At What Point Do I Need a Channel Manager?

Have you recently started a hospitality business or are thinking of getting into serviced accommodation in the near future? No matter how large or small your vacation rental business, you may still be doing things manually or linking channel calendars up to each other via iCal. You may have heard of channel managers or PMSes. However, you may not be sure about why they are needed. Perhaps you’ve already done your research, but now are left with one burning question. At what point do I need a channel manager? Do I get one before starting my business? If I’m running one unit, do I wait until I have 5? Hopefully the points raised in this article will help you make up your mind.

What is a channel manager or PMS and why do I need one?

In brief, they are pieces of software which, either on their own or in conjunction with each other, allow you to automate parts of your business. They help you distribute your rates and availability to multiple OTAs or listings sites such as Airbnb and Booking.com. Some of them, like Zeevou, also provide you with a website for direct bookings and a whole host of other useful features.

Do I need a channel manager?

If you are serious about running a successful hospitality business, the question is probably not whether or not your need a channel manager, but at what stage you need one. We frequently get asked this question by people who are just starting off or who are only managing a handful of units. Of course, it is possible to do without one. Perhaps, you could even be led into thinking that you can just save the amount it would cost you each month to pay for one.

Once you start reseraching channel managers, it will soon become clear that at some point or other you probably want to start using one, the question is when. It might seem a good idea to minimise your costs as you start off and leave signing up with one until further down the line, however both in the short run and in the long run, that could end up costing you a lot more.

At what point do I need a channel manager?

We recommend you sign up for a channel manager from the word go. Yes, you can manage without one. However, there are a few reasons why you should not wait before you choose one:

1. If not now, when?

When are you going to draw the line and convince yourself to invest in your business? It’s likely to be one of the smallest investments you make, but could be one of the most rewarding ones if done right. The argument that you’ve only got one apartment doesn’t stand. Why is 2 any different than one? Or 3 any different to 2? Does anything change at 5, 10, 50, or 100? The only time there’s a marked change is when you go from 0 to 1! And if you’re thinking that it will be worth your while whenever you need a VA and can save on your VA costs by getting a software, then you’re suggesting that your time is worth less than that of a VA up to that point, which is most definitely not the case.

2. Get direct bookings from the start.

One of the aspects of your business that you need to pay sufficient attention to is getting direct bookings. Many channel managers will provide you a booking widget to add to your own website, some will even provide you a full website with an integrated booking engine. This means you’ll be able to save on commission fees. It will also help you get on the ladder of search engines immediately. The savings can far outweigh the cost of your channel manager. Make sure to ask the channel managers or PMSes that you are considering how good their direct booking website actually is. Is it SEO optimised? Does it have rich snippets built in? Can you specify your own keywords and other meta data? Are you able to run a blog off it? How about adding custom pages?

3. Keep your data clean.

The other thing that your channel manager or central reservation system (CRS) is likely to become, is your main database. It will containt all your guest data and contact information. You want to make sure that you have all your booking data in one system too. Doing so will allow you to run year-on-year reports in the future to analyse trends in your business. At the same time, you want to make sure that the channel manager you go with automates the collection of guests’ real email addresses. This will enable you to start building up your very own direct email marketing list from the word go. Check that the channel manager can also take care of GDPR opt-in/unsubscribe requirements for you.

Data migration between channel managers is extremely difficult as most providers only allow you to export a very limited amount of information if you’re trying to leave them. Hence, it is even more important to pay great attention to choosing who you decide to go with from the start. This will ensure that you can build your business on a safe base. It will give you confidence that the information that you are gathering is systematised and won’t be lost in the long-run.

How do I decide which provider is the right one for me?

If you’ve decided to start using a hospitality management software, make sure to look into every claim in detail. This way you can ensure that it does what it says on the tin the way you want it to. Check their full feature list. Try to find out how dynamic they are in releasing new features and keeping up with the times.

Figure out how much time using one is going to save you. Calculate how much you are going to be able to save in OTA commissions. Finally, look at their pricing. See if it makes sense as good value per money, rather than absolute cost. Make sure you get yourself the best channel manager out there for your needs. You don’t want to regret it further down the line! (For a full blog post on what the difference is between a PMS and a channel manager, and how to choose one, click here.)

Should you need any help in choosing a channel manager that suits your needs, drop us a line and a member of our team will be happy to guide you.

Grow your serviced accommodation business. Keep hold of your cash and spread the cost of refurbishing your Serviced Accommodation.

1. Cash is King but why not to use someone else’s money instead and grow Grow your serviced accommodation business.

As the saying goes, “Cash is King”. If your serviced accommodation business runs out of cash you can’t pay your costs , wages or bills and can’t grow youe services business accomodation, it won’t be long before you have to stop trading. When it comes to buying the goods and equipment your business needs to operate. some people still work under the policy of “if you can’t afford it, don’t buy it”, which is one way of doing things.

Another school of thought is this – why would you spend your cash reserves on refurbishing your property, when :

a)the goods depreciate rapidly, meaning the value of your assets reduces the second you pay for them.

b) you can use someone else’s money instead. 

Yes you do have to pay interest on the money you borrow, but you will keep hold of your cash which you can use to invest in other parts of your business that are going to give you a bigger return. you will have a pot of valuable cash in case of any slow periods or for a rainy day.

Here’s how it works in practice and grow your serviced accommodation business – you could either spend £50k of your cash refurbishing a property paying for furniture, kitchen goods, carpets and soft furnishings; OR you could put the refurbishment on a 5 year finance agreement, such as a Lease, Hire Purchase which isn’t secured against the property, and use the £50k cash as a deposit to buy another property with, meaning you would then double your income.

How long would you have to wait for a second property by taking the profits from just having one? Having the ability to use a separate finance facility which is not linked to the property or its mortgage, allows you to free up the cash you would have spent fitting it out, otherwise.

2. Try Alternatives and grow your serviced accommodation business.

In the last 20 years, there has been a gradual rise in the “Alternative” finance market. You may see the occasional TV advert or Facebook post but in general most of the lenders behind this movement have chosen to go under the radar. They don’t advertise in the news, radio or on TV, and they don’t spend large amount marketing on social media on the internet. This is because they have a ready-made group of people to bring business to them – Brokers.

And so why would they spend money on advertising when they don’t need to? Brokers are not directly employed by the lenders – they don’t need to have an employment contract and don’t need to be paid a pension. More and more lenders have come into the finance market in recent times and their first port of call is to announce their arrival to the broker market as they realise the benefit a broker can bring to a transaction.

They can pre-screen everything, collect the right information and deal with the customer every step of the way, whilst the lender sits and waits for all the correct information to arrive on their desk so they can come to a decision on whether to lend or not, and pay out the cash to the relevant parties, if they have given an approval.

Since the financial crisis of 2008/9, we have seen the major High Street banks pull back from lending to Small to Medium Sized Businesses (SME’s) in the UK. In some cases they are paying Challenger Banks to take customers of their hands – perhaps they became too big? There was too much risk lending to all of these SME’s for low-value assets, and for unsecured loans.

In many cases, the High Street Banks are now taking a month to come back with an answer or initial feedback on a loan application before asking for more information and coming back in another few weeks with a decline or an acceptance with onerous conditions, which is basically the Bank saying it’s a decline but they’ll do the finance if you accept something crazy – it’s a tactic used to let businesses down gently without saying a direct “No”.

Quite often the acceptance conditions make the finance “approval” completely untenable. I know this through first-hand experience, as many of my customers have been through exactly that experience. And in the main, I have benefitted from the High Street Bank’s lack of appetite with these clients. They are happy lending against Cars and Machinery, which have a decent resale value, but anything outside of that is not given much of a chance.

In the Alternative finance market there a number of specialist lenders that will finance low-value assets. They are willing to take the risk as there is a large market out there for customers looking to finance furniture, IT equipment, software, and the entire costs of a refurbishment/ fit-outs of a business premises.

The focus moves away from the asset that’s being financed, to the strength of the customer lending the money and their ability to repay the loan. This means an established SME trading for 3 years or more can get funding at reasonable rates, not too distant from the banks rates, with a decision in roughly 1 working day. That’s a far cry from the month you wait with a bank. And what’s more is the broker doesn’t charge a fee to the Business borrowing the money – we take our fee from the Lender. So it’s a win-win-win for everyone. The lender gets the loan, the broker gets paid for sourcing the loan at the best rates possible, and more importantly, the business / customer gets the finance for the refurbishment and keeps hold of its cash.

This offering can also be extended to Start-Up companies and let them grow their serviced accommodation business – those business trading between 0 and 3 year. Once you have filed 2 sets of Annual Accounts at Companies House it is generally considered that you are no longer a start-up business, in the eyes of the underwriters at least. There are however some differences – interest rates for start-ups are higher because of the perceived extra risk to lend to them – there is no trading history and therefore no historic data to base a finance decision on.

On top of this, the lenders will always ask for Personal Guarantees from the Directors, and they will need to be home-owners, to show there is some wealth sat behind them. As mentioned before, the finance is not secured against a property so just because they want the Directors to be homeowners, there is no direct link between the refurbishment finance and the Director’s properties, on the Personal Guarantee. All it states is this – should the business not be able to make the finance payments for whatever reason, the Directors will cover them with their own wealth.

The process to get a decision on the finance is a straight forward one. At first we provide our clients with a quote that can have as many options as they want – Lease, Hire Purchase or Unsecured Loan; anything up to 5 years. The goods being financed can be anything you buy for your business. If you want to go ahead and grow your serviced accommodation business, we ask for some basic financial information – generally a full set of Annual Accounts and some up-to date trading figures for the current trading year, if available.

If it’s a new start business, we will want a business plan with financial projections and maybe some bank statements. We will then write our proposal our present it to the underwriters with the best interest rates – we will always go to the lender with the lowest rates, first. If we get a decline, we can go to another lender, if it’s approved we can then write the finance agreement for you to sign. Then we will get an invoice from the supplier of the refurbishment goods – these invoices will only be paid with your authority.

The day they are paid your monthly payments begin. If it’s an unsecured loan, the cash will go directly to your business account and you will pay the suppliers yourself – but remember Unsecured Loans will always require Personal Guarantees from the Directors; whereas Lease & Hire Purchase generally don’t. This will all come down to each individual case and the financial strength of your business, and the view of the Underwriters, but it’s not a pre-requisite with a HP or Lease, like it is with an Unsecured business loan. 

If you would like to discuss financing the refurbishment of your Serviced Accommodation, Property Developments, Hotels, Offices, Pub, Café, Restaurant or any other types of business, feel free to get in touch. We have a panel of over 70 lenders to finance all types of equipment, and another panel of over 130 lenders for all forms of Property Finance.

I hope to hear from you soon

Best regards,

Billy Walker

Managing Director

Source Asset Finance Ltd

M: 07956 045421

T: 020 3816 0396

E: billy@sourcefinanceuk.com

W: www.sourcefinanceuk.com

This is a guest blog post for zeevou’s Blog.

Which 5 Sites Bring The Most Bookings?

Which 5 sites bring the most bookings is a question that is often asked and discussed within hospitality circles. Any hospitality owner will be aware of the importance of driving their direct bookings. At the same time, it is common knowledge that it is not sufficient to only count on them. Almost no short term accommodation provider can survive without advertising their offering on Online Travel Aggregators (OTAs).

The detailed breakdown of actual figures depends heavily on where you are located and who your target market is. However, below is a rough guide as to which sites will get you the largest number of bookings flowing through (ranked alphabetically rather than in order of importance):

1. Agoda

Agoda is Asia’s largest online travel agency, so it’s sure to bring you some good bookings. The number of bookings you receive may not be as high as some of the others on this list. However, its customers generally seem to be happy to pay high price tags for properties that they like. Hopefully this will land you the odd high-value booking!

List your property on Agoda by clicking here.


2. Airbnb

Airbnb is a very large listing site based in the USA. It started off as Airbed And Breakfast (the idea being that you could rent out spare rooms in your home to travellers. The site has quickly grown to become one of the largest listing sites for entire homes. It is very popular with tourists and travellers. More recently, Airbnb has been attempting to cater to business guests. It has also launched Airbnb Plus, a hand-picked list of curated homes.

List your property on Airbnb by clicking here.


3. Booking.com

Booking.com is a relatively young company, and it has grown aggressively over the past few years and is now the leading booking site for hotels and alternative accommodation providers such as holiday homes, vacation rentals and serviced apartments in Europe. Most channel managers and property management systems link to Booking.com. It can bring a large amount of bookings with a healthy mix of leisure and corporate customers.

List your property on Booking.com by clicking here and get 5 commission-free bookings!


4. Ctrip

Ctrip is probably the least well-known out of this list of sites. It is China’s largest online travel agency, so if you list on here make sure to try and cater to things that Chinese guests may find appealing. Top tips include providing slippers and pot noodles. Make sure to take a close-up photo of a pot noodle and add it to your listing. If you’re ready to tackle this massive market and are up for a challenge in how to attract a larger number of guests, you want to look into this.

List your property on Ctrip by clicking here.


5. Expedia

Expedia is a massive group that owns dozens of other sites, and distributes your inventory across all of them. This site can help you attract a fair amount of corporate clients. However, as there are often many systems involved in the distribution of inventory and retrieval of bookings, it is not always easy to make contact with the guest booking the accommodation ahead of time, so if there is no reception at the property, you need to spend some more time and energy in trying to make contact with the guest through Expedia once you get a booking.

List your property with Expedia by clicking here.


Note: Some of the above sites manage payments and security deposits for hosts, others manage them partly or not at all. If you wish to automate the distribution of your rates and availability, retrieval of bookings and processing of payments, security deposits, communications, and guest vetting, you may wish to take a look at Zeevou Book‘s 5-Step Booking Confirmation Process.

Which 5 Sites Bring The Most Bookings? Is Yours One Of Them?

In this article we have been talking about 5 OTAs and large listing sites where you should be advertising your properties. This will help you increase your occupancy levels for your short term rental. However, the number one site that you should be focusing on is your own website. Promoting this correctly will help you drive direct, commission-free bookings. Many softwares for Serviced Accommodation operators or Guesthouse/B&B owners will automatically generate a website for you (for example, take a look at Zeevou Show).

Always Book Direct

However, not every provider will give you a website that is good enough to rank highly on search engines such as Google. Moreover, it will not necessarily provide a good booking engine. You should be looking for one that allows you to offer promotions or voucher codes for direct bookings. You may be unhappy with what your channel manager or property management system currently has on offer. If this is the case, take a look at the Boostly Websites. Furthermore, Boostly allows you to easily set up your own #bookdirect website which will attract the attention of bots and humans alike. Finally, it allows you to link that up to your booking engine to convert interested visitors to your site into paying guests.

NB: If you’re looking for a hands-off solution, then you may wish to enquire about the Boostly Done For You Websites. If you’d like to find out more about this service, which includes a free marketing review, fill in this form and a member of Boostly will reach out to book in the job and explain the process.

Startup Grind Shortlists Zeevou for European Conference

Startup Grind Shortlists Zeevou

Startup Grind has shortlisted Zeevou. As a result, it is amongst only 100 companies that can exhibit at the European Conference. This will take place on June 6th 2019 in London, UK. This acknowledges Zeevou as one of the most promising start-ups from over 1000 entries.

About Startup Grind

At the Startup Grind Europe Conference over 3,000 startups, investors, and innovators will converge in London for discussions around the future of startups, venture capital, artificial intelligence, fintech, and more.


https://www.startupgrind.com/europe/

Startup Grind is a global startup community designed to educate, inspire, and connect entrepreneurs. Most importantly, Google for Entrepreneurs powers the program. Na’ím Anís Peymán, Chief Revolutionary at Zeevou said:

Comment from Zeevou

Na’ím Anís Peymán, Chief Revolutionary at Zeevou


It is very encouraging that they selected us as one of the most promising European Startups of 2019. Noteworthily, this happened before our website was even up and running! Both this shortlisting and the feedback that potential users have provided indicate that our product is truly world class. We believe that we will be able to disrupt the hospitality industry.

What is Zeevou?

Zeevou is a highly innovative property management system which also offers a channel manager as part of the package. The resulting product is a centralised hospitality management hub. It allows managers of short term rentals and owners of hospitality businesses to automate their processes. This allows them to grow their business while minimising additional staffing costs.

Moreover, all packages provide a free website. This allows for commission-free direct bookings as a bonus. Finally, Zeevou Direct acts as a centralised booking platform for all Zeevou Hosts. Thus, they can advertise at a discounted rate through what is effectively an online travel agency (OTA). Hence, they can ensure that they do not fall foul of rate parity regulations. At the same time they can offer discounts for direct bookings.