Ancillary Revenue Final Exam 2023 Graded A+
The basic Ancillary Services which generate revenues for SEE venues include:
Concessions
Catering
Programs, souvenirs and novelties
Alcoholic beverages
The five (5) traditional SEE venues include:
Stadiums
Arenas
Amphitheaters
Theaters/Concert Halls/Auditoriums/Performing Arts Centers
Convention Centers
Other non-traditional SEE venues include:
Ballparks
Racetracks
Fairgrounds
Amusement Parks
There are two management models for the delivery of Ancillary Services:
In-house
Contracted
How does the SEE venue manager decide which management model to use?
The SEE manager should assess the infrastructure to determine whether in-house
operation of contracted services would yield the greatest amount of ancillary revenues.
In assessing the infrastructure to determine whether to use in-house or contracted
services, the following items must be included:
Staff training requirements
Purchasing and Procurement policies
Labor laws
Financial resources
Capital equipment needs
Manager's time and ability to oversee in-house operations
A manager of an SEE venue and/or organization must set clear operating goals for two
areas:
Service requirements
Financial goals
The five (5) step budgeting process includes:
1. Prepare a forecast of sales revenues
2. Prepare a forecast of cost of sales
3. Prepare a forecast of labor needs and related labor costs
4. Forecast operating expenses
5. Calculate the net operating profit
The overall industry standard for cost of sales percentages for concessions operations
is
21% to 22%.
Typical fixed operating expenses include:
, Leased vehicles
Telephone
Other equipment rentals
Armored car service
Exterminator services
Typical variable operating expenses include:
Uniforms and laundry services
Cleaning supplies
Paper supplies
Utilities
a typical rent or commission rate which a private contractor pays in an SEE venue:
30%-40%
An example of straight line depreciation:
$1 million investment depreciated over 10 years = $100,000 depreciation per year.
The basic control process has four (4) steps:
Establish the standard
Measure performance against the established standard
Identify the deviation in performance as compared to the standards
Implement an action plan to correct deviations and achieve goals
The seven (7) basic steps in the cost control process include:
1. Forecast
2. Order
3. Receive/Store/Issue
4. Produce
5. Sell
6. Record
7. Analyze
Step One:
Forecast the expected sales of all menu items
Step Two:
Order the correct amount of supplies
Step Three:
Recieve the supplies and verify their quality and quantity
Store the supplies in a secure area such as a commissary
Issue the inventpry in a controlled manner which accounts for all items
Step Four:
Produce the predicted number of items and have them ready for sale
Step Five:
Sell the items produced to the guests/ customers
Step Six:
Record the resulting sales
Step Seven:
Analyze the results in comparison to the sales forecast
These four (4) items must be a part of all stand sheets:
Sales of each menu item
Total sales of all items
The basic Ancillary Services which generate revenues for SEE venues include:
Concessions
Catering
Programs, souvenirs and novelties
Alcoholic beverages
The five (5) traditional SEE venues include:
Stadiums
Arenas
Amphitheaters
Theaters/Concert Halls/Auditoriums/Performing Arts Centers
Convention Centers
Other non-traditional SEE venues include:
Ballparks
Racetracks
Fairgrounds
Amusement Parks
There are two management models for the delivery of Ancillary Services:
In-house
Contracted
How does the SEE venue manager decide which management model to use?
The SEE manager should assess the infrastructure to determine whether in-house
operation of contracted services would yield the greatest amount of ancillary revenues.
In assessing the infrastructure to determine whether to use in-house or contracted
services, the following items must be included:
Staff training requirements
Purchasing and Procurement policies
Labor laws
Financial resources
Capital equipment needs
Manager's time and ability to oversee in-house operations
A manager of an SEE venue and/or organization must set clear operating goals for two
areas:
Service requirements
Financial goals
The five (5) step budgeting process includes:
1. Prepare a forecast of sales revenues
2. Prepare a forecast of cost of sales
3. Prepare a forecast of labor needs and related labor costs
4. Forecast operating expenses
5. Calculate the net operating profit
The overall industry standard for cost of sales percentages for concessions operations
is
21% to 22%.
Typical fixed operating expenses include:
, Leased vehicles
Telephone
Other equipment rentals
Armored car service
Exterminator services
Typical variable operating expenses include:
Uniforms and laundry services
Cleaning supplies
Paper supplies
Utilities
a typical rent or commission rate which a private contractor pays in an SEE venue:
30%-40%
An example of straight line depreciation:
$1 million investment depreciated over 10 years = $100,000 depreciation per year.
The basic control process has four (4) steps:
Establish the standard
Measure performance against the established standard
Identify the deviation in performance as compared to the standards
Implement an action plan to correct deviations and achieve goals
The seven (7) basic steps in the cost control process include:
1. Forecast
2. Order
3. Receive/Store/Issue
4. Produce
5. Sell
6. Record
7. Analyze
Step One:
Forecast the expected sales of all menu items
Step Two:
Order the correct amount of supplies
Step Three:
Recieve the supplies and verify their quality and quantity
Store the supplies in a secure area such as a commissary
Issue the inventpry in a controlled manner which accounts for all items
Step Four:
Produce the predicted number of items and have them ready for sale
Step Five:
Sell the items produced to the guests/ customers
Step Six:
Record the resulting sales
Step Seven:
Analyze the results in comparison to the sales forecast
These four (4) items must be a part of all stand sheets:
Sales of each menu item
Total sales of all items
