7 Reasons Why You Should Use Revenue Management Software
Wondering if you should adopt revenue management software? Here are 7 reasons why you should do it now!
While the potential of online distribution is now clear to most hoteliers, many still hesitate to work with a revenue management system, or RMS, the technical name for revenue management software.
Here, then, are 7 advantageous reasons why you should use revenue management software in your lodging establishment.
1 - Automate the publication of prices to the PMS and channel manager
In addition to external data (weather, flights, events, etc.), RMSs use internal data from the property's managementsystem and channelmanager to forecast market demand trends, anticipate them and, thus, maximizerevenues.
Connecting to the management software and channel manager also gives you the ability to simplify sales by automatically managing prices and room availability.
You thus avoid the risk of late price updates and distribution errors, such as the classic problem that during the property manager's days off, no one updates prices.
2 - Better make revenue forecasts with statistics
Without revenue management software, the average accommodation owner makes demand forecasts based on seasons: low, medium or high.
What the revenue management system does is provide better forecasts based on more accurate numerical data, frequency of bookings and on-the-book reservations.
In addition to helping you increase revenue, this also allows you to optimize hotel operations and reducecosts. Greater accuracy in forecasting also translates into greater precision in purchasing and managing your resources, financial and human.
3 - Make more accurate calculations with software
Closely related to the previous point, we can add that the performance of a revenue management software is, for some activities, much higher compared to that of a person.
The software's computational capacity allows it to take into account many more elements to make its predictions. The results it generates are therefore much more accurate and unattainable for a human being.
And this allows you to maximize revenue.
4 - If you have a revenue manager, you improve their performance
Each member of your staff performs at their best when they can devote more focus to their tasks, and the facility's results improve accordingly.
So if you let the RMS handle the calculation and rate distribution part, the revenue manager can devote the time saved to more productive activities. They can, for example, define sales strategies, create promotions, and analyze market segments.
In this way, the revenue manager takes care of the strategy and the software takes care of the operational (tactical) part.
Both work to their strengths while maximizing results.
5 - You set truly profitable prices and maximize your revenue
Hospitality managers who calculate rates without the help of software almost never manage to choose prices that maximize their profit margin.
Finding the perfect match between supply and demand, that is, the maximum guests are willing to pay at any given time, is complex.
Without the computational and analytical power of an RMS, two scenarios happen: either you choose a price that is too high and does not sell rooms, or one that is too low and does sell rooms, but without maximizing revenue (i.e., without taking advantage of guests' willingness to pay more).
Instead, revenue management software like Smartpricing allows you to sell at the right price at the right time, the price that maximizes your facility's sales and revenue.
6 - Reduce uncertainty and stress
An RMS that finds the right price at the right time also helps you reduce any doubts and stress.
Many hoteliers who update prices on their own are in fact in a perpetual state of anxiety due to not knowing if their price is actually the most profitable one.
They also keep mulling over the changes they have just made, fearing that they have taken action too early or too late.
Experiencing these emotions several times a week, along with all the other tasks that running a hospitality business entails, does not contribute to owners' peace of mind.
A revenue management system is definitely a great way to have more certainty and break down this state of anxiety.
7 - You can devote yourself to what you really love
Over the past few years, a great many hoteliers have complained to me that they have lost their passion for their work, and in talking about it, I have realized that the reason is due to the sudden change in the activities they perform on a daily basis.
For many of these business owners, revenue management software can enable them to get back to doing, at least in part, what they love most: providing an unforgettable stay for their guests.
For many revenue management questions, the answer is usually "it depends."
However, when the question is "Should I use revenue management software?" my answer is always "Yes!"
This is because the benefits offered by an RMS are so great and its cost has become so affordable that the return on investment is always positive, often beyond all expectations.
Start using revenue management software now, try Smartpricing!