Ahh, summer. Sunshine and . . . budgeting. If the thought of drafting next year’s budget stresses you out, then it may be time to upgrade your hotel budgeting software.
Most hotel companies start out using Excel spreadsheets for their budgets. While it is a useful tool, it has its limitations. As your hotel company’s needs mature, so should your software. Spreadsheets can be full of frustration; for instance:
- Mistakes are easy to make and difficult to catch.
- It’s complicated to share if you only want to share sections or totals without disclosing specific line items.
- It is tedious and time-consuming to combine spreadsheets into a single global budget, making it challenging to delegate budgeting by the department.
On the other hand, when using an ERP with a built-in budgeting module, such as Hotel Investor Apps ERP & Accounting software (HIA), the former challenges become advantages:
- It is easy to create a new budget, either by uploading an Excel template, or starting with pre-existing actuals or another budget.
- Because it is hosted on the cloud, all changes are automatically saved and synced for consistency and single-version-of-the-truth.
- The software can catch mistakes, such as when the total budgeted amount and distributed amount do not equal.
- It is easy to share access with other users while knowing visibility will be restricted based on existing account structure and user security settings.
- You can switch effortlessly between property view and portfolio view for ultimate visibility planning.
When using HIA Budgeting, here are a few best practices:
- Because the budget module is fully integrated with HIA accounting, start your budget with an existing ledger, such as last year’s actual or last year’s budget.
- Save time by using a multiplier to increase or reduce the budget overall by a set percent, or increase or decrease values by the department by focusing on an account range.
- Take advantage of unlimited custom drivers to create your own budget formulas, to create as accurate calculations as possible.
- Validate your budget by comparing it against the hotel’s actual ledger, budget from a previous year, or another hotel.
- Budget by day is a good way to account for large events or groups
- Create multiple budgets to cover various “what-if” scenarios.
- Treat your budget as a living document that is continually updated for the most accurate forecast. You can also create a locked version of the budget for your reference as well.
Tip: Your budgets are available to view in HIA in various reports. You can run a 12-month budget report, Trailing 12-month Budget Report or monthly budget reports. Additionally, your daily report and financial statements have the option to include a budget column.
By using budgeting software that is fully integrated with your hotel accounting, and designed for hotels, you can streamline the process, reduce errors, more accurately predict operational needs, and plan for future cash flow. If you are ready to see the next generation of hotel accounting and budgeting software, request a demo here: https://hotelinvestorapps.com/request-a-demo/
Jaime Goss has over a decade of marketing experience in the hospitality industry. At Hotel Investor Apps, Jaime heads up marketing initiatives including brand strategy, website design, content, email marketing, advertising and press relations.