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How Hotel Reservations Work

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Re: How Hotel Reservations Work

#41

Post by smtm »

rubyrescue wrote: post #22
smtm wrote: post #17

Earlier quoted context omitted.

yield management is the exercise you do when your - the individual hotel's - distribution system is set up perfectly and humming along. The biggest gains for hotels happen actually when they set their mind to it that they want to shift the source of their business away from the OTAs to more direct business: direct can be the online booking tool on their own hotel website, mails, repeat customers, phone calls. yes eve…

who is your typical customer?

Small independent Hotels, Apartments & Fincas. Mostly in Austria, Germany, recently Spain and Switzerland. Properties between 1 and 30 units. Typically they are looking for a management approach that helps them to handle the reservations remotely. 1-4 Staff are dealing with the reservations.

Re: How Hotel Reservations Work

#42

Post by mattmanser »

kls wrote: post #2

The article misses the fact that there is a roll over cost associated with room occupancy. So booking all rooms no matter the price can actually cost the property money. One has to factor in electricity use, housekeeping costs and complimentaries (as well as some other more hidden items like prorated taxes) on a per room basis and then tally a minimum rate for profit, 100% occupancy at any rate can actually be less p…

I thought this too at first, but my sister used to work in hotels, this is by and large wrong. Almost any price is better than none. Especially if you're out in the sticks and they'll buy dinner.

Think about it a little more. Electricity & heat will mostly be on anyway. Complementaries are bought in massive bulk and are almost worthless. They'd have the same number of staff on if the hotel was 80% or 100% anyway. Depending on the size of the hotel maybe you might have to hire one more minimum wage worker.

Hiring the room for a fairly nominal amount would cover all those costs. Upsell them one product, such as a meal, and you've got profit.

You have to remember the majority of the costs are fixed when calculating the cost per guest in a hotel.

Re: How Hotel Reservations Work

#43

Post by peripitea »

400k hotels * 200 rooms/hotel average = 80M hotel rooms in the U.S. That's one for every ~4 people in the U.S. That seems way too high... even if these rooms are only filled 25% of the time (which the article indicates is way below the 70% these businesses desire), that would mean the average American would be using a hotel room one out of every 16 days (and that assumes that people don't share rooms). Am I missing something, or are these stats wrong?

Re: How Hotel Reservations Work

#44

Post by zygen »

peripitea wrote: post #43

400k hotels * 200 rooms/hotel average = 80M hotel rooms in the U.S. That's one for every ~4 people in the U.S. That seems way too high... even if these rooms are only filled 25% of the time (which the article indicates is way below the 70% these businesses desire), that would mean the average American would be using a hotel room one out of every 16 days (and that assumes that people don't share rooms). Am I missing s…

You're not counting the rest of the world that may be traveling in the US =)

Re: How Hotel Reservations Work

#45

Post by dredmorbius »

peripitea wrote: post #43

400k hotels * 200 rooms/hotel average = 80M hotel rooms in the U.S. That's one for every ~4 people in the U.S. That seems way too high... even if these rooms are only filled 25% of the time (which the article indicates is way below the 70% these businesses desire), that would mean the average American would be using a hotel room one out of every 16 days (and that assumes that people don't share rooms). Am I missing s…

I think the article is substantially overestimating the average hotel size. I'd bet it's much closer to 10-20 rooms than 200. You're forgetting a huge number of smaller roadside / rural establishments.

For San Francisco (a large tourist-oriented city with many larger hotels), there are 215 hotels, offering 33,642 rooms (source: http://www.sanfrancisco.travel/research/) or an average of 156 rooms per hotel. Given that smaller cities and rural resort areas will tend to have smaller facilities, I see the rooms/hotel being markedly lower.

SF's population-to-rooms ratio is 24:1, or rooms for about 4% of the population (and that's in a city with huge tourist and business travel traffic).

That would give you a high-end of 8 million rooms, or enough for about 5% of the population (assuming double occupancy, 2.5% for single).

Re: How Hotel Reservations Work

#46

Post by base »

smtm wrote: post #17
patio11 wrote: post #4

Hotel yield management is about a decade or so behind the airlines, but they're catching up, so this is probably going to get a bit harder from the OTA's/customer's perspectives before it gets easier. (Yield management means the art/science of room pricing such that you sell out nearly all of your inventory while maximizing profits. It has gotten radically more sophisticated over the years -- loyalty programs, for ex…

yield management is the exercise you do when your - the individual hotel's - distribution system is set up perfectly and humming along. The biggest gains for hotels happen actually when they set their mind to it that they want to shift the source of their business away from the OTAs to more direct business: direct can be the online booking tool on their own hotel website, mails, repeat customers, phone calls. yes eve…

I own a small hotel in Europe and we are looking for a PMS. Does your software sync the availabilities with the major booking sites? Is your software in English?

Re: How Hotel Reservations Work

#47

Post by smtm »

base wrote: post #46
smtm wrote: post #17

Earlier quoted context omitted.

yield management is the exercise you do when your - the individual hotel's - distribution system is set up perfectly and humming along. The biggest gains for hotels happen actually when they set their mind to it that they want to shift the source of their business away from the OTAs to more direct business: direct can be the online booking tool on their own hotel website, mails, repeat customers, phone calls. yes eve…

I own a small hotel in Europe and we are looking for a PMS. Does your software sync the availabilities with the major booking sites? Is your software in English?

Yes the software is fully translated into English (The marketing site not yet). Syncing with booking sites works via an Austrian channel manager. I have two other channel manager tools in the pipeline, will be out later this year.
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