Displacement Analysis

What is the definition of Displacement Analysis in the hotel industry?

For a hotel, the idea of manufacturing money in the course of accepting assembly business bookings sounds like a good idea – a noticeable thing to do. At times it would be sensible to deny a group booking in favor of leaving rooms available to temporary (non-business) customers and walk-in guests. The technique used to make this decision is called Displacement Analysis. By using Displacement Analysis, a hotel can compute the worth of the group booking contrasting to what transient and walk-in bookings would produce by contrast. Based on the results of the Displacement Analysis, it can then make a conclusion on whether to admit a group business booking or not. With any hotel booking, you have to regard as the total value, not just the room rates. All food and drinks spending, assembling room rental, and any additinal outlet spending (minus any costs) comprised, as well as random auxiliary in-house spending, will have to be factored into the Displacement Analysis calculation. If the value of the displaced temporary booking is less than that of the group business booking, then it would make logic to agree to the group booking, of course (and vice versa!).

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