When the major hotel chains have unfilled rooms, they are able to absorb that loss in revenue thanks to economies of scale. With hundreds–even thousands–of rooms spread across many different locations, they expect a certain number to be empty at any given time, and can make up for it in other areas. For independent midscale hotels, however, this situation is much more worrying, with every empty room representing a significant lost revenue opportunity.
This is why room inventory management is such an important concept when it comes to smaller independent hotels. It allows for a complete overview of room availability, and can help maximize revenue, even if some rooms are empty. By implementing best practices and utilizing resources in an efficient manner, unfilled rooms can have less of an impact on the bottom line.
Stay On Top of Upkeep
You can’t book a room if a guest can’t occupy it. Maintenance issues like a broken TV or an overactive AC can obviously make a room uninhabitable, but even housekeeping can be a problem. For instance, if a block of rooms has not been cleaned and there is not enough staff to complete the work on schedule, hotels are typically forced to leave those rooms empty. Being proactive about maintenance and consistent when it comes to housekeeping ensures that empty rooms are always ready for occupancy.
Incorporate Revenue Management
It’s important to distinguish between inventory management and revenue management. Maximizing occupancy is a priority, but it’s not the same as maximizing revenue. Hotels may drop room rates to encourage bookings, then discover they made less revenue at 100% occupancy than they would have made at 75% occupancy with regular rates. Managing inventory and revenue at the same time is challenging, but with a comprehensive PMS, managers have the tools they need to drive both.
Align All Properties
No hotel wants to turn a guest away, but there are only so many rooms to go around. If your hotel has locations in the same area, however, it’s possible to offer guests a reservation elsewhere rather than an unhelpful apology. Room inventory management should not be limited to one property, but should be practiced across all relevant properties. Similarly, it should be managed across booking channels. Utilizing a centralized booking engine and tools that automatically update room inventory on OTAs allows hotels to capture as many potential reservations as possible. It’s also worth cultivating relationships with other hotels in your area. Through informal partnerships, it’s possible to attract business opportunities that would otherwise be missed. For instance, a hotel might have a large block booking that forces it to turns guests away, and it can send them your way. This sort of reciprocal relationship can benefit everyone involved.
Forecast Demand In Advance
The best way to optimize operations is to anticipate demand in advance. Booking trends are driven by seasons, events, room rates and many other factors. By collecting, storing and then analyzing as much data as possible, hotels can accurately forecast when demand will rise or fall and adapt accordingly. For example, if booking tapers off during winter, hotels could put packages and special offers together for off-season travellers. Forecasting also allows you to reduce spending during slow periods. To coincide with a predicted decrease in revenue, you could decrease stock levels in the restaurant kitchen and reduce the number of contract workers you employ.
Segment Your Guests
Very few hotels have only one type of room. Most have a variety of different sizes, layouts and features. Some of those rooms will appeal to travelling families, while others will appeal more to business travellers. Trying to market every room to every potential guest is a wasted effort, which is why hotels should segment their guests and approach outreach differently with each. A business traveller, for instance, may want a room with a desk and a flexible check-in time. Reaching out to known business travellers using these selling points will make a reservation much more likely. Also keep in mind that business travellers and vacationers often require rooms at different times of the week, month and year. By targeting guests according to their habits and needs, you can spread room bookings more evenly across the calendar.
If there is one overarching strategy to follow, it’s to leverage guest data as much as possible. Hotels can now collect incredible amounts of data related to guests, all of which could reveal what they really want and need. Hotels that use data effectively are able to anticipate demands, meet them preemptively and make a reservation as irresistible as possible.
RoomKeyPMS provides the key features hotels want – including room inventory management – along with customizations and integrations that make this a one-of-a-kind solution. Don’t just put heads in beds, put a smile on each guest’s face. Contact us to learn how.
Photo Credits: Shutterstock / Chinnapong