Re: [AGA-sc] [AGA-conheads] Projections

["S. Hieber" <shieber@yahoo.com>]

I'm glad you asked. We're going to have Cheryl confirm my work and then there 
will be a short quiz later this afternoon.

In some scenarios it might make sense to boost the roomnights but I don't think 
we're going to be in that situation.
 
There are two penalties that come into play andthey are both based on the 
number of roomnights sold:
 
First, if we don't sell 90% of the 115 roomnights we asked for, we have to pay 
for the rooms not rented (not counting the 10% allowance) - This means we have 
to pay for the diff between roomnights rented and 104. Let's call this the 
sleeper room penalty. So calling it will help us tell the two penalties apart 
-- I asked them to wear diff color carnations but hey wouldn't cooperate.
 
Second, if we sell less than 115 roomnights, there is a sliding scale for the 
cost of the meeting rooms. Let's call this the meeting room penalty.
 
Here's why we won't pay for sleeper room penalties:
Given the number of rooms that AGA2K6 will be renting, which I believe comes to 
24 if we include Ray Lucas (we buy him 3 night, rights?) in the total count, 
and given current figure, excluding speakers and Ray, of 78 roomnights 
reserved/sold, we have a total of 102 roomnights. So we only need 104 to make 
our threshold on the sleeper room penalty. I think we're bound to make that 
between now and the convention. But even if we were facing sleeper room 
penalties, it wouldn't help to just rent more nights since each one we rented 
would offset the penalty with an additional roomnight charge.
 
Here's why we might face meeting room penalties and why it might make sense to 
buy roomnights just to avoid meeting room penalties.
We are 13 short of the threshold for the meeting rooms penalty. The penalty if 
we sell between 100 and 115 roomnights is $500. We know we will sell at least 
100 roomnights so we don't have to worry about the higher penalties for selling 
less than 100. Suppose we end up with 111 -114 roomnights sold. Then, it will 
be worth the $448 to $112 to buy more roomnights to bring the total up to 115 
and avoid the $500 penalty.  If we sold less than 111 roomnights, then the cost 
of buying up the 5 or more rooms would cost more than $500 penalty we would be 
trying to avoid.
 
I still need to narrow down some things:
 
Are the Danes staying 5 nights in the hotel or 4?
 
Are we buying Ray 2 nights or 3?
 
What is the current count of roomnights and does that include any AGA-paid 
roomnights?
 
 
 


----- Original Message ----
From: Karen Randall <krandall@rdrcpa.biz>
To: AGA BOD <aga-sc@thekrib.com>
Sent: Wednesday, October 4, 2006 9:11:14 AM
Subject: Re: [AGA-sc] [AGA-conheads] Projections


Do these figures meam that at some point it makes sense for us to pay for 
the extra regs, even if they aren't use, rather than take the penalty hit? 
It would seem so from the amounts you have mentioned.

Same thing with room nights.  How far off are we?  For an $8,000 loss, we 
could buy 80 room nights, right?

Karen

----- Original Message ----- 
From: "S. Hieber" <>
To: "Convention Planning" <aga-conheads@thekrib.com>
Sent: Wednesday, October 04, 2006 8:19 AM
Subject: Re: [AGA-conheads] Projections


> For those wondering why the big swings in financial results with what 
> might seem small diffs in the number of paid regs, the reason is that the 
> hotel contract was negotiated on and estimated turnout and there are 
> penalties in the form of charges for unsold roomnights and for the meeting 
> rooms if the thresholds are not met. In each case the charges are based on 
> proportional or sliding scales, so as you move move farther from the 
> threshold, the financial effects are greater. As you get closer to the 
> threshold, those charges dwindle down to nothing. So at 90 regs AGA2K6 is 
> estimated to about breakeven, at 80 it's estimated to have about a $3,000 
> loss and if the convention were held today, with 67 regs, a net loss of 
> over $8,000.
>
> Compounding this, the average number of roomnights reserved per paid 
> registrant is lower than it has been for other AGA conventions, which 
> means, for AGA2K6, we need more registrants to make our roomnight 
> threshold. Apparently, we aren't getting tourist extra-day stayovers that 
> we had hoped for. At this point, purely form a financial point of view, 
> it's really roomnights that will help more than the number of 
> registrations, although we are unlikely to get more of the former without 
> more of the latter.
>
> sh
>
> ----- Original Message ----
> From: S. Hieber <shieber@yahoo.com>
> To: aga-conheads <aga-conheads@thekrib.com>
> Sent: Tuesday, October 3, 2006 6:36:28 PM
> Subject: [AGA-conheads] Projections
>
>
> Right now, I'm projecting a financial breakeven if we hit 90 paid regs and 
> about a $3,000 net loss if we have ten less than that. We currently have 
> 67 paid regs, so hopefully we can pick up another 23 paid regs between now 
> and the convention.
>
> _______________________________________________
> aga-conheads mailing list
> aga-conheads@thekrib.com
> http://lists.thekrib.com/mailman/listinfo/aga-conheads
> 


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