Hotel Online  Special Report

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Industry First:  VIP International Inks Strategic Alliance
with Buckhiester Management to Optimize Profitable
Revenue for Operators

Paul’s Motor Inn and Laurel Point Inn Pull Away from the Pack
with 75% Profitability on Boosted Revenue

Calgary, Alberta, Canada — September 14, 2004 — In a move that gives operators a proven systematic way to reach higher profitability and increase the value of their hotels, VIP Investment Corporation today announced an exclusive strategic partnership with Seattle-based Buckhiester Management USA, Inc., a revenue management industry leader. The first-of-its-kind accord combines VIP’s channel distribution and sales leadership with Buckhiester’s structured REVolution™ business process and revenue management toolkit in one turnkey solution for significantly increasing revenues.  Participating VIP clients will have access to Buckhiester’s REVolution™ combined with VIP’s ongoing channel management and professional sales support.

“By partnering with Buckhiester Management we are offering, under one umbrella, a proven way to optimize profitable revenue for our clients and manage all of the channels that deliver it,” said Kelly Blake, president of VIP International.  “Profitable revenue is the crucial slice of incremental income above fixed costs that most hotels are now leaving on the table.  It’s the difference between an asset that grows in value for its owners, and one that does not break even.  Buckhiester Management’s unique business mapping process excels in calculating that incremental revenue potential for hotels and increasing it.” 

Bonnie Buckhiester, president of Buckhiester Management USA Inc., said, “The practice of revenue management is a distinct discipline in our industry.  We have simplified it by giving operators the tools to optimize each link in the chain of events that creates revenue.  With our proprietary business process REVolution™, operators are able to identify the gaps in their revenue management strategy, establish benchmarks for superior levels of rate maximization, and then teach the discipline to others in their organization.  VIP has a genuine passion for revenue management which makes them a perfect match with Buckhiester.” 

REVolution™ Tools from Buckhiester

Effective immediately, VIP will offer its clients Buckhiester Management’s one-of-a-kind REVolution™ toolkit, which is a proven methodology that includes workshops, practical application decision support tools, follow-up and coaching to train hotel operators in revenue management.  The REVolution™ process focuses on:

  • Product Definition – Understanding what kind of hotel you are, what market you want to attract and if you are aligned with your customers’ needs;
  • Competitive Benchmarking – Establishing competitive-set comparisons that guide price setting to gain maximum revenue for each market;
  • Strategic Pricing – Refining rates to optimize all of a hotel’s distribution channels; 
  • Business Mix Manipulation – Matching segmentation strategies with the new ways different consumers buy rooms, and optimizing each property’s segment blend;
  • Demand Forecasting – Developing rate management and stay controls based on historical demand, current market forces and future trend information;
  • Distribution Management – taking distribution beyond channel management to optimize every manner in which the product is sold.
Paul’s Motor Inn, Laurel Point Inn Overall Revenue Rockets $550K on 75% Profitability 
 
Laurel Point Inn in Victoria, British Columbia, first partnered with VIP International in 1991 for GDS connectivity and was joined by its sister property, Paul’s Motor Inn, in 2001 when Buckhiester Management was brought in to train Laurel Point’s managers.  VIP’s initial role was to manage the vast range of Internet channels and simplify how they communicated inventory and rates.  Avril Matthews, revenue manager for both properties, explained, “We used to send dozens of faxes every day notifying the large number of Internet companies selling our rooms about rate and inventory 

Laurel Point Inn
 680 Montreal St
Victoria, British Columbia
adjustments.  The first thing VIP did was provide access to the GDSs.  In 2001, we began using their technology to consolidate communications and update all electronic channels with one access point.  This saved us a great deal of time and made our online offering more accurate.  It was a big step, and allowed us to instantly maximize our rates and availability across all four seasons.  When I input a season now I set parameters based on our corporate rates for each individual market to keep revenue up.  After our Laurel Point Inn training we decided to run both properties’ reservations departments out of the same office so that we could apply our new understanding of revenue management to Paul’s Motor Inn.”  Paul’s Motor Inn saw its Internet reservation segment jump 47 percent in 2002 year-over-year.

The two sister properties have been using the combined services of VIP and Buckhiester Management for three years with stellar results.  Avril Matthews continued, “We started using Buckhiester’s REVolution™ toolkit alongside VIP’s channel management in 2001.  Although the two companies were not partnered then, after one year of working with both companies we showed an increase of $550,000 in revenue over the previous year, in spite of a plunging economy.  The following year we increased another $500,000 year-over-year; but the best part is our profitability on the increased revenue was 75 percent.  We continue to perform very well compared to our market.” 

Matthews explained that the unique Buckhiester process is customized for every property owner and that, before their REVolution™ training began, Laurel Point Inn’s entire rooms division management team was interviewed.  “We were asked where we are now, where want to be and what our goals are,” Matthews continued. “They showed us key markets we had not considered and we learned how to price each market separately plus optimize our segment participation.  Discovering ‘micro markets’ was important to us because our transient segment, for example, is composed of government, seniors, AAA, and negotiated corporate rates, each with different revenue potential.  Understanding our strategic pricing was the turning point; for us it was huge.”  Laurel Point’s team was coached in how each micro market has different stay patterns and how accurate demand forecasting can help protect availability for higher rated segments to maximize revenue and occupancy.  “Buckhiester’s training was a logical step-by-step process over a period of months.  They taught us how to spot individual markets and how to participate in them across all our seasons.  Buckhiester educated our managers in a comprehensive process that optimized the tools we already had, like VIP’s channel management and reservation technology.” 

New VIP Division:  Revenue Management Professional Services
 

VIP President Kelly Blake said a new Revenue Management Professional Services (RMPS) division will eventually be formed within VIP to provide the benefits of the strategic partnership with Buckhiester Management to its clients, giving VIP four specialized divisions: CARS, hotel, airlines, and RMPS.  Blake underlined his message to operators, “If you are not profitable, you definitely need the Buckhiester Management tools we are offering. If you are profitable, you need to ensure these skills are finely honed to stay ahead of your competitive set.”

Kelly Blake

About VIP
VIP Investment Corporation (www.vipintcorp.com) is a channel marketing organization that drives revenue for hoteliers, car rental owners and regional airlines through a multi-channel reservation sales center, the adoption of leading-edge technology, and partnerships with clients to provide ongoing education.  Founded in 1979, the privately held Calgary, Alberta-based firm has a mission of optimizing profitable revenue for clients.  This is accomplished through mastering the electronic channel marketing environment, developing and implementing strategies for each client's unique position and educating customers about how to optimize participation in the changing electronic marketplace.  VIP, the industry's second largest provider of reservation sales services to hotels, car rental companies and airlines, serves more than 5,000 clients worldwide.   A sister subsidiary of VIP acquired Lexington Services in November of 2003.  The combined companies are a central distribution point to every viable Internet Web booking site, and to all of the major global distribution systems including Sabre, Galileo, Pegasus, WorldRes, Amadeus, and Worldspan. VIP is headquartered in Calgary, Canada with a USA headquarters in Dallas, Texas and significant development office presence in Denver, Colorado, London, United Kingdom, Hong Kong and other cities located around the world.

About Buckhiester Management USA Inc. 
Buckhiester Management USA Inc. is an industry leader in Revenue Management education, training and practical application tools.  Using a unique and structured business process approach, Buckhiester USA enables hotels to develop Revenue Management as a core competency.  Buckhiester USA deploys a proprietary diagnostic process called REVRoadMap™.  This business mapping process calculates a hotel’s incremental revenue potential by examining the six key Revenue Management components.  From this diagnosis, Buckhiester USA develops customized learning programs using its one-of-a-kind product REVolution™, an effective, affordable combination of revenue management tools, training and process.  Clients include Fairmont Hotels & Resorts, Westin Grand, Marriott Residence Inns, Pan Pacific Hotels & Resorts, Intrawest Resort Group, Radisson Hotels International, Coast Hotels & Resorts, Joie de Vivre Hospitality and Tourism Vancouver.  Buckhiester has also been chosen by HSMAI to provide all Revenue Management content to their association.  Founded in 1995, Buckhiester has offices in both the U.S. and Canada. 

###
Contact:

VIP International
Rick Shaum
Senior Vice President Sales and Marketing
VIP International Corp.
(719) 487-0789
rshaum@vipintcorp.com
www.vipintcorp.com

Buckhiester Management USA Inc.
Victoria Edwards, VP Strategic Development
206-694-4555
victoria@buckhiester.com
www.buckhiester.com



 
Also See VIP International Continues Strategic Travel Industry Expansion, Tapped by Harmony Airways for Call Center Reservation Services / August 2004
Lexington Services Boosts Internet Bookings and Revenue for Clients through Targeted Promotions, and Hands-On Channel Management / July 2004
Lexington Services Introduces First-To-Market Hotel Website Package Booking Engine / June 2004
VIP Adds Website Services and Merchant Express to Drive Property Bookings, Maximize Rates / May 2004
336 New Properties Chose VIP International to Drive Channel Reservation Sales in First Quarter of 2004 / April 2004
Franchisees on the De-flagging Fence: A Gamble Or A Golden Goose? Former Franchisees Talk Specifics About Channel Loyalty and How They Leverage VIP International Channel Marketing to Succeed as Independents / March 2004
Lexington Services Launches Galileo's Next-Generation Seamless Solution, Inside Shopper™; Gains Access to Real-Time Rates and Availability / March 2004
Midscale Franchisor Hands Franchisees 22% Increase in Internet Bookings; Country Hearth Inn Fuels 22% Growth in 2003 with New Internet Booking Technology, Branding Strategy for Franchisees; Projects 28% Growth in 2004 / February 2004
Study: Room Rates 6.5% Higher For Reservations Booked From Hotel Sites - VIP International Launches Website Services to Drive Traffic to Property Sites / December 2003
An Affiliate of VIP International, Reaches Definitive Agreement to Acquire Lexington Services / November 2003
VIP International Boosts Hotel Reservation Services, Selects Voxify to Reduce Costs for Clients, Enhance Call Center Efficiency / October 2003
#1 Provider of Car Rental Software Teams with VIP International to Fuel Independents’ Reservation Volume / October 2003
Business Travelers, Consumers Grab Lower Rental Car Rates, Book Online from Independent Agency Site / September 2003
E-Z Rent A Car Perfects Internet Strategy to Boost Reservations 20% in 2003 / September 2003
WorldRes Agreement Gives VIP International Hotels Second ‘Low-Fee’ Merchant Model Program / Aug 2003
Top Channel Marketing Provider VIP International Taps Industry Veteran to Power Marketing Efforts, Funnel 158% Growth  / Aug 2003
VIP International Cements Reputation as Leading GDS and Channel Marketing Provider for Asia Pacific / Aug 2003
Hotel Owner/Operators Disclose Secrets of Web Booking Success / June 2003
Dave Crawford Appointed Director of Airline and Auto Rental Business Development for VIP International / June 2003
Hotel Company Sharpens Channel Management for 22% Increase in Average Length of Stay for GDS Bookings, 14% Jump in ADR / June 2003
Interstate Hotels, Candlewood Suites, Regal Hotels, Canadian North Airlines Shift Call Center Responsibility to VIP: Interstate To Pass Along 8% to 10% Savings to Properties; Regal Hotels up 26% / May 2003
Zero Transaction Fees: Independent Hotels, Chains Profit from Landmark Agreement; Manage Discounted Rooms Through Central Res Systems at No Cost / May 2003
Interstate Hotels & Resorts Signs Five-Year Agreement with VIP International to Outsource Call Center; Expects to Pass Along 8 Percent to 10 Percent Savings, Increased Revenue to Hotels / April 2003
Hong Kong’s Largest Hotel Operator Sees Reservation Numbers Jump 26 Percent In First 10 Months of 2002, Increases Global Presence with New Reservation Sales Provider / February 2003
Canadian North Chooses Calgary-based VIP International to Provide Voice Reservation and Support services / January 2003
Midwestern Chain Targets Value-Conscious Senior Market; Picks New Channel Marketing Provider to Power Goal of 100% Increase in Bookings / January 2003
Midwestern Management Firm Gains 69% Increase in GDS Reservations YTD at 12 ‘Enhanced Limited-Service’ Properties / Dec 2002
Texas-Based Hotel Chain Captures 104% More GDS Reservations YTD, Speeds Ahead of Economy / Dec 2002
Four Star Calgary Hotel Reports 42% Increase in Bookings During Initial Period With New Channel Marketing Provider / Nov 2002

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