Your annual budget is a critical set of metrics that is influenced by a multitude of factors. With so many moving parts, it’s more important than ever to have the right technology. When your software is BI optimized and personalized for your specific brand or individual property, you’ll be able to have a firm grasp on your projections, profits, and spending. Here are five specific ways that your RMS will help you plan your budget efficiently and accurately.
1. Define Your Strengths & Weaknesses
One of the most important ways that a robust software suite can improve your budgeting process is by helping you understand which segments of your property are high performers and which ones are less profitable. Once you have a clear picture of your core segments you’ll be able to hone in on what’s working and capitalize on their strengths. Great software can also help segments that are lagging behind previous projections by showing you the ‘why’ behind what happened. A powerful software system will drill down into the specifics of why a certain segment isn’t meeting its goals. Once you’re able to see where your brand’s high and low segments are and the reasons behind the data, you can adjust campaigns and your budget spend accordingly.
2. Know What Your Comp Set & OTAs Are Doing
Your software solution can also provide valuable insight into what your comp set and the OTAs are doing. High quality comp set reporting is much more than just tallying a list of competitors’ prices. The best software will help you accurately define who is actually in your specific property’s comp set, then analyze ADRs and so forth for a holistic portrait of your competition. The best software will also take OTA pricing into account, and update in real time for accurate comparisons. Your comp set is an important piece of your budgeting, as it will provide parameters for your pricing. If you’re not looking at the right group of competing properties in the right way, you may miss the mark.
3. Fully Customizable For Your Unique Property
You’re well aware that there are dozens of factors beyond rates and performance that influence your budget. Things like local events, seasonality, weather, and more can have serious impacts on your budget projections. Your software should be able to adjust for those specific cases so that you’re not scrambling to adjust your reporting when those events arise.
4. Track Your Spending And Save
A top-of-the-line software system will also be able to help you project what you’ll be spending in the next year. By analyzing occupancy rates, events and other factors, you’ll be able to see what each segment will likely require in the upcoming year in terms of staffing and resources. You’ll be able to determine areas where you can potentially cut back on inefficiencies and save on costs. That will free up revenue for budget spending on revenue generating campaigns, like brand awareness and guest service enhancements.
5. Create Clear And Accurate Reports
Once your budget is determined, you’ll need to circulate your findings to your teams. Instead of a bland, unintelligible list of numbers and statistics, your RMS should be able to create dynamic reports for each segment of your property. It’s easier to meet goals when they’re presented in a straightforward and engaging way. A great software system will make it easier to communicate expectations and budget allocations across every team.
Planning a budget is as much of an art as it is a science, so your expertise and technology need to work together. Looking at the wrong data, or even looking at the right data with the wrong perspective can drastically skew your results. The right software will ensure that your budget will be an accurate and thorough representation of your property’s potential.
Want more expert tips for budget season? Check out the second installment of Rainmaker's ongoing webinar series: