How to Beat the 2023 Post Pandemic Hotel Budgeting
The start of the budgeting season is already here with us. Unfortunately, it coincides with a particularly challenging inflection point for most hoteliers. While the travel demand has returned to the pre-pandemic levels, the staffing shortages have strained even the most finely-tuned hotel operations.
Challenges in the industry have pushed hoteliers to continually improve their capacity to deal with uncertainties. And one of the vital tools that have supported them against uncertainty and improved their profitability is budgeting.
We’ll discuss strategies to help you level up your budgeting process and conquer challenges hoteliers face. With some flexibility, the budgeting season can help your hotel navigate the challenges of post-pandemic hospitality.
1. Reassess Your Budgets
Many things have changed in the hotel industry post-pandemic, so it’s imperative to evolve your budgeting process. The hotel business has become dynamic; therefore, it demands real-time flexibility. You need to budget to adjust to the present demands accordingly.
That calls for a fresh budgeting process like a regular review of budgets. Usually, hoteliers tackle budgets annually, but the widespread staff shortages in the industry have shown us just how important it is to have room for regular budget review. Also, you can utilize rolling budgets that cater to the most pressing priorities for each period.
2. Tap onto Your Creativity
Despite the looming uncertainty, experimentation remains a potent tool for success. Right now, you’re dealing with the challenge of staff shortages and increased demand. As we enter the budgeting season, ensure the budget always has room to pursue new opportunities and innovative endeavors.
Co-marketing is one of the novice opportunities for hoteliers that allows them to work with local businesses that guests love. That enables the hotel to tap into their desired audience without additional operational costs. Also, you can work with influencers to showcase your hotel to potential guests in a budget-friendly way. Choose influencers that align with your objectives and your desired level of engagement.
3. Revisit Your Tech Stack
As we navigate the budgeting season, evaluate your existing tools on a performance basis. Assess the value the tools in your tech stack bring to your hotel regarding revenue, productivity, and usage.
Evaluate how the tools contribute to direct bookings or improve your guest experience, driving up your revenue. Also, check how the tools may have improved your staff’s ability to deliver exceptional services.
It’s essential to provide your staff with a pleasant work environment and tools that help them do more with less. At the same time, you can budget for educational initiatives to help your staff maximize the tools and use them correctly.
4. Identify Tech Gaps and Plugin New Tools
After identifying the tools you should retain in your tech stack, you now need to identify gaps. This is your opportunity to implement new tools to your tech stack to drive productivity and yield more substantial revenue.
Evaluate your customer relationship management tools and see if they provide you with insightful information about the guests and how that connects to your tech stack to utilize that knowledge. If your CRM doesn’t deliver, consider establishing a loyalty stack that can drive up your business.
5. Involve the Entire Team in Budgeting
Budgeting across all departments can be messy, and you might be tempted to avoid it. However, letting each department budget on its own can cause a lot of wasted opportunities and overlaps.
Instead, bring the whole team together as your budget and let them contribute to segment-based budgeting. This helps track marketing profitability and ROI in a better way. Also, you can allocate more funding to the winning segments and minimize the losing side.
Budgeting is vital for hoteliers as it keeps them anchored. But it’s no longer something we engage in annually. This is happening more frequently, in most cases, quarterly. So, as you approach this budgeting season, remember that budgeting has changed permanently. That means budgeting is not only influenced by future forecasts but also by the most current inputs, as realities are constantly changing.