Boosting Incremental Revenue at a Luxury Branded Hotel

Luxury, Branded City Center Hotel

THE CHALLENGE:

A hotel ownership group was examining the operational performance achieved at their luxury branded hotel in a major US city center. The owners had limited visibility into the pricing and sales strategies at a departmental level, so Carpedia Hospitality was engaged to provide a third-party view of the processes, systems and behaviors within the on-property operations of the hotel. The client asked us to observe and implement any additional opportunities that could increase incremental revenue from guests.

THE SOLUTIONS:

The revenue review focused primarily around opportunities within the Food & Beverage department, with additional review of the Spa and Front Office. In order to gain a full understanding of the operation, Carpedia Hospitality’s management consultants conducted an extensive analysis of historical data around sales volume, menu item performance, and competitor pricing. From there, targeted observations were conducted to determine where sales opportunities existed within regular guest touchpoints.

After a thorough review of the Food & Beverage data, opportunities were identified in menu item pricing from both a competitive standpoint and relative to cost. Menu analysis indicated which items were most optimal to upsell to maximize profit. Observations also uncovered opportunities to maximize guest interactions by incorporating sales techniques without detracting from the service experience. Pricing analysis was also conducted in the spa and indicated room to modify pricing for both services and retail items. Front Office data indicated inconsistency in following charging policies for various amenities and add-ons that could be reinforced to boost revenue.

Ultimately through this detailed revenue review the following initiatives were implemented by Carpedia Hospitality’s management consultants alongside the management of the hotel:

• • Identified upselling and pricing strategies that enhanced revenue and profit in the food & beverage and spa departments
  • Provided a comprehensive review and analysis of pricing and sales opportunities
  • Developed metrics and tracking tools that strengthened management’s ability to measure success for continuous improvement

THE RESULTS:

Overall, a more analytical approach to sales was established throughout the hotel. As a result of the revenue generation strategies deployed, the hotel moved toward higher revenue capture in each department included in the scope of the project.

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