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Old 20th July 2010, 05:19 PM   #1
AngelBiz
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Default Key Performance Metrics For Hotels And Service Business

Every small business owner needs to look at the business reports daily, weekly and monthly on a regular basis to stay up-to-date with how their business is performing. You need to understand what key performance metrics to look at in those reports.

You don’t have to start from zero when looking for key performance metrics for your business. Many types of small businesses have “standard” set of metrics. As a small business and franchise owner you should be aware of these metrics.

What are the key metrics relevant to hotels / motels and services businesses. Read more to find out...

Read more - http://www.angelbusinessadvisors.com...ices-business/

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Old 20th July 2010, 07:35 PM   #2
Logan
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One thing I've found interesting about the hotel industry is that it is common practice for them to share their metrics between properties. It is typical for a front desk of a hotel to check other hotel's (aka competition) occupancy and rate every evening. This is then compiled and reviewed by management to make decisions. every night, most hotels do this. freely sharing their performance data with competitors back and forth.

How many other businesses have a standard practice of sharing their performance measurements like this?

While the metrics are important, if you are only comparing them against yourself they may tell you things have changed within your own four walls but you may be blind to what is going on with your competition or how you compare when it comes to the customers perspective.

I'd be interested in hearing comments/practices regarding metrics, in particular how to compare to competition like the above scenario with hotels. Is this sort of thing unique to hotels?

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Old 21st July 2010, 08:55 PM   #3
AngelBiz
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Quote:
Originally Posted by Logan View Post
One thing I've found interesting about the hotel industry is that it is common practice for them to share their metrics between properties. It is typical for a front desk of a hotel to check other hotel's (aka competition) occupancy and rate every evening. This is then compiled and reviewed by management to make decisions. every night, most hotels do this. freely sharing their performance data with competitors back and forth.

How many other businesses have a standard practice of sharing their performance measurements like this?

While the metrics are important, if you are only comparing them against yourself they may tell you things have changed within your own four walls but you may be blind to what is going on with your competition or how you compare when it comes to the customers perspective.

I'd be interested in hearing comments/practices regarding metrics, in particular how to compare to competition like the above scenario with hotels. Is this sort of thing unique to hotels?
Logan

That's an interesting observation. A friend of mine who manages hotels told me that beyond comparing metrics they pass referrals to each other when one of the hotels is fully booked. He told me this is also a standard practice.

I have not heard of this practice in other types of businesses. That's why competitive benchmarking is important. If you are part of a franchise they can give you metrics covering your territory, region or national averages. Though not the competitive metrics these are still useful.

Another point I made in the post I wrote today is that the metrics tell you only HOW your business is performing. You have to talk to customers, employees and other to understand WHY.

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Old 21st July 2010, 09:20 PM   #4
Logan
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Yes, that is true. Many years (erm almost a couple decades) ago I was a manager for several marriott hotels. As a manager I had established relationships with every other hotel in the area. Not only do they refer the business, but we would negotiate between us what was often called a "walk rate" where the price of the room was already negotiated in advanced. In hindsight, it was a reciprocal relationship that was understood to always work both ways. When one asked for the rate or occupancy, their own data was offered/provided in return.

Come to think of it, we even swapped back and forth more than a few rollaway beds. They just roll right across the parking lots.

Sometimes these are your friendly (in this case business) neighbors, literally geographically (and at all hours of the night).

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Old 18th August 2010, 09:23 PM   #5
smartKPIs
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Hi AngelBiz,

Speaking of KPI for hospitality industry. www.smartKPIs.com may be a good resource for you. It contains a user friendly library of well-documented performance measures. At the moment it lists over 4700 KPI examples, grouped in 73 functional areas, as well as 83 industries and sub-categories.

KPI examples for the hotel and hospitality are available on this page http://www.smartkpis.com/kpi/industr...accommodation/ They include but not limited to:

# Treatment per guest visit
$ Revenue per available treatment room
# Average booking value

In addition to examples of performance measures, www.smartKPIs.com also contains a catalog of performance reports that illustrate the use of KPIs in practice.

Examples of such reports for hotels are available on: http://www.smartkpis.com/kpi_example...accommodation/

The website is updated daily with new content, so check it from time to time for additional content.

Please note that while examples of performance measures are useful to inform decisions, each performance measure needs to be selected and customized based on the objectives and priorities of each organisation.

Best regards,

Anita Liang
Research Analyst
www.smartKPIs.com

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