Managing Service Demand in the Hospitality Industry

CITY HALL, Singapore - Aug. 16, 2020 - PRLog -- As a marketer in the hospitality industry, you need to employ strategies to generate demand for your services and to effectively manage this aspect of your job function.

In his article on Your Article Library (https://www.yourarticlelibrary.com/company/service-management/strategies-for-managing-demand-of-services/34185), Smriti Chand shares some strategies for managing the demand of services based on certain conditions that may exist in a fixed-capacity service organization. These conditions include demand being greater than the maximum capacity, demand being greater than the optimum (most advantageous) capacity level, demand and supply being equal at the optimum capacity level, and demand being lower than the optimum capacity level.

There is a difference between maximum capacity and optimum capacity. When demand is greater than your maximum capacity, you may have to deny some customers the opportunity to stay at your property and it is possible you could lose them permanently. If demand is greater than your optimum capacity level but less than your maximum capacity, you will be able to accommodate all clients, but the quality of your service may deteriorate, and customers may not enjoy a fulfilling experience.

Underutilization will result if demand falls below your optimum capacity level, which is the level at which you are operating below full capacity in order to maintain superior customer service and happy customers. In order to optimize capacity in peak seasons, examine the mix and total volume of business. Your mix should include market segments that are more profitable to your business and fit well with its mission as well as enhance the setting you wish to create.

Consider the following to help you to manage demand: (1) Do nothing and let demand find its own levels. (2) Influence demand by reducing it in peak periods and increasing it when you have surplus capacity. (3) Adopt a reservations system that will assure customers of access to capacity at certain times. (4) Establish formal queuing systems. (5) Combine approaches 4 and 5.

eCornell offers a marketing certificate called Strategic Hospitality Marketing (https://www.ecornell-genashtim.com/certificates/category/...). When you pursue this program, one of the many things you will learn is how to manage service demand through pricing and distribution strategies.

eCornell courses are approved by SkillsFuture Singapore for SkillsFuture Credit as well as by HRDF Malaysia under its SBL Scheme.