In my selling adventures at IDeaS, I often encounter smaller independent hotels with leadership teams believing ‘having fewer guest rooms’ means their property ‘doesn’t need a revenue management system’ (RMS).
Similar to larger hotels, smaller ones are constantly generating data. Especially if the property has a restaurant, spa, bar, or other ancillary sources of revenue. Without automation, it is difficult to compile and analyze all this continuous information.
Furthermore, smaller hotels frequently have fewer resources and don’t have a dedicated revenue manager; thus, leaving the revenue strategy up to the general manager, director of sales and marketing, reservations manager, or an RM team – all of which already have hectic days filled with other responsibilities. Often times, this results in over-pricing and under-pricing room rates, which leaves independent hotels at a competitive disadvantage.
The human mind (or even a team of minds) can only process so much information in its decision-making process. One of the biggest challenges with manual revenue management practices is the inability to collect quality data in a timely manner while being able to use it before it is obsolete. Hotel data comes from a multitude of sources, changes rapidly, and is critical to making proper pricing decisions.
My view is smaller hotels need an RMS more than larger ones. Here’s six reasons why I believe a revenue management system is important to small independent hotels: