Breakage Income Question

[DavidRoss]

Use Vero Beach as an example. This resort is not sold out yet. If a person pays $300.00 for a room for a night, does DVC get all that money as breakage income? Or, if Vero is only 50% sold out, would DVC only get $150.00? How does this whole thing work to ultimately lower our dues?

 

[DebbieB]

It would only be breakage income if the room came from the points room inventory. If it's from the developer room inventory (the part not sold yet), then it would not be breakage income.

 

[DavidRoss]

So it sounds like you are are saying that if a non-declared room is sold DVC memebers would not benefit at all. But if a declared room is sold, DVC members would get the full benefit. Is that correct?

 

[RobDoc]

Yes, David. The "breakage income" would also be minus any associated expenses. The resort itself would deduct typical front desk, maintencance, housekeeping, etc. charges from the transaction and only the "profit" would be applied to the breakage and sent on to the DVC budget. At WDW resorts- the breakdown would also include the bus transportation costs which are built into the room charges.

Doc
doc@wdwinfo.com