The discussion highlighted the critical importance of ancillary revenue as a key differentiator and profit driver in today’s competitive hospitality landscape. While room revenue remains fundamental, services such as F&B, spa treatments, and curated guest experiences provide valuable supplemental income streams that can be directly influenced by operational strategies.

Current approaches to optimizing ancillary revenue focus on experience-driven amenities and tactical upsells like early check-in/late check-out services. However, significant untapped potential exists due to technological limitations in tracking and analyzing profitability at the individual service level. While properties currently monitor profitability for major departments (rooms and F&B), more granular analysis of specific ancillary offerings remains an area for development.

Several high-margin opportunities have been identified, including

• parking,
• retail,
• premium F&B options, and
• flexible arrival/departure services.

These services represent substantial revenue potential but require focused attention to scale effectively.

Early check-in and late check-out services in particular emerge as both highly profitable and guest experience-enhancing offerings, with pilot programs demonstrating success through controlled availability models (typically 1-2 rooms per day).

AUTOMATION

Automation plays a pivotal role in realizing these opportunities, enabling dynamic inventory management through “if-then” rule-based systems. This technological support, when combined with comprehensive operational training, creates a framework for successfully monetizing ancillary services while maintaining service quality. The integration of such systems addresses current limitations in data accessibility and decision-making capabilities, positioning properties to better capitalize on these valuable revenue streams.

COLLABORATION

What does effective cross-department collaboration look like in today’s hotel business strategy?

The hospitality industry is undergoing a significant transformation, requiring hotels to rethink traditional approaches to remain competitive. A recent HSMAI roundtable discussion with APAC industry leaders revealed critical insights on shifting from revenue to profit optimization:

• Improving cross-department collaboration,
• Making data more accessible, and
• Maximizing pre-arrival upselling opportunities.

METRICS

One of the most important realizations was the need to move beyond revenue-centric metrics like RevPAR and instead focus on profit-driven indicators such as GOP and GOPPAR. This shift requires closer integration between commercial and finance teams, breaking down the traditional silos that separate revenue management from cost control. Rather than holding separate P&L reviews, hotels should incorporate financial considerations directly into commercial strategy discussions. The concept of “revenue meetings” should evolve into “business optimization meetings” where profitability becomes the shared goal across all departments.

Effective collaboration emerged as another key theme. Successful hotels are creating a culture where commercial strategy isn’t solely the responsibility of revenue teams but involves input from F&B, front office, spa, and other operational departments. These cross-functional discussions work best when each team comes prepared with their own performance insights rather than simply reviewing static reports. Transparency and data literacy are essential for meaningful collaboration, requiring hotels to present information in ways that are accessible and actionable for all stakeholders.

The conversation highlighted the importance of democratizing data across the organization. Many hotels still restrict performance data to commercial teams, but leading properties are making relevant KPIs available to operational departments like F&B and spa. To make this data meaningful, hotels are using storytelling techniques – for example:

• Recognizing top-performing bartenders or
• Illustrating how spa treatment sales contribute to overall profitability.

This approach requires investment in training to help non-commercial teams interpret and act on data effectively.

Regarding pre-arrival upselling, participants agreed that while the opportunity is significant, many hotels still approach it incorrectly. Successful upselling requires personalization based on guest preferences and behavior patterns, similar to airline industry practices.

Upsell offers should focus on enhancing the guest experience rather than simply discounting.

Integration with live inventory systems is crucial to ensure offers are both relevant and immediately bookable. Perhaps most importantly, operational teams must be prepared to deliver on upsold experiences seamlessly.

These insights point to a broader evolution in hotel management philosophy. The most successful properties are those that view profitability holistically, break down organizational silos, empower teams with data, and create guest experiences that naturally drive revenue. Implementing these changes requires leadership commitment but can significantly enhance both financial performance and operational efficiency.

The roundtable consensus was clear: hotels that adapt to these new paradigms will be best positioned for long-term success in an increasingly competitive market.