Learn about the deeper financial implications of in-housing revenue management when you own 10-20 hotels from Raj, a hotelier.
Raj: At 10-20, you know, you’re growing into a midsized hotel management company, and you’re thinking about a lot of different things outside of just your immediate property operation, because you’re thinking about how you’re putting deals together, why am I commencing partners, investors, banks, to lend to me, what advantages do I have over the next management company, smaller or bigger. So, as you’re looking for those advantages, you know, bringing us in as a partner to help, bringing in-house the revenue management side of things helps because you’re able to create this advantage over your partner about reporting, about efficiencies. You’re able to say that you have an in-house revenue management team that you’re able to direct in any strategies that you’re wanting to implement. The way you want your management company to look to the outside, it is a worry that you have.
So the second thing was, you know, not only am I looking at how can I outperform on the revenue management side, but how can I outperform on the guest satisfaction side, how can I outperform on the sales side, you know, what am I doing to gain all the RFPs, where am I seeing efficiencies where these properties are located close here, and these are here. So now we’re talking about how do I look at year-over-year data, right. Even if, for example, we have a brand that changes PMSes, they didn’t bring over their historical data, but because we have those hotels on RevGEN’s platform, we’re still able to compare what companies am I missing last year as my revenue starts to decline, or what groups that I have on the books last year are not here this year, and where are my need dates for group business. So you’re really able to make RFP cases, track X, Y, Z company and how many room nights they have, whether it’s by the rate plan or the company profile. So you’re really creating efficiencies throughout your hotel operations by using the data platform. And the last thing is, how do you make this all make financial sense, right? Once you’re at 20 hotels, you can realistically say that you’re paying an out-sourced company, let’s take the brand for example, maybe 35 to 40,000 dollars per month to out-source it. And you’re thinking, well, whether you save money or you spend that money, what is your output? You may save a little bit of money, but you may gain an output in production from your revenue management team. That translates to sales, that translates to operations, to guest satisfaction. So you’re really creating a model where your revenue management output is feeding your other parts of your operation.
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