Budgeting and Forecasting for Covid-19 Reality

The word budget often strikes fear into the most seasoned hoteliers’ heart but when you mention budget in our current trading environment many of us are simply unsure of what steps we should take in shaping a budget framework for the year ahead.

One thing we know for sure and common to all business’s not alone tourism and hospitality is the need to build in greater agility and reaction to market changes amid ongoing uncertainty. Where we find ourselves, may also be an opportunity for us to approach this exercise with greater energy, generate bolder discussions and work in a more innovative way to deliver what will be your revenue road map for 2021.

In doing so you might consider following :

Lead time is starting to lengthen for many of you and this in itself will allow you to forecast further in greater detail as some trends emerge.

Rolling forecasts are becoming a norm for all businesses for the future or at least until more certainty comes into the market – Consider how you might set the frequency of your rolling forecast, taking account of your lead time will have an influence on this.

Consider creating a suite of sensitivity analysis to stress test minimum performance requirements to ensure breakeven- know in granular detail how many rooms you need to sell each night

Have you reengineered your segmentation to reflect the segments that are now booking? Once you start to understand our new guest behaviour you can then plan your demand generation activity for those segments.

Review what has worked for you during since you reopened? In terms of pricing and or sales volume? Remember to align your rooms budget or rolling forecast against your sales and marketing activities – make sure you place your resources (human and monetary) to the areas where you will see the best return and which is in line with your segmentation goals.

If you would like to have a chat about paving your hotel’s budget/forecast for 2021 give us a call +353 87 2432145 or drop us a line sales@theinnovateroom.ie


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