Hotels across Australia and New Zealand are enjoying a boom in occupancy, especially in the regional areas, and the 170 properties that make up Choice Hotels are no exception. With border restrictions now lifted, and both interstate and international travel back on the cards, occupancy levels across the group show strong recovery over and above pre-pandemic levels.
At the recent Choice Hotels Asia Pacific iGNITE Conference in Melbourne, Director of Performance and Revenue Management Anthony Stanley shared that the adoption of revenue management services was proving to be a game changer for properties.
“Having dedicated revenue managers assessing and setting rates for properties has seen an average increase of $13.50 per room per night for participating properties, leading to significant gains in profitability for hotels,” he said.
According to Mr Stanley, the maths is simple and shows the significant impact in profitability for hotels over the course of a year.
“Over the first half of 2022, the average rate at a Choice Hotels property using our revenue management services was $152.60 per night, with non-RM properties charging $139.10; a difference of $13.50.”
“If you do the maths, on a 45-room property, over a full operating year based on average network occupancy, there’s almost $150,000 in revenue available to non-participating hotels,” he said.
His question to hotel owners attending the Conference was: “how much revenue are you leaving on the table?”
Choice Hotels Asia Pacific has a team of revenue managers who strategically set and monitor rates for hotels within the group.
Ingot Hotel Perth General Manager Paul Rogers said revenue management was key to ensuring they received the highest possible yield during times of “very high occupancies”.
“Revenue Management services have been vital for us, both in our early days as a new operation, throughout COVID, and most certainly now that we’re coming out of COVID. The work the revenue managers do is crucial in ensuring we’re maximising our revenue,” Mr Rogers said.
“Using Revenue Management allows my staff to focus on providing our guests with the service they deserve as they come in the door and throughout their stay. Someone else is keeping an eye on occupancy levels, our current rates, and rates in the market, and they’re looking ahead for us and factoring in what’s coming up.”
Quality Hotel Lakeside General Manager Kelly Sullivan said the property had seen an almost 20 percent increase in room revenue since pre-COVID, with record revenues, up 36 percent on 2021, much of which she attributes to having dedicated revenue management services in place.
“Previously, I would always be looking at rates. I’d try to look at it at least once or twice a day and adjust as needed. When the business was busy, it would sometimes get forgotten or put at the bottom of the list,” she said.
“Now, I am confident that our revenue manager is always looking at rates and has the tools to make the best decisions for the business. “
Mr Stanley said revenue management was becoming a vital part of the franchise groups model and was essential for ensuring profitability and lowering the cost of ownership for franchisees.
“In addition to Revenue Managers, earlier this year we started to roll out the ChoiceMAX automated revenue management service, and franchisees using this system are already seeing the benefits of using market and historical data to set the best rates for today and into the future, with pricing changes occurring multiple times a day” he said.
Revenue Management gives our franchisees the potential to maximise their revenues, grow their profitability, and give them time to focus on delivering the best customer service and value for money.
For more information, visit joinchoicehotels.com.au