Today we going to take a look at what I would describe as the most powerful Owner utility you, most likely, have never heard of. (D)ated Rack Income Posting (Owner Management à Owner Posting Tools) is used to generate room revenue to an Owner’s Contract folio to compensate for a discrepancy between actual posted INCOME and a user-specified percentage of the applicable Rack Value (as configured in Rack (R)ate Value Setup (Owner Management à Owner Operations.)
This was originally designed to be used by rental operations that guarantee their Owners a minimum nightly room rate when their unit is occupied. Occasionally, this is limited to certain Market Segments such as a Group or Wholesaler floor rate.
More popularly, it is deployed as a method for managing an alternative to establishing and tracking Comp Allotments. Keeping track of comps (e.g. 3 nights per year in each unit) is usually a thankless job – Marketing wants to use the best units repeatedly while Owners resent any use at all. Depending upon the per unit allotment, the number of nights needed for a given reservation may require moving the Guest mid-stay. Lastly, there isn’t a good mechanism for properly allocating comps between units (though the off-menu report Nights by Unit does make monitoring usage much easier.)
The Dated Rack Income Posting utility offers an excellent solution to this conundrum and can turn this into a win-win-win situation. Properties can eliminate the Comp Allotment clause from their contracts by guaranteeing Owners revenue for every night of occupancy, establishing that value as the benchmark against which the zero posting from actual Comp usage would be measured. Run as an end-of-period process, the utility handles the comparison and manufactures the “missing” room revenue for each Owner, as appropriate.
There is, however, a second aspect to this mechanism by which it can also generate the concomitant charge and, using SMS|Host’s expense distribution functionality, treat that charge as a Marketing Fee to be allocated between all Owners of an affected unit type, typically based on their individual ratio of total INCOME. Your Comp program has just become a self-funding Marketing campaign.
- Win – Marketing and Group Sales can effectively use Comps as needed
- Win – Property Operations no longer needs to track and balance Comp usage between units
- Win – Owners are no longer concerned about “lost” revenue.
This process is described in detail in the Dated Rack Income Posting Owner Functionality document. I would encourage you to review it, consider the benefits and contact me if you would like to discuss the ramifications of implementing this procedure.
Next time, we’ll take a look at what’s involved in capturing a Guest’s image from a passport, driver’s license or other ID at check-in.
