To improve monthly hotel profitability, hoteliers must focus on increasing top-line revenue while effectively managing expenses. By leveraging the following four strategies – including improving RevPAR, adopting real-time accounting practices, and implementing multilocation financial reporting – hotel owners can drive growth and success in the highly competitive hospitality industry.
1. Improve RevPAR
Guestroom Rates: Maximize occupancy and optimize pricing strategies across each market segment with intelligent hotel revenue management. Hotstats, a leading hospitality benchmarking tool, provides valuable insights into setting competitive rates for any given day of the year.
Value-Added Services: Uncover revenue-generating opportunities that will not only improve your topline but enhance the guest experience like upselling incentives, preferred parking fees, or convenient self-service food and beverage options.
Engage the Local Community: Partner with local travel bureaus, event organizers, tourist attractions, and businesses to drive increased traffic. Attract more day visitors to your property by renting space for personal and business events like luncheons, private family celebrations, and meetings. Collaborating with the local community can be a win-win situation for everyone.
2. Reduce Expenses: Cost-Effective Accounting Solutions for Hotels
Effective expense management is vital for maintaining profitability in the hotel industry. Hotel owners need an industry-specific, real-time accounting system that can show them exactly where they stand financially at a moment’s notice. With this type of access, hotel management can predict monthly profitability, and in turn, reduce short-term variable expenses or plan for future expenses and capital projects. Docyt, a comprehensive AI-powered accounting automation tool, offers real-time visualization of financial data, empowering hotel owners to make informed decisions. By adopting this software, hotel owners can optimize their expense management and ensure sustainable profitability.
3. Empower Your Team with Real-Time Financial Statements
To incentivize the hotel team and align their efforts with gross profit targets, provide them with real-time financial statements. This information empowers hotel managers to contribute actively to expense control and profitability. Offering commissions based on meeting gross profit goals can motivate employees and create a collaborative environment focused on driving revenue.
4. Multi-location Financial Reporting and Benchmarking
For hotel owners with multiple locations, it’s crucial to have a robust financial reporting and benchmarking system in place. By comparing financial reports across properties, owners can identify any discrepancies or inefficiencies quickly. Analyzing key categories such as linen cost-to-revenue ratios can highlight areas for improvement and standardize expected costs for each property. Implementing internal benchmarks enables hotel owners to track progress month over month and maintain consistent profitability.