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Hotel Surcharges Make A Comeback
U.S. and Puerto Rico hotels seek to improve revenue and profitability while minimizing customer complaints about unexpected surcharges
By EVELYN GUADALUPE-FAJARDO
October 16, 2003
Many U.S. hoteliers, including those in Puerto Rico, are establishing or increasing surcharges because of a slow recovery in demand, flat occupancy rates, continued declines in the average daily rate, and increased operational costs.
Most major hotels in Puerto Rico charge guests some sort of surcharge. The Caribe Hilton, for example, imposes a $6 per day resort fee for in-room coffee, newspaper delivery, and tennis court & fitness center access. Wyndham El Conquistador Resort & Golden Door Spa charges an 11% in-house tariff for guest amenities such as in-room coffee, health club access, bottled water, and ferry transportation to Palomino Island.
Surcharges appearing in the tourism industry include cancellation fees; early departure fees averaging $50; master-folio billing fees anywhere from $50 to over $1,000; resort and amenities fees ranging from $15 to $20; telephone surcharges on local calls over 20 minutes and connection fees for toll-free calls; increased fax charges ranging from $1 to $5 per page; handling charges for overnight packages; room-service fees of $2.50 in addition to a 15% to 17.5% gratuity; minibar restocking charges of up to 20% on the items; automatic gratuities or service charges for housekeepers, bellhops, and doormen; charges for meeting rooms in which food and beverages are served, in addition to meeting-room rental fees; and open-bar charges.
"Hotels are seeking to enhance revenue and profitability while minimizing customer complaints over unexpected surcharges," said Bjorn Hanson, global industry leader at PricewaterhouseCoopers Hospitality & Leisure Practice.
In Puerto Rico, tourists have complained about paying higher government taxes at some hotels because the properties were hiding the resort surcharges in the government-imposed room tax. Paradors charge a 7% room tax, hotels without casinos 9%, and hotels with casinos 11%. Room-tax revenue is helping to finance the development and construction of the islands convention center.
According to PricewaterhouseCoopers, consumers are increasingly resistant to resort surcharges, and some hotels are responding by disclosing all fees during the reservation process and educating staff about surcharges.
This Caribbean Business article appears courtesy of Casiano Communications.