Revenue Management Assistant

HOTEL ANALYSIS IN LISBON Located in a growing and tourist city, the Hotel in Lisbon has 320 available rooms and a 60% occupancy rate. Based on the provided numbers, we can conduct a complete analysis of the hotel's performance and identify strengths and weaknesses, as well as possible opportunities for improvement. FINANCIAL PERFORMANCE The hotel has a good financial performance, with a RevPAR of $225 and GOPPAR of $220. RevPAR is calculated by multiplying the occupancy rate by the average daily rate, while GOPPAR is the net revenue per available room, after deducting all fixed and variable costs. However, the cancellation rate of 40% is a point of concern. This rate may indicate that something is wrong with the pricing strategy or customer service. It is important that the hotel monitors and understands the reasons behind the cancellations in order to act and reduce this number. ROOM OCCUPANCY BY TYPE AND TRAVEL MOTIVE The hotel has a room occupancy rate of 70% for the executive suite, 15% for the luxury suite, and 15% for the presidential suite. It is important that the hotel monitors this occupancy by room type to ensure that its pricing strategy is adequate for each type of room. The occupancy rate by travel motive is 50% for business, 30% for leisure, and 20% for tourism. It is interesting that the hotel pays attention to market trends and customer needs to adapt its offer and maximize its occupancy. SALES CHANNEL The hotel has an occupancy rate by sales channel of 30% for OTA and 70% for direct channel. The current trend is for hotels to work more and more with the direct channel in order to reduce commissions paid to OTAs. It is important that the hotel works strategically to increase its direct sales, through a good website, presence on social networks, and direct marketing campaigns. COST PER OCCUPIED ROOM The cost per occupied room (COQ) of $30 is a good indicator, as it is low compared to the average daily rate of $220. This means that the hotel has good cost management and is maximizing its profitability. MARKET TRENDS The hotel industry market in Lisbon is quite competitive and constantly growing. Tourism in Portugal has been growing year after year, and Lisbon is one of the most sought-after destinations by tourists, which brings business opportunities to the hotel industry. Another important factor is the growing interest in sustainability and responsible tourism, which can be an opportunity for differentiation for the hotel. Systems in trends: One trend in the hotel industry is the implementation of revenue management systems. These systems collect market data, such as information about competitors and demand, and use it to adjust prices and sales strategies in real-time. With this technology, it's possible to maximize revenue, increase occupancy rates, and improve the hotel's profitability. Revenue Maximization Practices: There are several practices to maximize a hotel's revenue. One of them is intelligent price management, where the rate is adjusted according to demand, allowing the hotel to obtain the best possible price. Another practice is channel management, where the performance of sales channels is analyzed, and adjustments are made to maximize bookings and revenue. Additionally, promoting special offers, such as promotional packages and discounts on early bookings, can be a good strategy to increase occupancy rates and revenue. Comparison with another hotel: For comparison purposes, let's analyze another hotel in Lisbon, Hotel A, which has 250 rooms and an average rate of $180. Hotel A's occupancy rate is 70%, and the RevPAR is $126. Comparing to our hotel, we can see that Hotel A has a higher occupancy rate and a lower average rate, resulting in a lower RevPAR. However, both hotels face a common challenge, which is high cancellation rates. It's important to evaluate the reasons behind this cancellation rate and implement strategies to reduce it, such as stricter cancellation policies or offering advantages for early bookings. Review of calculations: The calculations are correct; however, it's essential to mention that the average rate of $220 is close to the ADR of $150. This may indicate that there is a significant variation in room rates, or that there are many bookings with rates below the average rate. It's necessary to evaluate the pricing strategy and adjust it to ensure that the hotel is maximizing revenue and optimizing occupancy. Conclusion: The analyzed hotel has a healthy occupancy rate, a good RevPAR, and a satisfactory GOPPAR. However, there are opportunities for improvement regarding the cancellation rate and price management. Implementing revenue management systems and revenue maximization practices can help increase the hotel's profitability. It's also essential to evaluate the competition and implement differentiation strategies to stand out in the market.