Vacation rental News
Make Extra Money From Alternative Business Opportunities
The average vacation budget for an average family in the Us is between $4,000-$6,000. This varies, of course, depending on how many members in the family, the duration and distance.
Independent of the budget, there are always approximate percentages that guide where or what travelers spend their money on when they decide to go on vacation.
Talking about approximate percentages, on average 20%-25 of the budget is spent on travel, 30%-40% is spent on accommodations, and 35%-50% on experiences, dining, activities, etc..
OTA´s Like Airbnb and Booking.com know this, which is why they also provide their customers options to buy experiences, tours, museum or event tickets, shuttles etc..
Long ago, property managers used to be purely a key and property provider. They would just provide the key and that was it, and in fact, there are many property owners that still do. Professional property managers, however, saw the opportunity to sell extra services and products to squeeze more revenue out of each booking, and it works.
Margins on services and events are quite high, sometimes even bigger than the margins that the property managers can get out of their rental from their owners.
Below is a small list of extras or services that Property managers are regularly offering to their customers and that are making their business more efficient. In reality, there is no need for extra work or expenses in the organization, it is only a question of seeing the margin and the benefit out of what your customers really need and demand of you most of the time. Indeed it may be seen as a better quality service and an option to increase your revenue from your main business.
Depending how your customers reach your properties, here is a list of extras and/or services:
- Shuttle service from and to Airport
- Welcome Pack (basic for breakfast or dinner)
- Basic list Supermarket purchase
- Extra Daily Cleaning Services
- Extra Towels and Sheets replacement every 3 days
- Guided tour ½ day for the whole family
- Historical and Gastronomic visit to town
- Any Rental services like cars, boats, bicycles, motorcycles, canoes, kayaks, paddle boards
We could write a 10-page list but the idea is to show that 95% of your customers do consume, and you know these services, they ask you for a recommendation or they directly ask you for help to find them.
We have listed 8 different services. Your margin could be between $20-$50 for each service, so minimum $180 or maximum $400. Would this represent 50% or 60% of your actual commission for the rental if the rental period is around 5 days?
There is a huge opportunity but many property managers are still focused on the organization and not the business. Our recommendation is to create a department at your agency and make someone responsible for upselling, to earn more revenue with less effort from each booking.
If you are too busy to make it possible, at least try to find a partner or a business associate that could cover this part of the business on your behalf and get paid a cut for it.
There is a way and a margin to make extra money out of alternative business opportunities.
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