Revenue management is generally characterised as offering the perfect room at the perfect cost to the perfect client at the perfect time. Presently in hotel industry revenue management is extending to conferences, restaurants and other recreational facilities such as spas and golf courses. The key component that every one of these products is exceptionally perishable; if a hotel room is not sold till tonight then it is a waste. It can’t be held in stock. This implies the hotel owner must guarantee that the revenue achieved from each night room’s sale is streamlined. Neglecting to do so implies that the hotel loses out on revenue and likewise benefit.
It can prompt a 10% minimum increment for each available room rate which prompts to a sensational increment in profitability. The bigger the room the more profits although revenue management change is vital even to the smallest operation.
To increase the revenue and to earn big profits it is very important to understand the importance of revenue management in the Hotel Industry so that you can properly implement it to gain the desired results. Some of the Revenue Management importance’s are as follows:
- It focuses on each group or department within a hotel on the actions to be taken to increase profitability.
- It makes the overall company more efficient by driving down the costs.
- It leads to innovation in both the creation of new products and services and their pricing.
- It helps in improving demand forecasting.
- It helps to maintain the right balance between general managers, revenue managers and hospitality managers.
- It gives the hospitality personnel’s an idea of how to manage revenue flow.
- It helps in gaining competitive intelligence and market awareness
- It helps a person to critically consider a condition and also provide the best techniques towards a possible hotel management system.
- It reduces the time and costs associated with traditional pricing tactics.
Revenue management is a vital part of the hotel business and ought to be approached with care and regard. So everyone should know the importance of revenue management in the hotel industry to make their hotel run successfully.
Check out our Introduction to Hotel Revenue Management Course HERE