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The Best Revenue Management Systems (RMS)

By Hugo Gil Esteves, Head of Strategy & RM of RM HUB


What is a Revenue Management Systems or RMS?
Revenue Management Systems analyse internal data, market supply and customer demand to calculate the ideal rates for your rooms. This allows you to optimize prices on your distribution channels from a centralized panel.
Its use has grown rapidly in recent years. However, there are still between 80 to 90% of hotels that have not adopted any RMS. With that in mind, the implementation of Revenue Management Systems will put you in an advantageous position in relation to your competition and give your hotel a substantial advantage.
However, with so many options available, it can be challenging to know where to start. In this article, we explore the benefits, functions, and options available for your hotel. By the end of this article, we hope you are ready to start implementing RMS in your unit. But if you want a recommendation, contact us.

How does Revenue Management Systems benefit your hotel?
RMS can analyze large amounts of data extremely quickly. The software uses algorithms, working 24 hours a day, 7 days a week and 365 days a year. Humans cannot perform these complex calculations so quickly and accurately.
Calculations determine your ideal rates by room type and day. In addition, Revenue Management Systems allow you to instantly adjust prices across all distribution channels from a single platform. As a result, it is possible to dramatically improve your RevPAR and GOPPAR.
However, Revenue Management Systems are not intended to replace people. Far from it. Their biggest advantage is that they allow Revenue Managers to focus on the things they do best: being creative, thinking flexibly and making strategic decisions. An RMS is as good as the Revenue Manager that uses it. The system needs to absorb what the Revenue Manager knows and allow manual replacements.
With RMS, Revenue Managers can go beyond spreadsheets and manual pricing. They can enter the field, working more closely with the Marketing, Sales and Front-Office departments. Most importantly, they can focus on developing and implementing long-term strategies to maximize total revenue.
However, Revenue Management Systems also benefit other departments. General Managers will have solutions that will guide them through critical tasks, while making decisions automatically. Vice-presidents of Revenue, Marketing and Sales can create a sustainable Revenue culture at all levels of the organization.
Hotels that will be successful in the future will be the ones that will make the most of this technology now. They will use Revenue Management Systems to establish long-term strategies throughout the hotel, instead of working day-to-day with reactive tactics.

Main features to look for when choosing your RMS
Revenue Management Systems are sophisticated software, with a wide range of functions. The exact requirements will depend on your property, inventory, and equipment. However, there are some essential functions that must be included.

1. Forecasting Management The first step in effective Revenue Management is to forecast supply and demand. Any RMS software must offer a complete and accurate Forecast functionality. These forecasts must be based on a variety of data sources. In addition, these forecasts must be flexible so that they can be updated in real time.

2. Pricing System The main function of Revenue Management Systems is the pricing system. This feature uses all available data to optimize room rates, calculated for different room types and days. These prices must be divided into individual bookings, corporate bookings, and group bookings. Some systems also allow you to change the prices for each channel.

3. Gestão dos Canais de Distribuição A Revenue Management System should allow the Revenue Manager to optimize prices across all distribution channels through just one platform. A high-quality RMS system will integrate the channel management functionality. This allows the Revenue Manager to change and check prices and inventory on the hotel website, OTAs and hotel booking platforms quickly and efficiently.

4. Reports Data is the foundation of everything Revenue Management Systems do. However, it is not useful if you are unable to access, understand and act accordingly. RMS software should provide clear performance reports and graphics for all channels and activities. This should include KPIs and relevant, personalized, and easily exportable information for different teams to analyse.

What are the best Revenue Management Systems for your hotel?
Revenue Management Systems are beneficial for hotels of all sizes. Smaller hotels have fewer rooms and must maximize the revenue generated by each room. For larger hotels, the manual Revenue Management workload becomes problematic and results in missed opportunities and more frequent errors.
Therefore, there is no 'one size fits all' RMS. However, we work in close partnership with a select group of software vendors that we consider to be the best in the market. These companies provide unmatched service and support for customers of all types and sizes.

1. Climber RMS Climber RMS is a rising national star in the field of Revenue Management software. Headquartered in Lisbon, Climber helps hotels around the world to maximize their revenue by automatically setting the ideal price per room type. In addition to the price recommendation (where hotels are able to define their own price algorithms), Climber has a user-friendly interface, an assertive Forecast, and an excellent BI module. Climber is used in several countries, with hotels ranging from 16 to 600 rooms. After only 5 years on the market, Climber is in the opinion of RM HUB as the number one Revenue Management software for hotels, based on the price-quality ratio.

2. Duetto Duetto GameChanger is another option that allows your team to develop and implement strategies quickly and easily and to optimize all bookings independently yielding in all segments, channels, and room types in real time, with enhanced information about demand, but here you can weigh the share of costs / investment.

3. IDeaS IDeaS, a SAS company, is the world's leading provider of Revenue Management software and services and has over 30 years of experience. IDeaS provides Revenue science to more than 13,000 customers in 140 countries. By combining industry knowledge with innovative data analysis technology, IDeaS creates sophisticated and simple ways to provide Revenue leaders with automated and accurate decisions. From major hotel chains to independent properties, customers rely on IDeaS to provide profitable pricing decisions every day. In this case, we also recommend a detailed analysis of the investment to be made.

Conclusion: How to choose the Revenue Management System?
Every hotel has specific requirements when it comes to RMS software. The key to success is to ensure a simple and effective tool that empowers and does not frustrate your team. This software must include a friendly interface so that everyone in the hotel can use it.
The resources needed depend on your business, history, and goals. Likewise, your team will have different levels of knowledge with Revenue Management Systems. The final point to keep in mind is that no RMS is good for your hotel if it does not generate a positive ROI when using it. Therefore, we recommend that you discuss your options with a Revenue Management consultant at the Revenue Management HUB.
We can provide an unbiased opinion, tailored to your exact needs. If you would like a personal recommendation or an introduction to one of the mentioned RMS providers, please contact us.