Revenue Management 101

Transcription

1 Revenue management 101 for small accommodation providers / 1 Revenue Management 101 for small accommodation providers

2 Revenue management 101 for small accommodation providers / 2 12 Chapter 2 Yield management 13 / What is yield management? 14 / What strategies can you use? 23 / How can you manage your channel bookings? Table Of Contents 04 Chapter 1 Managing your inventory 05 / What is inventory management? 07 / Managing your inventory accross channels 09 / Using a reservations system to manage reservations 26 Chapter 3 Measuring success 27 / Setting smart goals 29 / Reports 33 Glossary of Terms

3 Revenue management 101 for small accommodation providers / 3 Introduction The joys of being an accommodation provider come from delighting your guests. However, it can be difficult to strike the delicate balance of providing excellent value and service while making sure your small hotel runs efficiently and profitably. In this ebook we will cover the essentials of revenue management for any small accommodation provider; inventory management, yield management, and the information you need to measure success. Happy reading!

4 Revenue management 101 for small accommodation providers / 4 Chapter 1 : Managing Your Inventory

5 Revenue management 101 for small accommodation providers / 5 What is inventory management? Inventory can refer to many things, but in this case we are going to discuss it in relation to your rooms. Your rooms are your biggest revenue-generating asset, so the way you manage them is key to maximising your revenue. TWEET THIS

6 Revenue management 101 for small accommodation providers / 6 Inventory management refers to all of your efforts to control how your rooms are sold in order to boost your bottom line. Managing it well means that: You can sell the right room, to the right guest, at the right time, at the most profitable price. From an operational standpoint, you should be able to upload, manage, and distribute your inventory easily and quickly. The purpose of this is to make sure you have a continuous stream of bookings that you are able to service well, at a minimum cost, and at a maximum profit.

7 Revenue management 101 for small accommodation providers / 7 Managing your inventory across channels In order to grow, small accommodation providers need to sell their rooms through more distribution channels, such as Online Travel Agents (OTAs) and hotel aggregators. The tricky part is making sure you avoid double booking your rooms while still maximising your revenue. If you can t effectively update your inventory across channels, it will cost you money and loyalty in the long run. TWEET THIS

8 Revenue management 101 for small accommodation providers / 8 Key challenges come from: Allocating rooms even though not all are filled. For example, you allocate 10 rooms to a channel but only 8 get booked, so you miss out on the 2 rooms that could have been booked either directly with you or through another channel that has booked all the rooms you allocated to them. Having two guests make reservations for the same room, either because you expect one of them to cancel, or because your room availability simply isn t updated across channels. You end up with unhappy customers and distribution partners. So the system you use to manage your inventory - whether it s manual or automatic - directly impacts your bottom line.

9 Revenue management 101 for small accommodation providers / 9 Using a reservation system to manage inventory With the system you re currently using, ask yourself: What would happen if a channel sold my rooms, and I forgot to update inventory? How long does is it take me to update inventory across channels? Can I see an overview of inventory and rates distributed over all channels? Can I see how many rooms I have left? Can I see whether I m visible on channels for sales? How far out can I manage inventory? How easy is it for me to load new inventory and rates? Relying on a spreadsheets to manage your inventory can take up too much time, simply because of the volume of changes that need to be made. It just doesn t scale. For example - if you need to update your rates for a particular season that spans 20 days, across 7 channels, and 3 room types per channel, that amounts to 420 changes. That is a lot of changes to confirm when you re already short for time!

10 Revenue management 101 for small accommodation providers / 10 This is why many small accommodation providers turn to software to fix this problem. In looking for the right online reservation system, ask yourself: How many distribution channels can it connect you to? Does it allow for live rate and availability updates? Can you manage all your booking sites from one place? Can you upload your inventory 365 days in advance? Can you easily see an overview of how your channels are tracking? Is it affordable in the long run? Does it lock you into a contract? If you don t have a system that distributes your rooms in an organised way, you run the risk of double booking your rooms - resulting in unhappy customers, lost revenue, and even more wasted time trying to rectify the situation

11 Revenue management 101 for small accommodation providers / 11 A modern online reservation system like Little Hotelier should allow you to manage your live inventory in such a way that you can simultaneously update your rates across all your channels. Also, when a room is booked, it is automatically reflected on all of the OTAs that you re connected to. That way, you fill the most rooms possible without worrying about double booking your rooms and dealing with unhappy customers.

12 Revenue management 101 for small accommodation providers / 12 Chapter 2 : Yeild Management

13 Revenue management 101 for small accommodation providers / 13 What is yield management? Yield management or revenue management refers to all the pricing tactics you use to sell your resources to the right guests at the right time. It s based on the economic theory of supply and demand - you alter your rates so that you can get more incremental revenue, because different guests are willing to pay a different price for using the same amount of resources. Without it, you miss out on the opportunity to get more bookings, offer competitive rates and promotions, get more revenue per booking, and forecast the upcoming booking season.

14 Revenue management 101 for small accommodation providers / 14 What strategies can you use? #1. Use different rates You should never have just one fixed set of rates. Here are the rates you should have in place...

15 Revenue management 101 for small accommodation providers / Rack rates These are your normal room rates, based on the category of the room, type of bedding, and occupancy. Guests are usually quoted and charged rack rates. It s important to note that you may need to set a minimum length of stay per booking to recover your fixed costs. For example, a minimum of 4 nights at $70 gets you $280, and you know it costs you $180 to service the booking with a $30 cost for each extra guest. 2. Group and tour rates For companies who block a large number of rooms, you should offer them discounted room rates. This is usually when meetings, seminars, or conferences are scheduled at your property s function room or nearby. You can also offer this rate to tour operators, as long as they commit to book you a minimum amount of rooms over a given period of time.

16 Revenue management 101 for small accommodation providers / Special and promotional rates As a marketing strategy, you should offer promotional rates to people who regularly stay with you. This includes corporate travelers, traveling sales reps, military personnel, airline staff, and other regular clients. If you re looking for a way to bump up your revenue in low season, you can also run marketing campaigns promoting these rates. 4. Package rates Packaging your services along with a banquet or special event works very well. The total package often includes different elements. For example, if it s for a sporting event nearby, the package will include accommodations, tickets to the event, and transport to and from the venue. Consider having wedding, honeymoon, Christmas and new year s eve packages. You will need to establish partnerships with other companies.

17 Revenue management 101 for small accommodation providers / 17 What strategies can you use? #2. Change your pricing based on timing Your regular rates should also change depending on what time of year it is.

18 Revenue management 101 for small accommodation providers / Seasonal pricing All rates should fluctuate according to what season it is. Most of you will already have a high and low season, but you may need 3 or 4. Have another look at your reports for the past few years and see if you can notice any trends. 2. Day of week pricing Some days are just more in demand than others. Make your busier days more expensive, while making quieter days cheaper. Deal-seeking guests who would prefer to book on the busy days will come during the quieter days instead, simply for the fact that it will save them some money. This makes room for others who can t make it on your quieter days. 3. Time of day pricing Changing how you price your facilities can be an effective way of making the most money during your busy periods. For example, if you offer bicycle hire at your property, you can charge $15 per hour from 7am-10am, and increase it to $40 per hour from 10am-2pm.

19 Revenue management 101 for small accommodation providers / Peak pricing When you re subject to extraordinary operating costs, it makes sense to increase your prices. On days like public holidays, guests expect to pay more for services being provided. 5. Last minute pricing Discounting your prices at the last minute can give you a lot of incremental revenue. However, you must be careful not to sell less than your full cost per guest. For example, if it costs you $100 to get a Deluxe room ready and an extra cost of $20 per guest, then don t sell your room for less than $120. You also need a way to let potential guests know of your discount quickly. Without it, you may just be selling your services short to guests who would have paid full price.

20 Revenue management 101 for small accommodation providers / 20 What strategies can you use? #3. Focus on increasing revenue per customer. While you re trying to find more new guests, you should also actively try to get the most out of each current guest. Besides enforcing penalties for cancellation and schedule change, you should...

21 Revenue management 101 for small accommodation providers / Up-sell at every opportunity Complementary offers that will enhance their experience include shuttle transfers, room upgrades, equipment hire, and tours and activities. Persuade your hotel guests to spend a little more through your online booking engine by adding carefully thought-out extras such as a romantic package or champagne breakfast. You could also consider asking a guest during check-in if they would like to get a better room for a slightly higher rate. This is simply about letting your guests know what options are available to them. If it s out of sight, it s out of mind! Use your front desk or other designated area to take advantage of point-of-sale opportunities such as car rental or tickets to events and tours. Adding this extra value to guests not only brings in revenue but also provides a better traveller experience. Whatever the product may be, give guests something to remember their time with you and add a new revenue stream by making some of your products available for purchase. For example, sunscreens, shampoos or even towels for the beach. (This might even prevent them from accidentally packing your bathroom towels in their bags before check-out!)

22 Revenue management 101 for small accommodation providers / Encourage referrals Satisfied customers should be encouraged to refer their friends and family to stay at your property. Offer your potential guests incentives such as a promotion code, which you can easily set up in your all-in-one booking management solution to be redeemed at the time of booking on your website. A post-stay can also be set up to automatically send to your guests after they leave, with a specific promotion code and discount. Remember: Word of mouth is often the most powerful marketing tool. 3. Welcome pets You may not warm to pets, but many travellers would love to travel with their furry companions. If possible, make your small hotel pet-friendly so you not only attract a different segment of travel customers, but can be in a position to charge a little extra for your rooms. 4. Offer discounts for extended stays Some guests are quite flexible with their travel schedule and might want to stay an extra night or two. Offering a 50% discount off an additional night, when paying the regular rate for the first few nights, could ensure a higher occupancy and incremental revenue.

23 Revenue management 101 for small accommodation providers / 23 Using an all-in-one online reservation system to manage revenue Your reservation system should help you execute the strategies we talked about. It should be easy for you to get more revenue from... TWEET THIS

24 Revenue management 101 for small accommodation providers / Online bookers Can your guests check availability and make a reservation instantly from your website, and all of your connected OTAs? Can you securely take down their credit card details? Can you send systematic confirmation, reminder, and follow-up s? Can you instantly update your rates and availability across your channels? With a manual process, it takes so much time and effort for you to be constantly at your desk, responding to s and phone calls and updating spreadsheets to get everything organised. With an online reservation software, you can let guests self-serve and manage your distribution channels in a few clicks. After setting it up, you can let it run on auto-pilot so you can be out and about, servicing your guests and spending quality time with your family.

25 Revenue management 101 for small accommodation providers / Current guests Can you package extras like late check-out, breakfast, and spa packages? Can you customise extras to suit each product? Can you add extra sale items to reservations during your guests stay? Selling extras manually means that you can only really offer extras when you meet your guests face to face. It also means that you have to jot down the extra charge somewhere. Sure, you can remind yourself, but you re human and when things get busy, it s an easy task to forget. With an online reservation system, you can present your options in a professional manner, before they ve made the reservation. Guests can pay for extras beforehand, so that you can make sure you re ready to service them when they arrive. You can also easily add it in so it isn t missed in the final charge.

26 Revenue management 101 for small accommodation providers / 26 Chapter 3 : Measuring Success

27 Revenue management 101 for small accommodation providers / 27 Setting SMART goals You can t talk about revenue management without discussing how you will measure success! And of course, to measure success, you need to set goals.

28 Revenue management 101 for small accommodation providers / 28 S S Let s refer to Peter Drucker s SMART criteria for goal-setting. It requires that your goals be >> M An example of a vague statement: I want to increase room occupancy by getting more online reservations from China in low season. An example of a SMART statement: I want to increase room occupancy from 60% to 75% during low season by launching our new Chinese traveller package. I m going to do it by partnering with Ctrip as an OTA. I m giving myself to the end of low season to achieve this. A R Realistic and relevant Describe the outcome that you want. Make sure it s realistic and relevant to your business. TWEET THIS T

29 Revenue management 101 for small accommodation providers / 29 Reports It s tough for small accommodation providers. You have a limited budget, and need to be smarter about where you allocate your money. TWEET THIS

30 Revenue management 101 for small accommodation providers / 30 When planning your budget, your report should include: Fixed costs (eg. rent): No connection with business activity. Variable costs (eg. wages): Changes according to business activity. Income: Forecasted and other expected revenue. Actual costs: The difference between budgeted figures and actual numbers. If the budget was in line with actual costs, that s great. Think about how you can further capitalise on it. If not, then document why you think there was a difference - was it a matter of timing (it will happen at some point in the future), or was it permanent (it won t happen at any point in the future)? But without advanced reporting, you won t be able to calculate your budget, or see the return on your investments.

31 Revenue management 101 for small accommodation providers / 31 To manage your revenue successfully, you need to be able to see all your revenue streams from the online booking websites where you advertise your property, to your marketing and sales. Without this visibility, you won t be able to make pricing decisions that are based on one of the most fundamental principles of economics: supply and demand. How easy is it for you to generate a report of: Your best performing booking sites? Your direct bookings? Your occupancy rates? Your income and oustanding payments? Which of your promotions (hot deals) work? Without a reservation system, you will probably be struggling to manipulate data in Excel spreadsheets using formulas. Besides taking up a heap of time, one human error could mess up your whole spreadsheet!

32 Revenue management 101 for small accommodation providers / 32 With an online reservation system, it s easier to slice and dice your data, exporting it if need be. A modern system will display it to you visually and allow you to print it out. You can spend more time making sense of the data and deciding what to do with it, instead of painstakingly manipulating it in Excel documents. For example, Little Hotelier lets you generate reports for: Average occupancy rate Average length of stay Average lead time Average revenue per booking Revenue per available room Average daily rate Dollar value of cancelled reservations

33 Revenue management 101 for small accommodation providers / 33 A glossary of terms for Revenue management

34 Revenue management 101 for small accommodation providers / 34 A Alternative Distribution System (ADS) Distribution using the Internet. (OTAs primarily) Availability The number of vacancies possible for a specific type of accommodation for a specific set of dates. Average Daily Rate (ADR) Figure derived by dividing actual daily revenue by the total number of rooms sold. Average Length of stay (ALOS) The total room nights in a hotel divided by the number of reservations in the hotel. It is used to keep track of hotel performance in attracting and keeping guests in house. Formula: Total occupied room nights / Total bookings. B Best Available Rate (BAR) The lowest non-restricted rate bookable by all guests. This rate can change several times a week up to several times a day. Also called Best Flexible Rate (BFR). Best Rate Guarantee (BRG) The promise that hotels or OTAs will display the best rates on their own site as compared to any other side for the same product. Booking Engine (BE) An application powering the hotels own brand site for reservation related information. Budget Usually refers to the annual budget prepared in late fall that sets the financial plan for the property for the next calendar or fiscal year. It includes a daily occupancy, rate and RevPAR by major market segments and feeds into the Financial Budget for the property. This budget shows percent change vs. last year and previous year by month and quarter. C Central Reservation System (CRS) The application used to manage a hotel s distribution and hotel room bookings. Typically will be used to reach guests via multiple distribution channels such as travel agencies (via GDS), online travel agencies (such as Expedia, Orbitz, Travelocity, Priceline and others), direct to the hotel website, and telephone (either via call center, direct to property or both). Channel Management Controlling the allocation of hotel inventory and rates across all distribution channels including website, third parties, and the GDS. Effective channel management solutions should reduce labour costs and improve efficiency by providing a centralised way to control multiple channels.

35 Revenue management 101 for small accommodation providers / 35 Charge A Charge is a financial obligation for a Product or Service during a guest stay. Examples of Charges are: Room Stay Function Room Rental Merchandise Purchase Food Purchase Closed to arrival (CTA) It means that no new reservations can be taken for guests arriving on this date. Reservations can stay through the date. It is used to control inventory. Closed to Departure (CTD) A restriction by which the hotel can restrict any check outs on a specific day. Demand Generators Specific strategies or programs that attract or drive demand to the area or a specific hotel. Device Asset A Device Asset is an electronic item owned or leased by the hotel. Displacement Analysis for hotels Since hotels have a fixed capacity, whenever they sell a room, they are taking a chance that they might be taking rooms out of inventory that could be requested later at a higher rate. One purpose of Revenue Management is to keep this from happening. With groups, it is usually worthwhile to do a displacement analysis. In other words, is the hotel going to be full and so some of the last people to book will be turned away. Multiply the number of guest rooms that will be denied times the average rate for that segment of business. If that is higher than the group revenue, then the group should be turned away. The group value includes all food and beverage spending, meeting room rental and any additional outlet spending minus any costs involved. Commission That payment that a travel agent receives from a supplier for selling transportation, accommodation or other services. D Demand Based Pricing Changing rates based upon demand within the marketplace and what the market will bear. Distribution Strategy Determining when and through what channels to sell rooms based upon the cost of acquisition of the individual channel. By driving business to lower cost acquisition channels during high demand periods, hotels can maximize their profitability. Dynamic Packaging The ability to create packages based upon the components the customer selects.

36 Revenue management 101 for small accommodation providers / 36 E Early Bird A promotion only available for advanced bookings where a minimum number of days are left between the reservation and the date of check in, often a discounted rate with fencing. Electronic Distribution (ED) All the electronic channels of distribution, which includes GDS, Online Travel Agencies (OTAs) and Web Booking Engines. These distribution channels can be accessed through the Internet, an intranet or through an interfaced connection. F Fair Market Share A hotel s individual percentage of the market they should reasonably expect to capture all things being equal based upon their competitive set. Calculated by dividing the number of rooms at the hotel by the total number of rooms in the competitive set (inclusive of the subject hotel). Flash Sales A promotional sale by a hotel that is available for purchase by the customers for a limited time only. Folio A Folio is a collection of Charges and Payments incurred or made by a Guest or corporate account, or in-house account, etc Forecast In addition to the budget, a day forecast is prepared each month (usually in the last week of the month). It includes the same statistics as the budget but is based on evolving information on bookings, no shows, cancellations and market trends. Usually the 30 day forecast is not changed during the applicable month and actual results during the month are reported against this 30 day forecast. Revenue Managers prepare the forecast and distribute it to all departments for their planning. Function Room Occupancy The measure of how efficiently hotels are utilising their function room space. It is recorded as an occupancy percentage. Formula: Total occupied Function Room space/ Total square footage of function room space available. G Global Distribution System (GDS) A reservation platform started by code sharing airline partners to enable reservations for Airlines. Later on hotels, cars and cruise companies came on board. There are 4 major GDS companies. Sabre, Galileo, Amadeus and WorldSpan (Galileo and WorldSpan are owned by Travelport) offer a comprehensive travel shopping and reservation platform to travel agents worldwide. Agents use one of these systems to book airline, car, hotel and other travel arrangements for their customers. OTAs also use one or more GDS to power some or all of their content on their site. Gross Margins The figure you arrive at after dividing your gross profits by net sales. Gross Operating Profit Per Available Room (GOPPAR) Calculated as room revenue minus expenses divided by total rooms available. It is the new RevPAR for owners.

37 Revenue management 101 for small accommodation providers / 37 H Hosted Payment Collector A system designed to collect Payment Card information without going through any Hotel System. Hosted Payment System The system that presents a web page where payment information is securely collected Housekeeping Asset A Housekeeping Asset is a consumable item used to maintain a Room-Type such as toilet paper, cleaners, soaps, shampoo, etc. All items are not accounted for. I Interactive Voice Response System An Interactive Voice Response (IVR) module, typically part of a telephone system that allows a caller to enter information, via keypad or voice commands. Internet Distribution System (IDS) Distribution using the Internet (OTAs primarily). Inventory The rooms available that the hotel has to distribute/sell across all channels. Invoice An Invoice is a request for payment made by the hotel to a company with which is does business. J K L Lead time Time it takes for a guest that his visited your site to make an online reservation. Revenue managers typically measure average lead time and try to drive it down. Linen Asset A Linen Asset is an item used to maintain a Room-Type that is re-used after laundering such as sheets, blankets, towels, etc. These items quantities are tracked, but not the individual assets. Lookers to Bookers (L2B) Refers to the conversion of online shoppers to actual buyers; often communicated in a ratio. Lose-it rate This term refers to a rate where the hotel would be better off leaving the room unsold than sell at this rate. This could be because the hotel expects to find a better group at a rate high enough to take the chance of waiting for it to come along. It is often true if the dates requested are in a peak group season, and if there is significant time left in the group booking window for those dates.

38 Revenue management 101 for small accommodation providers / 38 Loyalty-Program A Loyalty Program is a marketing program that offers rewards to guests for regular or frequent business. A loyalty program may also be a partnership with loyalty programs of other businesses (airlines for example). Loyalty may be tracked by points or other means. M Maintenance Asset A Maintenance Asset is an item used by the facilities maintenance staff such as a light bulb, caulk, bolts, screws, brooms, carts, mops, etc. Some of these items are traceable/accountable and some are not. Markup The difference between the hotel s selling and the merchant s price offered to the consumer. Maximum Length of Stay A room inventory control function that limits the number of nights a reservation can stay when arriving on a certain date. Minimum length of stay (MinLOS) An inventory control function primarily used to ensure that a peak demand night does not get filled with one night stays thus blocking the days around it for longer lengths of stay. It requires a reservation to meet or exceed a certain length of stay (2 or more) in order to complete the reservation. Marketing Campaign A Marketing Campaign is an activity designed to promote and increase the awareness of the hotel and one or more of its services. Marketing Channel A Marketing Channel is any individual or company used in making the hotels products and/or services available to its customers. Marketing Collateral Marketing Collateral is the collection of media used to support the sales of a product or service. The media typically describes the hotel and one or more of its services and may be targeted to a specific audience. N Net sales The figure you arrive at after subtracting your costs from your total sales. Night Audit A Night Audit is a reconciliation of the previous 24 hours of transactions. O Occupancy rate Fill measure of a hotel calculated by dividing the total number of rooms occupied by the total number of rooms available times 100, e.g. 75% occupancy.

39 Revenue management 101 for small accommodation providers / 39 Online Travel Agencies (OTA) Websites offering comprehensive travel shopping and Reservations Solutions to consumers. Examples include Expedia, Orbitz, Travelocity, Priceline, and many local and regional sites. Overbooking The practice of booking rooms beyond the capacity of the hotel in anticipation that some guests will not show up. P Package A collection of components being sold at a single price, where the component prices may or may not be known to the consumer. Payable A Payable is a liability that the hotel must pay. Purchase Order Tour voucher Payment Service A party that can authorize and settle payment-card transactions. Payment Terminal A physical device capable of capturing and encrypting Payment Card data from the Payment Card presented by the Customer (either by swipe or keypad entry or both), such that it can only be decrypted by the Tokenization Service. Price Match Guarantee (PMG) The promise that hotels or OTAs will offer the lowest rates or match the lowest rate available across any channel for the same product. Purchase Order A Purchase Order is an agreement made by the hotel to spend a specific amount of money for a specific set of services with one of companies it does business with. Payment A Payment represents remuneration made by the Guest against a specific Folio. A Payment can be in any form such as: Credit-Card Corporate-Account Cash Promotion Loyalty Redemption Q

40 Revenue management 101 for small accommodation providers / 40 R Rate Fences Rate rules that may include restrictions such as advance booking cutoffs or non-refundable payments. In general, no discount rate should ever be offered without fences, like advance purchase required, minimum stay length, non-refundable, etc. An example of how to use them: If all your business travelers are paying $100 per night, and book within 5 days of arrival and you need to encourage some extra, non business revenue, you may want to offer a $79 rate for guests booking two weeks in advance. This advance purchase requirement is a fence that keeps the guests already willing to pay $100 from buying your rooms for $79. Rate Parity The strategy that all distribution channels of a hotel should reflect the same rate for the same conditions for a particular room type. Rate parity strengthens customer loyalty and encourages guests to book directly with the hotel where terms/policies may be more flexible, given the same pricing as in other channels. Receivable A Receivable is an amount of money that the hotel must collect. A Receivable may be a Folio or an Invoice. Reservation The record of a request to set aside a room or other resource for use in the future. Revenue Management The process of understanding, anticipating and reacting to consumer behavior to maximise revenue. Yield Management is also referred to as Revenue Management. Revenue Management System (RMS) The software application hotels to control the supply and price of their inventory in order to achieve maximum revenue or profit, by managing availability, room types, stay patterns (future and historical), etc. Revenue Per Available Room (RevPAR) Calculated by taking the daily room revenue of a hotel and dividing it by the total rooms available at that hotel. Revenue Per Occupied Room (RevPOR) Also known as revenue per booking. Calculated by taking the total daily revenue (including ancillary revenues) and dividing it by the total number of occupied rooms at the hotel. Room Block A Room Block is a group of rooms. Room Blocks may be created to organize rooms in various configurations to aid in planning and sales or other management tasks. Examples of Room Blocks might include: associating rooms with a single fixed price, a single Guest, a Channel, or a single team of Staff Members that manage or maintain the rooms in the block. Room Inventory The set of rooms available for stays for a particular date or range of dates. Room Type A Room Type represents some form of categorisation, set, or collection of rooms with some common element at the hotel that must be managed for marketing purposes within the hotel. For example, a Room-Type might be a Suite or a Single Room with a double bed, Poolside or Oceanside. A Room may belong to multiple Room Types.

41 Revenue management 101 for small accommodation providers / 41 S Service A Service is an intangible benefit that can be offered to a Guest. Service Contract A Service Contract is a legally binding exchange of services promised and agreements between the hotel and service provider that the law will enforce. Examples of services are: Telephone service Cable TV and movie service Temporary or other non-employee personnel Alarm and control systems Static Pricing Charging one price for a product regardless of the time of year or the demand in the marketplace. System of Record A System of Record is the system that has the core responsibility for collecting and maintaining a specific type of data or information. T Third Party System A system that accepts and tokenizes credit card data (into a Tokenized Payment Method Record), that may eventually be sent to a Hotel System. Total Revenue Per Available Room (TrevPAR) Calculated by taking the total revenue of a hotel and dividing by the total inventory of rooms. U Unconstrained Demand (True Demand) The concept explains the total demand that exists for a certain time period irrespective of the capacity to accommodate it. Stay Record A record of a guests previous visit to a hotel. V Vacancy One or more rooms available to accommodate guests.

42 Revenue management 101 for small accommodation providers / 42 W Work Order A Work Order is a request maintenance work to be performed. Sources: Work Queue A Work Queue is a set of Tasks or Work Orders that must be performed by a specific set of Staff Members. X Y Yield management The process of understanding, anticipating and reacting to consumer behavior to maximise revenue. Also referred to as Revenue Management. Z

43 Revenue management 101 for small accommodation providers / 43 The all-in-one business solution for bed & breakfasts, guesthouses and small hotels Everything you need to run your property like a pro WATCH A DEMO 30 DAY FREE TRIAL + + Front Desk System Direct Booking Engine Channel Manager Manage your guests stay from reservation to check out and everything in between Take reservations directly from your website, commission-free Give your property maximum exposure on the world s leading online booking sites

44 Revenue management 101 for small accommodation providers / 44 Get a free assessment of your online profile! One of our online experts will take a look at your property s online profile and offer you helpful tips. GET A FREE ASSESSMENT