RAFFLES HOTEL

Financial Evaluation of Raffles Hotel Singapore

Financial Evaluation of Raffles Hotel Singapore

Introduction

Revenue analysis helps the investors and creditors to know about various important variables of the company. It gives insight about the how the company is performing and its creditworthiness. Investors and creditors are more inclined towards their returns & repayments respectively. They have to gauge the performance, repayment capacity and the ability of the company to pay rewards to investors before they take any material interest in the company. Revenue analysis assists stakeholders to understand the company using ratio analysis & common-size statements i.e. horizontal & vertical analysis (Cunningham et al, 1996, p. 143). It helps company in taking long-term and even in short-term decisions. Because of such surmounting importance, it has become integral part of the planning & budgeting of the company. Therefore, revenue analysis has significantly influenced the internal management of the organizations too. Revenue analysis aids analysts and interested parties relatively easy about the financial health of the company rather swallowing big numbers aimlessly.

Revenue is also known as turnover. It is an income that an entity obtains from the sales of its offering or from providing certain services. Review of revenue assists us in understanding the various sources of finance available to a business or other statutory institution. In order to address the requirement of this assignment we are going to review the Raffles Hotel of Singapore

Discussion

Rational of the Study

Hotel industry is a very competitive market of which all multinationals chains try to be the leader whereas the market is almost reaching its critical size. It is a very active market which is influenced by ever changing geopolitical environments (Dev & Olsen, 2000, p. 77). Therefore, hotels always must to adapt their strategies and foresee the crises if they want to resist at these fluctuations. The hospitality industry through the last few decades has grown and matured to such an extent that it has evolved into a highly competitive environment. In the hospitality industry that includes both restaurants and hotels the true measure of business success lies in business ability to continuously satisfy the customer and enhance their loyalty to gain a competitive edge by managing and acknowledging customers of different cultural background away from their homes.

Overview of the Hotel

Raffles Hotel is a prominent name in the hotel industry, it is one of the renowned hotel located in the centre of Singapore. It is a colonial style hotel. Two American brothers Tigran and Martin established Raffles Hotel, these brothers belongs to Singapore. The hotel became a prominent name because of its cuisine and quality oriented management. The name of hotel was acquired from the founder of modern Singapore named Stamford Raffles. The hotel consists of around 103 numbers of rooms (Kimes, 2011, p.72). There are also 103 suits available in the hotel.

Source of Revenue of Raffles Hotel

Raffles drive its revenue from a number of sources (internal and external) revenue drive from each source may be different from each other ...