Yes I am Quoting Rack Rate!
Think of it this way – if you had a spy in the sales department of all your comp set hotels it would be wonderful to know how many rooms your competitors had left on any given day. Imagine you receive a lead for a nice corporate group for 3 months from now. Then, prior to sending your proposal your spy tells you that none of your competitors have enough rooms and function space left to house this group. Would you still quote this group the same rate – or do you think you would quote higher than normal?
If all of your competitors closed for renovations at the same time you would do the same thing (don’t we just wish)! It is basic economics that we want to charge what the market will bear. And if you are the only provider left with availability then you have the ability to charge whatever you like. Similarly, if you know that all of your competitors still have availability then that tells you that right off the mark you need to be competitive if you really want the piece of business. Or if you knew that only one of your competitors still had availability then you would know exactly who you were selling against…
One of the best ways of doing this is to absolutely make sure that you are logging ALL lost business. You should be logging every single lead in some way. You should then have some form of calendar notation that people can easily access when they go to check availability. I know of some sales teams that create calendar entries that list the names of the potential bookings that were lost (or turned down) for each date. That way when a Sales Manager goes to check availability that calendar date is flagged as having lost business.
I know of one sales team that goes so far as to have an Excel spreadsheet that lists all lost bookings by hotel for each date subtracted from their total number of guestrooms. Other properties I know have a large ‘lost business calendar’ in the sales office where they color code lost business with a different color for each competitor.
- Number of guestrooms per night
- Amount of function space needed
- Name of hotel they ended up booking with
I am not necessarily suggesting you put the same amount of detail into loading all these lost bookings, but as long as you have the three pieces of information I listed above then you will be armed with some very interesting information. However you do it, you need to keep track of every group that has booked with your competitors.
Arm yourself with this information and you will be ready to maximize your revenue when you know that your competitors are unable to take the piece of business. When the day comes that your competitors are sold out, you want to know it as far in advance as possible so that you can fully maximize your rate – or even (gasp) sell rack!