Discovery Learning Exercise #10: Differential Pricing in Golf and Restaurants
Part 1
Read the following scenario which will be the basis for part one of the assignment: Forrest owns Turkey Creek Country Club in Gainesville, Florida. The current greens fees for playing one round (18 holes) of golf on the course is $175.00 per player. To increase sales, Forrest partners with six different hotels that have created golf packages marketing to their own customers. Each hotel pays Forrest a different amount for the rounds of golf included in their package. Forrest wants to calculate a net round yield for each hotel using the following formula:
Distribution costs = Standard Fee – Net Round Fee.
New Round Fee/ Standard Round Fee = Net Golf Round Yield
(round to nearest %)
Where Standard Fee (-) Distribution Costs to hotel = Net Golf Round Fee
Step 1: Fill in the empty boxes on the chart below with the following information:
NOTE: In your calculations, write dollar values as $##.##. and do not round. For percentages, however, round to the nearest tenth.
Turkey Creek Weekly Sales Recap:
Source (A) | Standard Fee (B) | Net Golf Round Fee (C) | Dist. Costs per Hotel (D) In Dollars | Net Golf Round Yield (E) In Percentage | Golf Rounds Sold (F) | Net Revenue (G)
--- | --- | --- | --- | --- | --- | ---
Comfort Suites | $175.00 | $92.00 | | | 25 |
Hampton Inn | $175.00 | $91.00 | | | 40 |
Hilton Garden Inn | $175.00 | $90.00 | | | 40 |
Springhill Suites | $175.00 | $88.00 | | | 30 |
Eleo | $175.00 | $85.00 | | | 50 |
UF Hilton | $175.00 | $84.00 | | | 35 |
Average or Total | $175.00 | | | | 220 |
Step 2: Answer the following questions from your calculations:
1a. What is Forrest’s average distribution cost for the hotel members?
1b. What is Forrest’s average net round fee for all hotel members?