dynamic rate dynamic wholesale rate Hotel Distribution

How hotels can improve occupancy and profitability with dynamic rates?


Hotels to increase profits with dynamic rates

For a hotelier, his main target boils down to maximising occupancy and profitability, it doesn’t get any simpler than that. So how can that be achieved? Well we follow the basic principles of economics; demand and supply, and see how that can be used to the hotelier’s advantage.

Dynamic hotel rates are the best way to move forward. Hotels should change their tariffs based on demand and supply of rooms and constantly re-evaluate that. This ensures that hotels are not selling all their rooms at a very low tariff or only a few rooms at a high one.

Many hoteliers have contracted rates with some of their corporate clients to ensure that at least a minimum block of rooms would be regularly booked. These rates would be contracted and would be static so hoteliers should ensure that they maximize profitability for the balance available rooms.

Revenue managers or the hotel managers should plan in such a way, that guests who book rooms at an earlier date get an advantage on the room tariffs by having cheaper rates. This is an advantage for both the hotel as well as the guest, guests are able to enjoy the same privileges at a more competitive rate, and hoteliers are ensuring that their rooms are getting blocked. Closer to the chosen date, room tariffs can be increased so that the balance rooms are sold at a more premium rate, this averages out the ADR of the hotel.

Another plus point for hoteliers is that dynamic wholesale rates decreases the chances of expired parity rates being available in the chosen online distribution system of the hotel. Hoteliers are available to strategise tariffs which work to their advantage.

Hotels can increase profits with optimized channel distribution

So how can hoteliers go about implementing this?

Well most chain and big sized hotels generally have revenue managers, whose sole purpose is to monitor the hotel’s tariffs to the hotels advantage based on demand and supply. This doesn’t mean that small and mid-sized hotels should lose heart. Hotels should truly consider installing an efficient PMS which has an integrated distribution system.

A system like Hotelogix can help hotels plan out the tariffs that work to their advantage and also manage them through one dashboard across all their distribution channels such as OTA’s, GDS, hotel’s own website and so on. The reports can help them forecast demand and supply and plan the tariffs accordingly.
So Hotels start working with your sales and marketing teams, and see how you can make dynamic wholesale rates work to your advantage.

Hotels can increase profits with optimized channel distribution