‘Set and forget’ pricing is still common in independent hotels — and it’s quietly costing many of them revenue. Rates get set at the start of the season, tweaked now and then, and mostly left alone. Perhaps there’s a local festival happening, or a film crew comes through needing some rooms, so prices get put up, but overall the rate strategy is largely static. It’s feels efficient, but in reality, it’s one of the easiest ways to lose revenue.

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Why set and forget pricing doesn’t work in hotels anymore

While it would have been ok a few years ago, so much has changed that now it’s just a surefire way to to leak money. Guest behaviour has changed. People book later, they shop around and compare more, they book rooms to keep their options open then cancel while still within the cancellation window. Meanwhile, your competitors are monitoring demand and adjusting prices daily. If your rates stay the same, you can quickly fall out of step.

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Where the money leaks away

Pricing isn’t just a question of being too cheap or too expensive, but also of being and in and out time. For instances, selling too cheaply when demand is strong or holding prices too high when demand is weak. Or, missing spikes around events or busy periods.

Individually, none of these things will materially affect your year-end. But over time, the cost of these missed opportunities accumulate.

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The tyranny of a full calendar

If we take occupancy as our key metric then on the face of it a full calendar looks like success. But if you sold your rooms too cheaply, then all you’ve done is fill space — not maximised revenue. We see this a lot: good occupancy = lower-than-expected revenue

Plus, what about the additional housekeeping costs of servicing and changing rooms. Is occupancy really that helpful a metric?

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What better pricing looks like

Rather than constant tweaking I would advocate for paying attention: review your pricing regularly, watch how quickly rooms are selling, adjust when things are clearly too fast or too slow

That’s it!

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A simple blueprint

Take 10 minutes once a week and review the next 30–60 days.

• Filling quickly? You’re probably too cheap. Is anything happening locally? What are your competitors doing on Expedia and Booking.com?
• Not moving? You may be too expensive. Again, what’s happening?

This small habit can make a noticeable difference, and hopefully it will get you out of the cycle of raising or lowering prices at the last minute.

You should also think in terms of cause and effect. Sometimes, if occupancy is low and bookings are slow, the impuse can be to lower prices. But what about the guests that have already booked? The next thing you know you’ve had a rash of cancellations and rather than attract bookings you’ve driven them away!

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Want a quick sense-check?

If you’re not sure whether your pricing is working as hard as it could be, it’s worth a second look.

At B&B Consulting, we help hotels and accommodation providers:

• Improve pricing
• Increase direct bookings
• Build more reliable revenue

Get in touch for a quick chat, or download our free guide to get started.