{"id":5224,"date":"2019-10-15T20:18:41","date_gmt":"2019-10-15T20:18:41","guid":{"rendered":"http:\/\/wp.mbahotels.com\/?p=5224"},"modified":"2019-10-15T20:18:41","modified_gmt":"2019-10-15T20:18:41","slug":"maintaining-profitability-in-an-environment-of-increasing-costs","status":"publish","type":"post","link":"https:\/\/mba.demowork.xyz\/index.php\/2019\/10\/15\/maintaining-profitability-in-an-environment-of-increasing-costs\/","title":{"rendered":"Maintaining Profitability in an Environment of Increasing Costs"},"content":{"rendered":"

Everyon<\/span>e agrees: the hotel industry <\/span>growth<\/em><\/strong>\u00a0is slowing, but this does\u00a0<\/span>not<\/em><\/strong>\u00a0mean a downturn, at least not imminently.\u00a0Occupancy remains high overall, though around zero growth nationally. Average daily rate is the main driver of revenue per available room (RevPAR) growth. Nationally, demand and supply are on par, about 2% growth each. STR forecasts RevPAR growth to be about 1.1% in 2020. <\/span>[STR RevPAR Forecast<\/a>]<\/span> Slow and steady revenue growth is keeping the industry optimistic, but it\u2019s the profitability which is worrying some hotel investors and management companies.\u00a0<\/span>
\n\"According
\nAccording to the\u00a0HVS<\/a><\/span>\u00a0presentation at the Lodging Conference, hotel net income, as a percentage of revenue, peaked in 2015 and has declined for 3 years in a row. Rising labor costs and labor shortages have been a concern and discussion topic for hoteliers for several years now. Other pressures on profitability include rising franchise fees and renovation or product improvement plan (PIP) costs. The dilemma for hotel management companies is how to carry more top line revenues through to bottom line profits.<\/span>
\nStephanie Ricca, Editorial Director of Hotel News Now in her re-cap of the Lodging Conference, says:<\/strong><\/span><\/p>\n

\u201cThird-party management companies are on the front lines of managing labor, optimizing revenue and dealing with profitability issues\u201d.<\/em><\/strong><\/span><\/p><\/blockquote>\n

\"\"Big waves were made recently by the planned merger of two of the largest third-party management companies, Aimbridge Hospitality and Interstate Hotels and Resorts. At the time of the merger Aimbridge Hospitality managed 103,079 rooms across 834 properties and Interstate managed 78,905 rooms across 479 properties. Combined, the company\u2019s portfolio of managed properties would be 1,313 hotels, creating what will be by far the largest third-party hotel management company in the world.<\/span>
\nTo compete against this new Goliath, many other third-party management companies are looking to differentiate their services and their advantages. Of course, the best way to stand out from the competition is with stellar results — meaning delivering higher profitability to their owners.<\/span>
\nAs management companies compete, the best of them are researching and deploying new technology to automate tasks, increase efficiencies, and also to use and deliver better business intelligence tools to inform better business decisions and thereby, optimize cash flow and know when, where and how to reduce operating expenses.<\/span>
\n\"\"According to a report by Hospitality Technology, 54% of hotels planned to increase their technology budgets for 2019, while only 8% planned to decrease. Expedia Group reveals that the priority for chain hotel companies is technology that seamlessly integrates with their existing systems. [New Study Reveals Technology Investment Priorities for Hotels<\/a>]<\/span><\/span>
\nExpedia Group SVP Ait Voncke said in a statement, “We’re witnessing chain hotels place\u00a0significant investments\u00a0in technology, which opens the potential for a greater divide between properties that are not able to match those investments\u201d.<\/span>
\nAnd yet, Ait Voncke continued, (and I really agree with this quote),<\/span><\/strong><\/p>\n

\u201cTechnology has the power to level the playing field for hoteliers of all sizes.”<\/em><\/strong><\/p><\/blockquote>\n

Technology can now make the most sophisticated accounting, business intelligence, and software integrations and automations accessible, both financially and in terms of ease of use, to smaller hotel owning and management companies.\u00a0 Hotel management companies can set themselves apart when they use modern business management software that offers time-savings and can help lower operational costs while keeping all stake holders better informed with individualized dashboards, real time reports, and access through fully functioning phone apps.<\/span>
\nHotel Investor Apps ERP & Accounting<\/a><\/span>\u00a0software is just the solution for hotel management companies and owning companies looking to lower costs, and drive higher profits. Built on the fastest growing Enterprise Resource Planning (ERP) platform in the world, Hotel Investor Apps has all your data seamlessly integrated across all its ERP modules, as well as 200+ integrated software services.<\/span>
\nOptimize cash flow with integrated PO system, automated bank reconciliation, and AP approval.\u00a0 Recapture hours of general manager and employee time every week by eliminating duplicate and manual data entry, automated PMS importing, predictive entry, and more automations. Manage employees with WorkFlow to set tasks and reminders, and integrated HR Time and Attendance, and employee expenses. Your accounting staff can manage more hotels in the same time with advanced functionality like automated intercompany account entries, personalized dashboards, favorites tab, full audit capabilities, and drill-down to bills and invoices.\u00a0 Make the best business decisions based on accurate, up-to-date financial reports, operational information, and business intelligence.<\/span>
\nIf you are interested in learning more about Hotel Investor Apps, check out our website at\u00a0https:\/\/hotelinvestorapps.com<\/a>.<\/span>\u00a0 For a product demo, email\u00a0Chris@hotelinvestorapps.com<\/a>.<\/span><\/span>
\n 
\n– Charlie Fritsch,<\/em> President of MBA Hotel Brokers and Hotel Investor Apps<\/span>
\n– Jaime Goss,<\/em> Marketing Director MBA Hotel Brokers and Hotel Investor Apps<\/span>
\n <\/p>\n","protected":false},"excerpt":{"rendered":"

Everyone agrees: the hotel industry growth\u00a0is slowing, but this does\u00a0not\u00a0mean a downturn, at least not imminently.\u00a0Occupancy remains high overall, though around zero growth nationally. Average daily rate is the main driver of revenue per available room (RevPAR) growth. Nationally, demand and supply are on par, about 2% growth each. STR forecasts RevPAR growth to be…<\/p>\n","protected":false},"author":1,"featured_media":5872,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"image","meta":{"footnotes":""},"categories":[2],"tags":[],"class_list":["post-5224","post","type-post","status-publish","format-image","has-post-thumbnail","hentry","category-blogs","post_format-post-format-image"],"_links":{"self":[{"href":"https:\/\/mba.demowork.xyz\/index.php\/wp-json\/wp\/v2\/posts\/5224","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/mba.demowork.xyz\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mba.demowork.xyz\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mba.demowork.xyz\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/mba.demowork.xyz\/index.php\/wp-json\/wp\/v2\/comments?post=5224"}],"version-history":[{"count":0,"href":"https:\/\/mba.demowork.xyz\/index.php\/wp-json\/wp\/v2\/posts\/5224\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/mba.demowork.xyz\/index.php\/wp-json\/wp\/v2\/media\/5872"}],"wp:attachment":[{"href":"https:\/\/mba.demowork.xyz\/index.php\/wp-json\/wp\/v2\/media?parent=5224"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mba.demowork.xyz\/index.php\/wp-json\/wp\/v2\/categories?post=5224"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mba.demowork.xyz\/index.php\/wp-json\/wp\/v2\/tags?post=5224"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}