HOUSEKEEPING BUDGETING
Housekeeping is one of the departments in the hotel that has the most bulk expenses and consumable items. Items like bathroom amenities such as shampoo, conditioner, body lotion or moisturizer, eau de cologne, facial soap and body soap; bath towel, hand towel, face towel, bath mat, bathrobe, rubber mat; bed sheet, pillow, pillow case, throw pillow, neck pillow, mattress pad, blanket, duvet/ duvet insert, bed cover; toilet paper, facial tissue; coffee maker, coffee sachet, sugar condiments; ironing board, flat iron; alarm clock; cooking utensils, crockery's and cutlery; give away toothbrush and toothpaste; printing materials, stationery, envelope, note pad, ball pen, folder, telephone directory, Bible or Holy Qur'an can have a substantial impact in the hotel's overall expenses.
These are variable assets that when consumed, damaged, lost or become sub-standard are being discarded or removed from circulation, Once removed from circulation or consumed, the same quantities must be replenished or replaced with additional mark-up in order to maintain the high standard or quality of service in the hotel.
Fixed assets like the room's furniture and fixtures such as beds, fridges, television sets, mirrors, sofas, easy chairs, reclining chairs, tables, telephones, lamps, headboards, air-conditioning/heating equipment etc. can be very costly when damaged or become sub-standard. These items are usually included in the Capital Expenditure Budget especially when refurbishment is required. But if its only one or two pieces, this amount can be allocated in the operating budget.
For the machine and equipment, Housekeeper's cart and vacuum cleaners are the most important tool used in the overall cleaning and maintenance of the hotel guestrooms and public areas. Machines like carpet shampoo and water extraction machine, rotary machine for carpet shampoo, floor scrubber and floor polishing, wet and dry vacuum cleaner. hydraulic lift etc. are additional heavy duty machines that help in the overall cleaning requirements of the hotel. These too are included in the Capital Expenditure Budget.
For Laundry area there will be the laundry machine, washer, dryer, dry cleaning machine, laundry folding machine/ calendar, tables, carts, laundry sorter boxes, movable clothes hanger rails, guest laundry printer etc. are Capital Expenditure items, while detergent , bleach, stain remover, dry cleaning fluid, ph level water treatment solution etc. goes to the operational budget.
Listing all the detailed items involved in preparation of budget gives you an idea how intricate housekeeping budget preparation is.
With the above numerous items, the consumable or fast moving items are the most important items in the preparation of budget. The consumable items are included in the operational budget. The fixed asset items are included in the Capital Expenditure Budget or CAPEX.
Operational Budget is being prepared annually and submitted to the Director of Finance for further study and to finalize the total amount in coordination with the department head. Operational Budget is always based on the next year's forecasted occupancy percentage. For example:
Item: toilet roll @ $0.50/roll
2008 consumption @ 50% occupancy = 50,000 @ $0.50 =$25,000.00
2009 forecasted occupancy percentage is 75%
75%- 50% = 25% (25% of 50,000 =12,500)
(50% + 25%= 75%) = ($25,000.00 +$12,500.00 = @37,500.00)
Remaining items are calculated in the same manner till all the items required are included in the next year's budget.
Capital Expenditure Budget is for specific items or project that needs to be replaced, made and built in the improvement of guest service or the hotel itself. For example:
The hotel management with the approval of the owner of the hotel would like to extend the Laundry service to non-hotel guest or outside customer. The project will be a "Laundry Shop", therefore a quotation will be required from the contractor for the cost of building the Laundry Shop, the additional guest/customer laundry bag, laundry and dry cleaning list, and additional manpower for customer service etc. To sum up the amount of Construction of laundry shop = $35,000.00; additional laundry bags and lists = $5,000.00 and additional manpower = $9,000.00 annually.
The $35,000.00 will be included in the Capital Expenditure while the additional laundry bags/lists and manpower will be added in the operational and staffing budget.
Therefore, the operational budget is for the consumable items and Capital Expenditure is for special project or items that are costly. There are also certain items being shared by the Front Office and Housekeeping. The charges on these items are being split between the two departments. When it comes to Maintenance, Engineering Department charges the Housekeeping for any services rendered like maintenance of the machine wherein they have to supply machine parts and labor, so these are being coordinated with Engineering. It is important that housekeeping machines are handled with care to avoid such charges.
Monitoring the Operational budget is the most crucial part in the operation of business. With the modern technology and the computer software, daily updated total expenses against budgeted amount are made possible and easy to trace in order not to exceed the budgeted amount. Every end of the month, the Accounting Department distributes copies of last month's budget outcome to the General Manager and the Department Heads in order for them to review and analyze where their budget is in line and where it is not. General Manager will require the department head that have exceeded their budget a reasonable report since he is accountable to the corporation as well as the owner of the hotel.
MANWAL