4 Hospitality Business Challenges And How To Solve Them
Managing finances can be complex and, as we all know, comes with its own set of unique challenges. Challenges that typically arrive during a point in the year when time is short, resources are low, and owners/managers are already stretched thin.
In this month’s blog, we’re going to discuss four of the most common challenges that businesses face when it comes to finance and accounting and go over some helpful tips on how to solve them.
Enterprise Resource Planning
In a perfect world, every growing hospitality business could build its own enterprise back-office system to manage the financial aspects of their business. Often different stakeholders have a variety of different expectations and timelines. So the real challenge becomes how management can implement affordable and scalable solutions, without spending a fortune and meeting all of the owner’s expectations.
The solution? Partner up.
There are so many options available now in hospitality-specific technology. By tapping into month-to-month subscriptions, any business, whether it’s a single location owner or a large scale portfolio, can utilise the best accounting and finance technology on the market at a fraction of the cost of ownership.
One of the many perks of these solutions is that they’re built for minimal ramp-up and training because the functionality and language of the system is already in “hospitality-speak.” This includes formulas for revenue per hour and per cover, average daily rate and so on. By adopting solutions that are developed by hospitality experts, you’re able to give yourself – and your business – a huge leg up.
Sometimes it can feel as though hospitality businesses have an endless list of employees. Front desk staff, housekeeping, security, management staff, and so on. These people can be part-time, full time, or work at multiple locations. And to top it off, your staffing requirements may vary from day to day depending on demand. The challenge is how you can meet the labour demands of the highs, without overstaffing for the lows, and stay within your budget.
The solution? Real-time labour monitoring.
In hospitality, you must establish and maintain a balance between monitoring daily/weekly labour costs, managing overtime, overseeing daily payroll transactions and accessing simple reporting functions. With the help of cloud-based reporting tools, you can oversee the monitoring and management process and utilize the on-demand management of earnings to manage transactions in real-time. By adopting a solution that incorporates job standards, as well as budgets, this allows you to ensure that proper staffing is in place based on the previous cyclical changes and circumstances.
You likely have full access to a whole host of data sets – sales variance reports, location management system data, guest satisfaction surveys, comments and financial data from multiple properties just to name a few. But with so much data at your fingertips, you may encounter a bit of “analysis paralysis” when trying to sift through it all. With the industry constantly claiming it must have data, the challenge then becomes how to best decipher that data to determine the story being told and then how to read the story to best react.
The solution: A centralised platform.
Save yourself time (and a lot of headaches) by utilising an easy-to-use operational management dashboard and mobile platform. It’s important to have a business intelligence and analytics tool in place when you’re trying to manage an overload of data. This will help you recognise where efficiencies can be improved and where you can reduce expenses. By using an operations management platform, you can import data into a centralized dashboard and identify trends so that you’re able to make informed decisions.
Every hospitality business has a seemingly endless and ever-growing to-do list. Everything from guest services, sales, operations, financial management, accounting, cash management, asset management, balance sheet performance, maintenance— how does anyone find the time to get it all done? How are you supposed to focus on the core competencies that drive revenue if there are so many irons in the fire that require your attention?
The solution: Outsource it.
You cannot be all things to all people. (But we applaud you for trying!) As you look over your core competencies, mitigate the events of natural disasters, minimise turnover and training fees and right-size your organisations — outsourcing certain functions of your business can be a lifesaver — and hospitality accounting is no exception.
Outsourcing your business’s accounting and bookkeeping needs can be an efficient and cost-effective solution in many cases. In some cases this many only apply to certain duties or time frames but, for others, it may require a comprehensive and permanent solution.
If you’ve been considering outsourcing your bookkeeping and accounting management, why not give the professionals at Solve a call? Book a free business review to see how we can help your business. As always, there is absolutely no obligation. We always appreciate another business learning about Solve and what we offer our clients. Email firstname.lastname@example.org to book your review today!