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Remote/Centralized vs. On-Property Revenue Management

Over the years Revenue Management has rapidly evolved as a science and an art. Effective application of Revenue Management principles proactively drive sustainable revenue optimization, superior competitive performance and long-term profitability. Therefore, more and more hotels have invested in establishing a strong revenue culture that aligns people, process, technology. However, I am always posed a question - what is the best approach to lead and this important role – a centralized/remote service or a dedicated on-property revenue manager?

While all the above options are widely being exercised today, it really depends on several factors that influence this decision. It is also important to understand that while technology solutions have made the process much simpler and efficient; the complexity and application of Revenue Management is also expanding beyond the realm of just room Revenue Management – now expanding to function space, spa, restaurants/bars and not to forget distribution optimization.

Therefore, while the answer is not as straight-forward; here is a tool to help you determine the best option that applies top your nature of business.

As mentioned earlier there no straight forward solution as there are many benefits and considerations associated with either approach. Determining the appropriate Revenue Management deployment for your hotel begins with knowing the objectives you’re seeking to accomplish, and the level of services you desire from this deployment.

At Rev-Mantra Pte. Ltd. we use multiple methods for establishing the best structure for a hotel or hotel company. Sometimes we have observed that a blended approach towards the deployment works best. In other cases, a singular approach is most favourable. Irrespective, of the approach that is being pursued, the underlying objective should be to operate in an efficient environment that fosters collaboration and innovation with highly skilled revenue management talent, all resulting in optimum revenue performance for your hotel.

About the Author

In a career spanning 20+ years in the hospitality industry Puneet Mahindroo, Founder and CEO, Rev-Mantra Pte. Ltd., has worked in various hotel and corporate level roles in Marketing, Revenue Management and Distribution. He has been responsible for implementation of several strategic projects; ranging from Performance Marketing, Sales Systems, Automated Revenue Management System, Revenue Management Education, Pricing Reforms and implementation of Distribution Platforms; for brands such as Four Seasons, InterContinental Hotel Group and Taj Hotels Resorts and Palaces.

Puneet is also involved in various industry wide initiatives. He serves as the Asia Pacific Chair to the HSMAI Revenue Management Advisory Board and in the past successfully completed 2 terms as the Asia Pacific Chair on the Board of Directors of Hotel Electronic Distribution Networking Association (HEDNA). He also served as a member of the Leading Hotels of the World International Rooms, Revenue Management and Distribution Advisory Board.

Puneet is passionate about education and training and has been external/visiting faculty of Revenue Management to leading business schools such as Indian Institute of Management, Ahmedabad, SP Jain, Dubai and also involved with the Cornell University on projects and roundtables.

About Rev-Mantra Pte. Ltd. Rev-Mantra management consulting services focus on our clients' most critical issues and opportunities: strategy, marketing (offline/online), distribution, sales representation and analytics across service industry and geographies. We bring deep, functional expertise, but are known for our holistic perspective: we capture value across boundaries and between the silos of any organization. We have proven a multiplier effect from optimizing the sum of the parts, not just the individual pieces.

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