6 ways to limit expenses for your hotel business in times of crisis
COVID-19 Tips / 15.04.2020
In times of financial crisis, one of the first factors to consider to save your business is a guaranteed method for cutting costs. Although there are different types of crisis, the start of 2020 has made us witnesses to one that affects almost all parts of human life.
The rapid spread of COVID-19 has not only significantly influenced people’s health, but it has also brought changes in lifestyle, social distancing, the closing of numerous businesses and overall – has possibly set the start of a period of serious financial challenges for the global economy.
Although some businesses have been unaffected and have managed to cope with the changes, others in sectors such as restaurants, entertainment, hotels and more have already started to see the negative impacts.
In this article, we will provide valuable tips for hotel businesses and share 6 ways in which cost reductions can be made in difficult times.
1. Implement flexible investment plans
Most hotels have in place long-term investment plans with the aim of ensuring growth, development and innovation for the future.
In standard times, this is an essential part of running a successful hotel as it is a sure way to win the hearts of clients and create more valuable loyal relationships. After all, offering the same service year after year when everyone else is innovating won’t exactly get you that desired competitive advantage.
However, when cutting costs is of essential importance, review your investment plans to see if there are any opportunities to pause or reduce investments.
2. Amend cancellation policies
Cancellation fees are among the worst nightmares for clients who consider booking their stay in their favourite hotel.
Especially during periods of global uncertainty, it is likely that customers will hesitate to make a booking when they may face paying cancellation fees in the future.
Their plans may change due to unexpected circumstances and knowing that their booking can be changed free of charge will increase your chances of winning more customers during challenging times.
3. Optimise energy consumption by going green
Hotels’ energy bills make up a significant portion of the business’ overall expenses. Even if your hotel is family-owned and only includes a few rooms, consider how much you could save if you cut down your energy consumption.
Going green is not only beneficial for your bank account but it is also a great way to contribute to saving the environment.
For instance, a programmable thermostat could eliminate the need to heat and cool down rooms when your rooms are empty. LED lighting, on the other side, could help you reduce the consumption of energy by 75% when compared to the use of standard bulbs.
These are just two examples but there is so much more that your hotel can do in terms of cutting down the consumption of energy.
4. Implement open-source software
Investing in the creation of your own, personalized hotel management software is a great idea for the future of your business. However, when your financial situation is uncertain as a result of a global crisis, it is best to postpone this investment.
There are alternatives that you can use to prevent your hotel from losing business. Your solution can be found in open-source software. There is a range of open-source solutions that you can temporarily use to run your hotel like a pro.
If you own a boutique hotel with only a few employees, this could also be a preferable solution in the long run.
5. Offer secure and inexpensive remote payment solutions
Accepting payments online is often associated with monthly fees, high transactional costs, and expensive implementations.
Choose a payments partner that can provide a reliable, inexpensive and secure way for your clients to pay for their bookings remotely.
For example, a solution like myPOS provides a range of online payment tools. On top of that, you can accept MO/TO payments and reduce potential risks via Pre-authorization.
The best news is that our credit card machines don’t include monthly fees, setup expenses or binding contracts.
6. Introduce changes in working hours
Making changes in your staff’s working hours and pay is another way you can look for cutting costs for your hotel business.
Although it may cause temporary dissatisfaction and lack of motivation, with great management, you can stimulate employees to be understanding in difficult times and acknowledge that the measures taken are aimed at their protection.
This is especially relatable to the COVID-19 situation around the world.
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