Spa Revenue Management: How to think different?

The Spa Industry today has become one of the largest leisure industries in the Middle East as the spa visitor market has increased (Jordan, Egypt, Qatar, UAE and Oman). Today spas have become significant revenue streams and multiple independent spas are also gaining market share. In fact, I am talking of proper spa structure with experience therapists, and not the spa business setup in an upscale neighborhood villa of Jumeirah Beach / Al Wasl (Dubai) area with 03 treatment rooms, and no advertising signage.

As the industry is developing, spas are becoming independent profit centers, responsible for providing detailed cost accounting to the hotel property, and justifying their gross operating profits and metrics benchmarking.

Back in 2007, when I was piloting the first Revenue Management Spa Project for Shangri-La Hotel Dubai along with great colleagues, such as Michael Monsod, we challenged our think out of the box ideas by reviewing demand and pricing with operational excellence, following demand calendar….etc.

We got them back up by Ernst and Young Middle East as an consulting organization to provide to the market with benchmarking metrics such as RevPAT (Revenue per available treatment room) or alternative metrics to estimate the impact of Spa retail products vs. Spa Revenues. For whatever reasons, after nearly 18 months of operations, of what supposed to be the first spa benchmarking for Gulf Countries, it got discontinued.

Nowadays, with the new re-definition of Total Hotel Revenue Management, being roll-out in the market, along with the opening of many hotel+spa facilities, Spa operators or Spa manager are faced with many challenges.

One of the challenges is the efficiency utilizing the spa facilities, the spa therapists and the booking system in order to yield profits. 

My dear revenue managers, does not this context seems familiar to the work you are doing in rooms, groups…etc??

Both profit centers have something in common with the spa industry: the product that is offered is perishable and the capacity in which the product is offered is fixed.

In a spa, the high fixed costs are the treatment rooms and low variable costs are the treatment, the staff performance and the body products that are used during the service.

In Spa, demand may vary depending on the day of the week and the hour of the day. Similar to the hotels, spa bookings are booked in advance.

So now, let’s take a look and define your key performance indicators.

1    1) Spa Utilization Occupancy Rate (SUOR)

If someone asked you what’s the spa utilization rate of your spa, what would you answer? How about last week, last month? What is your variance to same time last year?

Are you measuring the spa occupancy of each of the treatment rooms by hours, by period (Morning, Afternoon, Evening)?

To calculate effectively your Spa Utilization occupancy rate of your spa, you need to define time and space units to be measured.

Let’s say, your spa has 10 treatment rooms and it’s open from 10.00am to 10.00pm. And during the week you have sold 180 hours of treatment. The occupancy will be 21.4%. That sounds low but it’s the reality. So what are we doing when the treatment rooms are empty?

The Spa utilization occupancy rate is calculated as:

Hours of treatment Room Sold divided by Hours of Treatment Room Available

180 Hours of treatment sold / (12 hours x 10 treatment rooms x 7 days) = 21.4%

2) Average Treatment Room Rate (ATRR)

The ATRR is the revenue generated by the spa revenues (retail must be excluded) divided by the number of treatment sold. The average treatment room rate is varying by days of the week (stronger on weekends), by time of the day (stronger after 5.00pm). This is an excellent comparison to review your pricing structure and strategy.

3) Revenue Per Available Treatment Room (REVPAT)

It is almost the same calculation than Revpar but data are changing.  It is calculated by the total revenue generated by treatments divided by the number of treatment room hours (treatment rooms x number of hours opened).

Do the calculation at your hotel and call your revenue management peers. Kindly note that some Spa Managers in Dubai 5-star hotel have initiative that types of data exchange, so works your PR with your Spa Managers.

It is also interesting to look at proportion of retail spa sales versus the spa total revenues, because spa products are costly in stocks (see p&l).

Now it’s up to you to setup a process to analyze that along with your KPI, and identify trends. In few weeks, you can develop a Spa Revenue Management Strategy. 

Once you are in control of those metrics, you could perhaps check your booking pace, market segments, price points and turn-aways. 

But one great advice you can revolutionize the pricing prior to perform a full analysis of your guest segmentation and behaviors, spa menu (low moving / high moving items), spa treatment cost....

If you experience difficulties, you may contact us at info@rsvp-hospitality.com, for a project evaluation.

Maxime @ RSVP-Hospitality
Visit us @ http://www.rsvp-hospitality.com 

KPI Metrics Application

In the previous post, we detailed 05 key performance indicators metrics there are, to measure your business with. There will always be new ways of measuring the business of hotels, outlets and venues.

Let's us bring you in a more figures approach with an elaborate calculation of those metrics.

Let's put data from Bur Dubai Market:
Month: 31 Days
Number of Hotel Room for Bur Dubai Market: 5,428
We estimated each room in Bur Dubai to be 30m2 so in total there were 5,048,040 m2 available (Total Number of Rooms Available multiply by Square Meter Average multiply by number of days in the month).
Market Room Revenue: AED 49,975,596
Occupancy Rate: 78.9%




1) RevPAR Calculation
This will give you RevPAR (Revenue per Available Room) on Hotel Rooms at AED 297.00.

2) RevPAS Calculation on Hotel Rooms
In addition, your REVPAS (Revenue per Available Square Meter) on Hotel Rooms will be:
Market Room Revenue divided by Total Available Square Meter for Rooms
The RevPAS on Hotel Rooms will be at AED 9.90 (Nine Dirhams and Ninety Fills).

3) TREVPAR Calculation
You will need to gather your Room, F&B, Spa and Health Club, Parking, Business Center and Other Income from your financial controller, and divide total revenues by number of room available in the market. Till date, I don't know if any benchmarking company such as STR, Benchmarking Alliance, MKG can provide markets with such an information. Obviously it would be a key metrics to measure, especially while you are running a Total Hotel Revenue Management strategy.

4) GOPAR Calculation
Same as above, Revenue Manager need an access to a Profit and Loss (P&L) from the Hotel Manager or Financial Controller, because they need to extract the expenses lines. If you have never been exposed to P&L (see post in February), don't bother asking all expenses details, and asked your FC to provide you the Gross Operating Profit results. Once you have it, divide it by Number of Rooms Available. Then call up your revenue manager in the market, and compare it. If there are unable to do so, present the idea to your GM and network accordingly. Here are the keys to make your role looking like the most accurate person, not only from your hotel but also from your owners representative.

5) REVPAM Calculation
The Bur Dubai Conference and Banquet Hall Market details:
- Number of Available conference square meters: 581,250
- Conference Revenues: AED 24,412,500
- Occupancy: 24%

REVPAM on Conference Rooms will be at AED 42.00

Interesting it seems there are plenty of money to explore in conference and event. 

6) RevPASH and RevPAT will occur in a separate post as they require some excel template to be submitted as there are featuring multiple metrics to look at.

In the Revenue Management Get Together, organized once a month, it would be interesting for Revenue Managers to discuss those metrics rather than Best Practices. Once you will start comparing, you can see that there are plenty of money for RevPAM - Conference Room, because to the exception of Monday - Tuesday (Corporate Business) and Weekends (Weddings, Social and Family Gathering), there are lots of money left on the table.

Owners representative companies should really get involved in those 5-6 metrics, as there are really driving the performance of an entire hotel team. With those metrics, generated on a regular basis, throughout the market, it will help Asset Management companies to build the right hotel, for the right owner at the right location. How many hotels in Al Barsha, Deira, Dubai Marina, Palm, Bur Dubai, Al Ain, Sharjah and Northern Emirates, end up with under use conference facilities.

Think Total Hotel Revenue Management process in your hotel and make sure you start practicing Revenue Management on Conference and Events space, food and beverage, spa and health club. Ensure that you understand the demand pattern, and also the one from your competitive set. Discuss with your Banqueting Manager, CCS Manager, and show them where you want to reach.

I am sure these topics will be discussed at the Arabian Hotel Investment Conference that will occur in Dubai. It's great to build Financial Assessment and Business Models between Development Team and Metrics company. HVS, Jones Lang Lasalle, Horwarth HTL, STR

Romain @ RSVP-Hospitality

How to measure your Hotel Performance Efficiency?

How can you measure the results of your sales and revenue management strategy at your hotel or hotel apartment? Which Key Performance Indicator (KPI) should you us at your property?

KPI s a regular benchmark for large hotel chains, while for Independent Hotels it mainly come from a Financial Controller or Hotel Manager's initiatives. Every hotelier involve in Head of Departments position should have an understanding of the below.

Here are some KPI to measure the results of your hotel revenue management strategy?

1. REVPAR- Room Revenue per available room
2. TREVPAR - Total Room Revenue per available room (Rooms + F&B + Other Income)
3. GOPAR - Gross Operating Profit per Available Room
4. REVPAM - Conference and Events Revenue per available square meters
5. REVPASH - Food and Beverage Revenue per Available Seat per Hours
6. REVPAT - Spa Revenue per available treatment room 

Which metrics do you look at on a daily basis? How do you compare the figures? (Manual inputs via telephone operator exchange or online benchmarking daily input). Do you measure RevPAR and GOPPAR on a daily basis?

Which persons in the hotel accounts for analyzing those metrics? Director of Sales, Front Office Manager, Revenue Manager, Financial Controller, F&B Manager, Spa Manager, Hotel Manager...

If you don't measure any of the above, you can not realistically assess your performance neither for your hotel property or with the market competitors.

Maxime @ RSVP-Hospitality

Gulf Food Exhibition - How does Dubai hotels violate their publish rack rates?

Everyone knows while planning their pricing structure, that Gulf Food Exhibition occur the 3rd week of February, in Dubai. We know that it is always a citywide convention, that it brings over 50,000 people in town, because the food import products industry is really important for Dubai. 


As I wanted to see how the city is behaving in terms of prices, there are still availability for AED 2,000 budget to stay in a decent 4 or 5-star of Sheikh Zayed Road stretch. Maybe I have an unrealistic notion of value for price at hotels, while I notice few 4-star and hotel apartment using an OTA extranet to sell their last rooms and publish a 4 to 5 digits rates during a citywide event, it's really surprising, when they are usually selling with a 3 digits rates all year through.

4-Star Hotel Dubai, selling normally between AED 450-600.00
Gulf Food Price: AED 15,000 for a Deluxe Room

Ramada Hotel Dubai - Deluxe Room - AED 15,000

Hotel Apartment Dubai, selling normally between AED 400-600.00

Gulf Food Price: AED 9,000 for a One or Two Bedroom Apartment

Hotel Apartment Dubai, selling normally between AED 300-450.00

Gulf Food Price: AED 5,000 for a Deluxe Room

I am wondering how Dubai Department of Tourism Commerce and Marketing would comment on this. As a hotelier, I always thought that the Rack Rate can only be the highest rate the hotel can sell. But it's seems that in Dubai, it is not being respected. And while I would pay AED 2,000 for a Fairmont, Emirates Tower, The Address, Armani, Rotana, Hilton, i think those snapshots are ridiculous. We are talking about pricing, and not gambling. A client who pays such as rate, will definitely have high expectations, which will end up not being deliver.

I also think that Booking.com should monitor this because on a 20-25% commission for a AED 15,000 sale, you can imagine the commission. 

Let's be reasonable for this budget, you would rather sleep at Burj Al Arab - Deluxe One Bedroom Suite at AED 7,480, a usual rate for the season:

I do hope that this practice is monitor by Dubai DTCM, because it brings a bad image to the emirate. Dubai has always been fairly price, and those hotels should get a penalty, for selling way above their rack rate. If only, Ramada / Howard Johnson / Imperial Hotel Apartment would have been smarter by selling a higher room category, it could have reduce the feeling of being "cheated".

No comments!

The signs of poor Rate Management

It's becoming quite easy to spot hotels which are not using revenue management. Hotel properties which start-off with strong rates and suddenly drop the rates when they realize that reservations are not what they expected to be. It seems they enjoy those panic situations, one or two weeks into the month, when management figure out that they are not going to make budget and slash the hotel rates to a low BAR level? it's usually too late, but something has to be done, isn't it?


How often does this happen at your properties? Who is taking the call? on another situation, this same hotel will do nothing when reservations appear stronger than anticipated. In many situations, Reservation agents are order takers, they are barely trained on selling techniques over the phone, so it would be up to the hotel to make sure demand patterns are understood. Honestly i don't know which scenario is the bigger sin. This situation is more common among single unit independent hotels and can be avoided if someone is assigned to revenue management the right way.


Hotels who do not maintain a rate parity, for instance they will sell on their own website, Standard Room, 1 Adult, 1 Night at AED 395.00 while they will sell, at the same conditions, AED 425.00 on OTAs and will slash a Groupon/Cobone deal at AED 299.00. 


The way I see it, revenue management does not need complicated process to be effective.  Sometimes our industry tends to focus and discuss the complexity of various tasks. Revenue management is a learned process, but you need to assign it to someone who has a legitimate interest and curiosity for numbers. If there is no one on staff with this knowledge, RSVP Hospitality will assist you in setting up training and process management  to handle training and/or coaching of existing team member. The return on this modest investment can be huge.


Rahul @ RSVP-Hospitality

Yield and Revenue Management: the right path...

Hoteliers in Dubai, Sharjah and Abu Dhabi claimed a strong demand during January 2012 due to a market mix of Individuals leisure and corporate, along with MICE Groups demand to the Emirates. While reviewing our independent properties, they still focus on "we were 100% occupancy for 24 days in the month". So what hoteliers are running for? Filling up all the rooms at the price the market want? Or organizing a yield management methods to control their destiny?

Revenue per available room (REVPAR) is a definitive measure of a hotel's performance, complementing the traditional measurements of occupancy (Occ%) and average room rate (ARR). And yet, too often, few people in a hotel fully understand the significance of this measurement. This is where the revenue culture should start.

So many people think that REVPAR and yield are the same measurement. Many hotels which claim to perform yield management are simply measuring REVPAR on a daily basis and staff are not able of explaining to a guest why different rates are charged on different days for the same room. 

The usual front office discussion would be "I am sorry, we are almost full" instead of advising "we are experiencing high demand, due to xxx events in town, therefore the best rate available would be.....". 

Yield management and revenue management are one and the same thing. Essentially they are an approach to maximizing profit by responding to what we know about the past, what we know about the present and what we think will happen in the future. 

In other words we are trying to sell the right room at the right time, at the right price to the right person. You could say that this is nothing new, but on the other hand many hotels are focussed either on occupancy or average rate and make most decisions on a very short-term basis. 

Revenue management apply to all types of hotels boutique, big, city, airport, resorts, 

Hoteliers should want to work with yield management because you don't want to accept low-rate groups at the expense of high-paying individuals, because you want to know what rate to quote before the telephone rings, because booking lead times vary by segment, because demand from different market segments fluctuates and because you need help in deciding which business to convert or accept and at which rate. 

Consequently you need to deeply analyze your bookings transactions to understand, discuss and elaborate strategic decisions.

Yield management consists of taking decisions based upon the actual business that you already have on the books, past business and booking patterns, future trends and most importantly very recent trends. 

We see the levels of knowledge of revenue management in the wider independent hotels is the hardest and finding good people that just have a real passion for the number is hard.

There are also lots of confusion between what revenue management is a discipline and data analysts. Some people think that being a data analyst is being a revenue manager and it's absolutely not. Anyone can crunch the numbers even an income auditor, a restaurant supervisor or a purchasing manager. 

We have seen revenue people, across different hotels, that think that putting these great colorful spreadsheets along with macro setup together is revenue management. But unless you're setting a price point for decisions, there's no value. 

Yield management is about forecasting, managing inventory, pricing, discounting, booking pace, pickup trends, overbooking, evaluating group enquiries, redirecting demand and rational pricing. 

Hotels should be able to understand different customers who are prepared to pay high prices from those who are prepared to change their travel plans to secure low prices, or make a commitment well in advance for secure low price (payment conditions, special cancellations...).

Yield Management works well for airlines carrier such as Emirates, Etihad, Qatar Airways, Fly Dubai, but for hoteliers it is still a hard concept to understand.

Customers should segment themselves

As Robert G. Cross define, it is all about selling the same room at a different price depending upon demand and most critically, all of your staff being able to explain to a guest why they have paid a certain price, without having to fall back on a 'roomtype' argument. It's time to educate staffs and clients too.

This will only happen if clear direction has come from General Manager or Owners, if everyone has been trained in yield management, if information is up-dated regularly and if weekly yield/revenue meetings take place to agree and modify the strategy for the next 06-12 months. 

With UAE set for 9 millions tourists in 2012 (Source: http://www.arabianbusiness.com/uae-set-for-9-million-tourists-in-2012-445216.html), it's time for people to change their approach, if they  would like to increase their double digit growth in Revenues and Profit.

Maxime @ RSVP Hospitality

Fujairah - Market Snapshot Overview - 2012

Fujairah is the United Arab Emirates' easternmost region and the only emirate that does not touch the Persian Gulf. Separated from the rest of the emirates by the Hajar Mountain Range, it used to be a small fishing and pearling port. Fujairah has been elevated to an up-and-coming travel destination in the U.A.E., largely due to its unspoiled beaches on the Gulf of Oman.


The Emirate of Fujairah currently has 180,000 inhabitants who all live in peace and security under the leadership of the ruler of the emirates, His Highness, Sheikh Hamad bin Mohammed Al Sharqi and the Crown Prince, His Highness, Sheikh Mohammed bin Hamad bin Mohammed Al Sharqi.


For the historian, Fujairah is a hidden treasure waiting to be discovered The old fort in Fujairah's historic town which is approximately 300 years old and the many small wind towers still standing in neighbouring villages as proud reminders of the town's recent past. However, archaeological ations have shown that man's presence in the region actually dates back to the Iron Age. In fact, some of -the mosts important archaeological finds in the Arabian Gulf have been made in the area.




Fujairah is host to an increasing number of visitors, driven by Fujairah soaring economy and to his great reputation as a leisure destination. 

Fujairah Emirates has 31 building, including 14 hotels with most hotels being 5-star or 4-star located in the Al Aqah area. These are known hotel brands such as Le Meridien Beach Resort, Miramar Hotel, Rotana Hotel, which has benefited in the past few years from major changes such as the enlargment of its buildings, which has enabled an increase in its capacity. Those hotels are running on high RevPAR on weekends due to local expatriates community, and during weekdays they rely on international leisure markets from CIS, Northern and Eastern Europe.


In downtown Fujairah, where the capital of the emirate is located there are several hotels such as Al Diar Siji, Arjan Rotana, Coral Tower and Concorde Hotel. This reflect more a business segment demand, due to the facilities provided (Hotel apartments).

Currently, the Emirate of Fujairah also includes 17 hotel apartments around the city and even in towns. These have been attracted by the active tourist movement in the emirate, which has in turn strengthened the investment in tourism projects like hotels, apartments and restaurants for the service of tourists.

Fujairah has currently 2,184 rooms and 698 apartments with about 850,000 tourists and travelers. Majority of the international tourists are still landing at Dubai International Airport, and they are transferred to Fujairah. Another great combination is 5 days (Fujairah) / 2 Days (Dubai) for leisure clients.

There are forecasts that go beyond one million tourists by the end of 2012. According the expansion of the emirate, it is consider there will be an increase in the number of hotel rooms that will reach 4500 rooms in the next two years. Future hotel projects named include ibis (180 Rooms, 2012), Novotel (254 Rooms, 2012), Fairmont (88 Rooms, 2013), Intercontinental Hotel (290 Rooms, 2013), Landmark (236 Rooms, 2013)...

With major mega malls being under development in Fujairah, Lulu Mall will feature 76 retail stores, Fujairah City Centre  - a MAF project with over 100 stores...) and Fujairah Mall which is part of Fujairah Commercial Complex. 

Additionally, there is a new domestic airline in the pipeline, with Eastern Express Development, that will ensure flights to Abu Dhabi and additional GCC cities.

Several infrastructure improvements (Fujairah Airport, New Highway to Dubai, Port), and residential and hotel development currently under way, are designed to complement the increasing attractiveness of the region. 

The Emirates Railway, the country's future national network, will be part of a GCC-wide rail network that will link Abu Dhabi, Dubai, Sharjah, Ras Al Khaimah and Fujairah and it is expected to be operational in 2016.

With oil prices stable at around $100 per barrel, the oil-exporting Gulf states are witnessing greater fiscal stability and investing billions of dollars into tourism infrastructure.


For detail information, kindly contact us at info@rsvp-hospitality.com

Hotel Profit & Loss Statement - Overview

"While we were in a Sales meeting, my boss uses that term that was not in my daily jargon, she mentioned several times "P....and L, P..N L" but I am wondering what is behind, dixit Joey Hernandez, a Sales Manager at a hotel in Deira". If you are like Joey, discover this post and perhaps you can challenge your boss later on. Well Joey, let us help you with the global understanding.
Profit and Loss statement is a flow statement that measures the performance of an organization over a period of time. Some key points to note in a profit and loss (P&L) statement: 

• It is an accounting statement: That means accountants can change it at their will,
• It is for a period: That means whenever you see any P&L, it would be for (let’s say) 1^st Jan 2011 to 31^st Dec 2011 or 1st Apr 2011 to 31st March 2012,
• P&L is like a Pipe! Money (In the form of revenues) flows into this pipe and Money (In the form of costs or expenses) flows out of this pipe! 

1) What are the revenues measured in a hotel property?

- Rooms Revenues,

- Food and Beverage Revenues,
- Conferences and Events Revenues,

- Telephone Revenues,

- Spa and Health Club Revenues,

- Parking Revenues,

- Other Income

Rooms and F&B are the main driver of overall performance, while the other revenues may help the total contribution.

2) What are the expenses / cost measured in a hotel property?

- Salary / Wages + Fringe Benefits,

- Food and Beverage Expenses,

- Spa Expenses,

- Administrative and General,

- Marketing and Distribution Expenses

- Repairs and Maintenance,

- Energy and Utilities Costs,

The major source of high expenses vary from country to country especially for Salaries/Wages (USA+Europe vs. Middle East & Asia), F&B Cost (Domestic goods vs. imported goods), Energy Costs (A/C environment vs. Normal climate, hotel facilities...). 

Ask yourself which expenses in your own work environment is being calculated in the P&L.

i.e: You are a Reservation Supervisor, so the cost that you generate would be (Phone Calls, PMS Software expenses, 

When you compare the revenues vs. expenses, you will then obtain the Gross Operating Profit (G.O.P).

To obtain the Net Operating Profit, you take your G.O.P and you subtract your Fixed Charges (Equipment and other rent/lease, real estate taxes, Building and other insurances).

The main size and performance measure in the Hotel industry are identified as the Occupancy Rate, multiple occupancy factors, length of stay average, ARR (Average Room Rate), Revenues PAR (per available room). The main profitability measures of an Hotel are based on Gross Operating Income PAR (Per available room), and to Net Operating Profit PAR (Per available room). 

So let's take a step back and run through the definition of RevPAR, GOPPAR and NOPPAR:

REVPAR = (Rooms) Revenue / (per) Available Rooms, or, ADR (average daily rate) x Occupancy %

GOPPAR = GOP (gross operating profit) / (per) Available Rooms

NOPPAR = NOP (net operating profit) / (per) Available Rooms

The difference between GOPPAR and REVPAR are the entire operational costs of the hotel. The problem is if we lump all of them together we don't fully understand the results from our pricing, contracting and distribution strategies. Same goes for NOPPAR.

If you are not familiar with these terms, we would recommend for you to either setup a meeting with your Financial Controller, or ask your training manager, to prepare a training about "Financial Acumen - for non financial people". 

Many times, we see Front Office Manager, Revenue and/or Reservation Manager or Sales Director focused on their daily operations and tactical, but looking into the P&L exercise, it become a weak practice. This is where the results are being discussed and compared. Only a great P&L results and a healthy G.OP will lead to a global appreciation.

RevPAR for Dubai and Sharjah Hotels is almost understood by everyone, while GOPPAR is rarely implemented. Things should change in 2012.

Cheers, 

Romain Saada

For more information, please contact us at info@rsvp-hospitality.com
Visit our website at www.rsvp-hospitality.com 

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

INDEPENDENT HOTELIERS : ASK US QUESTIONS

If any or all of you have any questions that you think we might be able to answer then do not hesitate to ask either via the response facility below or direct to us at info@rsvp-hospitality.com If we can we will give an educated and useful response.

If not then we will tell you so. Should you not want to share a discussion then simply email us and mark it as confidential. No advertising no nothing. We just love developing best practices and still want to contribute something if we can.