There are several revenue streams hospitality companies must manage, from reservation transactions, upgrades, room service, food and beverage sales, spa appointments and more. Without an automated way to view, track and analyze these data, a general manager and revenue management professionals have no clear sense of how operations are going and where to cut costs.
Accounting software for hospitality helps corral all the incoming financial data into one system and offers a dashboard view to see operations at a glance. In addition to assisting with the daily tasks of reservation and room service transactions, software gives managers tools to handle back office financial duties, like maintenance, payroll, food and housekeeping costs.
Reporting capabilities turn these data into actionable insights; see where your property drives the most revenue, find out which service areas are dragging or reveal which maintenance tasks are eating into your bottom line.
This guide will help software seekers determine which features they need to reach organizational goals. We’ll discuss:
What Is Hospitality Accounting Software?
Common Features of Hotel and Hospitality Accounting Software
Top Hotel Accounting KPIs
Evaluating Hospitality, Hotel and Restaurant Accounting Software
What Is Hospitality Accounting Software?
With huge turnover rates of customers, the hospitality industry, including hotels and restaurants, process a lot of data. Software designed specifically for hotels and restaurants, in addition to standard accounting functions, will accept and process reservations and include other features to manage daily operations, such as labor scheduling, food cost control and billing customers based on room charges and additional services.
We've written this guide to help guide hospitality professionals as they research solutions. We'll cover functionality specific to the hospitality industry, as well as best practices for evaluating these systems.
Common Features of Hotel and Hospitality Accounting Software
Hospitality and hotel accounting systems will include the following industry-specific features:
| Reservations |
Whether online, over the phone or both, managing reservations is one of the foremost functions of software for the hospitality industry. Tying directly to your website, the accounting and reservations functions should be integrated so that deposits and payments can go directly into the system once the reservation has been made. |
| Customer relationship management |
Particularly in the hospitality industry, it’s crucial to turn every lead into a sale. Hospitality software manages leads from initial contact to final reservation, and stores customer (or potential customer) data for future marketing campaigns. The more robust systems for hotels and resorts expand this into “tour management,” offering the user an online tour. |
| Daily operations |
Front desk, concierge, room charges, housekeeping, security, special events, facilities maintenance and all the other aspects of managing the hotel should integrate seamlessly with the accounting functions. This enables costs and revenues to be tied directly to the relevant department. |
| Labor scheduling |
For most hospitality companies, labor is the number one expense. Scheduling systems offers basic graphs, and advanced programs can even create those schedules for you based on sales trends, history and employee availability. Helping managers streamline operations, this feature can also cut labor costs by scheduling employees based on fluctuations in activity, contain overtime costs, ensure the best employees are serving at peak times and facilitate scheduling of routine tasks during lulls. |
| Food cost control |
One of a restaurant’s largest controllable expenses is the cost of the food. Certain restaurant management programs help control food costs by identifying variances in actual versus ideal food usage, excessive waste, theft, margins and other inefficiencies. They may also include budget & forecasting capabilities to support the decision-making for menu changes, specials or promotions. |
| Reporting |
Data is gathered as transactions are processed through the system. Users can then generate reports that show revenues and expenditures, as well as average daily rates and occupancy levels. Looking at historical information, you can reveal seasonal trends in bookings and optimize rates. View reports in a list format or in a graphical chart. |
Top Hotel Accounting KPIs
The hospitality industry relies on specific key performance indicators to ensure that room rates are optimized and the hotel is earning maximum revenue per square foot. Some of these KPIs include:
- RevPAR: Revenue per available room, calculated by dividing total room revenue by number of rooms (for a particular period of time).
- TRevPAR: Total revenue per available room, calculated by dividing the total revenue of an entire property by the total available rooms. Because hotels also earn revenue from restaurants, conferences and other services, this KPI is often preferred by hotel accountants because it offers the overall financial health of a property.
- GOPPAR: Gross operating profit per available room, calculated by dividing the gross profits by the number of rooms. This offers an even more realistic view by factoring in operational costs instead of just revenues.
- REVPAM: Revenue per available square meter, calculated by dividing the total revenue by the available banquet or conference space. This offers a view of space utilization.
- REVPASH: Revenue per available seat hour, calculated by dividing the total restaurant revenues by the available seats multiplied by opening hours. This can be used to calculate revenues per hour of on-property bars or cafes as well.
Many hotel accounting systems are designed to help calculate these KPIs quickly and present them in an accounting dashboard. Evaluate a system’s reporting capabilities to find one that can offer the most comprehensive view of financial operations so you can focus on reducing costs.
Evaluating Hospitality, Hotel and Restaurant Accounting Software
The challenge in finding software today is to locate a program that offers a solution that deals specifically with your company’s needs. Resorts, hotels and restaurants all have different challenges that need to be addressed. A fine dining establishment will have different needs than a fast food joint.
Specific questions to ask when these systems are:
- Do you need reservation capabilities? Will this need to be integrated into your website?
- About how many employees do you have to schedule, and how many shifts need to be covered?
- What kind of customer data are you looking to collect? Does the software store that data? How many records will it let you have?
- Are your frontline employees using the software in day-to-day operations?
