Pricing Strategy

Use Pricing Strategy to set demand-based selling guidelines for your sales team. The sales team uses the Pricing Strategy together with the Demand Forecast when replying to client requests. For example, the sales manager sees in the Demand Forecast that a requested date has a High Demand The amount of business that wants to book your function rooms. It equals the number of enquiries for a time period and includes all statuses. You define four demand levels, from High to Distressed, in the Daily Demand pages. level. The Pricing Strategy shows what they can quote for a High Demand date, including the optimum and minimum prices and the minimum capacity.

View this video for and overview of Demand Forecast and Pricing Strategy:

The Pricing Strategy page has four tabs. Three of the tabs enable you to optimise your selling strategy for different event types: Meeting Event types and seating styles where a lunch or dinner is not the main purpose. Used to differentiate from Banqueting and Wedding event types., Wedding Event types and seating styles that accommodate a lunch or dinner, plus a dance floor and a head table for the wedding party. Used to differentiate from Meeting and Banqueting event types., and Banqueting Event types and seating styles where a lunch or dinner is the main purpose. Used to differentiate from Meeting and Wedding event types.. Use the Rental/Catering tab if you mostly price based on function room rental, with catering quoted separately (you rarely use a Day Delegate or Package rate that combines rental and catering into one, per person, price). On each tab, you can see the date it was last edited.

You can add a custom tab to your Pricing Strategy page so that you can manage another Pricing Strategy category. The tab reflects either the Meeting or Rental/Catering functionality, respectively, and you use the Settings tab in Database Setup to set the custom tab name.

Setting the Pricing Strategy

1. On the Strategy Setting menu, click Pricing Strategy.
   The Pricing Strategy page displays using the current date for the pricing strategy. It will have one of the following statuses.

Status	Description
This is Default Pricing Strategy	The default pricing strategy is in use for the selected tab.
Strategy Effective From: date	A custom pricing strategy is in use for the time frame as specified.
Event rooms are not configured for pricing strategy	No function rooms have the Include in Pricing Strategy checkbox selected in Function Rooms Setup. Complete this setup to create a pricing strategy.

2. Click the PDF option to convert and save the current page as a PDF file.

Add Pricing Strategies

To have multiple pricing strategies, you need to add one or more to the system with different effective dates.

1. From the tab where you want a new strategy, click Add New.
   The Add Pricing Strategy window appears.
2. Click the calendar to select an Effective From date.
   Note: You must select a future date.
3. In the Copy From list, either select None (to not copy) or an existing strategy.
4. Click Save.

Export Pricing Strategies

You can export your pricing strategies to Excel so you can filter and display the data to suit your business requirements.

1. On the Strategy Setting menu, click Pricing Strategy.
2. At the bottom of the page, click Export to Excel to export the pricing strategies to Excel so that you generate reports.
   

Edit Pricing Strategies

You can edit existing pricing strategies. This is useful if you have periods where pricing increases or decreases based on demand.

1. From the tab that you want to edit, click Edit.
   The Edit Pricing Strategy window appears.
2. In the Effective From list, select the date of the strategy that you want to edit, and then click Edit.
   A status notice displays. Example:
3. Click in a cell to edit it.
   Not all items can be edited. See Data Details for each tab to learn which columns you can edit.
4. Click Save to save your changes or click Cancel to discard your changes. When you save, the system calculates the Minimum Revenue, Minimum Room Hire, and Minimum Total Revenue columns.

Delete Pricing Strategies

You can delete pricing strategies if you don't need them any longer.

1. Click Edit.
   The Edit Pricing Strategy window appears.
2. Click Delete.
   The Delete Pricing Strategy message appears.
3. Click OK.
   The pricing strategy is deleted and the values return to the default pricing strategy.
   

Data Details

If your quoted and booked prices have to include taxes, like a Value-Added Tax (VAT), include the tax in Pricing Strategy.

Note: All revenue figures in SmartSpace are displayed exclusive of VAT.

Meeting

Field	Description
Function Room	The name that you configured in Database Setup in the Function Rooms tab, if you checked "Include in Pricing Strategy."
Optimum Capacity	The maximum, or "wish," attendee capacity value for each room when configured as a Meeting Event types and seating styles where a lunch or dinner is not the main purpose. Used to differentiate from Banqueting and Wedding event types. room. This column uses the value that you configured in Database Setup in the Function Rooms tab and is read-only.
Optimum Delegate Package	The maximum, or "wish", day delegate rate for each function room. Type a value for each demand level.
Minimum Delegate Package	The minimum, or "walk," day delegate rate acceptable for each function room. Type a value for each demand level.
Minimum Capacity	The minimum, or "walk," number of attendees acceptable for each function room. Type a value for each demand level.
Minimum Revenue	The minimum, or "walk," total revenue acceptable for booking for each function room and demand level. SmartSpace calculates this value, multiplying Minimum Capacity by Minimum Delegate Package.
Minimum Room Hire	The minimum, or "walk," room rental price for each function room that is acceptable for a room-only booking without catering revenues. The system calculates this value, multiplying Minimum Room Hire percentage by Minimum Revenue. You define the Minimum Room Hire percentage in the Settings tab of Database Setup. The configured percentage is displayed above the column. For example, you could set 75% for high, 60% for medium, 50% for low, and 40% for distressed.

Rental/Catering

Field	Description
Function Room	The name that you configured in Database Setup in the Function Rooms tab, if you checked "Include in Pricing Strategy".
Optimum Capacity	The maximum, or "wish," attendee capacity value for each room when configured as a Rental/Catering Use this event type if you price based on function room rental, with catering quoted separately. In other words, instead of a Day Delegate, or Package, rate that combines rental and catering into one price quoted per person. event. This column uses the value that you configured in Database Setup in the Function Rooms tab and is read-only.
Optimum Rental	The maximum, or "wish," rental rate for each function room. Type a value for each demand level.
Minimum Rental	The minimum, or "walk," rental rate acceptable for each function room. Type a value for each demand level.
Minimum Attendees	The minimum, or "walk," number of attendees acceptable for each function. Type a value for each demand level.
Minimum Catering Per Person	The minimum, or "walk," catering revenue acceptable per person for each function room. Type a value for each demand level.
Minimum Catering Revenue	The minimum, or "walk," total catering revenue acceptable for each function room and demand level. The system calculates this value, multiplying Minimum Attendees by Minimum Catering per Person.
Minimum Total Revenue	The minimum, or "walk," total revenue acceptable for each function room and demand level. The system calculates this value, adding together Minimum Rental and Minimum Catering Revenue.

Wedding

Field	Description
Function Room	The name that you configured in Database Setup in the Function Rooms tab, if you checked "Include in Pricing Strategy".
Optimum Capacity	The maximum, or "wish," attendee capacity value for each room when configured for a Wedding Event types and seating styles that accommodate a lunch or dinner, plus a dance floor and a head table for the wedding party. Used to differentiate from Meeting and Banqueting event types.. This column uses the value that you configured in Database Setup in the Function Rooms tab and is read-only.
Optimum Wedding Package	The maximum, or "wish," wedding package rate for each function room. Type a value for each demand level.
Minimum Wedding Package	The minimum, or "walk," wedding package rate acceptable for each function room. Type a value for each demand level.
Minimum Capacity	The minimum, or "walk," number of attendees acceptable for each function room. Type a value for each demand level.
Minimum Revenue	The minimum, or "walk," total revenue acceptable for booking for each function room and demand level. SmartSpace calculates this value, multiplying Minimum Capacity by Minimum Delegate Package.
Minimum Room Hire	The minimum, or "walk," room rental price for each function room that is acceptable for a room-only booking without catering revenues. The system calculates this value, multiplying Minimum Room Hire percentage by Minimum Revenue. You define the Minimum Room Hire percentage in the Settings tab of Database Setup. The configured percentage is displayed above the column. For example, you could set 75% for high, 60% for medium, 50% for low, and 40% for distressed.

Banqueting

Column	Description
Function Room	The name that you configured in Database Setup in the Function Rooms tab, if you checked "Include in Pricing Strategy".
Optimum Capacity	The maximum, or "wish," attendee capacity value for each room when configured for a Banquet Event types and seating styles where a lunch or dinner is the main purpose. Used to differentiate from Meeting and Wedding event types.. This column uses the value that you configured in Database Setup in the Function Rooms tab and is read-only.
Optimum Catering Package	The maximum, or "wish," catering package rate for each function room. Type a value for each demand level.
Minimum Catering Package	The minimum, or "walk," catering package rate acceptable for each function room. Type a value for each demand level.
Minimum Capacity	The minimum, or "walk," number of attendees acceptable for each function room. Type a value for each demand level.
Minimum Revenue	The minimum, or "walk," total revenue acceptable for booking for each function room and demand level. SmartSpace calculates this value, multiplying Minimum Capacity by Minimum Delegate Package.
Minimum Room Hire	The minimum, or "walk," room rental price for each function room that is acceptable for a room-only booking without catering revenues. The system calculates this value, multiplying Minimum Room Hire percentage by Minimum Revenue. You define the Minimum Room Hire percentage in the Settings tab of Database Setup. The configured percentage is displayed above the column. For example, you could set 75% for high, 60% for medium, 50% for low, and 40% for distressed.

Best Practices

Create a Demand-Based Strategy

Set different strategies for each of your demand levels. Start with the strongest demand level, High. Set the optimum (or "wish") price and the minimum (or "walk" or "walk-away") price. Set the minimum capacity. You should have enough demand for that price range and number of attendees to sell the function rooms on all High-demand days. To check your demand, review the Daily Demand by Attendees. Define the other levels, down to Distressed, by lowering the values.

Note that medium and low are your normal price points. High is for exceptional demand. If needed, review the definitions of your Demand Levels.

Create a Realistic Strategy

Your optimum and minimum prices need to consider your available demand. If you push your prices too high, beyond the available demand, your sales team won't use your strategy or will find ways around it. The same is true if your strategy is too complex.

Optimise Price AND Space Utilisation

Improving your results is not only about increasing price, it's also about Space Utilisation. Use the Minimum Capacity field with the goal to sell a few more people in each meeting room, each day. By holding out for larger groups during high demand, you can dramatically increase revenue.

For example, your function room can hold up to 20 persons. On high demand days in the past, you have had multiple requests for the 11-20 attendee size. You want to turn down all requests during high demand for anything less than 18 attendees. Therefore, set the Minimum Capacity to 18. For Medium demand, you might hold out for 15 and set it to 12 in Low demand.

The Minimum Revenue column shows the combination of price and space utilisation, by multiplying the minimum price with the minimum capacity.

Define Your Strategy by Function Room

Vary your pricing and your Minimum Capacity by function room. Scenarios include:

• On high demand days, your function rooms for small groups get many more bookings than your larger rooms. Therefore, for the smaller rooms you want to hold out for larger groups and set the Minimum Capacity at the same value as their Optimum Capacity. For your larger rooms, you set a lower Minimum Capacity.
• Your smaller and mid-size rooms are comparable to those of your comp set. But your large ballroom has unique features that none of your competitors can match. Therefore, your medium demand pricing is only slightly below high demand, while the difference is larger for the other rooms.