A-Z list of hospitality terms and phrases you need to know!

A-Z list of hospitality terms and phrases you need to know!

Keba Vinod Keba Vinod August 2, 2022 News

Like any industry, hospitality has its own jargon that is widely used and very important in day-to-day operations. Here, we have compiled an A-Z list of the most frequently-used terms, phrases and acronyms in the industry to help you get up to speed and get in the know. 

hospitality

A

ABPCOAssociation of British Professional Conference Organisers

ABTAAssociation of British Travel Agents 

ADR (or ARR) – Average Daily Rate, or Average Room Rate (calculated by dividing revenue generated from income from hotel rooms sold by the total number of rooms sold), not to be confused with tech terms ARR which means Annual recurring revenue.

ADS – Alternative Distribution System. The Internet and other non-GDS electronic channels of hotel distribution. Also known as IDS (Internet Distribution System)

Advance Rates – Generally discounted rates to encourage guests to book in advance.

AGOP – Adjusted Gross Operating Profit (equal to the gross operating profit minus the hotel management base fee and any additional expenses)

AI – Artificial Intelligence.

Allocation – usually refers to an ‘allocation of rooms’ (e.g a conference or agents may have an allocation of rooms at an agreed rate)

Alternative Availability – Displaying other available properties when the requested property is unavailable for sale.

Amadeus – A common GDS (Global Distribution System)

AR– Accounts receivable (all income payments such as Debit/credit card, cash, cheque, city ledger) 

AP – Accounts Payable – All expenses payable 

ARI – Average Rate Index.

ATL – Above The Line (generally refers to mass marketing campaigns to drive awareness).

ARI – Availability, Rates and Inventory.

ARR – Average Room Rate (Total room revenues divided by the number of rooms occupied, excluding any rooms offered complementarity)

B

B2B – Business to Business.

B2C – Business to Consumer.

B&B – Rates that include Bed and Breakfast. Also, private house accommodation which only offers Bed and Breakfast. 

Back of House – Area of the hotel that is generally off limits to guests (e.g kitchens, offices, storage etc.)

BAR – Best Available Rates (typically rates that are the ‘best available at the time of booking, often these are short lead bookings)

Base Fee – Agreed upon hotel management fee earned by the hotel operator.

BDE – Business Day End.

Benchmarking – comparing your hotel against competitors. This could include benchmarking by product/service, room rate, quality etc.

BEO – Banquet Event Order.

BHABritish Hospitality Association 

BOB – Business on (the) Books.

Boutique Hotels – Generally refers to smaller, luxury hotels that differentiate themselves by their service and product offering. For example, a boutique hotel may have different, themed rooms etc.

BSC – Balanced Scorecard. A performance management tool for managers.

BTL – Below The Line (generally refers to niche marketing campaigns focused on return on investment)

Business Guest/Traveller – Those travelling for business.

C

Cache – A method to temporarily store information. Types of information cached often include HTML pages, images, rates and inventory. Can reduce the volume of direct system queries by allowing requests to be satisfied by extracting information from the cache (speeding up processes for guests)

C&B (or C and B) – Conference and Banqueting.

C&E (or C and E) – Conference and Events.

C&I (or C and I) – Conference and Incentive bookings.

CDP1 – Chef de Partie (in charge of a particular area of production within the kitchen)

CDP2 – Current Day Processing.

Chain Code – A two-letter code used in distribution systems to identify a hotel chain. A property needs to be associated with a chain code to be listed in a GDS (Global Distribution System). HEDNA (Hotel Electronic Distribution Networking Association) administers the list of available chain codes.

Channel Management – The process a hotel uses to update ARI (Availability, Rates and Inventory) in various distribution channels, also known as Channel Manager. 

Check In – The process by which guests register their arrival at a hotel and receive their key/keycards.

Check Out – The process by which a guest settles their bill and hands back any key/keycards.

Commis Chef – A basic chef in larger kitchens. May have just completed training or part of a training process.

Comp – Complimentary.

Competitor – A rival hotel group or individual property.

Competitor set (Comp set) – A list of hotels/hotel chains that are direct competitors.

Corkage – Charge placed on beer, liquor, and wine brought into the facility but purchased elsewhere. Such charges may also be applied to other products or services the hotel offers i.e. audio-visual but are contracted elsewhere.

Corporate Rates – Rates negotiated by corporates/companies with a hotel or sales team. Typically these are lower than standard consumer rates as corporates/companies can offer a high volume of annual bookings.

COS – Cost of Sale.

Cover – Refers to diners within a restaurant. E.g. A hotel restaurant achieved 30 covers (30 people dined)

CRM – Customer Relationship Management. Commonly automated to include pre and post-stay elements, along with loyalty programmes etc.

CRO – Central Reservations Office – the central ‘hub’ that handles bookings on behalf of a hotel (or chain).

CRS – Central/Computerised Reservations System. The system that facilitates the booking of rooms, conferences etc. This might be via telephone, website, email etc.

CVB – Convention and Visitors Bureau

D

Day Guests – Guests that arrive and depart the same day.

DBB – Rates that include Dinner, Bed and Breakfast.

DDR – Day/Daily Delegate Rate (per person rate for conference room hire, refreshments, catering etc.)

Direct Connect – A connection or interface that links a hotel system and a distribution system without relying on a third-party switch provider.

DMO – Destination Marketing Organisation. A company/group is responsible for the promotion of an area (this could be regionally, nationally or town/city specific).

DMP – Data Management Platform, used to better understand your hospitality/travel business data, often to achieve a single customer view.

DND – Do Not Disturb.

Domestic Travellers/Tourism – Residents that travel within their own country.

E

ETA – Estimated Time of Arrival.

Extranet – A secured connection between two or more intranets between two companies. Commonly used by OTAs (online travel agencies) to allow hotels to maintain their rates and availability and to receive delivery of reservations.

EBITDA – Earnings Before Interests, Taxes, depreciation and Amortisation 

EBITDAR – EBITDA + Rent.

EBIT – Earnings before Interest.

Extended Stay–  A category of hotels targeting guests with longer lengths of stay and may be more limited service, – usually have rooms that include kitchenettes and living areas, also known as Apart Hotels.

F

F&B (or F and B) – Food and Beverage. Refers to restaurant and bar business.

Fam Tour/Trip – Familiarisation tours/trips generally refer to complimentary stays for corporate guests who may be considering using the hotel for their organisation (accommodation, conferences etc.)

FF&E – Furniture, Furnishings and Equipment.

FIT – Free and Independent Traveller.

FOH (or Front of House) – Generally refers to guest-facing staff within the reception area of the hotel. These may include receptionists, concierges and room porters.

Full Board – Rate that includes bed, breakfast, lunch and dinner.

G

GDS – Global Distribution System. Network of electronic reservation systems used globally by travel agents booking hotel rooms (and airlines). Common GDS include Sabre, Galileo and Amadeus.

Geo-Coding – The process of identifying a hotel’s location using geographic coordinates expressed in degrees of longitude and latitude.

GM – General Manager.

GOP – Gross Operating Profit (Total revenue fewer expenses)

GOPPAR – Gross Operation Profit Per Available Room.

GOR – Gross Operating Revenue.

Green Hotels – Generally refers to hotels making an active effort to operate sustainably and reduce their environmental impact.

Group Rates – Negotiated rates (usually discounted against standard rates) for group travel. This can include guests attending conferences, meetings and tours etc.

GS – Guest Services.

GSM – Guest Services Manager.

H

Half Board – Rate that includes bed, breakfast and either lunch or dinner.

Head Chef – in charge of the kitchen, including Sous Chef(s), Chef de Partie(s) and Commis Chef(s).

HCD – Hotel Content Database. The content management system is used to distribute static information about hotels to 3rd parties including GDS (Global Distribution Systems), OTA (Online Travel Agents), IDS (Internet Distribution Systems) and others.

HEDNA – Hotel Electronic Distribution Networking Association.  Industry organisation was formed in 1991 to advance communication training, standards, procedures and technology for the sale of hotel accommodation through electronic systems.

HOD – Head of Department

Holdover – When a hotel may hold your room for a night or more, should you require a broken night stay (e.g. Stay Monday, Tuesday, Thursday, Friday and room held on Wednesday). Can also refer to squatters, see Squatters.

House Count – The total occupancy of the hotel at any given moment.

I

IBE – Internet Booking Engine.

IDS – Internet Distribution System.  The Internet and other non-GDS channels of hotel electronic distribution. Includes the Internet, World Wide Web, Intranets, Extranets and online services. Also known as ‘ADS’ (Alternate Distribution System)

Independent Hotel/Property – An individual hotel that isn’t part of a chain/group.

IRR – Internal Rate of Return – A formula for discounting cash flow and evaluating the feasibility of a project against accepted rates of return on the capital employed

J

K

Keys – The number of guest rooms in a hotel (measured by the number of keys). 

KPI – Key Performance Indicator. A target against which success can be measured. For example, an occupancy rate of 90%, an ADR of X etc.

L

L2B / L2B Ratio – Look to book. The ratio of people who visit your website or CRS (Central Reservations System) is divided by the number of reservations received.

Late Arrival – Guests that advise they will be later than the agreed time of arrival.

Late Charge – Charges that may be passed on to a guest after their departure from a hotel. For example, telephone calls or minibar charges that weren’t determined before the guest left.

Late Check Out – When a guest leaves the hotel later than the agreed time of departure. This may be at an agreed ‘Late Check Out fee.

Late Show – A guest who arrives later than the agreed time of their reservation.

LBA – Local Business Agreement.

Lead Time – The length of time between when a booking is made and the actual stay date. Typically hotels prefer long lead times as it allows them to plan room inventories/rates.

Leisure Guest – Those travelling for pleasure.

Limited Service – A hotel that may not offer the full range of services typically expected of a hotel. E.g no restaurant services are available.

LOS (or Length of Stay) – The duration of a guest’s visit. E.g 3 nights.

Loyalty Programme – A rewards programme for those that stay at the hotel regularly. Rewards can vary, but typically include free stays, dining vouchers etc.

LTC -Loan to Cost – a measure of leverage, usually used in the development phase 

LTV -Loan to Value – a measure of leverage, usually used on the operating phase

M

M&IT – Meetings and Incentive Travel.

Market Parity – Process of evaluating your product/service offering against a competitor set to determine your market price and ensure competitiveness.

Merchant Model – A business model where the hotel offers net rates so that a merchant can add their profit margin (mark up the rates) for sale to the public. Commonly used by OTAs (Online Travel Agents), wholesalers and tour operators.

Meta-Search Engines – A search engine where different sites are consolidated so that offerings can be compared. Examples – Trivago, Skyscanner, Google Hotels

MICE – Meetings, Incentives, Conventions and Exhibitions.

MLOS – Minimum Length of Stay.

MOD – Manager on Duty

MOM – Month on Month.

MPI – Market Penetration Index.

MPI – Meeting Professionals International

MTD – Month to Date.

Mystery Guest – A quality control measure whereby an undercover employee (usually of an external organisation) poses as a guest to evaluate the performance of a hotel.

N

Net Rate – A wholesale rate to allow a third-party markup.

NDA Non-Disturbance Agreement (or Non-Disclosure Agreement)

NS (or No Show) – A guest who doesn’t show up, despite having a reservation.

NOP– Net Operating Profit

NOI – Net Operating Income 

NPS – Net present score ( for reviews, feedback)

NPV – Net present value

O

Occ (or Occupancy) – The rate of occupation of a hotel’s total rooms, at any given time. For example, an occupancy rate of 95% would mean that 95% of a hotel’s room inventory is presently occupied.

OOO – Out of Order.

Opaque Model – A business model where the consumer does not know which product or brand is being booked before they purchase it. They know the rate, but not the product. Alternatively, the consumer may not know the individual component price of a bundled package (commonly used in dynamic packaging systems)

Operator – Could refer to a hotel management company managing a hotel under a management agreement.

OPR – Owner’s Priority Return

OTA – Online Travel Agent/Agency. A 3rd party who often sells a hotel’s room inventory on their behalf (and is paid a commission for any bookings referred) Examples of some of the main OTA’s include Expedia, Booking.com, Hotels.com etc.

Over Set – a number of covers set and prepared for over the guarantee.

Operating Realestate– Real estate assets producing income such as Hotel, Apart hotels, Student accommodation

P

Parity – The policy of providing a consistency between all sales channels. Commonly associated with rate parity, but can include room type, content parity etc.

Paid Out – An amount included on a guest bill for and expense which the hotel has paid for the guest and passes on, for example, taxis or theatre tickets

Pax – Number of people/passengers. E.g) 6 pax would be 6 people/passengers.

PDQ – Payment terminals that allow merchants to ‘Process Data Quickly

PIP – Property Improvement Plan (refurbishment)

PMS – Property Management System.

POS – Point of Sale.

Post-Con – Post Convention Meeting – a debriefing meeting held following the event

PPL – People

PP – Per Person

PPPN – Per Person, Per Night.

Pre-Con – Pre-Convention Meeting – a meeting held prior to an event to confirm and review all arrangements for said event. Attending are the organisation’s planning principles and key hotel or facility staff.

PRPN – Per Room, Per Night.

Q

QA – Quality Assurance.

R

Rack Rate – The standard or default rate for a room, before any discounts (for example, advance purchase discounts) are applied.

Rate Parity – The policy of providing consistency of rates between all sales channels.

RDR – Residential Delegate Rate (per person rate for conference room hire, refreshments, catering including overnight accommodation), also, referred to as 24 hours package.

Refurbishment – The process of restoring, renovating or modernising a hotel’s rooms or public areas to bring them up to a certain standard.

Res – Reservation.

REITs – Real Estate Investment Trusts.

RevPAR – Room Revenue, Per Available Room. The gross room revenue is divided by the number of rooms to calculate the RevPAR – a common figure used to benchmark performance (based on rates and hotel occupancy levels)

RFP – Request For Proposal. Often requested by corporate guests. E.g) They may require a hotel to provide a response to an RFP to outline negotiated rates for the following year.

RGI – Revenue Generator Index.

RMS – Rate Management System.

RN – Room Nights.

RO – Room Only (rate is for accommodation only).

ROCE – Return of capital employed

ROI – Return on Investment.

Room Night(s) – Essentially refers to an occupied room. 

Room Inventory – the volume of rooms available to be sold.

Room Only – A rate for the room only, no extras included.

Rooms Yield – Average revenue of all rooms, divided by the number of rooms in a hotel, divided by 365 nights, also, referred as REVPAR

S

S&M (or S and M) – Sales and Marketing.

Scraping or Screen Scraping – Copying information from one website and depositing it onto another site. Care must be taken to observe copyright laws.

Short Lead – refers to bookings made at short notice (e.g on the day of arrival or within a few days of arrival).

Snag List – Generally refers to a list of problems/issues that need to be addressed (usually as a result of a new hotel launch).

Soft Launch/Opening – Partial launch of a hotel property, perhaps at a reduced service level, usually to test the service offering prior to launching in earnest.

SOP – Standard Operating Procedure(s).

Sous Chef – ‘Under Chef’. Second in command after the Head Chef.

SPV – Special Purpose Vehicle 

Squatters – A person who stays in a hotel room beyond their booking duration, usually without payment or remuneration.

SRP – Special Rate Plan.

STLY – Same Time Last Year.

STR – Originally Smith Travel Research. A company providing benchmarking and operational statistics services to the hotel industry

Sustainable Tourism – Generally refers to environmentally conscious hoteliers/guests. They may request details of the hotel’s carbon footprint etc. Some corporates may select a hotel based on its sustainable practice.

T

TA – Travel Agent (or can sometimes be used to refer to TripAdvisor).

TAC – Travel Agents Commission.

TRA – The Restaurant Association.

U

UGC – User Generated Content.  Content generated by the general public (for example TripAdvisor reviews)

USALI  The book “Uniform System of Accounts for the Lodging Industry”, which sets out an internationally agreed system for compiling hotel accounts, is currently in its 11th Edition (2014), published by the AH&LA, the Hotel Association of New York City and expected its 12th Edition in Autumn 2022.

 Upgrade – Process by which a guest is offered a better room than he/she booked.

Upsell – Process by which a guest is offered (at a cost) additional services or upgrades (often at the point of purchase or upon arrival to the hotel).

V

VisitBritain – The name used by the British Tourist Authority, the tourist board of Great Britain incorporated under the Development of Tourism Act 1969, to promote tourism in Britain.

VisitEngland – Tourist Board for England.

Visit Scotland – Tourist Board for Scotland.

VisitWales – Tourist Board for Wales.

W

Walk In – A guest that hasn’t pre-booked, but simply walks in and reserves a room. Often they’ll pay a higher rate (even Rack Rate) accordingly.

WBE – Web Booking Engine.

Wholesale – The bulk sale of rooms, usually at a discounted rate.

WTM – World Travel Market.

WTO – World Tourism Organisation.

WTTC – World Travel & Tourism Council.

X

Y

Yield – Hotel’s profit margin when a room is sold (less any commissions etc.)

Yield Management – The practice of raising or lowering prices based on demand.

YOY – Year on Year.

YTD – Year to Date.

 

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