GOP Flow-Through (5%) MEIA-Specific Metric
OUR BUSINESS
Optimization of Cost Management
Objectives • In line with our OPERATIONAL EXCELLENCE Strategic Business Pillar • Analyses the hotel’s ability to (i) flow any additional revenue to the bottom line and (ii) flex the expenses if the revenue falls short
Definition •
Scoring Mechanism
Actual FY GOP 2 – Budgeted FY GOP 2 Actual FY Revenue – Budgeted FY Revenue
GOP flow-through vs Budget 1 =
GOP Flow-Through
BSC Score
Scoring based on Full Year Actual and Budget
•
• Monthly tracking based on variance between monthly actuals vs monthly budget
≥ 60%
5%
50% – 59%
3%
Illustrative Example
40% – 49%
1%
SLLN
Jan-20
Below 40%
0%
Actual
Budget
Variance
GOR
2,891,549
2,569,086
322,463 182,101
• Given that flow-through cannot be calculated, if the hotel hits its budgeted revenue and budgeted profit at Year-End, in this specific case the hotel will score the full 5%
GOP Before Management Fee
365,504
183,403
GOP Margin
12.6%
7.1%
56% Flow-Through
Feb-20
Actual
Budget
Variance
GOR
2,952,739
3,143,696
(190,957) (42,277)
GOP Before Management Fee
556,227
598,504
GOP Margin
18.8%
19.0%
78% Flow-Through
1. If negative variance, Flow-Through formula is: 1 – ( Actual FY GOP – Budgeted FY GOP/Actual FY Revenue – Budgeted FY Revenue) 2. GOP before Management Fees
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