Looking for ways to decrease hotel operational costs without decreasing the quality of service?
Hotel operators focus on occupancy rates, average daily rates, and revenue per available room, which are three metrics used to determine success. In today’s current environment, where these three benchmarks have been drastically reduced, hoteliers are looking to increase each guest’s spend while reducing costs.
Think of technology as its own employee. Someone who can work 24/7 without you having to pay overtime. You don’t need to hire more staff – you just need the right tools. With things like data processing, extensive manufacturer and distributor relationships, compliance analysis, line item matching, billing and allocation, technology can be a solution to assist with the complex work of running a business.
From reducing food and beverage costs and saving money on linens and chemicals, to contract management and data cleaning, there are many areas in a hotel operation where technology can be utilized to help you find substantial savings and decrease hotel operational costs.
Use Technology to Decrease Hotel Operational Costs
The use of technology has many benefits and can help you increase efficiency, save time, reduce labor costs, and identify areas of savings. When you have so much time and money invested into something you love, such as your business, it’s hard to hand off responsibilities or lean on solutions such as technology. You want to be hands on in every aspect that goes into running your operation. Unfortunately, there is only one of you – and you only have two hands.
Running areas of your hotel operation such as the kitchen and managing inventory are time consuming and require paying attention to details such as price trends, counting supplies and placing orders. Taking advantage of tools such as a food cost management software can be the second pair of eyes and arms you need to take some of the burden off you and your team. You can automate processes and free up employees to do other things needed to keep your operation running.
With the use of technology and automation, comes a whole lot of data. Data is generated from so many different places such as manufacturers, distributors and vendors that it can be messy and hard to organize. Your purchasing department alone generates a tremendous amount of data. Having access to technology such as spend management tools can help you track spend in real-time and provides customized reporting to help you make quicker more accurate business decisions.
You Don’t Have to Do It Alone – Join a GPO!
A tremendous opportunity to decrease hotel costs lies in working with a group purchasing organization (GPO). While the basic principle, leveraging the collective buying power of its members, holds true for all GPOs, the purchasing power varies. The purchasing power of Source1 Purchasing is $12 billion, making it one of the largest GPOs serving the hospitality sector.
This means when you become a member, your buying power has drastically increased, leading to better pricing and bigger rebates. Smaller hotel chains and independent operators can then compete with the big brands in terms of purchasing power. The whole becomes greater than the sum of its parts. Start saving today!