Monthly Archives: March 2010

Keeping the Pipeline Full

Sales has always said that if the pipeline isn’t full not much will come out as confirmed bookings. Another analogy that is used is the sales funnel.

How do you know if your sales staff is making enough of the right calls to generate the business you have projected?

Start by looking at your historical bookings over the last 4 years by market segment. How many sales calls in each market segment did your sales staff make to achieve those bookings? Are you satisfied with that booking pace? If not, identify the percentage increase you expect from each market segment. Then simply increase the number of sales calls for each segment by the percentage increase you desire.

    Test your market segment expectations.

    It’s easy to set goals and expectations. Making sure they are realistic is a separate issue. Your sales team has to “buy into” your sales goals and expectations.

        Can your sales staff realistically make enough calls on former or potential customers to meet the sales call goals by market segment?
        Are there enough potential customers coming to your area in each market segment? If not, how can you increase sales from existing customers in the market segment to meet your booking target for the segment?
        Test the assumptions on both of the above with your current sales team. Then sit down with them and assess the results and where they feel modifications are needed in the targets. Then ask them what additional market segments they feel the hotel should sell. The sales team can’t just say the targets are unrealistic, they need to be responsible for identifying other sources that could generate the business in the time they have to sell.

    Now step back and identify what additional training your sales team needs to meet the goals. We are all familiar with “order takers.” Today we need people who can find business and then sell the business at the rates we need. Our customers still want to get the best deal possible, but most also know that the markets are starting to change. They are willing to listen when your sales staff sell the value your hotel offers for the price you want to charge.

Economic Analysis: Tom’s Take

Where’s US economy heading and how do you make it work for you personally and in business?

US economy has never dealt with a recession like this one. We hear lots of talk about U shaped or V shaped recession, with few others thrown in. Appears to me we are closest to recession that has held Japan down for many years. Plain old stagnation. Can it switch to a stagfation? Yes, but the way we need to react as individuals or businesses is the same.

Why don’t we care which it is?

In a stagnation, the economy just doesn’t have much recovery. In a stagflation, we add inflation to the mix.

What’s different from previous recessions?

In past recessions, small business has lead the recovery. This time government is trying to lead the recovery in the US, and internationally in those countries most affected. Many states in US are in serious financial trouble and are raising taxes. Likewise many counties, cities, and towns. In the past we have not experienced the severe budget shortfalls at all levels of government. As governments at all levels have to raise taxes to make ends meet, it significantly slows the ability of American business, especially small business, to recover.

Whether government overspending just slows the recovery or leads to inflation, the result will be the same. A very slow recovery for the US economy, and by extension, other countries that are severely impacted. Increased government taxes and programs adversely impact business two ways, directly from the taxes, and indirectly from time lost adhering to more governmental regulations.

What’s solution for individuals and businesses?

Reduce debt and increase cash reserves. The goal is to have sufficient funds to take advantage of an upswing in the economy, personally or as a business. Or to preserve existing personal or business lifestyle should inflation pick up.

Personally, people need to do everything they can to reduce their amount of debt. Reduced debt enables increased savings or simply paying cash for more future purchases.

Many businesses, especially small businesses have done excellent job of reducing debt and expenses. Now they need to identify ways to increase revenues while still holding costs down.

How can business increase revenues?

Find new sources of revenues. Existing sources of revenues will not be enough for most businesses. Then back it with great customer service. As an example, have real people answer the phones. Use voice mail only as a last resort. Biggest customer complaints is not finding a phone number for a business and then only getting voice mail, that often goes unanswered. Business can not afford to let any sales opportunity go by, and providing great customer service enables more sales opportunities.

Share your success stories.

Attracting Millennials to your Hotel

Millennials are more social than Baby Boomers. Staying in their room working all evening, or watching a movie doesn’t hold a lot of appeal. They would rather work in the lobby or an open business center, even if they are not conversing with others. A key is a roomy business center. They are not interested in seeing how many people can be crammed into a 10′ x 10′ “business center.” They’ll work in the lobby first.

What can you do to encourage them out of their rooms?

  • One hotel started offering popcorn from 4:30-7 PM weekdays. Guests checking in came back downstairs. Business travelers enjoyed the popcorn. The popcorn encouraged conversation. So this select service hotel got a permit to sell beer and wine. First month on the program beer and wine sales topped $10,000. Now they are looking to add simple sandwiches. Word is spreading, and the hotel picked up additional 221 room nights in Feb. They now lead their market segment by 20 points. (They were third in the segment.)
  • Another hotel had a very small lobby. They moved their fitness room which had been just off the lobby and next to the pool. They converted that room to a “great room” with a big screen TV, 3 computer work stations, 3 game tables, complete with decks of cards, backgammon, cribbage, etc. They also added 3 vending machines. First month, vending machine sales topped $1100. Now there are typically 5-10 people in the room from about 5-10 PM weekdays. Families use the room on weekends when kids games replace the cards, etc. No increase in repeat bookings yet, but no attrition either
  • Another hotel knew a retiree who loved to make homemade donuts. They convinced her to make her donuts in the hotel from 5-6:30 PM weekdays. She always baked up few so the smell greeted guests checking in. Then she would fry up donuts and dip them in the frosting of the guests choice. The program was so successful it quickly attracted local business people. She now has taken over two rooms and the donut operation is available from 6 AM to 6 PM. Occupancy in Feb. was up 11 points over 2009 and ADR was up $3.

Share your success stories with us.

Getting More Business from Top 20% of Your Customers

Historically most companies get 80% of their business from 20% of their customers.

Each of us knows who our top customers are. Majority of a full service hotel’s profits come from rooms and banquets/catering.

What Are You Doing to Optimize Business from these 2 Segments?

Clients are telling us they are getting more meeting business the first half of 2010 from smaller companies.

We asked them what they were doing to increase the spend. Here are few of their comments:

  • Encouraging breakfast meetings. Very small groups can use the restaurant. Larger groups use meeting rooms. Some groups just want light breakfast, others want full breakfast buffet so they can start their meeting while the group is eating. A few groups broke up before noon, so providing breakfast ensured the hotel maximized F&B revenue from the group.
  • Another hotel found groups had lunch at the hotel, but let their groups go elsewhere for dinner. Hotel started selling evening cocktail reception from 4-6 PM for these groups. They got additional revenue from the cocktail reception with pool table, foosball, and poker for matchsticks including lessons. They found 25% of the group ordered dinner in the hotel so they could continue the games, which typically evolved into business discussions. The clients felt they got additional mileage from their meetings, and the hotel got additional dollars from their groups.
  • Another hotel surveyed the Top 20% to ask what additional amenities or activities they would like to offer their groups. One company wanted to offer something for their Secretaries who always arranged groups, but didn’t get to attend. They asked for a floral workshop. The hotel contacted a local florist who offered to do it for only the cost of the materials. No room nights, but a fun afternoon for Secretaries who also were given a tour of the hotel, including various room configurations.

What has your hotel offered groups that was unique and increased revenues from your Top 20%?

Credit Checks & Employment

Should employers be allowed to run credit checks before making job offers?

What Do You Think?

Washington and Hawaii have already passed laws banning credit checks on job applicants. At least 16 other states are considering similar legislation.

What are your views?

  • Should employers be allowed to run credit checks on all job applicants?
  • Just applicants for positions handling money?
  • Or should employers not be allowed to run credit checks on any job applicants?

Find the Best, Not the Rest

We’ve all heard the phrase, but how do we apply it when it comes to our recruiting efforts?

Who are the “best?”

People who currently have the skills needed to fill the job you have open. Individuals who exhibit the behaviors and motivation level to make an immediate contribution.

Are these people currently working?

There’s a 99% chance these people are currently working…in jobs they consider at least “Ok.” Most of these people are not actively looking…yet. They will listen.

70% of employees indicate they are willing to consider new jobs.

As the economy starts to improve, more and more employees are starting to “test” the employment markets. Most of us have had a tough go the last couple of years, small raises, little or no bonuses, reduced benefits, longer work hours, or more stress from additional responsibilities.

Keep your best, hire the rest.

How do you keep your best employees if you can’t pay them what the market says they are worth? Give them special assignments. Compliment them when appropriate. Learn their career interests and help them achieve them, even if it means they will leave you sometime. (If this is the case, they are going to leave. Far better to help them and be “in the loop” than to be surprised.) Most employers are surprised to find their employees have interests outside their jobs that are very important. Often just giving them the flexible schedule so they can pursue those goals will keep them working for you, even if they receive an offer for more money.

Most employees feel they are under-paid and that their talents are not appreciated. Of course they will listen to opportunities to make more money. Give more frequent small raises. Or reward special effort with a small monetary reward, even if it’s just a $25 gift certificate. Or work out a trade out with a competitor in another locale, close by for a weekend stay. Let your best employees know you are thinking of them.

Who are your best employees? Your Top 40%.

How do you hire the best?

  • Forget what you want to know about the candidate. Tell them what they want to know. Your objective is to attract great candidates. Once you have attracted them you can identify how to hire them.
  • Great candidate’s are looking for jobs that will advance their careers by giving them additional skills and responsibilities.
  • Once great candidates have applied, start the phone interview, or in-person interview by telling them how the successful candidate can grow with your property/company. Get them excited about your job opportunity.
  • Now start asking the questions you want to know about the candidate.
  • This will be a great opportunity to hire great employees if…

    Employers are ready to pay a little more than planned and are ready to offer opportunities to advance. Offer the best, to hire the best.