes place.

Foreign currencyMost hotels accept payment in foreign currency. Same larger hotels also offer currency exchange for guests

ChequeFront office staff need to keep very strict rules when accepting cheques, because big disadvantage is the cheque will take at least 5 to 10 working days before founds are received.

Traveller’s chequesThey were designed to provide travellers with a secure and replaceable document which would be accepted in exchange for cash, good and services

Credit cardsCredit cards allow payment to be made without the need for insecure cash or bulky cheque books and provide opportunity to pay for credit.

Debit cardsThese card looks similar to credit cards, but their function is very different – payment is immediately transferred directly from customer account to hotel’s

Credit accountsCredit system of which customers may obtain goods and services before payment Also called charge account

VouchersSame guests may have paid a travel agent for their accommodation and/or meals in advance. In such a case, the travel agent will usually issue some kind of voucher, showing the services booked and the amount paid.

AN EXAMPLE OF HOW TO CALCULATE COMMISSION AND FOREIGN EXCHANGE CONVERSION

CommissionCommission is calculated as a percentage of sales.If the commission rate is 10% and sales are €1000 then the commission earned is:€1000 x 10% = €100

Foreign exchangeLarge hotels which have a high proportion of foreign trade may offer foreign exchange facilities – both as value – adding service and as a potential source of revenue for the hotel.Example:

When converting from a currency into euro, you divide the amount by the rate of exchange (ROE), for example: $200/ 1.85=€108.10

When converting euro into foreign currency, you multiply the amount by the ROE, for example €200 x 1.42 = $284

SOME GUIDELINES FOR MANAGING CASH ON THE PREMISES AND WHEN MAKING BANK LODGEMENTS At the end of each day (or more often if necessary) money received from the various operations should be banked.Banks have sophisticated machinery for counting piles of notes and bags of coins, but some preparation is required

Piles of bank notes must all be facing the same way up, and should be packed in bundles of €100 or €500

Coins should be bagged in separate bags for each type of coin

To collect the total takings for the day and keep them in the cashier’s safe overnight to be paid into the bank the following morning

To pay in some of the day’s takings during the day, perhaps last thing before bank closing time. The remainder can then be kept in the safe overnight to be paid into the bank the following morning (two trips to bank each day)

There are significant security issues to handling cash and credit cards. There may be risk of:

Theft of cash left unsecured or unattended (by staff, guests or other people with access to the premises)

Armed robbery of the premises, if it is known that significant amounts of cash are kept there

Fraud of various kinds – the use of counterfeit banknotes, forged cheques or stolen credit cards, staff altering guests account ledgers and keeping the difference between logged payments and actual payments for themselves, etc

STOCK CONTROL IN RELATION TO GUIDEBOOKS, BROCHURES, LEAFLETS, SOUVENIRS

Stock control means controlling the level of stock held in a business. It is used to ensure that the business has sufficient stock to meet anticipated needs, while at the same time not holding more than necessary

Minimum stock level – stock cannot safely be allowed to drop below this level. To avoid this happening, a re – order level is set above the minimum stock level.

Re – order level – when stock falls to the re-order level an order is placed

Maximum stock level – this is maximum amount of stock that should be stored. Above this level it is uneconomical to hold stock

StocktakingA stocktake is simply a physical count of the stock that remains in the storeroom. A stocktake is carried out once a year or more frequently, depending on the nature of business and value involved. When a stocktake is carried out, the physical stock counted and recorded on a stocklist. The stock list will have the following information:

pre – order Reference number Item description Location of stock item Value of the item