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CITCO fails to keep up the revenue graph

chandigarh Updated: Jul 20, 2013 11:17 IST
Vinod Kumar

Revenue continues to fall at Hotel Mountview and with it the tall claims made by Chandigarh Industrial and Tourism Development Corporation (CITCO), as its ‘efforts’ to take corrective steps to put a check on the same has failed to bear any fruits.

The situation at Hotel Shivalikview too is far from satisfactory.

According to the sale figures, Hotel Mountview posted an income of Rs 4.75 crore from April 2013 to July 15, 2013, which was Rs 7.76 crore during the same period in the previous year, thus registering around 39% fall in the turnover.

There are a total of 158 rooms in the hotel and the occupancy rate was 57% last year, which fetched the corporation around Rs 3.72 crore as room rent.

In the first three months of the current financial year, the room occupancy has dropped to 28% and around Rs 1.64 crore was collected as room rent.

The hotel has also registered a decline in food sale. Last year, the food sale was recorded at Rs 3.29 crore as compared to figures of Rs 2.43 crore in the same period this year. The sale figures of Magic Wok restaurant, banquet and Rustles restaurant have plunged considerably.

The sale figures of bar sale have also shown a downward trend despite considerable increase in liquor rates. The net bar sale in the current year is Rs 41 lakh, while the bar sale had registered figures of more than Rs 43 lakh last year.

Similarly, the sale figures of Hotel Shivalikview are far from impressive despite the management spending around Rs 12 crore on its renovation. Though the figures reflect improvement of Rs 17 lakh in the turnover recorded from April 2013 to July 15, 2013, there has been a fall in figures of room rent and bar sales.

The hotel management collected Rs 1.74 crore as room rent this year, while the figures recorded last year were around Rs 1.8 crore. Interestingly, the room rent has come down despite increase in room occupancy. There are a total of 108 rooms in the hotel and the occupancy rate of the rooms was around 45% last year whereas the room occupancy saw a marginal rise to around 46% this year.

The net bar sale during the same period in the current year is around Rs 30 lakh, while the bar sale had registered figures of more than Rs 31 lakh last year. The net food sale has witnessed a rise. The gross food sale was recorded at Rs 1.85 crore last year, while the figures recorded this year are around Rs 2.11 crore.

Despite repeated attempts, CITCO managing director DK Tiwari was not available for comments.

Failure to cope with competition

While private players in the hotel industry in city are going an extra mile to attract customers, CITCO seems to be lagging behind.

Officials said the failure to cope up with competition prevailing in the industry in terms of food quality; service and ambience are some of the reasons for the downfall.

Besides, lack of accountability and wrong deployment of staff are other main reasons for the falling revenue of majority of CITCO units.

Officials said CITCO has witnessed a dip in its earning in recent years in both industrial and tourism sectors. However, the management has not held any official accountable for the fall in revenue.

In the recent past, questions have also been raised on deploying staff members at top positions, who allegedly do not posses required qualifications. The issue has been raised with the authorities on several occasions, but to no avail. As per the laid-down norms, 80% of supervisory staff of five star hotels needs to be professionally qualified, which is not the case with Mountview.

Giving examples of wrong deployment, a source said that an official qualified to hold the position of a banquet manager has been deployed as petrol station manager, while an official qualified for the post of food and beverages cost control has been given the charge of a supervisor in one of the units.

Question mark on extension in service

With no financial assistance from the UT administration, CITCO has to generate funds to meet all its expenditures, including salary of staff members.

A senior official questioned CITCO management’s move to grant extension in service to retiring employees.

CITCO has been giving nine-month’s extension to all employees after attaining the age of 58.
“What's the need of giving extension to employees, when the corporation has been witnessing a steep fall in revenue. It's a dangerous trend and it will have negative repercussion,” rued an official.