Many hotels innovate faster than ever. They are embracing AI‑driven pricing, hybrid spaces, and even membership models. Some people feel “stuck”, relying on their instincts rather than data. It’s something I see almost every week: hotels without a revenue management system or financial models. Some of these properties are in great locations. Some even provide a decent service. They may look like they are operating in 1995, but their bottom line is a reflection of that. At the end of it all, those who fail to evolve become nothing more than an opportunity for competitors eager to grow.
This is a staggering lag. According to a 2023 analysis by HotelExecutiveIn 2022 less than one third of hotels used revenue management software, and about 10% adopted advanced pricing methods. This means that nearly nine of ten hotels left money on the tables. This is a large amount of money. The adoption of RMS will easily result in an increase of RevPAR between 5% and 20%.
Financial planning is no different. Hotels often operate without rolling forecasts or detailed budgets, which leaves them vulnerable when costs or demand rise. Research by Boston University’s School of Hospitality Shows distressed hotel sales are often sold at discounts of 30 to 42 percent compared to healthy transactions. This value erosion could be avoided with financial discipline. Rolling forecasts and monthly re‑forecasts, which should be standard, are still rare in independent hotels and even in some smaller or family-managed hotel groups.
In many cases, these problems are accompanied by a lack of scale. We find that properties with just 20 or 30 key rooms have nearly the same cost as those with 60 or 50 rooms. This is particularly true when it concerns core staffing such as front office and housekeeping leadership. Their cost per occupied bedroom skyrockets without scale. Without the right revenue models and expense models, these inefficiencies are not noticed until profits disappear.
Similar stories are told by operations. According to CBRE’s report on 2025 trends in the hotel industry, labor alone accounts for 30 to 50 percent of hotel costs. Yet many properties still rely upon static schedules and manual supervision. I’ve seen hotels with overstaffed housekeepers on slow days and understaffed front desks on busy days. Inefficiency can snowball when energy is not monitored and rates are not negotiated. Hotels that invest into workforce optimization software and energy management systems can save money without compromising their service. Service usually improves.
These problems are easy to solve and offer a huge opportunity for transformation. Modernizing revenue strategy, implementing financial controls and instilling excellence in operations can turn a hotel that is underperforming into a leader on the market. The gap between a hotel that is “stuck” today and what it can be in 12-18 months is astounding.
The winners of today and tomorrow will be those who turn data into action, build agile teams, and invest in smarter system. The clock is ticking for the rest.
Tiago Castro
COO at Wotels
Wotels
