Deciding what to charge your guests that use your retreat center can be a long and precise procedure that can leave some camp and retreat staff wondering where they should begin. Using these methods described below will help you develop a plan that your team can use annually to discover the best way to charge your participants fairly and competitively without the risk of receiving less revenue per event to pay for your own costs. Here are three core practices to use when setting up your rates.
A Thorough Competitive Analysis is a Must
Start with a competitive analysis. Your region’s existing retreat centers will have collaterals and pricing lists online that you can request so you can see what they are offering and how much they are charging. Make a list of the base rate for those properties’ standard retreat packages of 2 nights lodging, 5 meals and meeting space. Compare and average those rates to find a medium in-between and this is your region’s average rate. This is a good starting point for the idea of where you most likely want to capture some leads since they will be looking at similar rates around the region. It is important that you consider all the amenities each facility has compared to your own to make sure you are looking at side by side packages and not charging more or less for what you may offer vs. what they are offering.
What Are Retreats Costing You?
Discover your actual costs to host retreats. Take your staff, food and utilities costs into factor and determine what is called a “cost per room occupied” in the hotel industry but what we like to call a “cost per person attending” when referring to retreat packages. Make sure that your food cost is in a range similar to conference center catering when bundled with hotel rooms. For example, most food costs in those budgets range from 13-17% per person for the entire bundle. Check what staff you will have to have there and what their costs are. What all buildings will you need to turn on or can leave off to affect your utilities cost. Finding out these factors will get you a % of the revenue that comes in from a retreat vs. what your profit will look like. Then make sure your rates are high enough or appropriately low enough to handle those costs. Here’s a nice article and some breakdown examples about how hotel management determines those per room night costs: http://hotelfinancialcoach.com/hospitality-financial-leadership-fixed-variable-costs-and-room-revenue-management/
Create Your Pricing Format and System
Lastly, discover what kind of discounts and or upgrades for various types of sizes of groups and lodging options that you can tweak compared to your base package rates and create some rate charts to use in your proposals. A group of rate charts for each type of retreat duration is a good way to make proposals look very personal and unique. For instance, have at least 3 to 4 different charts for your most commonly requested retreat duration. One chart will be for a 2-night stay and others will be for longer durations. In those charts you can have 2 to 3 different lodging types with starting rates allowing for the increase of group attendees. Larger groups will be attracted to discounts for the more attendees they bring, and they can see increases for their more private type lodging needs.
Determining your rates to publish to your prospective clients can seem daunting but once you have a solid set of pricing to use, you can use that set virtually indefinitely with just a yearly tweak for inflation at the going %. It is also highly recommended to not have your rates on your website or other places publicly and only have them delivered to clients via professional materials and collaterals. This allows your sales staff to identify potential rate increases if warranted but also allow for custom quotes when discounts when special cases arise.
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