How can I increase my hotel’s net-profit & improve bottom line?”
This is one of the common question every hotelier thinks of in mind to keep his/her business alive.
It doesn’t end in there, we get to hear this question over the meeting tables during the conferences from time to time by most of the hoteliers.
Joining the hospitality game is easy, but scoring profits can be a challenge.
While the revenue growth rate has been slow down across the nation, the US hotel industry has never stop seeing increased profits for a decade of consecutive years.
So the growth potential is high for Hoteliers.
All that needs to be done is to narrow the disparity feeling within them and focus more on implementing proactive strategies in hotel management and operations. That’s how can one can increase the overall revenue and net profits!
Here are eight strategies that hoteliers must use and execute by investing some time aside to increase net-profit of Hotel’s portfolio
1. Having a clear ‘Vision’
This is the first crucial step for a hotelier that cannot be overlooked.
One should know where the business is going, what’s the vision is for their hotel going forward 5 to 10 years. A strong vision can be formed using the budgeting and forecasting accounting software, making it easy to develop accurate forecasts and control costs, streamline cash-flow altogether to improve hotel performance.
As this is the key component of one’s vision, it shouldn’t be compromised or forgotten.
Aligning to the futuristic vision will leave space to increase the profit goals by placing the productive blocks.
2. Focusing on ‘Guest Satisfaction’
Always hoteliers must remember that, an unhappy guest will certainly hurt their business reputation – So it is to be made sure that all the guest satisfaction surveys are reviewed and acknowledged.
Keeping a high standard of hotel service and responding to guests diplomatically, yet calmly and offering a reimbursement to them if needed, will wholly increase the brand’s reputation and recurring guests.
What else could a hotelier expect? No, doubt this would take the business to the next level and boost profit gains.
It is also to be noted that, above and beyond just answering the reviews one should actually progressively act on them.
In fact, if there’s a large number of guests having similar kind of requests or sharing identical feedback on something, it becomes imperative to implement said changes in hotel business’s daily life.
3. Ensuring the ‘Hotel Staff is Happy’
If the hotel staff is kept satisfied and unbroken with the provided pay, working conditions and treatment then it definitely creates more patience within them, which in-turn helps in dealing with the bickering hotel guests
As well, each staff member can work with dedication in favor of hoteliers, creating a synergy between them and leading to the most innovative ideas that guide hotel or hotel chain towards its long-term financial goals.
This is proven key to score profits and skyrocket the business as the expected duties of hotel staff are met.
4. Being ‘Comprehensive’
If hotelier owns multiple properties, the process of hotel management across the entire portfolio requires a significant amount of detail and access to accurate snapshot of all financial happenings.
Hotel Accounting Software that leverages Automation, Integration and Intelligence improves the visibility and efficiency in driving financial and operational performance.
With the means of it, hoteliers can even create a variety of business-centric plans focused all throughout the year.
The core idea of actually being comprehensive is to associate with the entire hotel portfolio without investing a lot on operational overheads.
5. Working on ‘Operational Costs’
If improving the net profits is in mind, the vital step is to evaluate the current hotel operational costs.
This review for hoteliers offers a seamless vantage point in identifying the areas that require trimming.
One of the major area is labor costs, which could be saved by streamlining the operations by cross training the existing staff on different department work.
Being multi-functional and enhancing the bench strength really works wonders during the time of peak season, sums up to increase net profits.
6. Investing in ‘Automated Software’
Hoteliers can reduce the cost in handling their accounts and finances, without compromising on quality using an Automated Hospitality Accounting Software.
Larger number of Hotel Business owners are profitable when they embrace the automation in dealing with their day-to-day finances and staying accountable.
Rather than relying on various unprofitable sources, it’s better to have a unified solution for the entire accounting.
That’s how the highest net profits are attained, while focusing more on sales conversation rate.
7. Reducing overall ‘Direct Costs’
When this is done, hoteliers will have a significant impact on their hotel’s net margin.
And, one of the best way during this process is to negotiate for better discounts on everything that’s purchased or just finding a new supplier who provides the best quality compared in the market will work.
Yet another way to cut down direct costs is by eliminating any unnecessary purchases.
Furthermore, a thorough review on direct costs and its frequency will highlight overspending areas.
By which in total hotelier can work around and sooner or later net profit hits high.
8. Controlling ‘Inventory Stock’
The best way to streamline hotel business and advance the cash flow is by reducing inventory costs and taking control of it.
When the money is less tied up in sluggish inventory there would be less chances of expiry.
So it’s better to order more frequently which actually allows hoteliers make the best advantage of overstock discounts or seasonal clearance.
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