How to control travel costs?

Basic methods of cost control for tourism enterprises

1. Budget Control Method

Budget is the monetary quantity expression planned by tourism enterprises for a certain period in the future. Budgeted cost is the amount of cost expenditure under a certain business volume calculated based on standard cost. This control method uses budget indicators as the basis for controlling cost expenditures. Through analysis and comparison, differences are found and corresponding improvement measures are taken to ensure the smooth realization of cost budgets.

In order to connect with the current accounting system and better achieve budget control, operating costs and operating expenses must be budgeted separately according to different operating projects, and the budget period must be divided in more detail, such as Divide into monthly cost budgets or more detailed cost budgets. This will facilitate cost and expense control by department, project, and period.

In order to better achieve budget control, a flexible budget must be prepared to control the amount of cost expenditures under different business volumes.

2． System control method

This method is to use various cost and expense management systems within the country and tourism enterprises to control costs and expenses. From the perspective of financial management, the state stipulates the scope and standards of cost expenditures, and the finance, taxation and superior authorities also have their own regulations, which tourism enterprises should follow when controlling costs and expenses. As a tourism enterprise itself, in order to effectively control costs and expenses, it must establish and improve various cost and expense control systems and corresponding organizational structures. Such as the approval system for various expenditures and consumption, the daily attendance assessment system, the maintenance system of equipment and facilities, the procurement, acceptance, storage and issuance system of various materials and supplies, as well as the procedures and approval system, etc. The cost and expense control system must also include corresponding provisions on the reward and punishment system. Those whose efforts to reduce costs and expenses have significant results must be heavily rewarded, and those who fail to control costs and expenses and cause losses must be punished. Only in this way can employees truly be mobilized to save costs and reduce costs. Depleting positivity.

3． Standard cost control method

Standard cost is actually the unit cost consumption quota. It is a target cost that should be achieved under normal production and operation conditions and is formulated through investigation, analysis and calculation using scientific methods. It is an important basis for controlling cost expenditures, evaluating actual costs, and measuring work quality and effectiveness. For example, the consumption quota of materials and supplies for the guest rooms rented out by the housekeeping department, the quota of raw materials consumed by the catering department for the production of unit meal products, the quota of labor costs consumed by the provision of unit products and services, etc. These quotas serve as standard costs to control cost expenditures.

4. Break-even point analysis method

The break-even point refers to the quantitative limit of operating income that a tourism enterprise should obtain when its operations reach a point where neither loss nor profit is achieved. There are two indicators for the breakeven point, namely breakeven business volume and breakeven turnover. The breakeven point analysis method is a very useful method and a method that financial managers must master.