As always from Chekin, we seek to give you the best advice so that you can take advantages over other owners, and in general, advantages in the market. Today we would like to share with you a strategy devised by the company Omnibees, in which it draws in 3 simple steps, how to establish an ideal average rate for your accommodation.
As we know, in order to generate a good administration of our accommodation, it is not enough to have a good organization and a quality human team, it is necessary to establish a cost and profit structure that allows a correct development of the finances of the home or hotel.
One of the premises of this market indicates that, at least, there must be one employee for each guest, house, room or apartment. That principle translates into salary expenses, another reason why it is important to set a correct average daily rate.
Calculating it is not easy, but do not worry, since there are different options that can help you define it and then we will give you three tips to achieve that goal. These tips are useful for both vacation homes and hotels:
1. RevPAR analysis
There is no way to fix a problem without first performing a diagnosis. Therefore, in the case of hotels that are operating, before establishing a new average daily rate, it is important to evaluate the company’s performance through tools such as RevPAR (income per available room).
RevPAR should be taken as an indispensable tool for any manager. It is obtained after dividing the total income generated by the guests in a period of time determined by the number of rooms.
With the result of the diagnosis, added to other data that yield a deep investigation of the financial structure, the management team can determine how profitable the current average rate is and if it is necessary to modify it.
2. Partner with technology
The tourism sector has undergone radical changes since the 1990s, as have vacation rentals, due to the consolidation of automated systems and technological tools as ideal complements for the management team.
In the hotel world, a manager who is closed to strengthening ties with technology puts the stability of the organization he directs at risk. Adapting to changes is an indispensable requirement of any leader.
Currently, there are different technological solutions for the hotel market that, among other things, help define an average daily rate through sophisticated investigation mechanisms, with very low error rates.
That a hotel does not have the ideal average daily rate, attached to the characteristics of the organization, should be taken into account as an important alarm by any manager.
3. Monitor expenditures
Every good manager must supervise the flow of expenses in his accommodation. In this way, you can verify that your organization is spending what is necessary on important issues or purchases, which keep it running.
Otherwise, you will have many unnecessary expenses, which ends up affecting the accommodation and, in many cases, causes staff cuts or even the closure of the hotel or home.
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