February 10, 2012

Citywide Convention: Tips to increase your profits

Citywide events, you know it represent 15-25 days of the calendar year, where your hotel is selling at a peak rate. While receiving data from our clients, we always look at some hotels on the book, going towards citywide events (October -> March), being already sold out. Is that the right strategy? Did the hotel fill up with Individuals or Groups? How can we improve our profitability? ' We would tell the hoteliers "Do you know your sources of business and the reason your guests are at your hotel"?.

Here are questions, we usually address to our clients:
* Do you know your top 15 producing travel agencies (not OTAs) and the corporate accounts they handle?
* Are you getting your fair share of the business they generate in your market?
* Do you know the agencies generating business in your market but not at your hotel?

Here are 10 tips to look into to ensure maximum GOPPAR (Gross Operating Profit Per Available Room) during those key dates:

1) Look into your historical demand pattern for recurring events (Medical Congress, Construction Exhibition, Food Exhibition....).

2) Retrieve your daily market segmentation and any notes of strategy that you have performed in the past, so that you have a tracking in place (Reason of Success / Failure). 

3) When I was a Director of Revenue in mid 2000s, we used something called “denial reports.” These were reams of paper generated for me weekly by the on-site reservations department that showed a 365-day view of the dates my hotel was generating a turn-down to a guest attempting to make a reservation for a particular dateD * Pay attention to your stay restrictions like “closed-to-arrival” and “minimum length of stay” requirements. These methods have been absorbed by daily revenue management practices, but the reality for most hotels is that properties receive tons of data so regularly that it essentially overwhelms the staff. There has been a lot of talk about, but many hotels do not have staff that can be dedicated to it.


4) Make sure your groups block is fully prepaid, and go to your accounting department to make sure that, not only the 10% deposit, but also payment have been received accordingly. This is will make your General Manager happy in case of no show or cancellations. 

5) Status your competitors rate structure. 

6) GIVE CALLS, a few revenue managers have the complete skills to give the right call, and understand what's happening at the competitor hotel. 

7) Minimize your OTAs actions (because AED 1,500 at 25% Commission, it does hurt your profitability), and focus on your direct online bookings (5% commission). 

8) Forget to allocate much rooms for extranet because you will sell anyhow. 

9) Staff well the reservation department to ensure they can cope with the call overflow. 

10) Take risks, sell, overbook, you know your property inventory will fluctuate (no shows, cancellations, double bookings, non guaranteed release, early departure....). 

Maxime @ RSVP Hospitality

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