Revenue Management for Budget Hotels

Revenue management has always been a very unfamiliar section to the owners of budget hotels, many of whom have no real understanding of the meaning of revenue management! In fact, revenue management is a real chain of hotel profitability must kill, the success and failure of revenue management is directly related to the millions of revenue. The following is my organization about, welcome to read.

First, the first element of revenue management is cost control

1, development costs;

Development department as the vanguard force, the speed of the opening of the store as well as the quality of the very critical role; first of all, the development of a very systematic thing, and now a first-tier cities, basically every chain will have a certain The development is a very systematic thing, now the first-tier cities, basically every chain will have a certain amount of developers stationed year-round; many of the local brands is also in the property development stage to fully utilize the advantages of the local snakes, low rental costs, signing a long time, the longer the signing on behalf of the cost of depreciation, maintenance costs, the cost of outreach will be relatively low; the development of the cost of controlling the development is in fact easier to be divided into the following: staff wages, bonuses and benefits, expenses subsidies three major blocks. General hotel is used in the way: base salary + performance + meal allowance + supplement + bonus, belonging to the high salary, high performance, high bonus. In fact, the development of the cost of the high and low is not on this formula, the professionalism and enthusiasm of the developers is the development of the cost of high and low key place, if the enthusiasm of the developers is reduced, the company's development costs will certainly be very obvious soaring. So as long as the basic costs are controlled, the shorter the development of more projects, the lower the cost of the development of the shared; but the development of the staff to adopt a counting bonus model, and ultimately for the hotel's later management of the impact of a very large; because the development of staff only pay attention to the number of quality assessment model, and ultimately the hotel is still to pay the price for it;

2, Preparation costs;

Preparation costs belong to the second piece of hotel costs, also belong to the problematic sector! At present, with rising prices, almost all the economic hotels in the cost of input compared to 2009 are over budget by more than 20%! To our single-room integrated construction costs as an example, XX hotel chain in 2007, single-room integrated construction costs in about 40000; 2008 single-room integrated construction costs of about 42000, 2009 45000, 2010 50000; from this set of figures we can analyze the current chain of hotels in the construction costs at what level; our old! General mobilization of the eight ring to buy the second and third-tier cities, said there must be room to rise, I asked why? He said it is very simple, in 2007 we have a store in the renovation of carpentry is 80 yuan a day, in 2010 when the carpentry has risen to 200 yuan a day, visible, the house of civil engineering costs are in 2000 or so, if the local housing prices in the 5000 or so, and now really should go to buy! Currently in the economy hotel, Jinjiang Star's single-room integrated cost should be the highest, between 65,000 - 72,000, in fact, Jinjiang Star is also because it is a state-owned enterprises, spend other people's money does not hurt, if you really want to save like 7 days, single-room integrated cost should be controlled in 60000 or no problem;

< p>3, outreach costs;

Outreach costs! This foreign economic hotels do not understand the large expenditure program, which is in our great days of any city can not avoid the problem, I do not know now talk about this problem will not be cross-provincial. This aspect of the eight ring will say a little more obscure, lest we do not see the follow-up posting. In fact, the cost of outreach costs are indeed also high in the various hotels, the more large chains the more difficult to do, the more second-tier brands the better to carry out! Why? Because large chains need to be listed, the need to standardize financial standards, in the NASDAQ or Hong Kong stocks listed in the financial indicators of enterprises, but there is no outreach costs of this item. Jurisdiction of the famous scene I do not want to be across the province 1000, the head of the rope 2000, deputy head of the rope 2000 ................ ... XX hotel chain in 2009 to give out the standard: 45,000 yuan of outreach costs, but on a comprehensive point of view, only 40% of the single store can be controlled within this range, and most of them have to exceed the standard. The eight ring has seen more classic, the store manager invited to dinner, so long as the director of the designated which hotel, designated to drink what wine. Food over five flavors, wine over eighty years, the store manager pulled out an envelope sealed 3000. handed to Suo long, Suo long took the envelope pinched, said that between friends do not have to be so; the store manager to go to the restroom, and then added 2000, Suo long took over directly after the brothers said, between the brothers in the future; the envelope thin is a friend, after the envelope has become a brother. There is a classic case, XX hotel chain store manager usually more in charge of the special line of the deputy director of the So long out to dinner, usually how to ask about not out, New Year's Day before the deputy director of the So long take the initiative to call, called the director of the store over to sit down. After the store manager with an envelope to go over and found the office quite a lot of people, did not have the heart to take out. After taking this deputy director of the Sochi even unprecedented to send the store manager out the door, has been sent to the door of the compound, and took the initiative to reach out and shake hands to say goodbye, fortunately, the store manager is sober, and immediately pulled out the preparation of the guy, put in the heart of the hand, shaking hands in the moment to hand over, deputy director of the Sochi put into the left side of the pocket in the same way. In fact, from these issues can be roughly analyzed out of the current outreach costs of this piece is indeed also a very important piece;

If you want to save outreach costs eight ring can remind a few things:

A: from the jurisdiction of the neck of the slice to start, but can not be too much, can not be contacted too early, otherwise he will become a locusts have been staring at you;

B: through the neck of the slice to recognize the subdividing So long / deputy So long, you can probe the wind, if you can get through a person, you can give him 80% of the outreach costs of a person, by him directly to go through all the links, economic, environmental protection, low carbon, saving time. But the bad thing is to worry about the cost paid after the failure to return;

C: fire and special line is the most difficult two sections, especially the special line, belonging to the management of the fire brigade, the general relationship is very difficult to get in, please focus on these two;

D: summarize the sentence: find the right person, contact the key people, pick the right time, find the right place, eat the right meal, send the right gift, do the right thing!

4, operating costs;

Operating costs belong to the store expenses of the big head, a lot of hotels for this is to exhaust all sorts of ways, in customer satisfaction as well as compressed costs to find a suitable node between. I remember once GE company an advertisement: the world's greenest energy, is the energy saved. This sentence is very incisive. Let's look at a lot of large companies to change the boss, the boss of the past after the first thing is what? A: is to compress the cost, because you want to significantly increase revenue, a short period of time is not possible, then to make the information very beautiful, then the best practice is to reduce the cost, so that profits can be sharply increased in a short period of time; then our operating costs in our costs accounted for how big a piece of it? Sorry, there is no standard information here. The reason out of the rental cost of rent, because the difference between the rental cost of housing is too big; some 0.5 yuan / day / square; some 1.2 yuan / day / square; some 2 yuan / day / square; some 2.5 yuan / day / square ............. So the eight ring can not give a specific value;

Operating costs of everyone's standards will not be the same, the operating costs of economy hotels, per room / per day roughly in the 45 yuan - 65 yuan; hundred dollar hotel operating costs per day / per day roughly in 30 yuan - 40 yuan; this hotel operating costs per day / per day roughly in the -40 yuan; this operating costs include: washing, labor costs, energy consumption, guest supplies, etc., excluding depreciation and interest, as well as apportionment; so the economic hotel is not the kind of profiteering industry we imagine, so we advise you not to blindly see the rapid expansion of such as home, 7 days jumped headlong into the back of the people is a strong financial chain as a dependency, not This small single can be compared; undeniably, there will be some economic hotels will be able to return to the capital within 1 year of the project, but that is, after all, individual cases, this project in the industry as a whole should not be more than 3%; and high rates of return are concentrated in the second and third-tier brands, why? Because the second and third tier brands in the local market has a very strong network advantage, often the location is very good, the rental cost is very low property to take. In the operating costs are not similar, turnover has a slight difference in the basis, then the key point of profitability on the rental cost;

5, rental costs; rental costs belong to the hotel cost of the big head! Like Ibis, the speed of direct purchase of land and building is too slow, the capital chain is too long; always good at this Ibis also changed this store mode, into a leased property store mode. In fact, if Ibis is expected to China's crazy real estate prices, it is estimated that the world's hotels will be sold in China to implement the model of buying land and building; the current first-tier cities, compared to the initial stage of 2005, the cost of leasing, there has been a very big increase. 2005, the core of the first-tier cities, 1500 - 4000 square feet of space per day, per day, per day, per day, per day. In 2005, the core area of a first-tier city, 1500 - 4000 square feet of space, the daily rent per square foot is about 1.1 or so; in 2008 it became 1.8 yuan, and in 2010 it became 2.5 yuan. The brand as well as the number of increasing, directly leading to the cost of suitable property climbed sharply! Currently in first-tier cities, basically every brand has more than two developers. I remember we have a special project in Hangzhou, our developer quoted 1.3 a square foot; Pudding's people quoted 1.5; 7 days quoted 1.7, Ruijia quoted 2.2, Vienna quoted 2.5 .................... See, that's how the cost goes up! Development Department at the top of the pressure to open the number of stores, the Ministry of Operations at the top of the pressure of investment income; the company at the top of the pressure of shareholders; we all said that the duck pear is very big;

The most cupcake is the current first-tier cities have been close to the exhaustion of the available resources to guard a huge city, there is no suitable amount of special projects can be taken! Like Shenzhen, Guangzhou, the streets are full of developers, but a year and a half can not find a project, worried about the N brand's South China branch! Almost every large brand of South China branch at the end of the year are criticized by the company's objects!

6, amortized costs; amortized costs belong to the hotel investment inside the more hidden costs, the general staff will rarely take into account! Especially the single hotel, non-professionals are not familiar with this piece. Amortized costs include: depreciation/interest/management company cost sharing/;The current economic hotel depreciation is divided into hard depreciation and soft depreciation. Operating income minus about 25% depreciation is more appropriate. After all, the general economic hotel 5 years or so there will be a relatively large maintenance; interest here do not talk about it, each of the different sources of funding, the standard is different; management company cost sharing this piece is relatively large, XX hotel chain monthly headquarters costs are more than four million, not to mention the company's rental costs, energy costs .........................

The second element of revenue management is the increase in revenue

1, room rate strategy; room rates have always been a core component of revenue management. A lot of revenue management will be flexible changes in house prices as the core of revenue management to do. In fact, the control of house prices does occupy 55% of the revenue. How exactly should a house price strategy be developed! Generally speaking, there are two options for the development of house prices, the first: the cost reversal method. For example, the cost of each room to $ 100 X expected occupancy rate + 100%; the second is the price positioning method, according to the price of equivalent competitors to set the price of their own stores. Price in different years, different seasons, different times, different sources of customers, different competitors, different business conditions should have different price positioning

2, room strategy; our room type house price determines our ability to earn! House prices are changing, then the room type is not set in stone? The answer is no. We have a lot of hotel chains are now faced with single and double bed room allocation has a great deal of science! For example, commercial customers are relatively more concentrated places, the proportion of high-grade single beds should be appropriately increased, in the middle and low-grade customers concentrated places, the configuration of the twin room also needs to account for a certain proportion. In general, the ratio of single beds to twin beds is about 7:3 relatively appropriate! All of our room types are priced according to the beds. Generally divided into: economy room - dark room without windows or room area smaller room; king size bed - with windows or room area larger room; business single - large room area, orientation Better, the room soft configuration of the better room; Pu double - two beds in the room, usually indicators room; business double - room area is larger, better orientation soft configuration of the better room. Our room type there is a more critical place, that is, in the price up to the time can play a buffer role for customers; with the gradual increase in costs or room rates continue to climb, then our price increases must be inevitable. But hard price increases will generally bring the hotel 10% - 30% of the loss of guests, the hotel will need to spend a lot of extra costs to stabilize the customer, if the competitors and then do some targeted moves, then the hotel's revenue will be affected by a larger impact. If our price increase is not a direct hard price increase, but through the adjustment of some of the room types, then the customer in the degree of acceptance will be much higher;

3, price increase WOT management;;; Unfinished to be continued to see if there is a reply to the post, if the reply to the post of the people, the eight ring to continue to write;

4, RevPar analysis;

5, occupancy analysis;

6, promotional WOT management;;;

6, the hotel's revenue will be greatly affected by the competitors to do some targeted moves. 6, promotional WOT management;

7, thousands of dollars of labor output;

7, open source and cost-saving management;