Budgeting In

Housekeeping
Department
ajeet kr singh

Introduction

Housekeeping: provision of a Clean. Comfortable

and Safe environment.*
Budget: Plan of expenditure and necessary to
control the costs.
Operating Budget: A Financial Statement of a Plan
giving a Estimate of Operating Revenues, Profits (or
losses), expenses expected for a given period of
time.
Operating Costs: Expenses associated with
generating Revenues.

Operational budget for housekeeping department:

The portion of Operating Budget dealing with
Guestroom Revenue,Housekeeping dept. salaries
and wages,employee costs and controllable costs
relating to servicing of the guestrooms and public
areas of the hotel.

Occupancy Forecast: Short range estimate of

guestroom occupancy expected over a given period
of time, e.g. one week, one month etc.

Budgeting

Should be time-bound
Should be simple and practical
Keep in mind unforeseen problems
Important as a Mode of control over finances
Done through planning and forecasting.
Provides opportunity to critically review past
planning, costs of department, present
accomplishment and take appropriate steps to
accomplish more.

Budgeting in Housekeeping Dept.

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There are three main areas which are considered before

preparing of Budget of Housekeeping Department:
Wages and salaries
Operating costs
Capital expenditure
The budget should be the probable cost of:
wages, salaries
additional cleaning equipment
furniture, furnishings
cleaning agents, guest supplies, linen etc
planned renovation and redecoration.

Each item is given a priority rating with indicating

whether it is a replacement or addition.
It is highly essential to have all records, evaluations
of past performances and plans e.g. usage of
various agents, the cost of repair services etc, to be
able to justify the cost of a particular item.


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Thus keeping cost of following is beneficial:

Servicing a room
Cleaning of a particular area
Service of early morning teas
Night service,i.e, turning down
Overtime compared with extra staff
Hiring compared with owned linen
Checking of linen
Office supplies, handwritten versus printed lists
Re-upholstering versus purchasing
Bulk buying

Forecasting and Planning

To predict future happenings, e.g. staffing for high or

low occupancy, annual cleaning, redecoration, etc.
Plan in order that these eventualities are met and
objectives are achieved within time.
A good planner thinks on lines of economy utilizing
time , labor, and materials in the best possible way.
Fullest and most efficient use of equipment, space
and human effort by forecasting and planning what
work has to be done; when and how often to be
done; how is to be done; how long will it take etc.

Budget Formulation

Budget handover from Top Mgt not always

successful or followed
Budget with participation of the Executive
Housekeeper is essential as it brings input of
operational heads.
To keep in mind changes in external factors such as
labour market, commodity market etc.

Top Managements Input to

Budget

Company expectations to be stated

Criteria to be made regarding standards to be met in
use of supplies
After identifying Expected Sales and related costs,
Top Mgt. should critique the budget indicating where
adjustments need to be made so that Organizations
will be met.

Budget Cycle

Budgeting process commences well before the

beginning of a Fiscal Year. By the 10th period of an
active year in progress.
Operating Budgets usually reflect periods in a fiscal
year (mostly 13 periods system)
13 period system: is a 28days/ four consecutive
weeks taken as a period resulting in 13 periods an
year.

Advantages of 13 period system

Appropriate because period starts First day of

Scheduled work week and last on last day of fourth
work week.
Allows comparison of Revenues and Costs on
Consistent and systematic basis each period.
12 period systems disadvantage is that every
2months out of 12, extra payday will occur causing
distortion in wage cost against revenue.

Budgeting Subroutine

Each budgeting cycle is commenced by those

involved in budgeting room sales.
Schedules indicating volumes of room sales to be
expected each day in the upcoming year are
prepared and finalized before Operational Cost
Budgeting is begun by the Housekeeping
department as it is affected directly by the fluctuating
occupancy.
These schedules also show comparison between
upsoming budget year and the existing year in order
that growth be analysed.

Growth in sale of rooms along with changes in ARR

and expected period revenues later prove significant
in development of statistical targets of
Housekeeping department.
Consolidated Room Sales Summary will serve as a
basis for formulation of Housekeeping Departments
Budget.
Consolidated Room Sales Summary: presents the
expected room sales, occupancy percentage, ARR,
Sales in Dollars (or rupees) to be generated by the
Annual Budget.

Wage Classification

Man-Hour Utilization represents the Highest

housekeeping Cost of Operation.
Man-Hours of various types of works performed
within Housekeeping department are classified for
accounting purposes.
Hours worked by section housekeeper aides
(08),those worked by supervisory personnel are (02)
and so on.

Budget Justification

Executive house keeper need to explain how ManHour requirement are made.
A standard Man-Hour Justification Form is submitted
along with the Budget.
Considering the expected occupancies the
Executive Housekeeper refers to the Table of
Personnel Requirement to determine exactly how
many man-hours will be required to service this
occupancy.

Contd.

*Table of Personnel Requirement: At each percent

of Occupancy, this table establishes the number of
rooms that will require service, the number of
housekeepers required at the rate of 18 rooms
cleaned per 8hour workday. Number of
housekeepers required for one week, and no. of
housekeepers required for 28days/period.

Knowledge is key:
Reducing Capital Expenditure

Change in the facility can drastically alter a budget.

Having a good grasp on the needs of the facilities,
helps to put a price tag on it.
Know the quality levels and square footage of each
building the number of rooms, light fixtures, types
of flooring, etc and compare it to the history of the
facility enumerate advancements made to the
facility since the last budget.

Contd.

Developing a needs analysis will help to determine

the buildings desired level of clean, as well as the
frequency of cleaning and manpower necessary to
reach the desired goal.
A proper needs analysis will also take into account
both the data on the building, as well as high traffic
areas and impression areas, such as restrooms and
entryways.

Contd.

Evaluating frequency of tasks can save budget dollars in the

long run. Thus, it is important to figure out what absolutely
needs to be done. Evaluate what tasks can be reduced in
frequency, while continuing to maintain quality.
E.g.: An office where each tile is scrubbed every day. It could
just be swept, saving time and money, while cutting labor in
half and reducing expenses such as chemicals and water.
When evaluating work it is also important to include those
activities that dont involve cleaning. Omitting this when
putting together a comprehensive budget will skew the
numbers drastically. For e.g., Activities such as room set-up
and breakdowns can take as many as 10 hours a week.

Contd.

Eliminate duplication of services. For e.g.: One

facility had day maids and porters, as well as a
cleaning crew at night. Then they realized that they
all do the same thing so we moved everything to
daytime so that the work is only done once a day.
In the past, hotels would call a couple different
suppliers and just go with the lowest price. They
probably werent getting the best price because we
didnt create loyalty to any one supplier. Not to
mention they spent a lot of time with the process.
Now Hotels are loyal to one supplier and thus have
seen more savings than ever before.

Points to be kept in mind

Sitting down and developing a time study for every task required
to maintain a building will help facility managers determine where
to cut time and save money. Coming up with this calculation will
outline the annual hours spent on each task.
When factoring labor into the budget, facility managers should
consider both productive and non-productive time because both
will impact budget dollars. Does your facility provide vacation,
family medical and sick time? Those are all days where
employees are being paid, but work is not getting done.
Analyzing this may determine that of the total paid hours, maybe
only 70 percent are actually work hours. This needs to be
factored in.

Conclusion

Preventative maintenance will also save on the

budget. Listening to workers is a great practice in
preventative maintenance. Because they use these
machines often, workers will know when
maintenance is necessary.

Value the opinion of your staff when considering

budgets and purchasing decisions. They will tell you
what needs to be done and what improvements are
necessary.

Refernces
Branson

& Lennox, 4Hs

Jones & Martin, Professional Mgt. of
Housekeeping Operations.
www.cleanlink.com

Thank You