September 04, 2012

Summer is over - Time to get back to work at your hotel?

With the Ramadan season behind you, now it's a great time to take 60 minutes and check your on the books for 2013. Here are my 5 recommendations that should be in your radar as you will soon enter a new year:

1) Best Available Rates - Price & Availability: when we analyzed booking pickup during peak periods in Hotels, we realized that lots of reservation came from a Contracted Tour Operators or a Group, and sometimes much more than their allocation. The reason might be that since you don't extend your next year rates in advance, the business traveller that aims at booking long time in advance, does not see availability at your hotel, resulting that he will book your hotel using an alternative distribution channels.
Recommendation: In fact every month, you should load rates for 365 days in advance.

2) Rates Upload for online bookings: if you have a fair idea of your seasonality and your demand curve (high/low) for 2013, do upload your rates as per your online strategy.
Recommendation: Rates can be changed at any time, but if you don't display availability they will go to the next property.

3) New Competitors supply: named them Rotana, Accor, Hilton, Four Points, Marriott, there will still be new supply nearby your hotel, so start anticipating their opening date. Obviously every new hotel does need business, and comes on the market with an aggressive rate structure.
Recommendation: Explore your business intelligence networking capabilities, and you should be the one that inform your General Manager.

4) Talk to your Sales Team about 2013 rates: there will still be new conferences in town, inflation will still occur, new hotel supply will get released. You need to work your Business Intelligence, but first and foremost you need to build your base for meetings and conference for next year (06 months booking lead).
Recommendation: While your budget may not be started, prepare your group rates and allocation mix through the first semester to secure groups.

5) Give some thoughts to your next summer periods: for lots of hotels, this period is mostly a low demand seasonality with occupancy rate varies from 40-65% and low ADR impact. In fact, its quite surprising that for the last 08 years, hoteliers are practicing lower and lower rates offer, while the overall hotel expenses grew by 30% in the last couple of years (Electricity, Water and Gas cost / Employee Costs / Distribution costs...), resulting on a low profit margin.
Recommendation: Ask your Financial controller about the break-even cost, or level of revenues to performed in order to cover the cost, because you may walk into the wrong directions.

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