Here are some tips and tricks that can help you out in structuring your budget.
We sell Revenue Management Software to Independent and small hotel chains every day. Although multinational hotel chains were quick to adopt technology such as Revenue Management Software, smaller independent hotels seem more hesitant towards it. They often believe that having a small number of rooms means there is no need for automated Revenue Management Software and instead they often opt for manual Revenue Management practices.
“Small hotels often do not have a strong Revenue Management (RM) Culture nor a dedicated Revenue Manager in place.”
Small hotels often do not have a strong Revenue Management (RM) Culture nor a dedicated Revenue Manager in place. It is often the General Manager, Sales or Marketing Director or even front of house staff that decide on Revenue Strategy and make day-day revenue Management decisions. Manual RM practices do not only cost considerably more time than automated practices do, but also the manual computation of Revenue Management decisions often leads to over- and under-pricing room rates, resulting in competitive disadvantage. There are two major factors that make manual pricing decisions disadvantageous. One of them being the inability to collect and compile all the necessary information in real-time to be able to make informed decisions is near-impossible when done manually. Secondly humans are subject to a number of decision biases that affect pricing and in turn can have a huge impact on the bottom line results, such as those outlined in the For Smart Hotels article “Ten Dangerous Biases in Hotel revenue Management”.
From our point of view, Revenue Management Software is an essential tool not only for multinational hotel chains but also for independent hotels and small hotel chains. Here are the five reasons why: