The Distribution Channel Manager (DCM) module developed within our hospitality management solution CiHMS aims to manage all your bookings from all OTAs in one platform. Is it necessary? Absolutely! With the help of a DCM, hotels can easily approach targeted customers through direct as well as indirect OTA channels. According to a recent study from D-Edge.com, OTAs have brought over 63% of the market share in the Europe region, and 61% in the Asia Pacific. Although the COVID-19 pandemic did slow down the travelers, the market share of OTA remains high.

Hotels often sign contracts with an OTA to be listed on the OTA’s website without any upfront fees. The OTAs only make money, which is calculated as a percentage of the room’s total value, once the reservation is successfully booked and paid. OTA is gaining its popularity with its huge marketing expenditure to attract customers around the world from TVCs to online advertising through social media and sponsorships, even spending a huge budget on billboards, various marketing channels to promote their brands. In general, it’s a low-risk investment to get connected with an OTAs channel, especially if your hotel has a limited budget for marketing.

Channel Manager in CiHMS – your ultimate hospitality management solution will centralize all your bookings on one platform, allowing you to manage, monitor, and modify easier, quicker while staying synchronized in real-team across all distribution channels

Each OTA is targeting different types of audiences. Understand who your potential customers are to match it with the OTA profile and get the brand visibility your hotel is seeking for. There are not one or two OTAs, but a couple of hundreds per se. Imagine logging in all of these OTAs to monitor, manage and update your hotel rooms manually. It is not only a boring job but also tedious.

Thanks to the CiHMS Distribution Channel Manager, you are getting connected with all the available OTAs either directly independently, or indirectly via distribution points. At the moment, our CiHMS is connecting directly to the 5 leading OTAs worldwide: Traveloka, Agoda, Expedia, Tripadvisor, and the latest: Trip.com and Booking.com and more to come.

“Here at CiHMS, we respect each and every client equally. CiHMS allows hotels to approach their valued guests responsively in their best interest,” said Mr. Hoang Nguyen – CEO of CiHMS. “Direct connection with leading OTAs globally helps hotels to scale and grow their guests’ list, simplify and improve their operational practices.”

CiHMS Distribution Channel Manager also enables direct OTA connections through public API technology. With this methodology, hotels can instantly get connected with their favorite OTAs directly with a single click. CiHMS is quite new to the market, but speeding up quite fast and thriving to exceed our customers’ satisfaction.

Have you checked out our DCM yet? Contact us for a free demo of CiHMS-DCM. To go in-depth on what a Distribution Channel Manager is and why hoteliers need one, check out the details in our previous article. Contact us for a free demo of CiHMS-DCM.

Looking for information? Searching for your next holiday ideal destination? Typically, we would go on to “Google” it. This has become the conventional habit that all the generations unintentionally established over the last decade. That is the result of how fast and convenient Google results come back with your initial keyword input. Undeniably, Google has gradually defined itself as a “free, easy and accessible” encyclopedia across the globe. 

Recently, Google Travel products have launched the Free Booking Links last March 9, 2021, to allow hotels to receive traffic and bookings via Google hotel search. This feature brings such huge opportunities to hoteliers approaching internationally and domestically. Understanding the importance and competitive advantages hoteliers may gain with Free Booking Links, the CiHMS Hospitality Management Solution – has partnered up with Google to provide a seamless connection with Google for our customers. How does this work actually and what are the benefits you – hoteliers get from this partnership? 

The free Booking link feature was recently announced by Google. The new feature is going to change the online distribution in the hospitality industry worldwide

Google Free Booking Links

There are millions of travelers constantly searching for hotels and destinations on Google daily. To show up on Google search engine, hoteliers have to do SEO effectively, practicing, and monitoring it. Some even have to dedicate a large portion of their marketing budget to Google Ads, making sure to maintain their ranking and position on the Google search result pages. The broader your target audience is and depending on how high you want your search result position to be, the budget can fluctuate anywhere from 4 to 6 figures easily. 

Google is constantly observing and evaluating their user experience along with their interactions within Google’s travel products to best enhance it. Free Booking Links feature was first experimented with in September 2020 aiming to help hoteliers gain direct traffic and reservations through the Google search engine at a free cost. 6 months later, this new product feature was officially introduced globally and has contributed to the change in customer searching habits especially in hotel searches. You might have already experienced this feature without acknowledging it. Free Booking Links appear among the mixture of ads (which are marked with “Ads” to distinguish) whenever you search for hotels. 

Free Booking Links appears in Google hotel search in the results search page right after Ads. Allowing the hoteliers to approach direct customers

Free Booking Links allows hoteliers to have their hotels listed with their best room rates available for travelers to choose from. There is no payment or user engagement from Google collected for those links. Free Booking Links may look like Ads but they are not. The placements are ranked based on a variety of signals, including but not limited to: best matched available room rate for a custom search query, up-to-date feed price, price accuracy score, and matching price between your feed price and the landing page. While you can bid to rank higher in the Ads section, better placement cannot be bought for free booking links. 

The following information would normally be shown in the Free Booking Links section:

1. Hotel’s properties: those are the hotel’s name, address, phone number, websites, and directions to the hotel. There would also be reviews, your hotel’s pictures, average customer rating score, hotel descriptions, and highlights. 
2. The “Book a room” button drops down all your hotel room listings.
3. The booking module with top-ranked booking links and customers can easily adjust check-in, check-out date, number of guests to find the best rate available. 
4. Filtering option to view by nightly rate, nightly total or stay total.
5. Booking link ads which have to be paid for and labeled with an “Ads” badge. These ads are from OTAs, travel agencies, or even your own hotel running Google Ads for the selected hotel shown in this Free Booking Links section.
6. Free booking links under “All Options” and can be configured by hoteliers.

Here are all the elements consisted in Free Booking Links section

The benefits of Free Booking Links

The advantages that come along with Free Booking Links are the followings but not limited to:

• Free traffic: Yup, to show up on Google Free Booking links means you are visible to the world. These are natural traffic sources and are potential leads that are 100% Free. 
• In control of your guest experience and data: Google doesn’t charge anything on clicked links and the engagement for Free Booking Links. You can control your guest experience from the Free Booking Links section to your landing pages. Google allows you to track and enable you to generate Reports for your Free Booking Links to further configure to take advantage of it to the max. 
• Maximize your revenue with real-time rates and room availability: This benefit is for our CiHMS customers who own our hospitality management solution. CiHMS will automatically update your rate and availability directly with Google without you doing any further work in real-time. While others have to regularly update their feed price and send it to Google, we would do all that work for you. Fast, easy, and effective.

How to be eligible for Free Booking Links

You have to have an active Hotel Center account. If you don’t, you can register for one here. However, the process may take longer and there is no confirmation regarding the detailed timeline for this process yet. 

The other fastest way is through a Google integration partner, which is us – your CiHMS hospitality management solution. We are proud and honored to get contacted and become an approved Google integration partner. Make sure you have already set up your Google My Business profile for the property you wish to be listed on Free Booking Links. Please keep in mind that your hotel information on Google My Business should match with the hotel properties you have registered with us, otherwise problems may occur. 

If you are a CiHMS family member and not sure whether or not your hotel appears on the Free Booking Links section, contact us for more details. Any changes and modifications may take up to several weeks to apply on Free Booking Links, please be patient. 

The Free Booking Links feature has definitely brought out numerous potential to hoteliers at no charge, although this pandemic has not ended. COVID 19 shall pass and this tough period soon ends, it is exciting looking forward to the resume of the travel industry. Take this time to improve your hotel portfolio, physically and virtually, including its infrastructure as well as its online presentation. Make your property “within reach”, searchable, and in its best practice. Free Booking Links is worth trying at zero cost and would allow you to accomplish all the above. Why haven’t you started it yet? Have you tried out this feature yet? If so, share your thoughts in the comment section down below.

On April 9th, 2021, the Grand Official launch event for CiHMS – an All-in-one hospitality management solution was held at the Gem Center, Ho Chi Minh City. Thanks to all the guests that came to join us on this special milestone. We were extremely honored to welcome our dear customers, exciting investors, keen tech-savvy professionals, as well as enthusiastic experts in the field. Though the software has already been deployed for a number of customers since the beginning of this year, we believe CiHMS deserves the spotlight at the launch event itself. It is also a celebration and our appreciation party for the team, who have been striving harder every day in the last two years to get CiHMS to where it is today.

The launch event for CiHMS – hospitality management solution on last April 9th, 2021

CiHMS is an all-in-one hospitality management solution that can transform your hotel operations from the inside out. It helps to automate daily operational activities from the front desk to the back office. Room rate, allotments, and availability now can easily update on one platform and synchronize in real-time with hundreds of booking channels, across multiple properties. CiHMS also provides a centralized reservation system that allows you to quickly get an overview of your business with detailed reports in just a single click.

On top of that, our hotel management system is cloud-based software, meaning you can get access to the software from anywhere at any time with your mobile devices or a computer connected to the Internet. Cloud-based computing technology also frees your financial burden on IT infrastructure investment with zero cost on building your own server or IT staff to monitor and maintain it. No longer worry about regular maintenance, software update, and system upgrade. Leave them all to us!

Fully integrated with other 3rd party components, expandable to your business size as it grows, CiHMS is truly a flexible and scalable hotel management system while staying strictly secured. We respect and put our customers as our first priority. Being certified for PCI-DSS, HTNG, and is going to get our ISO 27001, ISO 27018 in a few months’ time now, CiHMS is determined to achieve data transparency with our customers while protecting their data privacy. (To read more on CiHMS features, please dig in here)

At the launch event, Mr. Hoang Nguyen – CEO of CiHMS shared the journey of CiHMS and how to build the complete hospitality solution from the start

Instead of paying in a full lump sum as you would for an on-premise hotel management system, CiHMS enables our customer to pay upon subscription services: Essential for small hotels, Plus for 3-4 stars hotels, Boutique & Premium targeting 5 stars hotels, resorts, and multi corporation hotel chains. During the launch event, Mr. Hoang Nguyen – the CEO of CiHMS also shared: “CiHMS has been developed with the latest technologies aiming to help hotels to operate effectively, minimize its operation cost, and provide customers experience at its best. Thanks to its capability to connect with hundreds of OTAs domestically as well as internationally, opening new doors and opportunities to hoteliers approaching themselves into a bigger market with greater revenue”. The launch event definitely closed on a high note. It has been a journey with CiHMS. Thank you all for your attendance. It meant the world to us!

If you haven’t read our CiHMS journey yet, don’t forget to check out the series at our very first entry: Buy or Build your own PMS.

Counting down to our first MVP release

The first MVP (Minimum Viable Product) version for our own Property Management Software was completed after spending 4 relentless months building the whole system from scratch. Following was the pilot test in September 2019. The first Alpha version of the CiHMS – the hotel management software – was installed and ran pilot testing in our customers’ City Hotel facilities. During the pilot testing period, there were also Beta, Gamma and Delta versions released. The whole process officially ended around December 2019.

We thought we had every feature figured out, until going into the actual pilot testing phase, which was carefully assisted and consulted by the experts and professional advisors in the field. Everything cannot be applied with the theory-based approach, neither does our Hospitality Management Solution. Only the practical procedures, real human interactions can reveal our PMS’s incompetent capabilities. We were able to learn, improve and adapt the updated features and changes for a better performance into the PMS.

In today’s blog, we’ll share with you our personal experience, failure throughout the pilot testing phase, and how we tackle and grow from it.

What is pilot testing?

For software development, pilot testing is the act of testing your software under a real-time operating condition. This allows us to verify the feasibility, cost, time, risk, and performance of our PMS in a small-scale, short-term experiment before the full deployment in all our customers’ properties. It is like a rehearsal before a live performance of your Broadway show, in this case, it is for your software. Prior to the pilot testing time, we had to:

• Build a pilot plan
• Schedule for the pilot test
• Deploy and test the pilot testing
• Evaluate pilot testing
• Rinse & Repeat

Our hospitality management solution pilot testing was carefully planned out to guarantee smooth implementation

During the pilot testing time, it was important for us to choose one of the following strategies after gathering and evaluating test data:

• Stagger Forward: adding more candidates into the pilot group
• Rollback: Restore the pilot group to its previous state
• Suspension: Stop the pilot testing
• Patch and continue: Deploy patches to fix the solution and continue on with pilot testing

First Pilot Testing Milestone: The City Hotel

We set ourselves up for the plan and carried them out gradually. The first pilot testing took place at city hotels. We started offloading all the metadata, which technically meant all the information related to your hotel, it was the detail that described the property information, the number of rooms, room types, etc.., of the first hotel into our alpha version of the CiHMS. The system was run for one month, while the room rate and reservation management were successfully imported into the travel agents’ booking portal to sync with the system room rate in real-time.

Then it hit us with complaints and conflicts among our product functions and the client’s front desk team expectation. Constant comparison between the old system and the new one worn out the coding team. We not only have to pay extra attention to the user experience itself, but also to achieve additional requests from the FO team. The night audit process, evaluating and closing daily cash flow in and out of the hotel account, was somewhat different from what we perceived.

The Beta version was released during this period to mostly fix a number of occurring bugs and re-code the night audit features. Once the new version was deployed, the staff started to cool off. They recognized they spend less time and effort on the night audit workloads than before. Everything was automated with a click of a button and started to make sense. It did take two to tango, indeed.

Second Pilot Testing Milestone: Resort, Spa & Entertainment Complexes Hotel Chain

After evaluating data, we chose to “stagger forward”, adding more candidates – hotel properties into the pilot group. These new nominees were evidently complicated with numerous operations linked with multiple systems. It was dreadful, and accomplishing this milestone did feel rewarding.

We also took risks in CiHMS Pilot testing period, had to roll back couple of times but never backed down

We had to roll back a couple of times due to integration failure with various existing software in the property. Fortunately, these did not discourage our team. We learned to pick up where we left off, patch, and continue to the next solution. At the end of November 2019, a Gamma version of CiHMS was released with full integration with SAP – our customers’ Financial Accounting System and other management systems.

Third Pilot Testing Milestone: Perfecting the system

It was our final stage of pilot testing after running the hospitality software solution CiHMS for 2 consecutive months. We got “perfect” data comparing with the existing On-Premises system at the time. That was a relief for our team. All features were based on practical procedures and protocols from actual hotel operations, no longer theoretical assumption. It helped to eliminate impractical and unnecessary functionalities that other Hotel Management Solution providers would suggest as extra perks in their software that ended up never getting used. We stuck to the cycle of Implementing, Validating, Adapting/Change, and repeating.

Pilot testing our hospitality management solution was tackled on September 2019 and ended later on that December

Though CiHMS has recently entered the hospitality management solution market for over a year, 4 months of pilot testing did help CiHMS as the product as well as the company to mature and grow quickly.

Performance test in Nha Trang

Apart from the pilot testing phase, we also did an intense performance test that took place in Nha Trang at one of the customers’ hotel properties. The test involved roughly over 200 front-office staff in our customer hotel’s property. It was required for everyone to log on to the system and performed all their daily tasks such as booking, check-in, check-out, restaurant booking, etc. at the same time.

This proved our system can handle numerous concurrent users at the same time and made sure absolutely no overloading nor crashing due to system incapabilities when we fully deployed the CiHMS in all our customers’ properties. We were extremely lucky to borrow the needed human resources from our customers’ hotel property to carry out this test. Without their help and support, it would be much more difficult for us to gather a large number of people, train them to carry out hospitality procedures and put them in the test environment to run the test.

Agile Methodology

The optimal approach for software development is the agile methodology, which practices the collaboration between self-organizing cross-functional teams with customers. It allows the team to deliver in workable increments, provides flexibility and responsiveness to changing business needs and customer feedback.

Agile methodology was applied in our hospitality management solution development

At CiHMS, we adopt the agile methodology from the start and this was a strategic move, looking back. Unlike the waterfall methodology, a Business Analyst (BA) had to come up with extremely long and time-consuming descriptive product information, and technical requirements which were likely expensive and impossible to change. The BA then controlled and knew how to implement the project thoroughly.

In agile software development, our Product Owner and Business Analyst did not need to have experience in the implementation process. They approached the customers to generate user stories. From there, the team prioritized the product backlog, split into each sprint with workload estimation given by the team members who were in charge. Regular stand-up, sprint planning, review, and retrospective pushed the building process and product delivery forward at a much faster pace.

The methodology was also applied during our pilot testing. We were able to reach out to the customers’ difficulties, create new user stories in the product backlog, improve and release them immediately in the next sprint. Agile methodology has changed our workplace culture to be transparent, value the people over process and tools, working software over documentation, respecting customer collaboration over terms and contracts, most of all, responding to change over following a plan.

The pilot testing ended, meaning we had to get ready for the full deployment on all of our customers’ properties. We had carried out the process in record time, exceeding experts’ expectations and our own. To know what we had achieved, be sure to check in next week with our next blog on: ”Go live with our Hospitality Management System: Zero to Hero”.

We – CiHMS – started just like any other hospitality management software company. Our first client came to us with a predicament. Contemplating among 100+ hospitality management software choices, taking trials, and evaluating the runners-up who seemed to have all the qualifications. Finally settled on one of the most expensive On-premises Property Management Systems in the industry, expecting its optimal effectiveness and unfailing support. Instead, our client was struggling, as time went on with on-going and unresolvable issues that we have mentioned in our previous blog “Buy or Build your own Property Management System”. If you have missed it, be sure to check it out. Hoteliers who have been using an off-a-shelf Property Management System probably would fathom the difficulties and challenges our client has gone through.

It became clear that there is a big opportunity here for us.

A brand-new Property Management System – Where to begin

Before we kick start the building project, we have set out a compelling roadmap to navigate the process:

1. Optimize hotel revenue as the top priority
2. Optimize operations cut down excessive procedures and time
3. Improve customer experience and satisfaction

These criteria had helped us to strategically concentrate on building the PMS that achieved our client’s benefits in their best interest.

A hotel Property Management System function consists of Front Desk Operations, Reservations, Channel Management, Rate & Occupancy management, and Payment processing. These often are linked to enable hotels to organize, schedule, and manage effortlessly their daily operations while serving their guests effectively. Where should we start first?

That was plainly from a business viewpoint. Looking through the technical aspect of it, there were much more criteria that come into the picture. Which programming languages should we use: Java? Node.js? Ruby? Python? PHP? .NET? Or in a combination of which? What should we build our database on? MySQL, PostgreSQL, MongoDB, etc? What should the network infrastructure be? How do we protect customer’s data, which includes confidential information, guests’ personal & payment data, and etc., during the building phases and while migrating to the PMS?

What would be the first step in building your own PMS?

Taking all these into account, putting ourselves into the client’s shoes, we came into an agreement to build the Central Reservation System (CRS) before the rest of the PMS. CRS acts as a centralized booking platform for hotels to manage, distribute, and maintain rate and room availability from various channels. It is extremely vital for us; especially in high seasons when booking always has been chaos.

Our customer provides accommodations and a dining experience, but also integrated golf courses, and entertainment complexes. They have many destinations across the country and 1 location can welcome up to 3000 guests a day during the high season. In the past, the customer would have the On-Premises PMS installed and running separately at each destination. This has made unnecessary delays, excessive double booking, or unwanted overbooking during rush hour. That was the result of not having a centralized system, they didn’t have the room and rate availability data for all properties in real-time.

Our customer also worked with numerous Travel Agents and Agencies so it can be overwhelming for the Front desk operations handling the booking. The result was many bookings were created through direct confirmation with the front desk at each destination, to avoid overbooking as the existing On-Premises system was unable to centralize all the booking data in real-time. In many cases, Sales had to contact the hotel directly to check room availability at the time, requested to put those rooms temporarily on hold, confirmed with guests, check successful transactions, then officially booked the rooms in person.

The booking system brings in daily revenue and is the first encounter your customers have with your hotels. If everything goes right, it is smooth sailing from here. After 6 months of endless coding, our CRS has successfully integrated with the existing On-Premises PMS as well as the many online travel agents that are connected to the current PMS, cutting down reservation time span tremendously. There were no longer phone calls, or unnecessary room hold and overbooking never occurred. Customers can also get their reservations done online, maximizing room occupancy.

Then, we shifted our focus to building the rest of the Property Management System, which we later named CiHMS, to optimize and automate the client’s hotel operations, which took us another 9 months. The development did not stop there. We were also set out to improve the guests’ experience during the stays as well as future ones.

Challenges behind the PMS

The Human

Finding the right companion was the most impatient, disappointed, nerve-wracking, and irrational process. Considering the fact that we had to commit to a very aggressive timeline, you can imagine how stressful a scenario we were in. We had to constantly leverage both full-time employees and outsource partners. At times, we found ourselves working with 100+ developers from 30 different outsource partners. Apart from the technological partners, we are grateful for the help of many business consultants and vendors. Without strict guidelines, intended set goals, and dedicated team, and the enormous support we received, the project could be an impossibility to us.

The Timeline

The initial timeline was set for 24 months. Yes, you read it right. We were given an extremely tight time frame, as others would likely take up to 5 years to build. It might sound intimidating to others, but for us, we were absolutely thrilled and excited to take on this challenge and achieve the ultimate goal. We got the whole system up and running in less than 18 months, which took 6 months coding the CRS alone, and 9 months on the rest of the CiHMS. It still screamed impossible to us, but this accomplishment is achieved with willpower, consistency, collaboration, and harmony of the team as a whole.

The Digital Transformation Journey

You may have heard the term Digital Transformation over and over again. What is Digital Transformation exactly? It is the integration of digital technology into all areas of business, ultimately changing your operations and value delivering to your customers. This also makes a change in your workplace culture; it requires the organization to constantly challenge itself. It becomes imperative to any business that wants to remain competitive and relevant to the world in this constantly evolving technological era.

As the digital era keeps changing, the business has to take their own path in the digital transformation to stay relevant, especially in the hospitality industry.

Building the CiHMS Hospitality Management Solution is the first step taking us into the next stage of our Digital Transformation journey, and definitely, it does not end here. The new PMS strives to create room for creativity in better procedures, modern tools, and consuming time effectively. It gives a new approach to the hospitality industry to explore new opportunities awaiting ahead once perfecting operations protocols, smooth workflows, guarantee meeting customer satisfaction, and maximize revenue.

The new Property Management System gives us the shot to train the hospitality employees in becoming professionals in what they do, making decisions, improving the hotel procedures, products, and services based on actual data and analysis exporting from the system. The CiHMS is aiming to help others in the hospitality industry to embark on their own path in the digital transformation journey.

Coming together is a beginning; keeping together is a progress; working together is success.

-Henry Ford-

More on a digital transformation can be read at our “Hotels Digital Transformation” blog or discussed in our last webinar that you can re-watch here @Digital Transformation in the Hospitality Industry. After getting done with the CiHMS coding, it’s time for our Pilot Testing in real hotel operations in real-time. All will be shared in our next blog: “Building a Property Management Software in-progress: Fail fast and learn fast.” Be sure to watch out for the upcoming blog this time, next week, you would not want to miss it.

Hotel owners have always been debating on whether to choose a hospitality management software on the cloud or just keep sticking with the good old On-premises system. The technology-savvy hoteliers would preferably lean on the modern cloud-based PMS, which has gradually caught up with all the features, conveniences, and benefits one seeks for earlier on the On-premises PMS.  

As its name describes, On Premises’ PMS and data are stored on a physical server at the site. The software shall then be installed on any workstation that needs access to it. The cloud-based PMS, on the other hand, typically features access through a web browser-based, making the software highly flexible and delivering real-time access to hoteliers. 

The cloud computing hospitality management software has been favored by hoteliers in the last few years, making a significant shift in the industry

Switching over to a cloud-based Property Management System has been going on for a while now. What does the cloud have to offer making this paradigm shift? Is it a trend or it is a new movement? Both systems serve the same purpose, however, each can be tailored to its customer’s needs differently. Here are a few highlights on the pros and cons of the two systems that have stood out for us. 

Technical Differentiations 

On-premise Property Management System requires a significant number of “on property” hardware compared to the Cloud-based one. It gives the hoteliers total control: data and the system, system configurations, networks, updates, and changes are all yours to decide. Running the On-premises PMS means hoteliers must maintain a dedicated server room, which also needs an effective cooling system and an around-the-clock support team to keep everything up and running smoothly.  

On-premise hotel management system puts hotel owners in complete control of the system, while be a heavy burden expenditure upfront

Backup data and migration can become a headache. They get accumulated over time. To make sure you store data correctly, update in time and security in check shall drain out your human resources.   

With the cloud computing vendors, the PMS providers would be responsible for most of the IT operations expense. The hoteliers can also get the advantages from the cloud computing vendors’ highly available servers, at their optimal performance. The upgrades and backups will also be covered by your vendors, as all of these are included in your contract.  

The Cost 

The On-premises PMS licensed fee normally does not include the initial setup fees and already totals up a huge sum of capital. The hidden cost includes hardware server costs, additional IT staff expenses to manage the system infrastructure, maintenance fees (yes, more maintenance fees), and the expenses of other 3rd party software integrations. Depending on the size of your hospitality business, everything adds up and gets more expensive by the day. The capital expenditure spent on the On-premise PMS can be a burden for small and medium-size hotel businesses.

The cost of purchasing a hospitality management system in a long term is not sustainable as your business model scales up

A cloud-based PMS has a much lower entry cost. They charge a fixed monthly subscription model, with a small initial setup fee. No server cost, maintenance fee, extra human resources cost, lower energy bills and is an extremely affordable budget for small and medium scaled hotel businesses.  

Mobility & Scalability  

If you value the ability to be accessible to your PMS anywhere in the world at any given time, the cloud-based Property Management System is the one. Your system is hosted on the internet and can be available to login using any devices supporting a web-based browser. Certain access restrictions can also be set up to enhance security if you have the need to do so. 

Although you can set up your On-premises PMS to be accessed from an off-site workstation or device, remote access can be affected by various factors. Getting real-time data can certainly be challenging, especially not at the speed that cloud-based PMS delivers.  

The cloud computing system provides greater flexibility in scaling up or down your hotel model and gives you the option to add or scale back licensing fees.  

Integrations 

The On-premise PMS has been around for years, way before the cloud-based system. It gets developed and integrated with countless integrations from accounting software to POS systems, from F&B to in-room management systems, and much more. However, the implementation of the process is complex and time-consuming. As cloud computing services are growing faster than ever, 3rd party software is constantly developing to adapt to the prevalence of cloud-based solutions. The integration process is getting easier and faster on the cloud thanks to the open API. Undoubtedly, On-premises PMS is still ahead of the Cloud-based system when it comes to the number of integration capabilities, the flexibility of built-in reports that got customized, added over the years. 

The cloud-based PMS makes the integration faster and much easier with the open API

Security 

Many hoteliers are afraid of not being in control if they cannot physically neither see nor locate the system in their property. It is old-fashioned thinking and is a quite common mindset found in the hospitality industry, mostly in big corporations and international hotel chains. 

In reality, they fail to consider following the security standards protocols for the in-house system. The server has to function at all times, meaning your hotel should have an uninterrupted power supply 24/7 with backup power to keep your server operating in a power outage or unexpected occurrences. Data backup for any crucial business data on your system is also essential in case of unusual erasing data events. Otherwise, a security breach can happen, losing your internal data, your brand reputation, revenue loss is unavoidable. 

On-Premises Property Management system puts you in total control of your servers, hardware, upgrades, data and so on, however, security protocols can be chaotic

The cloud-based PMS vendors have the expertise to carry out security procedures in building and maintaining the highly robust cloud computing platform. They help to remove all those hassles and vulnerabilities associated with servers automatically. With all the security standards to comply, hoteliers can rest assured that their data are well protected, the system is running up-to-date. They also offer public and private cloud computing networks for hoteliers to choose from depending on their preferences. 

Which Property Management System is right for my business? 

There is certainly not a right or wrong answer. Every hotel has its own requirement, expectation, and deployment strategy. Undoubtedly, there are many benefits the cloud-based PMS has outperformed On-premises: 

• Lower upfront cost: servers, IT staff, hardware, etc. 
• Regular and predictable cost for license fees and maintenance. 
• Highly accessible to the system in real-time 
• Quick and easy integration 
• Highly secured and very high uptime 

It explains the widespread adoption of cloud-based systems. The only thing you have to hold responsible for is your Internet connectivity which is basic infrastructure any hotel should already have in place. In fact, the switch to cloud-based PMS is not impossible for the existing On-premises system. With all said and done, we believe the shift toward Cloud-based PMS is here and you should take it into consideration. What is your thought on those two systems? Which PMS platform system you would go with? Share with us in the comment section down below.  

We also have a previous blog on the controversy of “Buy or Build your own Property Management Software?”. Be sure to check it out and don’t forget to tune in to the next blog where we share our own journey in Building hotel management software right here next week.  

Hotel software management – also known as Property Management System (PMS) has imperceptibly become a necessity, the heart of the hospitality business ecosystem. Every hotel owner, from small to boutique, corporation to multinational hotel chain, will eventually come across this conundrum: “To buy or to Build our own PMS?” at least once in their career. Even though it is a simple yes/no question, to come up with an answer will take you countless debates, meetings, discussions, persuasions and sleepless nights. With either choice, the final decision ultimately determines the next stage of your business. It can possibly pave your very first step in the Digital Transformation evolution journey.

To Buy or To Build your own Property Management System – the ultimate question to anyone in the hotel industry

Then which is better? In this blog, let us walk you through the whole process. You might be able to find yours ;).

Buying a Property Management System is quicker and easier

There are two types of hospitality management software out there that have been used popularly: On-Premise PMS software – everything is done internally from implementation to running the solution, maintenance to updates and setting up your servers; and the cloud-based PMS – cloud provider maintains servers, network and software for you, you can access all the information hosted by the vendors on a web browser-based, requiring no active management.

Both options are widely marketed from all the big brands in the hospitality industry software, such as Opera PMS by Oracle, Protel Air by Protel, Hotelogix PMS by Hotelogix, MSI CloudPM by MSI and so on.

Depending on your hotel model and operation needs, you can decide to stick with either On-Premise or Cloud. We shall have a detailed blog on The Cloud Property Management System and On-Premise Property Management System Showdown following up very soon, this might be able to help you figure this out.

Have an off-the-rack hotel management system up and running can be faster and economically efficient for small scales hospitality business

Purchasing a ready-made PMS is convenient. Have all your requirements listed out and match it with the existing PMS that provides those features. Voilà! You can have the system in place within days! It definitely benefits if your hotel model is small to medium size. The value-added from the PMS can be shown in a short period of time right after the installation. This means you can achieve a higher ROI ratio pretty quickly. Plus the initial cost of purchasing an off-a-shelves PMS is rather a fraction of the cost of building one.

The odds of purchasing your own PMS

Although big brands are involved in the making, all the PMSs still have their own limitations. Here are the few (but not limited to) that hotel owners have experienced over the years. If you do experience the same, don’t forget to like our blog knowing you are not alone.

The intuitive user interface:

Many have underestimated this feature, but it plays a tremendous role in the purchase decision process. The better and more easy-to-use interface the Property Management Software has, the faster a user can learn and adapt to it. Result in much less training time obviously.

Customizable Reservation, Fees & Taxes

Reservation might seem easy and impossible to go wrong to some, but when you have multiple channel reservation systems within your hospitality software management, overbooking happens more often than you think. Having it tailored to your hotel preferences, can be tricky and require extreme help from the PMS support team. Especially when it comes to complicated fees and tax policy, it can take months (if you are lucky) or longer (if not never) when there are technical customizations involved to get it running.

Report System

Mostly the report system comes with generic reports that won’t meet up your hotel report’s requirement. You’ll find the report system to be either too specific or too broad. Sometimes it just does not have the type of report that you are looking for. Seeking support can be discouraging, as you would end up receiving the typical “out of our scope” response or “we will put it on our next release” to later know that request would never be granted. It’s unlikely for the PMS vendor to acknowledge your problem as a worthy addition.

Buying an existing PMS for your hotel can result in frustration with the lack of reports you actually need

Accessibility & Integration

Unable to access your Property Management System from your mobile? Take too long or it won’t sync in real-time? Difficult to integrate with your current Hospitality Point of Sales, OTAs and the Hospitality Channels Manager? Before purchasing, you might look forward to all the promises the PMS sales team has committed to. Your high expectations will only bring greater disappointments. Be sure to keep those expectations on your brief and actual contracts, otherwise be clear on the possible risk of failure.

Supported languages & currencies

Double-check whether or not your Property Management System supports your local languages and currencies. If not, it sooner or later will impact your system and may cause a contradiction with the other existing software you already have. It’s best that your PMS supports all languages & currencies, or get ready to be back on the hot seat of whether to suffer from the accumulating frustration or starting over with a new PMS system.

In-time support and upgrades

Getting the support in-time can be a struggle! The software never runs smoothly as they promise. Without the support and upgrades, it means nothing. Some PMSs are well known for their prolonged queuing support time. Surprise? Unfortunately, this is the norm! Nobody would like to wait for 3 whole business days in order to get supported when your system is crashed and unable to function probably. The dependency on the support team along the way will scare you for good, especially to those who have enterprise-level PMS software.

Is Building the New Property Management Software for everyone?

Building the complete new software starting from scratch is not anyone’s cup of tea. It is almost impossible and out of the norm for small and medium-size hospitality businesses to walk this path.

It can be difficult to start building your own Property Management System, especially if your business is a small scaled hotel

The opportunity cost

The project can accumulate technical debts along the road and later turn into a technical deficit, making the software quality suffer. It also does not justify the cost of operations. The math on the opportunity cost of allocating the additional resources in building the software or spending the same cost to focus on other smaller budget projects might bring greater revenue and assets for the hotel in the short-term period may put a halt on the project.

The timeline and human resources

Even if a hotel owner goes ahead in building software, it would not suffice to find a competent team of technology specialists building PMS software within the scheduled timelines. Many others took years to build and perfect their software, how can hotel owners be able to manage the team to deliver on the dot.

How many other projects and assets you have to give up in order to build your own hotel management system? Is it worth the trade-off?

The budget

Last but not least, what is the actual budget? Will there be sufficient resources to help see it through to completion? It can get overwhelming at times and may make the owner compromise for less. Though the hotel might have proposed a timeline and finances, while in the making, things can merely go sideways. Are hotel owners prepared to take a failure? Honestly speaking, not many are willing to accept the loss of building a PMS project. It leaves a heavy financial burden to carry on.

Then who would like to take this bumpy road in building a brand-new PMS themselves?

There are multinational and big corporation hotel chains willing to invest in building their own PMS system. Any company with a long-term vision in scaling up, dependency on PMS vendors is not ideal, as its pricing model won’t be sustainable for the hotel’s system.

In addition, waiting for the PMS vendors to solve the unique problem specific to a hotel is unrealistic. Especially if the problem is one of the kinds, the issue shall be pushed to the very end of their backlog that never gains enough interest or benefits for them to proceed.

Getting your PMS software developed in-house guarantees a fully customizable model that can touch base on all the problems, issues, and expectations that one hotel currently confronts with. It puts the owner in complete control over the software from collected data to even security risks, from operation compatibility to mobile-friendly, and so on.

Building your own hotel management software brings greater value and rewarding if you can go through with it

In short, if you have an in-depth knowledge of the hospitality industry, inside and out, coherently and thoroughly, from its process to operation, front to back; while owning a strong and committed technical team then we don’t see any reason to hold you back from building a PMS for yourself. All the cons shall cancel out once you meet those two criteria; the pros shall recapture your mission, vision and reassure the investment you make is well-spent. Remember patience and persistence are your friends.

This has been rather a long blog, and we hope you have got the answer you have been looking for. What do you choose to do: Build or Buy? Drop us a comment down below. We love to hear your side of the story.

Tune in with us on our next blogs, where we will dig deeper into the software insights that you don’t want to miss. See you here, this time next week!