Author: Mary Michelle's Hotel Blog

How I Increased YOY Catering Sales by 39%

How I Increased YOY Catering Sales by 39%

Hotels spend millions of dollars each year trying to find out how to generate more catering revenue. If you work in a hotel you know that catering is struggling in the hotel industry. If you are interested in learning more about how to generate more revenue for your catering department then this blog is for you! I am going to give you three simple steps that WILL generate your hotel more revenue.

 

More companies are building their own meeting spaces, and more wedding are happening at unique locations. Everyday people are choosing places to hold their events and meetings, and everyday more and more people are not choosing a hotel. Many owners ask why this is, well simply hotels are not the current trend. Will having your wedding at a hotel become popular again? I would say yes eventually, but that doesn’t help you meet your budget this year or even next year. If you know it will be hard to attract new business at your hotel, how can you increase your year over year revenue? Well simply by looking at what you are charging now! I was able to increase year over year revenue in catering by 39% by doing just that.

The first step is to “shop” your competitors, meaning find out what your competitors are charging. When I did this I found out that we were way lower on some things and right in line on others. After you adjust your prices according to your competition, next look at what menu items are most popular. For my hotel at that time it was a Deli Buffet, why you may ask, well because it was the most “budget friendly” option. Meeting planners loved the deli buffet, and with it being $6 dollars (per person) less than other buffets it made sense. Well I made it $3 less instead of $6 dollars less, and wanted to see if we would still book the same amount of deli buffets. I then looked at my other top five sellers and priced them higher, and guess what? WE STILL SOLD THE SAME AMOUNT! We were able to charge more for those items, gain more revenue, and we didn’t even have to generate any new business. The last step in this process was to look at our room rental fees and our audio visual fees, while these were right in line with the competition I wondered what would happen if I charged additional fees. I started charging a tech fee for audio visual set-up, so anyone who needed any type of audio visual would pay for the audio visual as well as an additional tech fee. Previously we were offering complimentary water service, and complimentary room flip fees (changing the room from one kind of layout to the next). So I started charging a water service fee and a room flip fee, and guess what it didn’t hurt my business. I still had the same customers and they seemed to understand the additional fees since it was additional labor for the hotel. I also looked at our 18% service charge. When I did the shop I saw that our competitors were charging up to 22% for service charge, so I changed our service charge to 20%. We were still lower than the competitors, but were able to make additional revenue.

By doing those three simple things: comparing the hotel to the competitors, looking at high producing menu selections, and looking at additional charges and fees I was able to increase hotel catering revenue by 39% year over year. So if you are down in budget and don’t know where to get new customers, stop for a second and take a deep look at your current prices and your competitors’ prices.

Connect with me on LinkedIn at https://www.linkedin.com/in/marymichellemoore/

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