Bachelor of Tourism and Hospitality
BTHM Management
2019-SEM2-THH3113 Cost and Performance Management for Tourism and Hospitality
Assessment Task 3: Individual Assignment
Individual Case study Analysis:
Assessment of the assignment is based on the adequacy and accuracy of the submitted assignment.
For all written work students must ensure that they submit their own original work. Any act of plagiarism will be severely penalised.
Students must:
• fully reference the source(s) of all material, even if you have re-expressed the ideas, facts or descriptions;
• acknowledge all direct quotations; and
• Not submit work that has been researched and written by another person.
There should be an overview of the assessment task and expectations of students to successfully complete the task. This is an individual report. It should include the following:
Length: 1750 -2000 words
Date Due: Group Report Due Week 12 Sunday 13th 11.59 pm Weight: 40% - Individual Report
Your work will be assessed in terms of the following criteria:
1. Effectiveness of communication – i.e. readability, legibility, neatness, completeness and presentation
2. Demonstrated understanding of the subject matter covered - This will be evidenced by your ability of submitted answers.
Certain aspects of these questions may require some assumptions to be made. Therefore, different answers are very acceptable. For ease of marking please specify these if you think it clarifies your decisions and responses.
Your assignment must be submitted into the Turnitin drop box on LMS.
THH3113 COST AND PERFORMANCE MANAGEMENT FOR TOURISM AND HOSPITALITY (2019 Sem 2)
Student
ID:
First
Name:
Last Name:
Case study:
Dalton Events have got offers for events to be conducted during the Christmas holidays in different cities. The DOSM has got offers from two different organizations to conduct the event. The possibility is that they can only accept one offer as they are all on the same day in different suburbs.
As the revenue manager of Dalton Events Australia Pvt Ltd, events management company based in Melbourne, you are asked by your DOSM to critically evaluate the following and report on the same by categorizing costs and critically appraise & evaluate cost drivers with emphasis on cost drivers in relation to which offer is best acceptable for the business.
1. The First event is a trade show to be held in Melbourne on the 20th Of December. The event is all about One massive day of tattoos, art and entertainment, the venue chosen in Melbourne Exhibition Centre. International tattoo artists together under one roof to showcase their work. Visitors will have the chance to meet their next (or first!) artist, research the latest trends, and even treat themselves to a tattoo on the spot. Their requirements on that day of event are as follows.
1. They need a rock band to play from 10.00 am till late 6 pm
2. Video Production
3. Event Staff
4. 3000 chairs
5. Signages
6. Social media marketing
7. Light refreshments ( soft drinks and snacks)
They are expecting: Participants: 8000 Visitors and 300 Exhibitors. The venue rent would be paid by the Australian Tattoo Association thus Dalton Events has to only collect the entry fees and provide their service as an event organiser. These are the following information that Daltons DOSM has researched and collected from last years event that was organised by another company. The entry fee was $135 per ticket
Category Projected subtotal Comments
Venue related
costs
Location rental nil This is paid by the associations
Event staff $26,400.00 They have used 100 staffs to control that days crowd. Each staff was be paid at $24 per hour excluding half an hour break. They start from 8 am and run until 7.30 pm. All these
staffs are casuals (remember they also need to be paid superannuation’s as well which is 9.5 %)
Different equipment rental $40,000.00 They need to rent different equipment’s for lifting chairs , tables , setting up kiosk etc
Decorations $200,000.00 DOSM is expecting a rise of 10%
Lighting $150,000.00 There seems to be no changes
Additional signage $30,000.00 NO changes
Speakers $12,000.00 No changes
Rock band performers fee $30,000.00 This time they are inviting a different band so its expected to add another $18000 to the previous year price
Video production $25,000.00 This is expected to also increase by 22%
Chairs $12,000.00 Each chair will cost them $6
Social media
costs
Twitter $2,500.00 They are expecting an increase in social media marketing price by 15% for each
Facebook $3,000.00
Pinterest $1,200.00
Instagram $4,000.00
Google+ $2,500.00
Linkedin $3,000.00
Snapchat $750.00
Advertising
Print $ 8,000.00 They are reducing the printing cost by 25%
Outdoor $ 40,000.00 They are promoting on billboards thus an increase by 40 % is expected
Radio $ 6,000.00 They are advertising using all the radio stations which would add another $12000
Television $ 10,000.00 No changes here as they are using the airing time
Drinks $ 4,000.00 This is deemed to reduce by 10 %
Snacks $ 6,000.00 Snacks are increasing by 12 %
2. The second event is a YOGA event in Melbourne Showgrounds by the world famous Yoga trainer Vasudev
DROP-IN MEDITATION: The YOGA sessions are from 10.00 am till 5 p.m. In each class a different aspect of meditation is explained. Yoga Instructors would provide more information and no age limit is mentioned. No meditation experience is necessary, the classes are suitable for beginners and experienced meditators.
Everyone is welcome the event in the show grounds. The entry fee collected last time was 122 $ Their requirements on that day of event are as follows.
1. They need an Indian classical band to play from 10.00 am till late 5 pm
2. Video Production
3. Event Staff
4. 8000 mats
5. Signages
6. Social media marketing
7. Light refreshments (soft drinks and snacks)
8. Yoga matts
9. 20 live Display screens
(The requirement is the same except changes is few)
They are also expecting: Participants: 8000 Visitors and 300 Exhibitors. The venue rent would be not be managed by the Australian Yoga Association thus they Dalton Events has to understand that they need to collect the entry fees and provide their service as an event organiser. These are the following information that Daltons DOSM has researched and collected from last year’s event that was organised by another company which the providers are not satisfied by their service last time. There are 3 other big event organisers also tendering for this.
Category Projected subtotal Comments
Venue related costs
Location rental $40,000 They are expecting a 5% increase
Event staff $36,000 They have used 150 staffs to control that days crowd. Each staff was be paid at $24 per hour excluding half an hour break. They start from 8 am and run until 6.30 pm. All these staffs are casuals (remember they also need to be paid
superannuation’s as well which is 9.5 % so please add them in later costs) - Dalton is going to increase the no of staff to 200 as they think they need to provide better customer service keeping the payrate same
Different equipment rental $45,000 They need to rent different equipment’s for lifting chairs , tables , setting up kiosk etc
Decorations $175,000 DOSM is expecting a rise of 50%
Lighting $140,000 There seems to be no changes
Additional signage $60,000 NO changes
Speakers $42,000 the cost is increasing by 12%
Indian Yogic music $16,000 This time they are inviting a different band so its expected to add another $8000 to the previous year price
Video production $18,000 This is expected to also increase by 22%
yoga mat $48,000 Each yoga mat will cost them $6 , as they cannot be rented . They included this in the pricing for the entry fees. This time its costing them only 5.50
Social media costs
Twitter $2,500 They are expecting an increase in social media marketing price by 15% for each
Facebook $3,000
Pinterest $1,200
Instagram $4,000
Linkedin $3,000
Advertising
Print $4,800 They are reducing the printing cost by 25%
Outdoor $22,000 They are promoting on billboards thus an increase by 40 % is expected
Radio $5,400 They are advertising using all the radio stations which would add another $12600
Television $2,000 the new charges is 10000
Drinks $8,000 This is deemed to reduce by 10 %
Snacks $7,000 Snacks are increasing by 12 %
The DOSM wants you to Investigate, analyse and differentiate cost related to pricing and cost control techniques according to the various cost drivers and behaviours the costs that can be controlled and reduced to make more profit by not compromising on service.
Required:
Task 1: Categorize costs and critically evaluate which costs are cost driven. (sales driven) (750 words) (10 marks)
(Categorise the cost according to the cost drivers and explain the DOSM what are the cost driven expenses)
Task 2: Differentiate cost related to pricing and cost control techniques according to the various cost drivers and behaviours (750 words) (10 marks)
Evaluate and analyse which costs are directly related to pricing and the cost control techniques on how these costs can be controlled so that they can earn more profit
Task 3: Discuss with emphasis on cost drivers in relation to which offer is best acceptable for the business ( 15 marks)
(Considering the estimated expenses for the business calculate the entry fee per person considering the DOSM prefers 35% margin on the total cost estimated for each event and analyse the individual event to estimate and tell how many tickets they need to sell so that they can break even. Also analyse and find out which event is going to be profitable to accept and how as a Revenue manager you can come to the decision of choosing one event )( please use Excel program where possible to analyse and budget the cost and pricing and copy your findings to word and write your report accordingly)
Presentation with no errors is awarded 5 marks
(you can use Microsoft excel to work on your assignment and import it to Microsoft word when writing your report . Please use proper referencing where needed using APA style)