{"id":13406,"date":"2020-03-12T14:27:00","date_gmt":"2020-03-12T13:27:00","guid":{"rendered":"https:\/\/slope.it\/staging\/?p=13406"},"modified":"2020-03-18T09:09:05","modified_gmt":"2020-03-18T08:09:05","slug":"what-are-derived-rates-and-why-are-they-important","status":"publish","type":"post","link":"https:\/\/slope.it\/staging\/en\/2020\/03\/12\/what-are-derived-rates-and-why-are-they-important\/","title":{"rendered":"What are derived rates and why are they important"},"content":{"rendered":"\n<h2 class=\"wp-block-heading\">The importance of creating an easy-to-manage hotel tariff model<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The management of<strong> derived rates<\/strong> has a certain importance in defining the rate model of a hotel.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In this article we will explain why it is important to define a tariff plan that is <strong>simple<\/strong> to manage but at the same time also <strong>convenient<\/strong> in terms of revenue.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The <strong>tariff derivation<\/strong> is a fundamental functionality for a hotel management software, because it allows the hotelier to simplify the definition of prices.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Before explaining what a derived tariff consists of, let&#8217;s try to define what we mean by the terms &#8220;<strong>tariff&#8221; <\/strong>and &#8220;<strong>price<\/strong>&#8220;.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Difference between tariff and price<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The<strong> price <\/strong>is the amount for which a room is offered for sale for a given combination of guests, date and treatment.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The<strong> rate<\/strong>, on the other hand, defines the booking conditions for a particular accommodation and the relative treatment.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Example of definition of a tariff model that exclusively uses the tariff derivation<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Let&#8217;s start with a practical example of a <strong>tariff definition<\/strong>, taking into consideration a hotel that offers the &#8220;<strong>Room Only<\/strong>&#8221; and &#8220;<strong>Bed and Breakfast<\/strong>&#8221; treatment.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Our example hotel is made up of <strong>2 TYPES<\/strong> of accommodation: <strong>double and suites.<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">We suggest our hypothetical hotel manager to create <strong>5 rates<\/strong>:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Room only;<\/li><li> Non-refundable overnight stay (early bird);<\/li><li> Bed and Breakfast;<\/li><li> Non-refundable Bed and Breakfast (early bird);<\/li><li> Bed and Breakfast OTA.<\/li><\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">The &#8220;<strong>non-refundable&#8221; rates<\/strong> will be purchasable only with a minimum booking advance; this avoids the sale of a discounted rate but not refundable under the date.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The &#8220;<strong>overnight only<\/strong>&#8221; rate will be the <strong>basic rate<\/strong> on which we will define the derivation rules for generating the prices of the other rates.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This allows us to create a tariff model that is <strong>derivable<\/strong> with modification rules which can be:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Fixed supplement per guest;<\/li><li> Fixed discount per guest;<\/li><li> Percentage supplement;<\/li><li> Percentage discount.<\/li><\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">This mode allows you to define the prices for the basic rate only (in our example the &#8220;overnight only&#8221;) and the system will automatically take care of generating the prices for the other rates.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Because the derived rates simplify hotel management<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The <strong>derived rates <\/strong>simplify the hotel management because if you decide to change<strong> the basic room only rate<\/strong> for the double room, bringing it from \u20ac 100 (per night) to \u20ac 125 (per night), the system will automatically update the rates set as derived.<br> So the <strong>non-refundable overnight <\/strong>room rate, for which we have set a <strong>10% percentage discount<\/strong>, will update automatically and will cost \u20ac 112.50.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Same goes for the <strong>Bed and Breakfast<\/strong> derived rate which will automatically go up to \u20ac 137.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The <strong>great strength <\/strong>of having derived rates is that it will avoid going to <strong>manually change prices <\/strong>every time we carry out even a small tariff operation. In addition, manual editing is exhausting work and subject to distraction errors.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Inherit restrictions<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The<a href=\"https:\/\/slope.it\/staging\/en\/features\/property-management-system\/\"> PMS <\/a>of the management software of your facility must offer you the possibility to automatically set the same restrictions in the derived tariff as the basic tariff.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">For example, if you want the derivative <strong>&#8220;Bed and Breakfast non-refundable<\/strong>&#8221; rate to have the <strong>same restrictions<\/strong> as the base rate, that is, to be sold only on Friday-Saturday-Sunday and to have a minimum stay of two nights, this must be possible.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">How to avoid creating confusion with rounding prices<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">It may happen that going to set prices with discounts or percentage supplements, prices are generated that are <strong>not rounded to the euro<\/strong>, but with rather strange decimals that can cause confusion in the customer.<br> For a <strong>question of image and communication<\/strong>, it is important to ensure that the management software is able to round the price down to the euro. The rounding operation must take place automatically for all the derived tariffs.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Tariff derivation as a strategy at the basis of sales policies on OTA portals or agencies<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">With the abolition of the<a href=\"https:\/\/www.hotelnerds.it\/abolita-definitivamente-parity-rate-italia-ddl-concorrenza-legge\/\"> parity rate<\/a>, many hoteliers have started offering different rates on the official website compared to those on the OTA channels, perhaps by applying a <strong>10% <\/strong>surcharge on the latter.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Also in this case it is evident how the <strong>application of a derived tariff <\/strong>helps to simplify the management and sale process in the OTA channels.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">What do we mean?<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\"><br> The rooms of my hotel are on sale on<strong> three different OTA channels<\/strong>, where I decide to apply different prices.<br> Thanks to a derived rate, it will be sufficient to take a basic rate from which to start (in this case the Bed and Breakfast) and go to apply fixed supplements per guest or percentage increases.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">If in reading the article there were doubts about how to set rates and prices for your hotel, we refer you to reading<a href=\"https:\/\/slope.it\/staging\/en\/2018\/07\/13\/how-to-set-rates-and-prices-for-your-hotel\/\"> this post.<\/a><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Slope allows you to define the setting of the <strong>derived rates <\/strong>in an absolutely flexible way, thanks to an intuitive interface that provides the hotelier with the most appropriate tools to create a<strong> hotel tariff model that is easy to manage <\/strong>and absolutely modular.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Request a<a href=\"https:\/\/slope.it\/staging\/en\/request-demo\/\"> trial demo<\/a> of Slope, hotel management software now.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The importance of creating an easy-to-manage hotel tariff model The management of derived rates has a certain importance in defining the rate model of a hotel. In this article we will explain why it is important to define a tariff plan that is simple to manage but at the same time also convenient in terms [&hellip;]<\/p>\n","protected":false},"author":9,"featured_media":4352,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[196],"tags":[],"class_list":["post-13406","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-web-marketing-hotel-en"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.6 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>What are derived rates and why are they important &#8226; Slope<\/title>\n<meta name=\"description\" content=\"The management of derived rates has a certain importance in defining the rate model of a hotel. 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