This article was originally published as a blog post by AltexSoft. It is published here with permission.
What does a hotel business need to do to survive in a competitive market? At least two things: have an online presence that makes the reservation process easier and deliver outstanding customer service so that visitors returning to your area will choose your location again.
Automating daily operations and administrative tasks is an important part of achieving customer satisfaction as it helps provide reliable and quality service time after time. A hotel is a complex system that encompasses the activities of many departments, and every operation must be tracked. For this purpose, hoteliers utilise various tools including spreadsheets, paper forms, and unified property management systems.
In this article, we’ll talk about property management systems (PMSs) that handle reservations, front- and back-office operations, channel management, and more. You’ll learn about the main functions of PMSs, compare products available from different providers, and receive recommendations on how to choose the most suitable system for your hospitality business.
What is a property management system
A property management system (PMS) is software that facilitates a hotel’s reservation management and administrative tasks. The most important functions include front-desk operations, reservations, channel management, housekeeping, rate and occupancy management, and payment processing.
Although PMS software mostly controls reservation and financial transactions, it may allow you to manage housekeeping and perform human resources management as well. In general, PMS facilitates the main processes in a hotel related to internal and external operations.
The first hotel property management systems were introduced back in the 1970s. But, even today not every hotel has one. A report “Hotel Management Software BuyerView” by Software Advice shows that in 2015 only 34 percent of hotels used special software, while 25 percent still relied on pen and paper only to manage their hotels, and 16 percent had no hotel management system at all. The report is based on data from 385 owners of independent hotels, motels, inns, resorts, and other types of a hotel property in the US.
So, plenty of hotels still use Excel, a paper-and-pen format, or legacy software none of which fulfill the needs of a 21st century hotel. Legacy PMS software may perform just one function, require additional modules, or be too hard to integrate with other necessary hotel management software. Consequently, hotel owners are looking for a universal, one-and-done solution to manage all the processes.
Currently, hotel property management systems are used by big hotel chains, small hostels, and everything in between. With these systems, hotels can see the booking status of rooms and control reservations. However, their functionality doesn’t end here. Via PMS, hoteliers can manage back-office processes, food and beverage services, and track room occupation rates. Let’s take a closer look at the most common functions supported by PMS.
Main modules of property management systems
A modern property management system combines multiple work environments in a single piece of software. Depending on the provider, the combination of modules and functions can vary, and the functionality of one module can be slightly different. Here is the basic structure of a hotel PMS.
Keep in mind that it is hard to divide the functions of PMS into more and less important because all of them are necessary. However, regardless of a property type, hotel property management systems must have a reservation system with a website booking engine and front-desk operations module.
Other essential modules usually include channel management, revenue management, housekeeping, customer data management, report, and analytics. And big hotels or resorts certainly need point-of-sale (POS) services and back-office modules.
For a modern hotel business, online bookings are in most cases the main sales channel. The reservation module, which helps manage online bookings, effectively becomes indispensable to a property management system. A central reservation system (CRS) or any other reservation platform may be available as a separate module of PMS or implemented as a hotel’s separate internal solution.
A hotel reservation system holds all inventory data and dates, sending this information to the front desk. The reservation system must be integrated with the website booking engine and other distribution channels.
Chain hotels usually have one central reservation system for all properties, while independent hotels have their own reservation systems. If a hotel or a hotel chain already uses a particular reservation software, PMS must offer integration with the existing service.
Hotel property management systems: main functionailty
Key functions of the reservation module include:
- Room bookings. The system checks room availability and status, shows free rooms across different channels and the website booking engine. This function monitors double bookings and allows group reservations. Then it schedules bookings and displays information about current and upcoming bookings on a dashboard.
- Collection of e-payments, and identification of types and categories of payments that are processed via this module.
- Management of room inventory and allocation that prevents overbookings and duplication of bookings. In some software, this function is part of a channel management module.
- Reservation emails. The system sends confirmations to guests after they complete booking. In some PMSs, this function is a part of the front-desk operations module.
- Activities booking. Some software allows guests to book not only accommodation but also activities with this system.
A front-office module allows a front-desk manager to view and update room reservation status, check guests in and out, and process payments. When a guest arrives at the hotel, she wants to check in as fast as possible. Support from a receptionist is very important in this case, so front-desk staff should have time to help the guest.
Some property management systems offer integration into check-in kiosks or allow checking in or out via QR code. To get a better idea of check-in automation, have a look at how Marriott and other businesses leverage digital self-services in travel.
Using a front-desk module, the front-office manager should be able to access up-to-date information about all reservations, both current and upcoming. With the help of this module, room status should be updated quickly. The front-desk module allocates rooms automatically and facilitates a room change. This module includes management of electronic key cards, processing payments and issuing receipts to guests. The front-office module also allows users to perform night and shift audits.
Channel management software is a single interface to control and distribute inventories across different channels such as GDSs, OTAs, wholesalers, direct booking platforms, etc. A channel manager connects directly to a central reservation system that holds information about the availability and cost of hotel rooms, sharing this information via the distribution channels.
It makes room inventory available to travelers who want to book a room or property online, listing rooms on different sources. Also, a channel management module facilitates booking-related transactions.
Different distribution channels expose the inventory to different audiences. For example, connection to OTAs and some airline websites allow a larger number of potential guests to be reached, those who book flights or plan trips in advance.
Metasearch sites compare prices across different channels, letting a customer make the best decision. Connections to global distribution systems assist non-leisure traveler booking as well as group reservations.
Another channel of distribution is a website booking engine. An online booking engine allows travelers to complete reservations directly via a hotel website bypassing travel agents and OTAs. It’s important to allow loyal guests to book directly, and website booking must be available to those who find a hotel online. A booking engine must be synchronised with the hotel website and its central reservation system, making it an additional sales channel. Usually, this module processes payments via integrated payment gateways.
Such revenue indicators as Occupancy, RevPAR (Revenue per Available Customer), and ADR (Average Daily Rate) weigh heavily in evaluating a hotel’s financial success. While GDS and OTA integration helps maximise these rates, revenue management systems help a manager understand how to adjust the processes to achieve better results and control finances. This module helps increase total revenue of rooms using forecasting to optimise occupancy, deciding whether to raise or lower inventory prices.
The revenue management module enables dynamic pricing. Using algorithms, this module helps hotels price the rooms based on historical data about past reservations as it monitors competitors’ rates, weather data, and local events. It improves pricing strategies, and updates prices across all distribution channels to sell more rooms at the optimal rate.
To learn more about revenue management read this article on how machine learning redefines revenue management in the hotel industry.
Housekeeping with hotel property management systems
PMS housekeeping module connects housekeeping staff to the front office. A front-office manager can make a list of tasks to assign, and housekeepers can update room status. If this is a cloud-based PMS, housekeepers can update the status of their assignments or rooms through a mobile app or tablet. Also, this module keeps the list of maintenance tasks and reports for the users.
The main function of this module is housekeeping management and property maintenance. Housekeeping functionality includes management of room status, maid assignment for room cleaning based on a block or floor location, keeping lists of tasks for housekeepers. Maintenance management keeps the record of hotel disruptions and repairs with the further assignment of an attendant who can eliminate a problem.
CRM and customer data management
It is critical for hoteliers to collect and organise guest data to keep in touch with current and past customers during and after check-out. The CRM module must integrate with the front desk and reservation system, collecting all guest information from these sources. It helps store guest data and provides a database in an accessible format.
Also, it includes guest contact information before and after their stay. However, if a hotel already has its own CRM system, the PMS should integrate with it.
This module can also help organise marketing and promotions, measure guest experience, and pre- and post-stay services. The CRM module helps owners personalise the guest experience with membership and loyalty programs, which are especially important for hotel chains and resorts.
Reports and analytics
To monitor current processes and understand business performance, rely on analytics. A PMS can provide hoteliers with various types of automated reports. Depending on the software, it can generate night audit reports, room and tax reports, shift audit reports, departure/arrival reports, housekeeping reports, or other ongoing reporting.
This PMS module facilitates management of a hotel team, back-office operations, and administrative hotel operations. Functions of a back-office management module may include:
- Event management (conference and reception organisation) and catering
- Spa and gym management
- Staff management (human resources management in back and front office: shift management, staff invoicing)
- Consumption costs and hotel spendings analysis
- Inventory analysis
- Sales and management of promotional campaigns
- Reviews management.
PMSs that have this module included enable users to manage campaigns and send emails, as well as report a guest’s exact arrival time. This function may include internal messaging, and in some cases, accounting.
If there are multiple point-of-sale terminals in a hotel, this function is indispensable to handle transactions. It automates transactions and keeps financial data in one place. Most hotels have some kind of restaurant on the premises, not to mention properties with gyms and spas. With a PMS, hoteliers can include additional costs or discounts to the final bill for each customer. Additional costs may include:
- Spa, gyms, and activities
- Food and beverage services (restaurants, cafes, breakfasts)
- In-room services, mini-bar items, TV, or Wi-Fi.
When choosing hotel property management systems / software
The choice of a PMS depends on the size and type of a hotel property, as different systems have their own sets of core features and additional modules. Most players in the market offer hotel management systems that can be customised for different types of property and basic modules of PMS can be complemented with additional modules, required for a specific type of business.
Many properties already have reservation platforms or CRS of their own, or they already utilise certain software, so it is very important for the selected PMS to be integrable with third-party services. The final choice of a property management system for a hotel is largely shaped by the functionality required. But regardless of size and type of hotel, when choosing a PMS, consider the following:
Prioritise the ease of use. The interface of a PMS shouldn’t be too complicated to use and integrate. The quality of UX will impact your employees’ learning curve. The more complex and unintuitive the interface is, the more time you have to invest in staff training and transitioning.
Check integration options. If there are systems already used by a hotel, or if you plan on integrating additional software, make sure that your vendor supports all necessary APIs and is ready to provide integration services. If you already use a CRM system, it’s better to look for a PMS that can be directly integrated with it. Otherwise, you may consider an external technical consultant to provide integration services.
Assess customer support. Anything can happen to software, but it mustn’t affect the hotel service. Hoteliers need 24/7 access to technical support. When choosing a PMS, look for customer support reviews from fellow hoteliers or negotiate all support terms with your vendor in detail to ensure that any software outages won’t have a dramatic impact on your operations.
Pay attention to the degree of customisation offered by a provider. Depending on the size and type of a property, PMS requirements may differ. For instance, if you need a bed-based management system instead of room-based in the front-office module, make sure that the PMS vendor can provide this sort of customisation.
Consider cloud solutions first. Cloud solutions are generally less expensive than on-premise software, and an owner doesn`t need to pay maintenance fees. Users of cloud software pay a subscription fee depending on the number of rooms in a hotel and can pay only for the modules they use.
Also, cloud software is better at integrating with third-party systems like OTAs and GDSs. On top of that, cloud-based systems can be constantly and seamlessly updated.
Most popular hotel property management systems
There are plenty of vendors who sell off-the-shelf PMS, and those who provide customisation services. Trying to reach a broader audience, big vendors supplement and customise the basic PMS so that they can be used by as many types of properties as possible.
For example, such providers as Oracle, Maestro, eZee Technosys, and many more offer PMSs adjustable for hotel properties of all types, from big hotels and resorts to hostels and rental properties. Have a look at the most common solutions on the market and their feature sets.
Hotel chains and resorts systems – Maestro PMS, IQware PMS
Larger properties require solutions with a wide range of modules other than the basic reservation, front office, and housekeeping. Their PMS must facilitate the option of group bookings, have POS-services, a multi-property management system, back-office management, sales, and marketing functionality. Also, owners of big properties should consider PMS with options that speed up check-in and check-out.
One of the examples is Maestro PMS. It is a multi-property management system that includes over 20 modules that can be integrated into one interface. The product is positioned as a guest-centered PMS for chain and independent hotels, resorts, and vacation rentals.
Maestro PMS supports group bookings and even provides the functionality to create a Facebook booking app. The front-office functionality includes the Xpress Check-In Wireless module that allows front-office managers to check the guests in and out via an iPad and encode a room key on the spot.
This PMS is available both as a Windows app and a web browser application. The cloud-based system allows an owner to access several properties from one device and offers increased data security and a high level of module integration, including those of third parties.
Promotion, social media marketing, and email marketing modules are all parts of the back-office Maestro PMS functionality. The Maestro Sales and Catering module is integrated on demand and assists in sales and marketing as well as event planning and management. It facilitates sales and helps keep track of all aspects of event management, conference planning, and scheduling. This module integrates the front office with CRM.
Most PMS modules are focused on providing an outstanding guest experience (loyalty programs and membership cards). For example, some membership programs reward certain transactions through the PMS with points that can be used on special services in a hotel. Earning points can be based on criteria like money spent in the hotel or the number of reservations a guest makes.
Also, it allows guest preference tracking, updating preferences in a guest profile. This PMS has several modules for resorts, which include the Spa & Activities Management System and Fine Dining Point Of Sale & Table Reservations that integrate billing with the front-office module.
Another example of a PMS for big properties is the IQware Property Management System. It is designed as a multi-property management system for properties of all sizes. Its functionality can be applied to resorts, condos, villas, vacation rentals, campgrounds, marina-resorts, and extended stays. Like Maestro PMS, this software focuses on guest experience and offers group-booking opportunities, and a customisable guest app that facilitates check-ins/outs.
The main difference from Maestro PMS is the management of commissions for travel agencies, GDS, tour operators, hotel staff, or sales office. The revenue management module of IQware PMS has 5 levels of revenue control. PMS has group management in its reservation module, and another special feature is the allotment module that blocks the rooms for companies, airlines or tour operators, and travel agents.
Connection to GDS is possible with the IQlink Channel Management Tool. The other optional modules of PMS are Activity Booking, and Work Order Billing, which allows paying for separate services in different properties. Additional on-demand modules of IQware PMS include:
- Central Reservation System
- Hospitality’s Email Service
- Spa Management Platform
- Event Management Software
- Travel Insurance for guests.
Timeshare Management, Vacation Club Management, Condo-Hotel Management, and Marina Management modules may be particularly relevant for resorts or apartment buildings. They expand a standard list of features with functions like activities booking, or a customised maintenance management module.
Systems for city hotels, business hotels, conference centers – eZee Absolute, Protel
Critical modules for this group of properties are back-office management with conference and catering functions.
Property management systems for city hotels, business hotels, conference centers
eZee Absolute by eZee Technosys is a cloud-based software that supports multi-property management and has different integrated pieces that process certain operations. The eZee Absolute front-office module manages reservations and housekeeping and conducts a night audit that can be set automatically or manually.
Guests that check in with eZee PMS use the Hotel Guest Self Service Portal that speeds up the check-in process, lets them send requests directly from their smartphones, and receive receipts online. The CRM system included in the PMS allows for sending automatic pre-arrival, in-house, and post-departure emails, and manages email marketing campaigns.
eZee Technosys has also announced a new module for this PMS that will gather all the guest reviews from different sources like OTAs and travel websites and respond to them in real time. eZee Absolute has its own CRS that integrates with a hotel`s website or app.
eZee Absolute allows users to customise the system for certain types of properties. The PMS offers the Resort management system that has more functions for resorts. For example, it manages “Pay at Hotel” bookings. Resort software can send an online payment link to guests that they can use to make a payment of any amount.
This system also has a restaurant table-reservation feature. eZee Absolute PMS integrates with third-party services and has its own property management app for employees and hotel managers.
Protel PMS is a software that works for multi-property management of big chains and independent hotels. Basic modules of Protel PMS include front-office with a night audit function, reservation management, CRM, revenue optimisation with an inventory management mode, and housekeeping. The housekeeping module includes maid management, room maintenance, and the Lost & Found feature. It can be integrated in-app for the housekeepers that connect staff with the front desk.
The front-office module performs night audits and connects the reservation platform to an online booking engine, which is optional for this PMS. Protel PMS offers apps for guests and housekeepers to make the process of hotel management faster.
Additionally, Protel PMS offers an event-management module that includes organising conferences, receptions, etc. This module provides an overview of group bookings, equipment bookings, meeting rooms, facilities, and list creation with event information. The guest-management module has complete guest profiles and allows front-desk managers to see guest history and create personalised messages.
Systems for timeshares, vacation rentals, and apartments – Stays PMS, Vreasy
For properties of this type, basic PMS functions are multi-property management and an online channel management module. Most of the solutions for apartments and timeshares exist as customised versions of hotel property management systems. However, there are PMSs focused on serving these particular types of properties.
Property management systems for timeshares, vacation rentals and apartments
Stays PMS is a relatively new property management system designed solely for vacation property rentals. It features a channel management system with connection to more than 40 distribution channels, including Airbnb. Although this property management system is not designed primarily to serve hotels, it has all the tools of a typical hotel property management system.
Stays PMS has a website management tool that includes integration with Facebook and makes a content management function possible. It has a guest reviews tool, commission management, and a payment processing tool. Depending on the number of accommodations (from 10 to 1000+), a customer can choose a suitable subscription plan.
Another solution for rental vacation property management is Vreasy. It has a well-developed back-office module with the feature of task delegations to all staff members, starting from the front office and finishing with housekeeping, and offers its own communication platform.
Vreasy PMS has an owner portal with a data management module that has access to multiple data sources and generates reports. This PMS has its own payment gateway – VreasyPay – that accepts credit card payments in 130+ currencies. Direct APIs from this PMS connect a property to major booking portals, including Airbnb, Booking.com, HomeAway, and TripAdvisor. Also, Vreasy offers the following features: guest apps, marketing, activity booking, emails for clients.
Small hotels (hostels, inns, B&Bs) PMS – Little Hotelier, Hotelogix
Such types of hotel properties don’t require too many options and additional modules, like POS services due to their size and internal structure. The main modules these PMSs should have are usually an online reservation tool and integration to a hotel`s existing reservation platform. Because small hotels may need slightly different functions, the PMS should offer a high level of customisation.
Little Hotelier is a PMS powered by SiteMinder and integrates with this reservation platform. However, it also allows third-party integrations. Little Hotelier combines all necessary modules for a hotel in one PMS: front-office operations, intuitive booking management, channel management, and an online booking engine. It is a cloud-based solution for small hotel properties like B&Bs, hostels, and guesthouses.
This PMS allows for creating not only online reservations, but also reservations by phone or walk-ins that can be made via the front office. The channel manager of Little Hotelier distributes properties to more than 250 booking channels including connection to Airbnb and provides a channel analysis report.
Little Hotelier’s dashboard allows for viewing how the channels are tracked. All PMS data can be accessed from a single place, like a tablet, smartphone or desktop. For example, a hotel manager can see the list of today`s check-ins and check-outs, get a guest-coming notification, and print invoices.
Another PMS for small properties is Hotelogix. However, this PMS also be suitable for hotels and resorts. It has a strong channel management module, third-party integration with reservation platforms, and offers customisation. For example, a vendor can offer a bed-based reservation management system for hostels instead of room-based. Hotelogix PMS offers a Facebook online engine and mobile access from the app that allows management of a hotel`s team. Interfaces of both Little Hotelier and Hotelogix are available in ten languages, and process transactions in different currencies.
Technologies in the hospitality industry constantly develop, offering new functions and modules to optimise daily operations. A well-chosen PMS can improve service by making check-in and check-out processes smoother, automating housekeeping, and supporting the creation of a guest profile to provide guests with special offers and further information about the hotel.
When choosing a PMS, consider its ability to integrate with third-party software. If you are choosing a system for a hotel chain or vacation rentals, look at systems that manage multiple properties. For any system under consideration, reservation, front-desk operations, channel management, and housekeeping modules are critical, while resorts require POS services and a separate CRM module. And a PMS for a hotel with a conference center should be out of the running if it doesn’t have a back-office management module with catering and event management functions.