CHIA Final Exam QUESTION AND CORRECT ANSWER 2023/2024

CHIA Final Exam QUESTION AND CORRECT ANSWER 2023/2024 The four considerations when creating a competitive set are: - CORRECT ANSWERParticipation, proximity, pricing and product All of the following are good reason for a hotel to have an additional competitive set, except which one? - CORRECT ANSWER-Have one set that you can easily beat and another which is a realistic target What is the average number of hotels in a comp set? - CORRECT ANSWER-Between 5 and 6 When can a comp set be changed? - CORRECT ANSWER-At any time, although many wait until the beginning of the year KPI for the comp set are: - CORRECT ANSWER-Always based upon the aggregated raw data of each member of the competitive set When you receive your STAR report, your ADR for the month was $100 and the comp set ADR was $90. What can you tell? - CORRECT ANSWER-Your ADR was $10 higher than the average of all of the members of the comp set When you receive your STAR report you see that your ADR Rank for the current month is "3 of 7" What do you know? - CORRECT ANSWER-your hotel has the 3rd highest ADR among the members of your comp set When talking about US Industry Data, which is an accurate explanation of "modeled data"? - CORRECT ANSWER-Modeled data is derived by using actual data from reporting hotels to estimate performance for non-reporting hotels what is the period of time a hotel must close completely due to renovation in order to be considered a Close or Reopen? - CORRECT ANSWER-one month or longer What is the minimum number of reporting hotels for an industry segment to be considered "sufficient"? - CORRECT ANSWER-Four Occupancy, RevPAR, and ADR Index - CORRECT ANSWER-Subject Value / Comp Set Value * 100 YTD anything - CORRECT ANSWER-add up all values Divide Demand over supply YTD ADR - CORRECT ANSWER-Add up all Revenue and add up all demand divide revenue/ demand to get result How many rooms does a hotel have with use of only the month? - CORRECT ANSWER-Month (January has 31 days) times values given in multiple choice 3 month rolling ADR - CORRECT ANSWERWhich of the following is NOT an accurate statement regarding Weekly STAR reports? - CORRECT ANSWER-There are separate weekly Perspective pages for occupancy, ADR, RevPAR, segmentation, and TRevPAR. Which of the following is an accurate statement regarding Additional Revenue data on the Monthly STAR reports? - CORRECT ANSWER-Additional revenue categories include F&B and Other. STAR reports display KPIs (occupancy, ADR, RevPAR), percent changes, index numbers, and profit and loss numbers. - CORRECT ANSWER-False How many weekend days are there in STAR reports? - CORRECT ANSWER-2 Benchmarking - CORRECT ANSWER-Individual hotels compare their performance to the performance of a "competitive set" of hotels. This information is carefully tracked by the subject hotel Companies compare their own properties to a variety of comparative groups of hotels to gauge the performance of their portfolio. Tourism organizations also compare their local area to "comparable" markets Competitive set - CORRECT ANSWER-group of hotels used primarily for comparison against a subject property for performance benchmarking purposes. The properties that comprise a comp set are competitive in nature; competing for the same guests and sharing similar qualitative and quantitative features. Why are comp sets needed? - CORRECT ANSWER-Historically, hoteliers have relied on each other for performance information (price, quality, quantity etc.). Hotel staff would perform "call arounds" where they would talk to staff from competitive hotels. Aggregating - CORRECT ANSWER-means finding the averages based on the data from a group of hotels so that each individual hotel is protected from exploitation of their specific data. When are comp sets created? - CORRECT ANSWER-Competitive sets are created by the time the hotel opens. Sometimes comp sets are created long before the hotel opens while it is still under construction. Who chooses the comp set? - CORRECT ANSWER--Management company -GM -Chain Company -The sales and marketing team Chain standards for comp sets - CORRECT ANSWER-Including/excluding specific chains -Including/excluding different properties of the same chain -choosing properties within specific radial distance -choosing properties within specific chain scales Key considerations- Participation - CORRECT ANSWER-Monthly - this is usually the default •Daily - most hotels submit daily data each day or each week •Segmentation - many hotels submit Rooms Sold and Revenue broken down by Transient, Group, and Contract •Additional Revenue - some hotels submit F & B and Other Revenue in addition to Room Revenue Key Considerations-Proximity - CORRECT ANSWER-Distance - from the competitor to the subject hotel •Market and Tract (Submarket) - These categories will help you identify hotels that are geographically close to the subject hotel. •Location - This field can help show clusters of hotels related to some other entitity, such as an airport, a downtown area, or a beach or resort area. Key ConsiderationsPricing - CORRECT ANSWER-Scale - If you are a chain hotel, the Scale category will help to identify similar chain hotels. It is not uncommon to look for competitors in one scale category above or below the subject .•Class - The Class Category will help to identify independent hotels that are in a similar category as the subject hotel. Key Considerations-Product - CORRECT ANSWER-Number of Rooms - In most cases the members of a Comp Set should be somewhat similar in size to the Subject hotel. Size is somewhat reflective of the type of business. •Open Date - The age of the hotel can help when considering Comp Set members. •Hotel Type - These fields (Boutique, Extended Stay, Convention, All-Suites, ...) can help to identify hotels similar to the subject. •Meeting Space - Compare these values for possible competitors. •Amenities - Check these fields (Restaurant, Spa, Waterpark, Oceanfront, ...) to help indentify similar hotels. Rules to creating comp sets - CORRECT ANSWER-"sufficiency" must include 3 or more hotels in addition to the subject (outside of america, comp sets must include four in addition to the subject) Percentage checks and help to ensure that the data of a single hotel, chain or company is not isolated. When percentages are calculated the rooms of the subject hotel, as well as those in the same chain and parent company, are excluded. percentage checks - CORRECT ANSWER-No single property or chain (e.g. Holiday Inn, Comfort Inn, etc.) can account for more than 40% of the total participating room supply of a competitive set (50% outside North America). -No single company (e.g. Starwood, Choice, Interstate, Host) can account for more than 60% of the total participating room supply of a competitive set. The average amount of hotels in comp set are - CORRECT ANSWER-between 5 and 6 (Luxury, midscale, upscale, economic) Nameback % - CORRECT ANSWER-In the US, only 45.13% of the properties in your primary Comp Set name you in their primary Comp Set. Reverse Comp sets - CORRECT ANSWER-for a hotel are the specific properties that name your hotel in their Comp Set. •The average US hotel is named as a competitor by 2.8 hotels that aren't in it's Comp Set. When are comp sets changed? - CORRECT ANSWER-Changes in the subject hotel, i.e.: renovation, conversion, new management or owner company, contract changes .-Changes in the market, i.e.: new competitive hotels open. -Strategic changes, i.e.: repositioning, improving comp set strength .•It is possible to change your comp set at any time, although many people wait until the beginning of the year. Rules relating to changing comp sets - CORRECT ANSWER-If property wishes to change their comp set, they must do so by a net change of two or more properties. They can add two hotels, or remove two (as long as the remaining hotels is not below the minimum sufficiency number). They could also add one and remove one, add two and drop one, drop two and add one, etc.. •If only making a change with two properties, both must be in a different chain, parent company and management company from the subject hotel. Exceptions to the changing comp sets rules - CORRECT ANSWER-The exceptions to the "change rules" is that a hotel can add a brand new property which has been open less than six months. •Or a hotel can remove a property from its comp set that has stopped participating after three months. Index numbers - CORRECT ANSWER-are generated for multiple time periods, both monthly (YTD, Running 12) and daily (MTD, Running 28) to analyze performance for a subject hotel over various periods of time. •Some companies relate managers' bonuses to index numbers. The hq of many hotel companies receive corporate or regional Index Reports listing each of their hotels with the various index numbers. Hint with RevPAR Index numbers - CORRECT ANSWER-The RevPAR Index number less 100, will be the approximate sum of the Occupancy Index number less 100 and the ADR Index number less 100. •So if your hotel had an Occupancy Index of 110 and an ADR Index of 105, your RevPAR Index would be around 115.• Deriving Index % - CORRECT ANSWER-the Index Percent Change number shows whether the relative performance of the subject hotel compared to the comp set is better this year compared to last year. Positive numbers are good and negative numbers are not good. Ranking data - CORRECT ANSWER-"X of Y", where X is the subject hotel's position and Y is the number of participating properties in the comp set which includes the subject hotel. •For example "2 of 6" would mean the subject hotel had the 2nd best value in the comp set of 6 members •In the prior example "1 of 6" would indicate a narrow range of values, where "3 of 6" would indicate a broad range. Sufficiency of comp set data - CORRECT ANSWER--Whether or not enough of the hotels in the competitive set have participated (submitted data) for a single time period. When it comes to comp set data for a single month or day, there must be at least 3 or more hotels in the comp set that submit data for that specific month or day in order for that comp set data to be "sufficient". •Sufficiency does not take into consideration the number of hotels that are actually in the comp set. Multi-month numbers (YTD) are considered to be sufficient if greater than 50% of the months included in the multi-month period are sufficient. When the Monthly STAR Report arrives, the monthly number can be different than the last MTD number on the Weekly STAR Report. - CORRECT ANSWER-There can be three explanations:‒There may be a hotel in the comp set that submits monthly data but not Daily data. ‒A hotel may submit monthly data that is different than the sum of all of the daily data that they submitted. ‒Some hotels submit adjusted daily data at the end of the month after the last Weekly Report (with the MTD number) is generated but before the Monthly Report comes out. Full availability and comp sets - CORRECT ANSWER-Occasionally a hotel in the comp set may report a Supply number that is different than the number of rooms in the property times the days in the period. There is a very small range of acceptability. •In those cases, STR uses the Supply number based upon full availability, not the number that the hotel reports. Actual data and modeled data - CORRECT ANSWER-actual data is used for hotels that participate and "modeled data" is used for hotels that do not participate. Modeled date increases - CORRECT ANSWER-the accuracy of the total U.S. industry numbers. The numbers are not just based upon the participants but the non-participants The number of Rooms Available for an industry segment such as a market or a tract/submarket (or any group of hotels, including a comp set), can vary over time due to: - CORRECT ANSWER-New hotels opening Hotels closing Room additions Room drops New Supply = Original Supply + (Opens + Adds) - (Closes + Drops If a hotel closes completely for a month or more due to renovation, - CORRECT ANSWER-his would show up as a Close and an Open (in this case, actually a "Reopen"). This would affect the Supply (number of Rooms Available) for an industry segment. If the hotel does not close, but renovates rooms while remaining open, there is no adjustment made to the Rooms Available for that hotel. - CORRECT ANSWER-(This follows the "Full Available" rule.) So there would not be any sort of related Room Add or Drop for the hotel or the corresponding industry segment. Sufficiency of industry data - CORRECT ANSWER-If an Industry segment has 4 or more hotels that submit actual data, then that segment is defined as "Sufficient", similar to the comp set rule (3 required). Chain - CORRECT ANSWER-represents the hotel brand, which is clearly displayed to the public on the building and in all interactions with the customer. Parent companies - CORRECT ANSWER-consist of multiple chains. Often will have a variety of different types of chains. may have a range of high-end, middle, and low-end chains; or they may concentrate in one area. Corporate chain - CORRECT ANSWER-A corporate hotel is a chain hotel owned or managed by the chain or the parent company. Franchise hotel - CORRECT ANSWER-•A franchise hotel is a chain hotel run by a third party where the chain receives some sort of franchise fee Independent chain - CORRECT ANSWER-.•An independent hotel is not affiliated with a chain or parent company.