Youtube Video

Summary published at 10/18/2024

🏨 Revenue management is essential for operating a profitable hotel. Successful hoteliers continuously seek ways to improve cash flow and gain a competitive edge.

💰 Revenue management involves strategic pricing and distribution tactics to sell inventory effectively, ensuring you sell to the right guests at the right time and price. This includes not just rooms, but also amenities like food and drinks.

📊 Pricing strategies are crucial for future success. Three common strategies include:

  • Dynamic pricing: Adjusting room rates daily based on real-time market data.
  • Open pricing: Setting different prices for various target markets, such as lowering rates in the off-season for luxury hotels.
  • Length of stay pricing: Requiring a minimum stay during high demand periods.

⚖️ No pricing strategy is universally perfect; each hotel has unique strengths and weaknesses. A strategy effective for a large luxury chain may not suit a smaller boutique hotel.

📈 When forecasting prices, consider factors from the previous year and upcoming events, such as:

  • Revenue per available room (RevPAR) from last year
  • Groups and events from last year
  • Public/bank holidays and school holidays

🔍 Additionally, consider influences like sales resources, online marketing, and refurbishments for informed decision-making.

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