Cost of Walk Configuration

If your property can't provide the confirmed room to a guest, you might incur costs due to relocating, or walking, the guest to another hotel. G3 RMS calls that called Cost of Walk. This cost impacts overbooking and group evaluations.

For the overbooking decision, Cost of Walk defines the monetary risk from overbooking too much and incurring walks. The system weighs that risk against the revenue reward for selling an additional room. The higher the Cost of Walk, the lower G3 RMS tends to overbook. View this video to learn what impacts overbooking. Or learn more about how to set up and maintain accurate Cost of Walk values.

Setup Steps

  1. Click Next after you complete Room Class setup.
  2. Click to refresh and replace the existing Cost of Walk values using historical data, see using default values for more.
  3. Select Yes to update the Cost of Walk values. The value fields open for editing.
  4. Edit the Cost of Walk values, as needed, by room type and day of week. Your changes save automatically. For properties in countries with Tax-Inclusive PricingClosed Tax-inclusive pricing applies in countries where quoted and booked prices have to include taxes like a Value-Added Tax (VAT) or Goods and Services Tax (GST). If you are not in a country with tax-inclusive pricing, taxes are added to pricing only at the point of payment. In G3 RMS, tax-inclusive pricing is enabled and configured in Property Specific Configuration., enter the value as tax-exclusive. See Entering and Display of Tax in G3 RMS for more information. If you use Run-of-House overbooking, review all room types, not just the Run-of-House room types.
  5. Click Next. Continue to complete all the steps in Rooms Setup.

Best Practices

Set Up Accurate Cost of Walk by Using and Reviewing the Default Values

For each room type and day of week, G3 RMS calculates the default Cost of Walk values at 1.5 times the total ADR of the available data, up to 365 past and 365 future days. The system does that automatically in the initial system setup, or when you click to refresh the values. You review and, if necessary, update the default values.

  • During the initial setup, we recommend that you leave the default values unchanged unless they are extreme or clearly incorrect. After the system produces overbooking decisions, but before it sends them to your selling system, review those decisions and, if needed, change Cost of Walk.

  • After the initial setup, review the values regularly to keep them accurate. You can click to refresh and replace the values with new defaults based on the ADR of the available data.

Note: If G3 RMS doesn't find enough historical or future data to create reliable default Cost of Walk values, it warns you with this Alert. In that case or, if your property uses a Limited Data Build, review and change the Cost of Walk values to meet your expectations.

Don't Match Cost of Walk to Your Exact Costs

Don't try to match your Cost of Walk values to the exact costs for your property. Instead, view the Cost of Walk as an influence on the overbooking decisions. The values in G3 RMS represent the monetary risk associated with overbooking too much and incurring walks, while at the same time considering the revenue reward for selling an additional room.

Understand How Cost of Walk Impacts Overbooking

Increasing the Cost of Walk values tends to lower the overbooking decisions without the risks of overriding overbooking.

Note:
  • Cost of Walk impacts overbooking much less than Wash.
  • Changing Cost of Walk to a very low value likely increases the overbooking significantly, because it means a very low risk when overbooking.
  • Changing Cost of Walk to a high value likely doesn't result in zero overbooking because of the expected wash. As an extreme example, if the system expects 100 cancellations, then overbooking by 10 is still a low-risk approach, since it only offsets 10% of expected wash.

Use Overrides Where Needed

Use Cost of Walk overrides in Overbooking Management when the values vary from the default. For example, when a large, two-day convention sells out all hotels and your Cost of Walk increases. If the Cost of Walk varies for a longer period, like during your slowest season, use the Multiday option.