--- name: forecasting-budgeting description: > Hotel forecasting and budget modeling. Use when the user asks to 'build a forecast', 'create a hotel budget', 'reforecast revenue', 'project GOP', 'model occupancy scenarios', 'forecast F&B revenue', 'labor forecast', or any forward-looking financial projection for a hotel. metadata: version: "1.0.0" author: "HospitalityOS" --- # HospitalityOS™ Hotel Intelligence Suite ## Forecasting & Budgeting Skill **Professional hotel revenue and expense forecasting — combining historical performance, market assumptions, and booking pace to deliver monthly reforecasts, rolling 90-day projections, and annual budgets with full variance decomposition.** --- ## Data Acquisition Reference `../DATA_ACQUISITION_PROTOCOL.md` for the complete tiered approach. This skill needs: **Essential Data:** - 12–24 months historical P&L by department (Rooms, F&B, Other) - Group pace report (definite + tentative blocks, decision dates, lead time) - Transient booking curve (week-by-week pickup from previous years) - Confirmed room disruptions (renovations, closure dates) and planned events - Payroll / labor hour allocation by department - Current-year budget assumptions (market ADR, mix, occupancy targets) - Seasonal patterns and outlier events (e.g., natural disaster, brand conversion) **Tier 1 (Direct API):** - **Gmail** → Pull accounting emails with P&L attachments, budget uploads, variance reports - **Google Drive** → Access shared budget models, departmental templates, seasonal assumptions - **Google Sheets** → Live labor trackers, booking curve data, event calendars **Tier 2 (Browser Pull):** - **M3 / ProfitSword** → Income Statement, Budget vs Actual, department-level P&L - **Delphi / Amadeus** → Group pace report, pipeline by decision date, tentative blocks - **Opera / Mews PMS** → Forecast report, booking pickup, room type distribution - **STR Portal** → Historical RevPAR, occupancy, rate benchmarks (if available) **Tier 3 (Manual Upload):** - Excel file: 24-month P&L (rows: months, columns: departments and line items) - Excel file: group pace and transient booking curve (rows: future dates, columns: rooms, rate, segment) - CSV: room disruption calendar (date, reason, rooms out of service, anticipated impact) --- ## Property Context Before forecasting, **read the property profile** for: - Seasonality patterns (which months are peak, shoulder, trough) - Revenue center mix (% Rooms vs F&B vs other) - Primary guest segments (corporate transient %, group %, leisure %) - Room type distribution (king/double/suite split) - Special events or seasonal drivers (convention season, ski resort winter, beach summer) - Known constraints (union labor, franchise restrictions, market comp set) --- ## Role Detection & Output Customization The forecast output adapts based on the user's role: - **General Manager (GM):** High-level 1-page narrative with key numbers, occupancy/ADR trends, profit impact, and 3–5 strategic recommendations - **Revenue Manager (RM):** Detailed rooms forecast by segment, booking curve variance, rate strategy impact, and segment mix decomposition - **Finance Director / Controller:** Full P&L reforecast, budget variance with rate/volume/mix drivers, cash flow implications, and departmental variance - **Director of Sales & Marketing (DOSM):** Group pace detail, conversion assumptions, tentative block risk, and occupancy/revenue impact by sales vector --- ## Core Forecasting Framework ### Rooms Forecast 1. **By Segment** (build separately, then sum): - **Transient:** Apply same-year-ago (STYA) booking curve pickup to current pace. Adjust for known rate changes, market softness, or new demand drivers. - **Group:** Definite blocks at contracted rate; tentative blocks at high-risk % (default 70% conversion, adjustable). Add in pace of new proposals as they confirm. - **Contract / Other:** Extrapolate from historical agreement terms and renewal timing. 2. **Adjust for Disruptions:** - Subtract rooms out of service for renovations, maintenance, or natural disasters. - Add temporary inventory (overflow partner, pop-up rooms, if applicable). 3. **Check Against Capacity:** Never exceed available rooms. Flag if forecast overbooking. **Why:** Segment-level forecasting captures different booking behaviors (group books months in advance; transient books days ahead). STYA booking curves are the most reliable anchor for transient demand absent external shocks. --- ### ADR Forecast 1. **By Segment & Room Type:** - Extract STYA ADR by segment (transient corp, transient leisure, group, etc.). - Factor in **rate strategy changes** (rate fence removals, corporate contract renegotiations, seasonal adjustments). - Apply **inflation factor** if market is moving (typically 2–4% YoY in stable markets). - Account for **mix shift**: if group is replacing lower-ADR transient, blended ADR may rise or fall even if segment ADR is flat. 2. **Validate Against Comp Set:** - If STR or other competitive data is available, check that rate assumptions are reasonable vs. market. **Why:** ADR is the second lever after occupancy. Separating rate from volume drivers clarifies whether margin pressure comes from losing transient occupancy or from forced rate concessions. --- ### F&B Forecast 1. **Tie to Rooms Occupancy:** - Restaurant outlet covers = Occupied Rooms × Avg Covers per Occupied Room (outlet-specific; e.g., 30% breakfast capture, 20% lunch, 35% dinner) - Banquet revenue from group blocks: definite covers × contracted rate; tentative blocks at risk-adjusted cover estimates. 2. **Variable Costs:** - Food cost % tied to volume (typically 28–35% of F&B revenue); factor in inflation on COGS. - Labor (typically 35–45% of F&B revenue) partly variable with volume, partly fixed (kitchen skeleton crew). 3. **Handle Events:** - Pull banquet definites from booking system; add separate line for each catered event if needed. **Why:** F&B is the most correlation-dependent expense; it drives cash and operational leverage. Occupancy swings directly affect restaurant traffic and banquet demand. --- ### Departmental Expense Forecast 1. **Fixed vs. Variable Split:** - **Fixed:** Management salaries, rent/lease, insurance, franchise fees, certain utilities (baseline). - **Variable:** Housekeeping labor/supplies, food cost, credit card fees, commissions. - **Semi-Variable:** Utilities (baseline + variable usage), labor (minimum crew + variable overtime/casual). 2. **Labor Forecast:** - Extract actual hours by department from payroll system (Tier 2/3 data). - Estimate hours-per-occupied-room (HPR) by department from historical data. - Multiply forecasted rooms × HPR × average wage = departmental labor cost. - Account for seasonal labor (extra housekeeping in peak, layoff in trough). 3. **Non-Labor:** - Supplies: typically 3–6% of department revenue, scale with volume. - Utilities: split fixed base + variable per occupied room. - Other: depreciation (fixed), repairs & maintenance (fixed baseline + variable emergency spend). **Why:** Labor is 30–45% of hotel operating costs and is often misforecasted. Tying it to occupancy and HPR metrics prevents naive linear scaling of headcount. --- ### GOP / NOI Projection - **Gross Operating Profit (GOP)** = Total Revenue − Operating Expenses - **Flow-Through Model:** Forecast assumes that each incremental $1 of revenue flows through at the current GOP margin (e.g., if GOP margin is 40%, +$100 rooms revenue → +$40 GOP). - **NOI (Net Operating Income)** = GOP − Debt Service − Reserves. Include capital reserve assumptions (if required by lender or ownership). **Why:** Flow-through is a simple approximation; actual flow-through varies by segment (group with high F&B mix flows differently than transient). Separately modeling revenue and expense is more accurate than applying a single margin. --- ### Variance Decomposition **When comparing forecast to budget, always decompose into:** - **Rate Variance** = (Actual ADR − Budgeted ADR) × Actual Rooms - **Volume Variance** = (Actual Rooms − Budgeted Rooms) × Budgeted ADR - **Mix Variance** = (Actual Mix % − Budgeted Mix %) × Room Revenue (if comparing segment-level) **Example:** Rooms revenue miss of −$50K - Rate variance: −$10K (ADR came in $5 lower) - Volume variance: −$30K (missed 2 rooms per night) - Mix variance: −$10K (higher % of group vs. higher-ADR corporate) This decomposition tells the revenue manager what to action (rate strategy? occupancy chase? segment rebalance?). --- ## Output Formats ### 1. Rolling 90-Day Forecast - **Weekly granularity** for the next 12 weeks - **Columns:** Week, Occ%, ADR, Rooms Revenue, F&B Revenue, Total Revenue, Rooms Cost of Sales, F&B Labor, Total Op Exp, GOP - **Includes:** Actual YTD vs. forecast for weeks that have closed; forward forecast for open weeks - **Use Case:** Weekly operations review, cash flow projection, labor scheduling ### 2. Monthly Reforecast - **Full P&L** for the next 6–12 months in same layout as actual monthly results - **Variance columns:** Budget vs. Forecast, $ var, % var (by line item) - **Rate/volume/mix decomposition** for rooms revenue variance - **Footnotes:** Key assumptions (macro changes, group conversions, labor actions) - **Use Case:** Monthly board reporting, flash forecasting, departmental accountability ### 3. Annual Budget Model - **Excel workbook** with tabs: 1. **Assumptions:** Market ADR range, occupancy targets by segment, group pipeline, labor cost inflation, capital projects 2. **Monthly Detail:** 12 months of P&L with all departments 3. **Department Breakdown:** Labor hours by role, supply costs, controllable expenses 4. **Sensitivity:** Tables showing GOP impact of ±2% ADR, ±3% occ, ±5% labor cost - **Use Case:** Board approval, annual operating plan, strategic planning ### 4. Executive Summary - **1-page narrative** for GM/ownership with: - Year-over-year and YTD performance vs. budget - Key drivers of variance (segment mix, rate actions, cost inflation) - Occupancy and ADR outlook for next quarter - GOP projection vs. budget; implied profit variance - Top 3 risks and mitigation plan - Recommended actions (rate adjustment, cost control, revenue initiatives) --- ## Budget Season Workflow **Step 1: Market Assumptions & Macro** - Comp set STR data (RevPAR growth, occupancy trend) - Brand guidance on inflation, franchise fee escalation - Economic outlook (recession risk, tourism trends) - Consensus occupancy and ADR targets for the market **Step 2: Segment Build** - Transient corporate: historical mix %, ADR sensitivity to market, new corporate clients, travel policy changes - Transient leisure: OTA dependency, rate elasticity, seasonal swings - Group: pipeline (converted, committed, tentative), pace assumptions, group ADR (typically discount to transient) - Contract: renewals, escalations, any expirations **Step 3: Revenue Centers** - Rooms: segment build × room count × ADR - F&B: outlet-by-outlet capture rates, banquet catering pipeline, event calendar - Other: ancillary (parking, resort fee, spa, golf, etc.) **Step 4: Expense Build** - Labor: by department and cost center, headcount plan (hires, attrition), wage inflation, benefits - Fixed costs: management salaries, rent, utilities baseline, insurance, franchise fees - Variable: food cost %, supplies, commissions, credit card fees, STR subscriptions **Step 5: Capital & Reserves** - Planned capital projects (cost, timing, rooms impact, expected ROI) - Maintenance reserves (% of revenue or absolute $) - Working capital assumptions **Step 6: Consolidation & Approval** - Sum all segments and departments into consolidated P&L - Calculate GOP, NOI, EBITDA, EBITDAE - Run sensitivity on key variables (occupancy, ADR, labor cost) - Present to ownership for sign-off; document approvals --- ## Key Forecasting Principles 1. **Anchor to History:** Start from STYA and adjust for known changes, not wishes. 2. **Segment Separately:** Transient and group have different booking curves and drivers. 3. **Labor Discipline:** Use HPR and occupancy, not headcount intuition. 4. **Variance Transparency:** Always decompose variance into rate, volume, mix, and cost drivers. 5. **Document Assumptions:** Future you (and finance review) will want to know why you forecasted 65% occ vs. 70%. 6. **Stress Test:** Run upside and downside scenarios; understand breakeven occupancy. 7. **Update Frequently:** Monthly reforecasts (not annual budgets only) keep operations aligned. --- ## Operational Guardrails - **Never forecast occupancy >100%** or negative revenue/costs. - **Cross-check occupancy formula:** (Rooms Sold ÷ Available Rooms) × 100 = Occ%. Flag if STYA doesn't explain current pace. - **Validate ADR:** If ADR is rising but transient rooms are falling, mix is shifting (group is rising). Document explicitly. - **Labor sanity check:** CPOR (cost per occupied room) should be directionally stable unless staffing model changed. Flag anomalies. - **Flow-through reality:** If GOP margin is 40% and rooms revenue is up 5%, expect GOP to grow ~6–7% (volume + deflation mix). If it's growing 2%, cost inflation is eating flow-through. --- HospitalityOS™ — AI-Powered Hotel Intelligence Suite Forecasting & Budgeting Skill v1.0 | 2026 © HospitalityOS™. All rights reserved.