traditionally, the hotel industry has looked at occupancy as a measure of success. Another indicator of operational success that we have always consulted is the average rate per rented room (the average daily rate, or ADR). Yield manager puts these two together and, using forecasting based on the history of past sales, sets out to get die best combination of occupancy and ADR. Yield management, then, involves varying room rates according to the demand for rooms in any given time period. The argument is that when the hotel is going to be full, it makes on sense to sell any rooms at special discount rates. On a night when the hotel in definitely not going to fill. however, selling a room at a discounted price is better than not selling it at all, Going beyond maximizing rates. hotels are using yeild management to take more multiple-night (instead of single-night) reservations during management to take more multiple-night (instead of single-night) reservations during,busy periods on the theory that a multiple-night reservation offers less risk of havinga vacant room following checkout and thus is worth more to the hotel. A potential guest, therefore, inquiring about room availability for a large event such as vhe Super Bowl may find that the hotel requires a minimum stay of two to three night for this high-demand weekend. As with so much in hotel operations, careful employee training is essential to secure an effective yield management system that is operated in a way that will generate maximum revenue but not offend guests.
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