MY OWNER NEVER HAS ENOUGH CAPITAL FOR THE THINGS WE NEED.
A common cry from most managers is that too many important capital projects get denied arbitrarily by the Owner.
A common cry from most Franchisors is that some owners bleed their properties and don't keep them up to franchise standards, resulting in eroding market share and reduced profits.
A common cry from Owners is that the Hoteliers think they all have deep pockets.
LET'S GET CREATIVE!
It is surely time to get creative and instead of using Cash for Capital Projects, use what all hoteliers have in their off-season, vacant rooms and leverage the value of those rooms to the benefit of the Owner.
Here is an idea of the value of those vacant rooms,
Hotel size 200 rooms
Occupancy 65%
ADR $100............ but the Barter company will give you say $70.00
Barter Value $ 70.00 on 35% vacancy.......represents $1.8 million per year. Over 5 years, the $1.8 million a year represents $9 million and that represents an amount that should get most people's attention and in my opinion is well worth investigating even if one only considers the use of one-third.
Assuming that the "Concept" of leveraging these empty rooms that have been built, furnished, equipped, heated (or cooled) and maintained is agreeable to your Owner, you now only have to deal with your Financial Controller and the Government Taxman and decide on the exact amount.
See also this article on "Turning Vacancy into Profits" by Lisa Baum of PricewaterhouseCoopers at,
If you are interested in leveraging your inventory, contact [email protected]
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