SMS|Host actually offers eight different ways to calculate unit usage values but they conveniently fall into three concepts – Nights, Points or Revenue. For properties without an owner rental program, Nights is an ideal choice to rotate occupancy in order to minimize maintenance. All occupancy produces wear and tear, so a process that recognizes this and works to distribute it evenly can be easily adopted by every SMS|Host property without an owner component. F4 – Autobook and the F9 – Available Unit scan should already be the foundation of your unit selection procedures, so incorporating rotation can be seamless.
The Points option offers three variations – fixed Points, Dated Points and Timeshare Dated Points, the latter being the only appropriate choice if a property has fixed fractional ownership. In each case, a relative number of points is assigned to each Market Segment in an effort to compensate for lower revenues associated with certain segments (e.g. discounts, groups, wholesalers, etc.) I am not a fan of this approach, except as required for fractional ownership, because it is based on approximations and generalizations. Why use fake points when you could be measuring actual revenues?
There are four options that utilize Revenue production. Two of them have a conceptual flaw (fatal in my estimation) while the other two are worthy of your consideration. Both Rate and Posted Room Rate are based on a reservation’s nightly rate and the challenge they present is that no accommodation is provided for zero-valued reservations (e.g. Owner stay’s, group and marketing Comps). Furthermore, different types of comps need to be handled differently or rotation can be unfairly affected to the detriment of many in the rental program.
The remaining two are quite different from each other but the primary distinction is in the degree to which they can be leveraged for maximum fairness and adapted to a broad range of circumstances. One is called the Formula and, very simply, it tracks the average payable rate in a unit. For properties that are willing to “set it and forget it”, this approach will provide an adequate basis for rotation, as long as the basic room selection procedures are followed.
The other is called “Posted Revenue with Zero Rated Room”, a long name that still doesn’t do justice to the array of configurable controls on offer. If you can’t already tell, I am particularly partial to this format and, in the next post, I’ll tell you why it is the best option for most owner properties.
