Regardless of where you are in your hotel building business, your main objective will always be driving revenue and profits growth. In the hospitality business, the number one focus for the entire team members is to increase the profit margin. If you want to make your hotel successful and profitable, then always be on the lookout for ways to reduce your overall expenses and manage costs.


Once you focus on controlling these two aspects of your business, the rest will follow. Here, we have compiled a step by step guide of simple ways one can go about controlling their costs and reducing expenses without harming their hotel’s service quality.


1. Manage Time More Efficiently


One of the largest issues faced by hotel industry is time management. A lot of time is spent trying to juggle the many tasks associated with running a hotel. If your hotel/ restaurant is still tracking bookings with pen and paper, we would recommend that you arm yourself with time-saving methods such as a property management system (PMS). This system will not only save you time but it will also reduce all non-value adding administrative work. Invest in a quality PMS that is easy to use – this means that it will require minimal time when it comes to training your staff. Once you’ve armed yourself with a quality PMS, it’s time to integrate it with other tools such as accounting software, payment software, and a booking channel manager.


2. Reduce Inventory


You’ll be able to save a lot of money by only controlling your inventory. Instead of maintaining large inventory, order items only when they have been requested. You’ll reduce your overhead and at the same time, save yourself from having to worry about finding ways to “move” the slow moving merchandise. Before any purchase, ask yourself whether that particular item is a necessity. Do you perhaps have something that can perform the same task? And the most important question; are you willing to put off your cost reduction goals and profits growth to have it?


3. Sales and Marketing Plan


Online marketing is a great tool to use as it reduces cost of printing materials and travelling costs. Instead of printing marketing materials, why not take advantage of social media? Provide your potential customers with e-brochures and virtual packages through the net. Another way to utilize social media is to promote your hotel through various channels such as blogs, Facebook, Twitter, etc.


What hotel sales and marketing plan you’ve use in order to increase your overall sales? For maximum profits, you’ll need to increase your reach by maximizing your booking channels as much as possible. This will involve using large and more expensive booking sites such as TripAdvisor,, etc. These sites will help promote your business to a global audience. For better management, we would recommend that you use channel manager software. This type of software ensures you don’t get a double booking through different sites. It also ensures that your rates stay constant across all channels used.


4. Introduce Direct Bookings


If you wish to increase your hotel’s revenue, make direct bookings through your website a breeze. Invest in an easy-to-navigate website that is attractive, readable, and mobile friendly. Most hotel bookings nowadays occur online through laptops or mobile devices. For a smooth and swift booking, invest in a booking engine that will integrate seamlessly with your PMS.


5. Find Your Niche


What can your hotel be best known for? Is it corporate events, weddings, general events? If your hotel is surrounded by a big land, why not cultivate this into a serene and beautiful garden where clients can host their weddings or other outdoor functions? Find what your hotel can do best and invest in it.


6. Look Out for Cost-Cutting Ideas


Are you aware that nearly 65% of all energy upgrades are related to lighting? If you are still using traditional light bulbs, are you aware that only 5% of the electricity consumed is converted to useful light? Invest in energy efficient light bulbs (LED’s). Granted they cost more upfront, they however last ten times longer and are up to four times as efficient. Why not invest in sensor tools as well? These tools are relatively cheap and a great option for areas that aren’t in use frequently such as restrooms and conference rooms. Sensor lights will reduce your energy consumption and help you save up on your overhead cost.


7. Use Annual Supplier Contracts


It’s presumed that multiple year contracts with your supplier will result in lower costs. This can be true but not always. A multi-year supplier tends to go in favor of a supplier. Try working with supplier contracts that do not exceed one year. This will force annual biddings – or at least an annual price discussion with your current supplier. This will almost always end up in lower costs of supplies.