New Age Revenue Management System & Property Management System: Does technology really help?
Two major functions which determine success at a hotel, be it a single property or a chain of hotels spread across the world, are Property Management and Revenue Management systems
The hospitality industry is very complex. Even at a hotel level, a lot of resources, people, money, strategies have to work in unison to succeed. And, add to this mix the ever changing market dynamics – hoteliers have their task cut out indeed.
It’s easy to say that software makes running a hotel remarkably easy. Is there all-in-one software to manage your entire hotel? The answer is NO. And it is good this way. As each hotel function brings its own set of challenges, each function deserves a bespoke solution – than one-size-fits-all software.
Two major functions which determine success at a hotel, be it a single property or a chain of hotels spread across the world, are Property Management and Revenue Management systems.
Property Management System to connect, control, improvise services
As a hotel owner, wouldn’t you seek good communication skills in your staff? Equally important is connecting each function inside your hotel (front office, housekeeping, restaurant etc.) and allowing them to communicate freely. Software which links all your hotel functions and helps you deploy resources effectively – directly contributes to customer satisfaction and higher revenue.
Hotels are finding new ways to selling or upselling new services to make more revenue. Gone are the days of selling a room and waiting for the next guest to arrive. Today, guests indulge in services ranging from dining at the in-house restaurant to spending an hour at the spa and beauty services as well. As far as what you can sell – has no limits.
Business hotels offer foot massages for busy guests who rush in and out of the hotel. Scenic hotels offer local tours or a walk-across the in-house garden. The possibilities are endless. A sound Property Management System will hold all your services and connect all your service to men and women and make it easy for guests to pay and use your services, and also makes it easy for you to deliver those services.
At the end of the day, you, the hotel owner can sit back and review your PMS dashboard and analyze each business function and maintain efficiency. This is the true power of the PMS.
Streamlining your revenue management to boost occupancy through dynamic pricing
The existence of a smart revenue management system – RMS – is to help a hotel owner to:
● Define Revenue Per Available Room (RevPAR)
● Forecast demand based on past performance and market forces
● Achieve optimal pricing for each inventory
● Implement dynamic pricing to match demand
● Setting a base minimum price to avoid losses
● Set up automation to change prices dynamically to capture demand growth
● Constantly monitor competitor prices in your region on major OTAs
There is so much you can learn from looking at your data and looking at market forces. It takes an experienced resource and a lot of time to achieve the aforementioned parameters manually. A smart revenue management system would do that all on its own.
However, an RMS is not this simplistic. An RMS is a part of strategy and execution – built with automation. This is a powerful combination. Every hotel owner has two concerns:
● Achieving maximum occupancy during peak season at high rates
● Achieving maximum occupancy during off-season at optimal rates
For this to happen, the hotel owner needs to understand his/her region’s demand – to begin with followed by defining his RevPAR. This gives him a base minimum price to be fed into the RMS. From here on in, the RMS will help the hotel owner to schedule prices for an entire year (peak season and off season) leaving room for the RMS software to change prices and to the match demand. What the RMS does is change the prices when needed and sends an alert to the owner each day. This is how hotels can control and achieve optimal revenue.
It’s a game of efficiency
Any piece of software, like the PMS or the RMS is built to run operations smoothly and get the best out of each room (inventory) respectively – thereby achieving maximum efficiency. However, there a ton of such software available and how does a hotel owner know which to choose? I would recommend every hotel owner to talk to the software provider and ask them questions. Set your expectations and most of all ask them who their clients are and how long have they been serving in the industry. All this helps in choosing the best software with top class support.
A tinge of realism would help
Hotel owners need to understand that software’s are not magic wands. It’s not like you buy the software today and grow your occupancy or revenue by 40% in a month’s time. It may happen sometimes, but not always. Talk to service providers and understand what is expected from you – the hotel owner. A PMS allows you to streamline business functions within no time, however complex systems like the RMS takes time to reap rewards. I wish you to be ahead of the game as well patient to achieve tremendous success.
Authored by Anil Kumar Prasanna, CEO, AxisRooms
