The hotel business is a retail business and in order to stay on top of your business you must fully and completely balance your daily revenues and settlements. Every day we begin anew and every day is a story unto itself when it comes to the revenues and settlements. I may sound like I am repeating “revenues and settlements,” but it cannot be emphasized enough.
Many hotels operate on what I call autopilot when it comes to this bedrock function. Many leave it in the hands of their latest manager of the day to ensure this function is properly done. Many hotel owners don’t even know that these controls can or should exist, let alone follow up to ensure they’re not bleeding money.
Here are 7 things you must do each day to ensure you are keeping all the cash that has legitimately come your way from your customers. It is imperative to not let someone else lose it because of careless practices or, worse still, take it from you.
This piece was inspired by a second-generation hotel owner that was curious enough about what wasn’t happening at her parent’s hotels to call me and get the skinny on what should be done each day to balance those revenues and settlements. What she found was appalling. You don’t want this to happen to you, and neither do I.
- Balance your cash control total.
Cash is king and cash is the most desirable thing you have that needs to be controlled. If you use a property management system, the end of day generates a cash control total. Make sure that’s what actually hits your bank account. - Balance your credit cards.
The credit cards are complicated – a three-step balancing act. Make sure all three are right every day and don’t wait to do this weekly or monthly. Even for a small hotel this is a big mistake. Do it daily. - Separate critical duties.
- Balance your PM to your GL.
- Review every rebate and adjustment.
- Prepare a room for verification report.
- Review the daily room rates.
At Hotel Financial Coach I help hotel leaders and teams with financial leadership coaching, webinars and workshops. Learning and applying the necessary financial leadership skills is the fast track to greater career success and increased personal prosperity. I significantly improve individual and team results with a proven return on investment.
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