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Front desk systems and property management software

Front Desk Operations

Josh started this discussion 18 years 2 months ago

What kinds of systems does your hostel use to manage reservations and guests?

Here are some of the ones that I have seen:

Paper reservation and accounting system
Excel or OpenOffice spreadsheet
roomMaster 2000
Ros2000
ASSD (including Gomio's version)
Hostelworld's Backpack software

Any others to add? Recommendations or warnings about one system vs. another?

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John Moriarty

10 years

All the best with the new Hostel in Portland.

For a new startup I would recommend myallocator with loventis.

Now it might not do everything some of the bigger players can do but it is cheap.

Myallocator is 12 euro per month and does all the channels you mentioned for no extra cost.

It also has code for your website for people to book through.

You can get Loventis for free if you have less than 29 beds and put a link to their website on your website.

I use myallocator with bananadesk which is also great software and in the process of adding a lot of new features.

It is 1 dollar per bed per month.

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HostelOffice

10 years

A 20 bed hostel needs to be selling each room as multiple types concurrently and have the best chance to gain as many direct bookings as possible. Connecting to more than 5 agents and going for the lowest priced software could be the most expensive decision a hostel owner can make. It is the lost bookings and commission that has to be paid on most bookings that traps a hostel. The future lies with doing a lot more for your owned online presence via a PMS rather than giving away that presence to commission retaining agents. Following this objective we have turned around hostels that have had over 90% reliance on agents to over 80% direct bookings that doubled their profits.

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Grant PDX

10 years

So, I understand there are a lot of options out there...and I've checked the majority of them and ran a cost analysis in addition to the time and ease of use. There isn't one fit that works perfectly. I'm currently trying to put together a Excel spreadsheet that will make this entire process easier for the Hosteling community. It will have the majority of the software on it and have some prices along with features, which OTA are serviced, if it's compatible with Microsoft, Mac, or online, etc. This has been a long road to finding the right fit.

I'm still curious about this software that The Crash Pad is using. They also have some amazing branding going on, which is rare these days in the hostel industry. I think I've found the software company...looks like it was a custom job. I have contacted them to see if I can get more information. I'll let everyone know what I find out.

http://www.agile-ds.com/oursoftware.html

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Federico Finki

10 years

Hi Guys, We are useing a cloud based realy powerfull pms called Mini Hotel PMS, we like it a lot because it has its own channel manager, and they have connectivity to one of the biggest OTA here in south america called despegar.com support is 24/7 in spanish, portugues and english. they also have some cool features like, restaurant management, PBX phones connectivity, shared availability, shared and private rooms, etc, the coolest is the revenue manager that based on rev par and many other cross data reports, helps you set up rules to maximze your your income by manipulating prices. an other cool this is that inclueds a booking engine for the hotel web site totaly customizable. the company alos has great value for us because they help us to create new bussines models, like they have a customizable thank you page on the boking engine that hooked up us with other tourism providers, like a travel health insurence company, that we get a commsion for every sale that comes from the thankyou page of our booking engine, its called upsale. check it out, [url=http://www.minihotelpms.com[/url] or in Brazil www.sistemahoteleiro.com

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CraigD

10 years

Hi Carpe Diem,

I would like to be able to highlight the virtues of GuestCentrix PMS for your hostel, but I will be quite honest with you and with your count of beds and private rooms, we may be on the slightly higher side price wise - and our GuestCentrix really suits hostels with a bed count of more than 50.

However, as you are evaluating software systems, I'm happy to give you my thoughts.....

Think ahead to what your software might need to do for you, not now, but in five years time. (I know this can be a little hit and miss, but bear with me).

The system you choose should be based on modern architecture (ie are you buying out dated DOS based systems for example?). Some will say that the application must be "Cloud Based" or "Web Based". This is true to some extent, but not essential. Ask your new software providers, what features and functionality has been added to the actual PMS in the last couple of years, and not talking about connecting to online channels, but what enhancements to the actual PMS have been adde - what new features has your prospective new provider added to the system in the last few years... are they still updating their offering?

"What reporting capability do you need to have in the system" is sometimes the forgotten question lost in the "how many online booking channels do I need" question (and there is no right or wrong answer there either). A good system will have a combination of essential reporting (which of your online channels is giving you the most business for example?), a combination of multiple online channels, as well as the ability to have a commission free booking engine on your own website.

Data and information is fast becoming a key differentiator between a hostel that merely sells a bed or a dorm online, check the guest in and check the guest out, and the hostel that knows where the booking has come from, why the guest chose that place to make a booking, has the guest stayed before, and what the guest does or doesn't like.

Any cheap and easy PMS can do the basics, and I know you "only" have a smaller number of beds, but choosing the right solution can give you information that no Excel Spreadsheet can.

I do know what software that the Crash Pad uses (no, it's not mine), and I think there are better systems out there than the one they use.

You mentioned ChartsPMS earlier, just as a point of reference, our GuestCentrix PMS replaced ChartsPMS over the past couple of years at the hostels at YHA Australia. And they haven't looked back. Like I said, these sites are on the bigger side, and I am aware of economies of scale when it comes to buying software, and it's good in the Hostel industry that there are software systems that work well, and are modern, across all price points / hostel sizes.

Good luck with the hunt!

Craig

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CraigD

10 years

Ooops. Double Post! Sorry!

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HostelOffice

10 years

This is a good idea and it is important to consider that the market changes and alters the priorities for a hostel. For example, as I wrote above, as soon as a hostel gives allocation to every possible agent then the next thought they have is how can they claw back that allocation and get as many direct commission free bookings as possible. So any spreadsheet of such PMS providers needs to have consideration for how the software improves direct bookings. As relying on agents at the expense of your own online presence is not sustainable.

Then what is the real cost. Sure you can write that we charge 100 euros a month for our software but that is not the reality. In reality a new user gains an increased income more than ten times what the fee is. A hostel with an industry standard booking engine replaced by our booking engine often gains 100%+ increase in bookings via our booking engine. So in effect we give hostels at least 1000 euros a month for using our software as long as they have people travelling to that destination.

Then we have mechanisms within the software to encourage people to travel to that destination as long as the hostel owner wants to put them to use.

I guess this is looking like a sales pitch but what I am trying to communicate is that value is a measurement that includes qualitative data that translates to an impact on the bottom line of increased profit per booking. So I am seeking to tangibly allude to how we achieve it for users rather than to present theories. There is much I can only communicate to users for their competitive advantage. Up-selling is certainly part of it.

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CraigD

10 years

Dean,

I have a client in the UK who migrated from BPO to GuestCentrix a couple of years back.

The hostel invested heavily in building their own booking engine for their website, on technologies we provided to them. They designed the entire site, connecting to GuestCentrix for Rate and Availability, as well as the obvious booking insert.

They now "save" around about GBP10,000 a month in a single hostel (or should that be they now add 10,000 a month to their revenue), as their reliance on Hostelworld went from about 60% of bookings down to about 10 % of bookings, and their bottom line is immediately boosted!

This isn't a sales pitch, but an education, but why give away this amount of money to an OTA when with the right booking experience, you can get a guest onto your own website.

I lost a piece of business in the UK about a year ago to another PMS vendor (big hostel too). The hostel owner stated that we were simply too expensive, and he bought a system about 30% cheaper.

I was on the hostel website earlier today, and could not believe my eye's when I saw the business was STILL pumping direct bookings on the hostel website through Hostelworld. Given the manager of the hostel at the time told me how many bookings they received via HW, I know that in the past 12 months that that business has paid out 20 times the cost of GuestCentrix in HW commissions (or has forfeited this revenue) .... And this was after I had done some numbers for them, based on three years of HW bookings (the numbers in 3 years were staggering, and the cost to buy a new PMS was minuscule in comparison.)

It's all about education. I said In a recent interview for a trade magazine in the UK, too many hoteliers and hostel operators consider the PRICE of the PMS as a COST. The right solution is an INVESTMENT.

I have on several occasions laid out a proposal for a property only to lose the business. Then several months later have the property call me back up "We bought the wrong system...what can you do for us"....

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HostelOffice

10 years

Craig thanks for your post as I have experienced the same thing time and again. You help me feel less insane :-) Users continually wonder why every hostel is not using the software. But some I have to print out their reports for them and walk them through it. We have a user that doubled their income to just over 3 million euros a year from using our software but they actually thought we caused them losses. I could not believe I had to send them reports to show them what we had done for them. But it is indicative of how hostel owners and managers tend to look at the wrong things to determine what makes them successful.

I often refer to our software as a money printing machine. But because most hostel owners and managers just don't seem to be able to understand, the result is that it seems to prove that the OTA business model that you get hostel users when you create a system that they are forced to use rather than choose to use based on good business sense. Not that we will be seeking to force to gain users.

This is why I have been so critical of hostels that protest against Hostelworld etc when we can see by looking at the hostel website that the hostel has placed themselves totally reliant on such OTA's. Any protest is only credible when the hostel has done things to stand independently.

At the end of the day I am in the business of supplying software because it provides a really interesting insight in to human thinking. I like the business challenges that result. The biggest financial beneficiary is the hostel and not me if they use our software. I am way past the point of chasing money as I achieved all my business goals in China and Europe in the corporate world. So it just blows my mind that I am trying to hand out money printing machines and people won't take them. Seems like you are experiencing the same with your software.

On my business cards I even dumbed down a statement that we increase income by at least 10%. The sentence should read 'often over 100%'. But hostel owners and managers just can't believe such a statement. I even had one hostel manager challenge the 10% claim and then looked at me like I was from outerspace when I told him the reality is often over 100%.

Everytime a hostel contacts me for info then does not use our software I have a little chuckle. Maybe some of such people are reading this and recall how I did not hit them with a big sales pitch or even appeared a bit rude to them as they expected to be sold to. Today I got an email enquiry from someone that did not tell me their name. So I replied to ask them their name and most likely they will not reply again and consider me rude. But when you are handing out money printing machines you do not feel like you have to give a big sales pitch and beg for them to take it.

When a hostel becomes a user then they gain a lot of respect from us because they have proven themselves to be superior to the majority of hostel owners and managers. We got a group of 9 new hostels today and the reply I gave them was to congratulate them on being so smart and then revealing a lot of hidden value we only share with users. I totally refuse to share all value with potential users as there are enough obvious reasons to use such software as ours and yours and possibly others.

If good software suppliers gained the more users they deserve then the software supplier could deliver even more benefits to hostels in totally new areas unimagined. But here we are stuck in a world created by the participants yet those participants scream out for the solution staring them in the face.

As they say - You can lead a horse to water but you can't make it drink.

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HostelOffice

10 years

Here is today's example.

I am at a user hostel that thinks they should get a PMS supplier that will link them with more agents. We get them 95.6% occupancy with 45% direct bookings paying 100% of the room price.

If they link with more agents then the agents will forward sell beds and push out the 100% cash paying guests. So the hostel will gain at most 88% of their bed price and less.

This totals over $50,000 a year in lost income to this user if they go that path. They will turn their back on the $50,000 we save them from losing now and on another $30,000 they could claw back from commission retaining agents if they pay attention to things we inform them of.

All I can do is tell them this and leave them to hang themselves. I can predict if they go that path that they will head towards bankruptcy.

We charge them less than 2000 euros a year.

LET'S EXPLORE THEIR THEORY:

THEORY= I just want agents to fill my beds and I do not care that I pay them commission to fill them.

I suggest this is a short term idea as it does not last the test of time. Why?

Because every hostel has expenses that causes them to have a minimum price per bed that they can not sell at any lower price without decreasing profit.

If your rent or bank payments are too high then you struggle to be able to supply a low enough price that travelers are willing to pay. If your heating and cleaning costs are too high then you struggle again. All hostels have expenses and have an amount of days of the month they have to work before they start to make a profit.

Some hostels only need to work 3 or 7 days to cover all monthly expenses before they are making profit and then other hostels can work all month just to cover expenses. The larger the profit a hostel makes on each booking determines how fast expenses can be covered.

When many hostels in the same location have similar profit margins because they have similar expenses and have lowered their prices in an effort to gain bookings. (These hostels are those that list with every agent possible) Then they are stuck in a losing situation. The stuck hostels get focused on their expenses and want any booking at any cost because their priority is to cover expenses to stay in business and not to make a profit. Sure they would like to make a profit but their first priority is to stay in business and not go bankrupt so they have to first give priority to covering expenses.

In this very common example it is the hostels that have lower expenses below all their competitors that are the winners. As commission paid to agents is an expense then those hostels that gain the more direct commission free bookings are most able to lower their price a little further and gain the bulk of bookings. THIS IS WHAT OUR ADVICE WRAPPED AROUND OUR SOFTWARE DOES FOR USERS.

Once a hostel gains some freedom to focus on improving profit then they are happier. This is reflected in ratings and reviews. The software also helps the hostel to provide a better service to the guests so that ratings and reviews are improved even further. Of course with good ratings and reviews then the hostel gains more bookings. Then the hostel no longer needs to be competitive just on the price alone and can have a slightly higher price. This then stops solely budget focused travellers from booking at this hostel. The travellers that book at the hostel are able to spend a little more and place value on having a good experience.

These travellers at the hostel spend more on hostel drinks and tours because they value these things more than the budget focused traveller. The other hostels with lower ratings and lower profit gain more budget focused travellers and get even more stuck in their losing situation.

Whilst the competitors are stuck, the users of good software like HostelOffice and Guest Centrix and are improving their owned online presence and gaining an un assailable advantage that secures their bookings for many years to come. Competitors in years to come will simply experience increasing commissions from agents and have to focus on the few weeks in the year when they can make a little profit because all other months just cover costs.

The story goes on and on and here is a film that saves me from having to type it all out. Click Here to see the film.

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