Hospitality businesses need a lot of factors to succeed. They’re not only growing revenue and getting more bookings but also save cost to maximize profit.
Rather, a deep dive into cost-saving ideas for hotels along with proper expense maintenance also counts as an important factor for your success.
Cost-cutting in hotels, just like in any other business; helps maintain optimum expenses and of course, control your spending on unnecessary activities.
In this blog, I have shared some basic and advanced cost control techniques in hotels, which can help you start with this step.
Although, before we go ahead with that, you should be aware of some Sureshot benefits and reasons to implement cost control measures at your property.
Well, you’ll find many practical yet obvious benefits of reducing your hotel expenses. But it all comes down to reasons which provide value. Those are:
To keep expenses under control: It is a human tendency to spend more given a free hand. Introducing the cost-cutting measures in hotels will help you keep a check on the explosion of expenses.
To increase profit: Since cost-cutting lets, you reduce your unwanted expenses, you can focus on desired revenue goals and increase your profit margin.
On top of that, having a transparent picture of your hotel expenses will give you some ideas where you can cut back on costs.
Now, let’s dig into some guaranteed and most effective techniques to save costs in your hotel business.
This is the first step towards cutting costs at your hotel property. To begin with, take some time to sit down and know where your expenses are going.
Hotel management systems are a great help in generating expense and revenue reports.
The busy schedule of entertaining guests and handling other operations can leave you surprised at the expenses incurred.
Make it a habit to analyze your expense reports regularly. Get a breakdown of your operating cost and try to spot some patterns.
Small details matter a lot when it comes to reducing the hotel expenses and running your business more efficiently.
You know it as well as I do that hiring staff takes up a large segment of your efforts, time, and expenses.
Learning new skills is a win-win situation for you as well as your team members. They can gain extra skills that will help them in the long run. And you’ll be able to save money behind new resource hiring.
A caution here you need to take here is that you do not overburden the staff. This will result in demoralization and will make them ineffective.
The hotel industry is advancing with time and so are the guest’s habits and expectations from the hotels.
However, I’ve seen hotels not investing in technology because they fear insufficient ROI. And a usual misconception revolves around hotel technology being a burden and an additional expense.
BUT, using new technology does not mean an increase in operational costs. Rather, these advancements can help in cost-cutting.
This reduces the need for a dedicated resource behind several operations and even saves time.
In addition to this, it is said that the Internet of Things (IoT) is also going to help in reducing hotel expenses.
The hospitality industry is rapidly evolving and it has moved from self bookings to self check-ins.
Guests tend not to wait for a long amount of time to check-in or avail of any services at hotels. They want to get things done faster and better.
So, installing a self-check-in kiosk is a great way to do cost control in the front office.
Though a kiosk cannot completely replace the reception desk, it can cut the labor cost to a great extent. It can also reduce dependency on manual labor as guests find it easy and convenient to perform self-check-in.
As hotels ultimately want to be more customer-oriented, self-check-in is likely to become an industry-standard in the coming years.
Adopting energy-friendly measures are economically beneficial and also benefit your hotel’s reputation save cost.
The Carbon Trust estimates that you could cut your hotel’s energy bills by as much as 20% just by implementing simple and inexpensive eco measures.
Using appliances that consume more electricity and printing unnecessary papers not only increases your operational cost but also hampers your cost-cutting strategies.
This falls in line with the “Going Green” initiative as well, which is an important step towards saving the environment.
Use energy star appliances: Use certified appliances instead of the old appliances that consume more electricity. Doing so with one appliance won’t make a difference, but slowly replace all equipment to see a reduced electricity bill.
Controlling the lighting, using the optimized room and water temperature, educating staff towards saving energy are some of the preliminary steps that can be taken towards going green and cost-cutting.
Incorporating IoT can help with cost control in the hotel industry by adopting some smart techniques.
Marketing needs research. And getting into a marketing campaign without knowing the facts and figures can definitely trouble your expenses.
Just throwing money without knowing the ROI is an inefficient way to promote your property.
Instead, there can be low-cost ways to spread awareness. Therefore, you can also take brilliant photos of your hotel and show them off to your target audience.
You should analyze the results of your marketing strategies constantly, and decide on the next course of action accordingly. If the results are not what you expect, do not continue with that approach and pick up a new one.
That’s how you can optimize your marketing costs.
Maintenance of systems and facilities such as plumbing, electrician, and the infrastructure can be quite a costly affair.
Preventive maintenance involves inspecting these facilities to prevent unexpected breakdowns. This works as one of the powerful cost-saving ideas for hotels.
An effective preventive maintenance method takes into account all the infrastructural specifics of your property.
The hotel industry is highly competitive and the cost of running a business is always rising.
But there can always be ways to keep the expenses low and run the hotel methodically. Look for solutions that fit best in your property, save cost, and increase revenue at the same time.
Write our ideas and suggestions in the comment box.