Our new guide, Forecasting Made Simple: A Guide to Smarter Planning & Higher Profits for Independent Hotels and Small Groups, shows how hotels can plan with confidence, make faster, better decisions, and improve profitability.
To bring the concepts to life, we share the story of Sara, the new GM of the three-property Bellevue Group. She faces a tough challenge: the owner, Bruno, expects a 10% boost in profitability this year, but they’re heading in the opposite direction.
Sara knows the solution lies in better forecasting and planning, but her managers aren’t even sure what forecasting is or how to start.
The guide follows her journey as she brings her team up to speed and puts forecasting into action. Along the way, we answer five key questions:
1. Why Do Forecasts Matter for Independent Hotels?
Forecasting helps hotels anticipate the future with data, not guesswork. Think of a forecast as a crystal ball or, as we like to say at RoomPriceGenie, a magic lantern. But instead of wishful thinking, it’s about data-driven decision-making.
Smarter planning is key to higher profitability for every property, but especially for small hotels with lean staffing and resources. By balancing long-term planning with short-term agility, hotels can stay proactive rather than reactive, seizing opportunities while minimizing the risks of underperformance.
2. How Are Forecasts Used by Small Hotels?
“We forecast so we can catch issues early and adjust strategies before it’s too late,” Sara explains to her team.
An accurate forecast supports better decisions in three key areas:
- Commercial Planning: Identify whether you’re on track to meet revenue goals and what sales, marketing, and revenue strategies will get you there.
- Operational Planning: Plan staffing and supplies more accurately, avoiding last-minute chaos and unnecessary costs.
- Financial Planning: Anticipate revenue to better manage cash flow, payroll, and expenses.
3. What Are the Basic Ingredients of a Revenue Forecast?
To forecast accurately, hotels review four main types of data: historical data, on-the-books (OTB) data, external factors, and forward-looking data. Then they prepare monthly forecasts for the year ahead, updating them regularly with the following details:
- OTB reservations
- Expected pickup
- Projected occupancy, ADR, RevPAR, and revenue
- Variance from the budget and last year’s results
- Breakdowns by market segment and room type
4. How Can Hotels Use Forecast Insights to Boost Performance?
Here are a few of the strategies outlined in the guide:
- Stay flexible and ready to respond to unexpected market shifts
- Forecast by day for a clearer picture of demand patterns
- Use insights to fine-tune pricing, promotions, and stay restrictions
- Align operational planning with forecasted occupancy
- Compare forecasts with actuals to improve accuracy over time
5. How Can Forecasting Be Automated?
Forecasting can be time-consuming and error-prone, especially for smaller properties without a dedicated revenue manager to oversee the process.
A modern RMS like RoomPriceGenie automates forecasting, making it faster, more accurate, and easier to update regularly. This frees up hotel staff to focus on strategy and demand generation.
Getting back to Sara, upon realizing that Bellevue Group’s growth targets are unreachable without the support of an RMS, she convinces Bruno to make the investment. Naturally, she recommends RoomPriceGenie as the ideal fit.
Related reading: Comment convaincre votre directeur général de dire oui à un SGI ?
Great Results! Now Let’s Raise the Bar
A few months have passed, and Sara is relieved to report to Bruno that the Bellevue Group is on track to increase profitability by 15%, surpassing the original goal by 5%.
“Our managers did an incredible job,” Sara proudly tells Bruno.
Bruno grins. “Good to hear, because next year, I expect another 10% increase.”
No sweat. Now that they have the right tools and processes in place, Sara and her team are ready for the challenge.
Now, the big question is: Is your hotel ready to grow business?
For help, download our free guide today: Forecasting Made Simple: A Guide to Smarter Planning & Higher Profits for Independent Hotels and Small Groups.
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