Revenue Management @en

Revenue Management ABC: words that can help your hotel (L-O)


6 May 2015 at 9:30, by

Books and letters, Google Plus.

Books and letters, Google Plus.

Do you know what LOS stands for? Have you heard of Open Pricing? What is a No Show client? Miguel de Cervantes said “Más vale una palabra a tiempo que cien a destiempo” meaning that one word spoken at the right time is worth more than one hundred spoken at the wrong time. This applies to Revenue Management, where strategy and terminology must go hand in hand to optimize benefits.


Leisure traveller: A client travelling for leisure, not work.

LOS (Length of Stay): The length of a client’s stay in the hotel

LRA (Last Room Availability): A contract clause that gives a company or travel agency the right to use the contracted rate until the last available hotel room has definitely been sold.



MLOS (Minimum Length of Stay): This sales restriction is used to improve the management of the ups and downs of hotel occupancy. Applying a MLOS clause means the client must book a minimum amount of nights for the hotel to accept the booking. It is most commonly used in periods of high occupancy, like large trade fairs that receive lots of outside visitors, or cultural and sporting events etc.

MPI (Market Penetration Index): The relation between the market quota achieved by the hotel and the corresponding Fair Share.



Net rate: Rate with the supplier (or agent) commission already deducted.

Negotiated rate: Refers to a rate that has been agreed through previous negotiation between the hotel and a company, travel agency, official body, etc.

No Show: Referring to a client who, despite having a booking for a specific date, does not cancel or check in on that day. This client is normally charged the corresponding price for the first night.



OTB (On The Book): These are the confirmed bookings that a hotel has registered for a date or specific period.

Opaque Rate: A rate with a value that is not evident or obvious to the end client. It allows a hotel to offer discounts that are different to the prices available to the general public, without the price disparity affecting it’s strategic market positioning (the hotel remains hidden until the client completes the booking process). Generally these rates are used to combine various services and products, including hotel rooms, and put them on the market with a final price for the whole package, without detailing the individual price of each product.

Occupancy (%): Refers to a hotel’s occupancy percentage, which is calculated by dividing the occupied rooms by the available rooms x 100.

Online Travel Agency (OTA): Internet based travel agency. Some of the most famous are, Expedia, Lastminute, etc.

Open pricing: Refers to the technique of setting a different price for each room segment and channel depending on demand. Using Open Pricing we can work each rate that is for sale independently, if this is done well it will result in more income for the hotel.

Overselling: When more rooms are sold than really exist. The aim of overselling is to improve occupation, mainly during low demand periods. More rooms are sold taking into account that not all the tour operators or other distributors will fill their quotas, which means the hotel will not obtain full occupancy. The hotel also needs to bear in mind OTB cancellations and no shows on the arrival day, therefore, from a commercial standpoint, overselling should be viewed as a necessary strategic decision.

Overbooking: Happens as a result of overselling and bad control of bookings or occupancy forecast. As a last resort, overbooking implies sending clients to other hotels.

Innwise, as experts in this subject, we make use of the best strategies to optimize your hotel’s benefits. 



Idiso is much more than a technological service provider. Our mission is to provide real value to our clients. We want to become THE GLOBAL HOTEL SALES PARTNER, helping hoteliers sell more and better thanks to our 360º distribution and marketing solutions.

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