Research On Cost Control Of W Hotel In The Strategic Transformation

Since the21st century, hotel industry ushered in the golden age with the rapiddevelopment of national economy in China. In addition the quantity, scale and receptioncapacity of high-star hotel also improved dramatically. But hotels bore on financial condition,limited policy, cost of production and many other factors in recent years. Especially in2013and2014, the market environment for hotel industry had a great impact, particularlygovernment reception and high standard business conference reception based hotels. Afterthe Central Committee of the Communist Party of China issued ‘eight policy’ from the endof2012, the slump of high-star hotels is coming, various luxury consumption are less andless than that in previous years, no matter catering income or conference revenue. W hotel, astate-owned hotel, is a four-star hotel. It deals in a characteristic spa for recreation, andadvantages in high quality water, excellent facilities and service. Before2012, W hotel wasappointed to some other high standard reception, but now the changes of policy andeconomic environment slashes the reception spend of government, some enterprises andinstitutions. W hotel and many other similar hotels should carry out the exact strategictransformation in management. Managers of W hotel had discussed the operating conditions.With rapidly changing market environment, W hotel should be taken defensive strategy, costleading strategic transformation, in conclusion.But after2013, there are so many management problems greatly affecting the sustainedand healthy development of W hotel. Based on reading a lot of literature and theory,combined target costing and actual cost control, analyzed survey data in operatingdepartments separately, aimed at main problems in hotel management, this paper gets thattarget costing should be used in cost control in the process of cost leading strategictransformation. According to the conditions of W hotel, a cost control plan is drawing up andtarget costing will be practiced in related departments preferably.This paper studies the case of W hotel, that how cost control uses in the process ofstrategic transformation. Target costing has a high application value in the cost control ofhotel management. There is a strong reference value for strategic transformation of highstandard government reception appointed hotels.