Property Management System

Property Management System is one of the most important function of the hotel’s organization. The basic objective of this software is to help the management in coordinating the functioning of various departments of the hotel like Front Office, Sales, Planning, Accounts, Banquets, Material Management, and HR etc.

This is the location where all the information regarding the guest is stored, including the preferences of the guest and his past records of stay at the hotel. In Institute of Hotel Management, Aurangabad, we have a module fully dedicated to the property management system, and it is one of the important module for the students who will be the future front office associate. This module focuses on both the aspects of learning i.e. theory and practical giving opportunity to make our concepts & their applications clear and perfect. The role plays & case studies done during the practical sessions give us advantage of better understanding the concepts. The theory sessions are more of interactive nature, wherein the students explain a topic by giving examples.

In our module we have covered topics ranging from handling different categories of guest to making reservations. The role plays done during the training help to attend to the guests who come from different walks of life and have different nature (snobbish, introvert, emotional & sentimental etc.) and different temperament. The role play activity is application of theoretical learning into practice.

When we talk about the front office operations, we not only talk about the front desk but also the operations that takes place like doing the reservations, checking the identification documents and other arrival processes It is important to give attention to the smallest details like guest preferences, is he a frequent visitor or new guest. It is important that the guest preference is considered while making reservations as this gives a personal touch to the automated process, irrespective whether he is coming for the first time or a frequent guest. PMS will support this requirement by providing the necessary information Online. It is also important to be in touch with the Guest Relations Executive, as he/ she will be the person who will have all the details regarding the guest. The coordination between the two departments is very important as the chances of errors are reduced and the guest stay is smooth and without any hindrance. Whenever the guest reserves a room in the hotel he looks forward for a pleasant stay and that pleasant stay can only be provided if there is coordination between the front office and the guest relations executive.

We also did an article review on “An Investigation of Data Management and Property Management Systems in Hotels”. This article basically dealt with various aspects of usage of PMS Software like the level, major issues / difficulties faced etc. We observed that there as different software for each department in addition to Front Office. The article also shed light on the usefulness of PMS software in other departments.

The information or data collected by the hotels are both customer related and operational data for all the functions and is almost around 90% of the total data collection. The functionality of the PMS Software varies with the size of the hotel, bigger the hotel chains, more the functionalities. It can be stated that 4 star / 5 star hotels make the maximum use of PMS software as compared to the other lower end hotels.

PMS software also serves other departments some of which are explained below:

Sales Department: calculating the Occupancy Rate by month of the hotel for the sales department by each month, by season and on other various basis. This helps the Sales Dept. to project the business for the future etc.

Accounts Department: recording revenue room booked with rate of booking), collection, provide details of accounts receivable by month, by region (in case of multi locational hotel)

Stores Department: It provides details of the inventory by each room and its consumption etc.

Front Office: It provides preferences of the guest, best available rooms and rates for the repeated guest. PMS makes it easier to coordinate between the different departments regarding the rooms available or not, the guest preferences during his stay at the hotel. It also gives details regarding type of room booked and the rate of booking.

Once the guest has made reservations in the hotel, his or her profiles remains with the hotel and is provided to all branch hotels across the world. The profile is in the hotel’s security custody. The billing instruction preferred by the guest are also recorded in the PMS Software.

PMS software provides the occupancy rate. It tells us about how many rooms are occupied and how many are rooms under service or under renovation and approximately how much time will it take to make it available for the guest to stay.

During one of the sessions we learned about the upgrading process. This was a case study and the question was to whom will you provide the upgraded room and why. The upgrading of room will be provided to the guest will be for a short period of time. The logic underlying is that the guest who is there for short period of time will generate more revenue than the guest who is there for a longer period of time. Further, the room which is upgraded can be used by the next guest for his stay. The guest who is long stay will not be upgraded because the room will be occupied for a number of days and that room will generate less revenue as compared to the upgraded room occupied by the guest who is in the hotel for a short duration.

We were also required to prepare the reservation card for it. By preparing this card we got clarity about the whole reservation process. We also learned about the various taxes which are applied to a guest. The rate of these taxes varies from state to state. This was again a group activity and each group was asked to find the taxes which are applicable to the hotel services. By doing this activity we not only learned about the types of taxes but also where they are applied and by what percentage. The taxes applied are varied, ranging from service tax to entertainment tax. The entertainment tax is charged when there is a cultural program arranged by the hotel or during any event such as New Year’s Party or any such event when there are any program organized by the hotel. This tax comes under the scope of state government. Similarly luxury tax is applicable to the stay charges and not on the food charges. It is statutory in nature and is applied by the different states on the stay charges. We got to know about the application of VAT (Value Added Tax) and Service Tax and the logic behind it. We are charged service tax when we avail the services provided by the hotel such as room rentals, restaurant services, club membership, renting a cab service, health club or spa and money exchanging services. This is a centralized tax and the rate at which room is charged is 8.40%. VAT is charged on the following sectors in the hotel namely food and beverage, both are charged by different rates and also on liquor. After this we got more clarity about the tax structure and its applicability.

We did many case studies and during one such study we came across the terms ARR, RevPAR, OOO or Out Of Order, OOS meaning Out Of Service and In-House guest and Complimentary guest. ARR (Average Room per Revenue) which is calculated as Total Room Revenue upon Total Rooms Sold. This will tell us the average rooms sold and help us to calculate the budget. OOO or Out of Order are those rooms where either the maintenance is heavy or the room is under renovations. OOS, Out Of Service are those rooms where the maintenance is very less, i.e., when the AC is not working or the bathroom taps are not working properly, then these room comes the category of Out Of Service and can be fixed within a day. Whereas the rooms under the category of OOO (Out Of Order) can be of minimum night and maximum a week also. We also learned about the Occupancy Percentage, which will tell us about how many rooms have been occupied and is calculated as total rooms occupied upon available rooms and multiplied by 100. This will give us an approx. rate of many rooms have been occupied.

To make it more clear, we critically thought about various areas where ARR, RevPAR affects. These can be discussed as follows:

1. As stated above, ARR (Average Room Revenue), while calculating we do not include complimentary and in-house guests. ARR means rooms which generate revenue, are taken into consideration, whereas the complimentary and in-house guest does occupy the room but do not contribute to revenue of the hotel.

2. While going through the case study, we also understood why complimentary and in-house guest are also not taken into consideration while calculating RevPAR. The reason being that RevPAR means Revenue Per Available Room. Therefore complimentary and in-house guest do occupy the room but do not generate revenue. Since RevPAR is basically about the rooms which will generate revenue and not about how many rooms are occupied.

It is important to note that In House guests should not be considered for computing OR (Occupancy Rate). The reason being, the in-house guest will not be included as these guest will not be generating revenue and will affect only the rooms occupied.

When we talk about the IT skills which are relevant to PMS, we take into consideration the mails exchanged during the reservation process, recording & retrieval of data for use by different departments. The data for recording would include mails for reservations & confirmation of room rates, dates of arrival & departure, mode of payment such as cash, credit, B2C (Billing to Company) and vouchers. The mails we exchanged for the process of reservations were FTI, Company, Travel Agent, Group and also for Long stay and Event. FTI (For Individual Traveler) was our first reservation mail that took place. Company and Group reservations were second and more detailed reservation process and for these we had to prepare profiles also. The profiles included the name of the organization and its contact details. After that the reservation mail which we exchanged was for Long stay. In this particularly mail exchange process, we had more clarity about what should be included and what details regarding the guest preferences should be made. The last reservation mail was about an event and was a group reservation.

There are many PMS Software available in the market such as Innroad, Inquest, WebRezPro, Frontdesk Anywher, Guest Point, RMS, and Room Key PMS Etc.

It is one of the important pillar of management of any hotel.