As the saying goes, if you want something done right, do it yourself, right? Not always. For owners and GMs of independent hotels, manual pricing might seem like a safer, cheaper option than investing in a revenue management system (RMS).
NB: This is an article from RoomPriceGenie, one of our Expert Partners
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But in reality, do-it-yourself (DIY) pricing comes with hidden costs: missed revenue opportunities, wasted time, stress, and lost bookings.
Let’s explore how automated pricing can turn those hidden costs into profits and hear directly from hotels about their experiences.
Cost #1: Lost Revenue Opportunities
Static or DIY pricing decisions are often driven by fear or guesswork. Many hoteliers underprice rooms out of fear of losing bookings, only to fill too quickly and leave money on the table. Others hold rates even when demand drops, trusting their intuition that the market will bounce back – only to end up with empty rooms and lower RevPAR.
A revenue management solution takes the emotion and guesswork out of pricing by basing decisions on hard data. The system constantly monitors market demand and booking pace, then adjusts pricing to capture the best possible rate for every booking. The result: fewer empty rooms and higher RevPAR.
Just ask Kamal Patel, hotel manager at City Center Motel in the U.S. “Since implementing RoomPriceGenie, we’ve seen up to a 20% increase in both occupancy and ADR during the week,” he said. “Now we can focus more on what we love – welcoming guests from all walks of life and creating memorable experiences for them – while being confident that our pricing is always optimized for success.” Read the full case study here.
Cost #2: Wasted Time and Team Burnout
Many small hotels don’t have the luxury of a full-time revenue manager, which means pricing falls to the GM, front office, sales & marketing, or even the owner. That can mean spending hours each week monitoring competitors and tweaking rates while neglecting other duties.
The hidden cost isn’t just time, it’s also staff morale. Manual pricing is tedious and stressful, contributing to burnout and employee turnover.
An RMS prevents wasted time and frustration by taking over the repetitive, manual tasks of monitoring the market, managing daily rates, and preparing reports. Instead of spending hours tinkering with pricing, staff can review recommendations in minutes.
