How to solve overbooking problems

Are you dealing with the frustrating issue of overbooking?

You’re definitely not alone! Countless hoteliers face this challenge daily, and it can lead to a cascade of negative consequences for both guests and staff. But don’t worry; we’ve got some fantastic insights to help you tackle this problem with confidence and ease. Let’s dive in! 

Understanding Overbookings: A Common Hurdle    
Overbooking is a frequent challenge within the hotel industry, and it often stems from various factors, including:

1.   System or Technical Issues  
2.   Human Errors by Staff  
3.   Intentional Overbooking Tactics  

Let’s break these down so we can address them effectively!

  1. System or Technical Issues    
To fully grasp this, we need to understand how bookings work, especially with popular online travel agents like Booking.com and Expedia. Most modern hotel management systems incorporate channel managers that connect seamlessly with these platforms. 

Imagine this process: when a reservation is created on Booking.com, it flows through various stages:

  Booking.com   →   Channel Manager   →   Hotel Management System  

Then, the updated inventory circles back: 

  Hotel Management System   →   Channel Manager   →   Booking.com  

During this process, there’s often a slight lag—typically between three to five minutes—between the time a booking is created and when it appears in your hotel system. This gap can create the potential for overbooking if not monitored closely.

  2. Human Errors by Hotel Staff    
Mistakes can also arise due to several reasons, including:

-   Using Excel Instead of Dedicated Software: Relying solely on Excel for inventory management creates significant risks for overbooking due to potential errors in data entry and tracking.
  
-   Ineffective Hotel Management Software: While some hotel management systems exist, they may not offer adequate features to help prevent overbookings. This is why it’s critical to select a robust system designed to support your operations and provide reminders, helping staff avoid unconscious mistakes—like those stemming from fatigue or stress.

Investing in excellent hotel management software is vital not just for your operations, but ultimately for providing your guests with a fantastic experience.

The Impact of Overbooking    
When overbooking occurs, it can lead to deeply disappointing experiences. Imagine a weary traveler arriving after a long journey, only to find their room isn’t available. It’s a frustrating situation that can lead to heightened tensions in your lobby and stress for your staff and other guests.
At MEDIATOR, we proudly offer a three-part control mechanism to help prevent overbooking effectively:

1.   Real-time Alerts: If a team member attempts to create an overbooking scenario, our system immediately alerts them.
   
2.   Manager Approval: Should the team member wish to proceed, they’ll need a manager’s approval, ensuring multiple layers of oversight.

3.   Instant Updates: As soon as a booking is made, Mediator swiftly updates all room categories. Plus, we run automatic inventory updates every 10 minutes, minimizing communication gaps, and all these happen behind the scenes

Additionally, MEDIATOR enables a manual update option so that managers can feel fully in control of their inventory.

With these features in place, MEDIATOR is here to help you avoid the ups and downs of overbooking, creating a positive environment for both teams and guests.

  A Real-Life Lesson    
Let me share a story about a hotel owner who experienced significant challenges with profitability. He took the initiative to renovate his hotel, enhance guest amenities, and even engage a company for staff training. With beautiful reviews rolling in, he was excited to see his hard work pay off. However, he opted to manage reservations via Excel rather than embracing advanced software solutions. Despite my encouragement to switch to hotel management software MEDIATOR, because in high season, and with team turnover, it would have serious consequences running a hotel with Excel, ruining all his effort and costing him money, but he somehow resisted, did not listen, and tried to save miserable cost per month, and continued using Excel.
Soon, overbookings, irritated guests, employee turnover, low scores, and lost revenue led to a significant decline, from a 9.3 score to 8.0. And from $100 ADR, it ended at $40 ADR. And now he is selling the hotel. 
If you lack control over room inventory, reservations, billing, and housekeeping, and don't have sufficient reports for analytics, the outcome is always the same.

But Here’s the Bright Side!    

The good news? There’s an accessible and effective solution at your fingertips!

Utilizing hotel management software like MEDIATOR can significantly enhance both your guests’ and team members’ experiences, making operations smoother and more enjoyable.

We have also created a free package of MEDIATOR, which substitutes for Excel operations or software lacking Channel Manager integrations, helping hoteliers avoid mistakes like those mentioned above.
 
By right hotel management software with the right tools, you can enjoy a thriving hotel operation, free from the pitfalls of overbooking.