How to Think Like a Hotel Revenue Manager

By Cheryl Payne, October 29, 2015

Hotel contract risk reduction and cost containment are important metrics in today’s strategic meetings management (SMM) landscape. Demand is far outpacing hotel room supply, so hoteliers can be choosy about what meetings they accept. To be successful in negotiations, planners must create a plan based on specific hotel revenue management criteria. For each RFP and set of meeting dates, evaluate the following:

Total Hotel Room Block 

At 77 percent average gross profit, this is the hotel’s biggest profit center according to an independent survey of hotel chain executives by Meeting Sites Resource. Calculate the RFP response on sleeping room and suite rates by your projected room block to understand total room spend contribution. Additionally, track spend by individual hotel and chain, and use consolidated revenues to maximize negotiations success.

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