1. Agenda Baseline Performance Recommendations Action Plan Employee Training Performance Management

2. Baseline Performance 3. Monthly Spa Revenue300000025000002000000 Rupees15000001000000 500000 0MarApr MayJun Jul Aug Sep Oct Nov DecJan Feb BaselineRecs Action Plan TrainingPerformance 4. Daily Treatment Demand35.0030.0025.00 Number of Treatments20.0015.00 Peak10.00 5.00Off- Peak 0.00Baseline Recs Action Plan Training Performance 5. Daily Spa Revenue120000 10000080000 Rupees 60000 Peak 4000020000 Off- Peak 0BaselineRecs Action Plan Training Performance 6. Occupancy of Treatment Rooms 100.0090.0080.0070.00 % of Rooms Occupied 60.0050.00Off peakPeak 40.0030.0020.00 10.00-Mon Tue Wed Thu FriSat Sun BaselineRecs Action Plan Training Performance 7. Average RevPATH1,600.00 6.50Revenue per Treatment Hours Available1,400.00 6.00 1,200.00Number of Therapists 5.50 1,000.00 5.00 800.00 4.50 600.004.00 400.00200.003.50-3.00MonTueWed ThuFriSatSunTherapists Available, Off-Peak Season Therapists Available, Peak SeasonOff-Peak SeasonPeak Season *January not taken into considerationwithout any revenue data BaselineRecs Action Plan Training Performance 8. SWOT Analysis StrengthsWeaknesses Lack of packaging with F & B The Quan brand Unable to optimize walk-ins Club Marriott Membership Few alternate venues for treatments Non-resident guest component Lack of flexibility in scheduling Cross-trained employees therapistsQuan ThreatsOpportunities Flourishing individual spas Increase retail of Quan Spa products Other hotel spas Promotion during weak demand Price wars Non-resident segmentperiods BaselineRecs Action PlanTrainingPerformance 9. Customer Comments Asia Spa "New Spa of the Year" Award in 2006 Conde Nast Traveler Hot Spa for 2007 Positive Spa Magazine Favorite Hotel Spa in Asian Subcontinent Pevonia Asia Best Hotel Spa for 2007, 2008, 2009 Praise for the couples treatment room Indoceane treatment sugar scrub Negative Huge menu needs simplification Ambience music not tranquil Baseline RecsAction Plan Training Performance 10. Recommendations 11. Establishing Blue Red PeriodsHIGH SEASON Monday TuesdayWednesdayThursday Friday Saturday Sunday 8am-10 amQuiet time 10am -12pm 12pm-2pm Busy time 2pm-4pm 4pm- 6pm 6pm -8pmEstablishLOW SEASON Periodsbased on theMonday TuesdayWednesdayThursday Friday Saturday SundayTime of the 8am-10 amDay, the Day 10am -12pm of the 12pm-2pmWeek, and 2pm-4pm Seasonality 4pm- 6pm 6pm -8pmBaselineRecs Action Plan Training Performance 12. Improving RevPATH Adopt different strategies for Blue Red Attract more customers Sell treatments that Sell more treatments generate the most revenue Explore all revenuepossibilitiesManaging demand Baseline RecsAction PlanTraining Performance 13. Blue Period Hotel RoomsFood and BeverageWalk-in PromotionsDiscounts TreatmentCombinations Baseline RecsAction Plan TrainingPerformance 14. Blue PeriodHotel RoomsInclude spa treatments Additional incentives for with the Romance reservations made on the Packageday of the treatmentState the discount to leveragea better impactBaselineRecsAction Plan TrainingPerformance 15. Blue Period Food andBeverage Serve Drinks and Snacks Champagne at 20% off with a treatmentBaseline Recs Action PlanTrainingPerformance 16. Blue Period Treatment CombinationsAroma FusionBundle other treatmentsMassage = 50% of -> ANY TREATMENT 20% offhours sold BaselineRecsAction Plan Training Performance 17. Blue Period Treatment sold Second39% 15%treatment with20% discount61% FUSION MASSAGE OTHERSINCREASE Rs. 571,028.37 2.35%Blue period assumed to represent 60% of sales. We assume 1 treatment = 1 guest.Baseline Recs Action Plan TrainingPerformance 18. Price Customer Education Ensure spa information isIndependent fan page forcovered in the Roomthe spa Orientation Script Dynamic pricing strategy Encourage regularcustomers to become fans.Empower and IncentivizeBeneficial for the hotel front desk agent towards spa sales Special spa offers through and the spa social media Clear discount signage in Link between hotel andspa space spa social media pages Baseline Recs Action Plan TrainingPerformance 19. Red Period Create packages2 guests for buying AromaR$ 7000with contribution Fusion Massage higher thanaverage(58.5 R$/min) 1 guest for buying Aroma fusion Massage & Aroma Fusion Brightening Rejuvenating R$ 7100Massage can be Treatment With 20% discount on the used to enhance second Up-SellingBaselineRecs Action PlanTraining Performance 20. Red Period AromaDerma-PeelBrightening Back, Neck and Skin PerfectingRejuvenating Establish theShoulder Treatment TreatmentMassagehigh revenue- generating treatments133116 R$/min 75 R$/minR$/minUp to a Up to aUp to a 56% 43%29% discountdiscount discount BaselineRecsAction Plan Training Performance 21. Red Period100 guests 100 guests 100 Aroma fusion massage 85 Aroma fusion massage15 High contribution packages 58.50 R$/ min 74.81 R$/ minOver the Year increase of R$ 124,110.57 - - 0.51% of Total RevenueRed period assumed to represent 40% of treatment sold. We assume 1 treatment = 1 guest.BaselineRecsAction Plan TrainingPerformance 22. Time High Contribution Margins Compute the contribution margin per minute of eachtreatment:Contribution PriceCostMargin BaselineRecsAction Plan Training Performance 23. Red Period - Explore all Opportunities Simple treatments around the pool Foot massage Foot scrub Cross-train employees to meet exigencies Treatments in the hotel rooms Shorter menu with surcharges applied Spa therapists and Cross-trained employees Baseline RecsAction Plan Training Performance 24. Blue and Red Periods Empower sales team for MICE group packages Alter hours of operation Incentivize therapists for retail Adapt number of therapists available based on projected demand BaselineRecsAction Plan Training Performance 25. Data TrackingTreatmentsDemand By therapist Unconstrained By day of week Wait list By time of day improvement By demographic Reason fordecliningtreatment BaselineRecs Action Plan Training Performance 26. Action Plan 27. ImplementationPhase I Months 1-4Phase II Months 5-8Phase III Months 9-12 Baseline Recs Action Plan Training Performance 28. Phase I Months 1-4Begin selling high-value add-on treatments Seize the opportunity Increase in a 15-minute add-on of selling aroma fusion massage with shouldrevenue the 45-minute bath and body therapies. be evident at theend of this phase. Implement dynamic pricing Begin charging rates based on hot and cold periods. Baseline RecsAction Plan Training Performance 29. Phase II Months 5-8 Improve contribution margins Incentivize therapists for retail and loyaltyFocus on gaining Incentivize reservationists for bookings at rack rateemployee buy-in Train employees Explain how Revenue Management positively affects employeesContinued increase Share information within revenue guests Steer price-sensitive guests toward cool periods Keep price-insensitive guests coming during warm periodsBaseline Recs Action Plan TrainingPerformance 30. Phase III Months 9-12 Evaluate effectiveness of dynamic pricing Use RevPATH as the key performance indicatorRevenue Determine improvement on Management:capture rate Concentrate on offering incentives to team members and discounts to in-Continuoushouse guests to improve occupancy during cool periods Alter the hours of operationevaluation andchanging practices. Re-evaluate the effectiveness of operating for twelve hours on each day. Consider opening only during hours of high demand on slow days (e.g.during after-work hours from Monday to Wednesday)BaselineRecs Action PlanTrainingPerformance 31. Staff Training- RevPATH Explain the relevance of RevPATH Create an Excel tool to record RevPATH Train them on monitoring RevPATH BaselineRecs Action Plan Training Performance 32. Menu Simplification & PresentationPrepare a script for thestaff covering highcontribution margintreatments when they briefguestsMenu evaluation overa quarterly period toanalyze dogs Remove themBaseline Recs Action Plan Training Performance 33. Role-Play Training Handling walk-in situations when sold out Effective offering of the spa menu scripted delivery Up-selling of treatments or packages Baseline Recs Action Plan Training Performance 34. Training for Retail Train staff in Train staff through role plays selling retail Track retail sales by day products Incentivize staff Baseline RecsAction Plan Training Performance 35. Employee Cross-Training Select 8-10 hotel employees to help the spa inexigencies. Offer these employees incentives in their additionalroles Provide options to transfer to Quan Spa full-timeafter a period of time BaselineRecs Action PlanTraining Performance 36. Cost of Training and Implementation On-the-clock training for staff Costs incurred sum to hourly rate ofemployees and managersTechnology investment Development of Excel tool by tech-savvy in-house managementBaselineRecsAction Plan Training Performance 37. Performance Management 38. Metrics for Revenue Revenueper Revenueavailable per daytreatment part hourRevenueper day Baseline RecsAction Plan Training Performance 39. Periodic Checks and Balances Treatment analysis Quarterly Basis Unconstrained demand Detailed tracking on daily basis Staff productivity Tracking on a quarterly basis Promotions through various channels social media, magazines, brochures Monthly competitive review- especially for non resident segmentBaselineRecs Action PlanTraining Performance