7 Reasons Why You Need to Invest in a Hotel Revenue Management System

Last Updated on
January 28th, 2022


Last updated on : January 28th, 2022 by S Raange

What is a Revenue Management System?

A hotel revenue management system (RMS) is a software solution that helps you to perform important revenue management operations more effectively and efficiently. A revenue management system uses data from your hotel and market and analyses it to help you understand the market supply, customer demand, and competitor information so that you can make better business decisions. 

We have picked out seven good reasons why your hotel needs to have a revenue management system: 

1. Real-time data analysis:

Traditional revenue managers struggle to update rates manually once a day. But an RMS analyses your hotel’s historical data, current market data, and rates multiple times in a day to provide you with real-time rate optimization. 

2. Improve time management and efficiency:

A hotel revenue management software eliminates the need for any manual pricing work. This typically translates into many hours saved every week. 

Cloud-based revenue management systems are the best when it comes to accessing information from a centralized dashboard. You can allow multiple users to log in from anywhere and at any time. The software solution allows you to easily see all the pricing data as well as that of your competitors and the industry in one place. This means no need of maintaining excel sheets or do manual research. 

Hotel Revenue Management System

3. Generate more revenue:

As the name implies, a revenue management system manages revenue and looks at ways to improve it. When you set the right price, you attract the right kind of guests. This helps in bringing more revenue by maximizing ancillary sales. Based on your guest profiles, you can even optimize your revenue-generating strategies to upsell more effectively with specialized, targeted packages and offers. With the help of a revenue management system, you can potentially increase a hotel’s revenue by 2 to 10%. 

4. Manage & forecast demand:

All hotels – big and small – can maximize their revenue if they can recognize the past, present and future demand in business. This enables them to set the right price for the right customer at the right time through the right distribution channel. With the help of a revenue management system, daily rates can be adjusted for each room every day. 

5. Understand guest behavior:

With the help of an RMS, you get a better understanding of your guests’ booking behavior. You get insights into how early they book, what kind of rooms they book, and at what rates. When this information is collected, it can be analyzed to simplify the process of accepting guests under the right conditions over the best dates at the right price. 

6. Generate better and up-to-date reports quickly:

If data reporting is done manually in your hotel, you’ll know how time-consuming the whole process is. Compiling and presenting weekly or monthly data in an easily digestible manner are time-intensive processes, which can easily be automated with the help of a revenue management system. Moreover, through RMS, you can access visual dashboards and generate reports in real-time in just a few clicks. 

7. Affordable price:

The goal of RMS is to help you increase your revenue and not be another expense on your balance sheet. Earlier, RMS systems were only affordable to larger hotels. As the technology evolved, it became affordable and accessible to hotels of any size or rating.

The revenue management system will continue to become smarter as it embraces AI and machine learning. The hotel industry as a whole will move towards more automated, data-led systems that will give hoteliers more time, more power and more revenue. 

Author Bio:

Karan Iyer is an end-to-end digital marketer and blogger who inherently understands the hotel industry with his hospitality background. Karan knows how to convert the pain points and challenges of the hotel industry into business opportunities, and that's what he writes about for his readers. He also shares industry trends, insights and news to help his readers stay up-to-date.

7 Reasons Why You Need to Invest in a Hotel Revenue Management System

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