For large hotelier and travel brands, financial settlement and reporting are one of the most crucial aspects of operations. Not only does it keep the business moving, but it’s also what funds and fuels other critical efforts, including marketing and customer care. And for larger enterprises, some with as many as 30 brands under them, it can quickly become a diluted and overly complex process.
In the financial settlement and reporting process for large hoteliers, for example, there can be any number of contracts and agreements in place. Since most large enterprises operate on a franchise/franchisee model, each brand, property, and franchisee may have its own set of unique values, local marketing offers, and agreements with the parent enterprise. With so many moving parts, keeping timely and accurate financial reporting can quickly become a challenge. Read on for our tips on how to optimize your financial settlement process.
1. Ensure accuracy across agreements and settlement operations
When you’re looking at a simple stay, say a two-night stay in a standard room, the financial settlement process is straightforward. There is an exchange between the corporate fund and the property, the customer earns points for their stay, and that specific algorithm is applied to those earnings. However, let’s say you are dealing with something more complex—a five-night stay over two financial periods, or perhaps a three-night stay that was shortchanged into two nights. Now you must rebalance or potentially apply new algorithms, and it can quickly become a complex situation. Couple that with the number of unique acquisition agreements that enterprise-level travel brands have, and you can see how details can get lost in the mix.
A flexible and configurable financial reporting capability will help streamline the process. Having this flexibility allows for real-time changes, without impacting the accuracy of the information. Adding automation into the mix can also significantly reduce the cost of personnel labor, as well as help ensure accuracy across the entire process. Since this is a financial asset, accuracy is critical. By ensuring accuracy via your financial analytics team, third-party auditors, and automation, there is more room for configurable, on-the-fly changes.
2. Put your loyalty platform to work
Although with every booking, stay, and change that customers make there is financial settlement and reporting happening behind the scenes, this is not something the customer is usually aware of during their travel. Typically, customers and members are less concerned with what is happening on the back end than they are with how and what points or rewards they’re earning as well as how they can maximize those earnings during their trip. One way for consumers to maximize their earnings is to book multiple stays at the same property, in the same room, for a back-to-back stay. These types of bookings present a perfect opportunity to let your loyalty platform
do some of the heavy lifting and minimize labor required by being able to automatically flag these stays and combine them—providing accuracy and optimizing any points earnings for the customer and points assessed to each property.
Leveraging your loyalty technology is not limited only to straightforward actions such as combining stays; fully utilizing all of the platform capabilities can be an efficient and cost-effective way to minimize overhead costs. For example, leveraging your loyalty solution to provide self-service tools to your franchisees can limit the burden put on the corporate office to investigate issues. Having a tool with monthly, automatically generated reports that are viewable and searchable allows them more independence to handle issues as they arise.
3. Keep your customer experience top-of-mind
When your financial settlement and reporting process is running smoothly and accurately, your organization has room to focus on things like customer care, marketing, promotions, and communications efforts, which can lead to an uplift in engagements, bookings, and revenue. Although in most enterprise organizations the accounting and financial teams are separate from marketing and customer care teams, there is a triangle of support that comes into play. For example, when your financial settlement process is lacking, marketing and customer care teams may be required to mitigate customer dissatisfaction with lags in point balances, earnings, or redemptions that can lead to poor customer experience. For example, say an issue came through customer care because a customer never received their double points as promised through a marketing initiative or promotion. Now, both marketing and customer care teams must go in, double-check the promotion, see if the codes were applied correctly, and handle that issue in real-time. Once the customer issue is resolved, the financial settlement process must resolve any discrepancies to the administration of the values between franchisor and franchisee. With a streamlined and accurate financial reporting and settlement process, these types of issues can be avoided or quickly resolved and those teams can focus their efforts on acquiring new customers and delivering optimal customer experiences throughout the entire traveler journey.
In the end, while not at the forefront of the member or traveler experience, financial settlement is a crucial aspect—and in some ways part of the backbone—of the enterprise-level hotel industry. From franchise-to-franchisee exchanges, customer-to-property exchanges, and agreements with acquisitions, financial settlement keeps everything moving smoothly and allows for a seamless front-end experience. And having an organized, automated, and flexible system, coupled with the tools of a trusted and capable loyalty technology provider with robust and real-time functionality, can enable your brand to focus on the most important element: your customer.