Property Management System and Channel Manager

Okay. Welcome to the Boost Hospitality Podcast. My name is Mark Simpson and this is season six, episode four of the Boost Hospitality Podcast. Today we are going to be talking all about property management systems, otherwise known as pms. And I couldn't think of anybody else better to invite on to this podcast than Naim of Zivu. We're going to get in and we're going to talk about what exactly is a property management software, what exactly is channel managers? We're going to go through the full ins and outs of it. But before we get started, I just wanted to get Naim on and I just wanted to quick introduction and find out more about him, more about XIVU and. And then we'll go from there. So, Naim, welcome. How are we doing? And could you just tell us a little bit more about yourself, please?

Yeah. So my name is Naim. I got into hospitality at the relatively young age, starting off primarily in restaurants as a waiter, and later on in my summer holidays working in hotels. And while at university I started getting into property and then this of them sort of mixed together and I ended up in service apartments. So my initial encounter was when Airbnb was still a relatively new thing, hadn't quite qualified as much as it has now. I started off in Cambridge managing service apartments and setting up a company, managing them for others. And from there I went into rent to Rent SA before I even knew what rent rent meant or what service apartments were. At the time, all I knew about was Airbnb and then something called booking.com that was meant to fill the gap when things went quiet in August. So that grew quite a bit. And then I started facing issues of systematization as the business was growing. So we went within six months when I started working on it properly to about 50 units and we started having some expansion issues. So I decided to slow things down and then took about a year or so to train staff and get things going properly. And when I looked at expanding again, we were facing issues with finding a good PMS or channel manager software. Basically, at first I struggled to understand what the difference was between the two and why you needed to have two separate systems. So that's how Zivu was born, basically. So about two years ago now, I started working with our current team on developing the software and. And that's our latest project.

In simple terms then, and you just quickly touched upon it there. What is pms? What is property management software? What is channel manager in the most simplistic ways that you could describe it to everybody, that's tuning in.

Sure. The way I put it is that the property management system is the brains and the channel manager is the arms. So you've got sort of everything sitting in the PMS coordinating stuff, and then you've got the channel manager that's linking you up with different websites, grabbing the bookings, sending out the prices and so on. So they're meant to help simplify the running of your business, help with your marketing, advertising, reaching more guests across multiple sites and automating the collection of those bookings and processing to some degree.

So in your opinion, why is it so important to have a PMS for your business, whether it is service accommodation or hospitality?

So I guess in service accommodation it's slightly more complex than running something like a hotel in certain aspects. Now, if you've got food and beverage in the hotel, of course that adds complexity. If you got swimming pool and saunas and spas and all of that. But just in terms of if you're doing self catering rooms only in a guest house, say, or if you're doing service apartments. The issue with service apartments is that you've got multiple units in different locations and once you start looking at the operational aspect of managing those and ensuring that the quality is maintained and that all the stakeholders are kept informed, such as your cleaners, know where to go, at what point, that you can be sure that the clean has been done, that you can remotely monitor the qualities of those cleans without having a head housekeeper who's going double checking on everything to make sure you've got the supplies in place, you've got your linens there, your access arrangements are in place. So. So as you start adding more and more units, those things add in complexity and it sort of doesn't scale linearly, you know, you just end up in a mess. So I do know of people who've got, you know, up to 15, 20 units who don't use any software. They run on spreadsheets and Google calendars and just think OTAs between themselves. But it takes up a lot of time and there's a lot of potential for error, so it's okay as long as the business owner is doing it. But if you're thinking of starting to outsource things, if you want to have a VA who's going to answer some emails and they need to know what's going on, you really can't rely just on spreadsheets and iClouding.

Yeah, 100%. That just sounds messy. Like I say, I recommend everybody has a really good property management software channel Manager and a booking engine. Because there are still so many people that I come into contact with that don't have a booking engine on their website. And it's just the fact I've said this many a time, if you haven't got an access on your website where someone can go online and book, then you are going to get left behind in 20, 19, 20. The way that somebody books a property now has changed so much. The old age method of guest finds property sends an email to the property owner asking for availability, waiting for a response and booking it. People want it on an instant. So if you haven't got the systems and the structure set up specifically when you've got listed on booking.com, airbnb, HomeAway, Expedia, you just open yourself up to double bookings, unhappy guests and your business will just suffer for it. Okay then, so real good analogy of what a PMS is and a channel manager. And like you say, you have been involved in serviced accommodation for quite a while now and you've got to know through just networking and being in Facebook groups, so many service accommodation owners, what is the one big mistake that you see people make when they first join a pms, sign up to a pms, or when they first get started on listing their properties on these softwares? What's the one big mistake that you see the majority of them making?

Gonna sound a bit funny, but I think one of the biggest mistakes is the research that people do. So, you know, everyone wants to be as systematic as possible. So you get your spreadsheet, you put your features and then you categorize them and you say, I'm going to call all of them up, I'm going to have my demos or I'm going to go on their website and I'll see how many of these boxes they tick. And I'm going to look at the price and whichever has the best sort of ratio between features and price, that's what I'm going to go for. Now, there's two issues with that approach. I'll first talk about the features issue and then I'm going to talk about the price issue. The issue with the features is that pretty much everyone tries to tick the boxes, okay? And they will tell you that they tick the boxes. The question is, how do they tick the boxes? So a lot of systems out there will tell you they can sort security deposits for you, no problems. Once you start asking more questions, they will tell you they can integrate with various websites once you start more questions asking questions, maybe it's an icon instead of a full API integration. Well, what does that mean? Well, actually, you could end up getting lots of double bookings. You can't send your prices out and you can't retrieve the bookings. So that's a feature issue. You know, as long as it takes a box does not mean it's going to get the job done. And the pricing. I've come across a lot of people who try to find basically the cheapest for the features that they can get. Now, the issue with that is that, as I said, not every feature that is ticked is served in the best way possible by every pms. So if you only look at your price and you don't actually start to look at how much admin time you're spending on managing things through that pms, well, you don't have the full equation. So the issue is basically you need to look at how much time it's costing you or someone who you're going to hire to outsource the work to and add that to the cost of the software and any ancillary systems that you need to support your pms. So it could be that, you know, your PMS gets 50% of the job done and is relatively cheap compared to other PMSs. But then once you start looking at the features that they don't have and you start thinking, well, I need to have a separate system that's going to manage my maintenance and then I'll have a separate system for this. And then if you start looking at the amount of time it takes for you to log in and log out and copy information across, then, you know, those cheap prices don't look that cheap anymore.

I like that Buy cheap, buy twice. And I totally get it. And specifically, when you're starting up a business, and especially with service accommodation, because there's so much cost up front, and I totally get it. You get your property, you do it up to spec so it's presentable and it's attractable to guests. Then you go and look at, you know, everything else that you've got to do, the final things that people look at are normally some of the most important things, because it's all well and good having all the gear, but if you've got no idea on how to get guests through the door, then what is the point? And people do cheap out. And I've seen this so many times when it comes to the most important places. Number one, website, number two, is a property management software and they go for the one that is the cheapest or they make an error in just assuming that the one that's in front of them, the one that all of their buddies are on, are the best one for them. And like you said, not every two businesses are the same. And I really like that bit of advice there is that you've got to do your research. I mean, look at the training that goes on on how to source a property. So so much research is done on that on how to find your property. So why aren't you doing the same amount of research when it comes to picking probably the most important part of your systems and your structure? What is some of the bad advice that you see being given in the industry?

Well, I'd say that perhaps some of the worst advice is outdated advice, namely something that worked three, four years ago but doesn't work anymore. So even when I started my apartments myself, it was enough to put it on Airbnb. And you were fine. You were making lots of money. Then things started weakening a bit and you had to sort of start going on booking.com and you have to think around with HomeAway and holiday lettings, and it sort of worked for another year or two, and then the market really started getting crowded. So if you want to make it work, you basically need to be able to keep that extra slice of income that you're paying to the OTAs or the listing site. So I'd say the biggest advice is the missing advice. You know, the things that are not being said about how important direct bookings are and how you go about getting those direct bookings. I think that's a real lack in most of the training programs out there.

Yeah, I like that. And I like your tagline with xivu. Was it the book Direct Revolutionary. Is that right?

Direct Booking Revolution.

I don't think I do see that on the T shirt. Nice little product placement. I like that. So you're 100% right. You're 100% right. Book direct or direct bookings is not talked about enough. And that is my one goal with this podcast series, is to spread the word about direct bookings. It's one of the big reasons why I wanted to get you on this podcast and on this series, because it is so important for everybody to do. You're 100% right. Three or four years ago, you could just throw up a listing on Airbnb, get really nice photos so your listing stands out, and that's it. That's all you needed to do the same on booking.com but now the amount of people that are doing rent to rent or rent to sa. They're all being getting told the same things at these courses. And you can spot somebody a mile off who's doing service accommodation and the courses that they're doing by the state of the photos. And it has become oversaturated, you can just see in the major cities. So you have to have to be doing something even different now to stay ahead of the trend to be getting that booking first, that direct booking, or even if you have got an OTA booking come in, you've got to know how to convert that into a. Into a direct. And Amanda and David, they spoke about it in episode three and obviously we're going to go on and talk about it now. But what is xivu's goal then? You've created this business out of a need, scratching your own itch, which is normally why some of the best businesses are created. But what is your sort of 5, 10 year goal with this and with direct booking, with. Would you say, Naeem?

Sure. So what I'd say is that the business itself or the software itself was born out of the need, the PMS side, the channel manager side and all of that. It was probably a conversation on the Facebook group. I think it was a post by Jason Living and that really triggered what has turned XIVU into becoming a cause rather than just a business. You know, the cause for getting the direct bookings and the conversation was regarding rate parity, narrow and wide rate parity. And I'm not going to go into much detail, but basically OTAs will penalize you if you have a cheaper price on your own website than on their website. It used to be that you were not allowed to have a cheaper price on any ota, so you basically have to preserve the same price across all the OTAs. From my understanding right now, you can have OTAs, but you can't undercut them through your own website. So the idea came to me, why don't we just have a communal website where people can advertise their properties, where they don't have to pay any commission and given that it's not their own website, they can give discounts, they can give direct booking advantages. So that's how sort of the main, what's now the main bit of ZIVU came across, came about, which is trying to create this communal booking engine for anyone who's hosting, who's managing their properties through zivu that allow guests to book across all these properties. Now, we haven't exactly decided how it's going to work. Maybe you'll have A point system, or you'll have a 5% discount or whatever it may be. But the idea is, once we've got enough properties in the system, it will then be of a great advantage to all the hosts. Encourage guests to always book through Zebu Direct and to get leads for each other. And as part of that system, we're thinking of various different things, such as passing bookings that you can't handle that come through your own website or over the phone, where they can be picked up by other people. There might be a commission involved in selling them off to each other, but at least it's not going to box with big OTAs. You know, we're thinking things of creating a central blacklist again. That's something that I think Amanda is quite keen on, where we can exchange information as to, you know, who's come and damaged a property and then try to book another property. If the system can detect that that guest has already been blacklisted, then it could give a heads up to the new host to say, well, look, something's fishy here. Keep your eyes open.

Yeah, I like that. I really do like that. And funny enough, Jason Living was episode one of season six of the Boost Hospitality podcast. So it's good that all of the good people are chatting and sharing this and it's a really good idea. And I really hope that in five to 10 years, when we do this podcast again and when we're chatting about the evolution of XIVU and direct bookings in the essay world, then we can sort of look back on this, because that'd be amazing. So obviously you mentioned there that the product and the website is still in beta and you're looking to go live September, October 2019. So, as we all know, podcasts and interviews are evergreen and they stick around forever. So just in case someone is listening to this in September or October 2019 or beyond and they want to come out and find more about xivu, where is the best place to go?

Well, as we are on the book, Direct Mantra direct, go to Zevu.com you'll be able to find.

How do we spell it?

Yeah, so Zevu is Z, double E, V, O, U. That's Zulu, Echo, Echo, Victor, Oscar.

I'll put all the links and everything in the show notes for this, so do not worry. But that was good. That was really good. So I just want to say thank you very much for coming on and I wish you all the best with it. And I love that there is now somebody in the service accommodation world who's talking about direct bookings and book directs. I wish you all the best. Thank you very much and thank you everybody for tuning in to this episode of the Boost Hospitality Podcast. This is season six Episode four. If this is your first episode that you have ever listened to, please go back to the Fullback catalog. You will learn so much including the five steps to a booking process, what the guest goes through, how to run a perfect Facebook competition, we interview hospitality owners from all over the world to chat about their direct booking journey and so much more. So this is Mark Simpson, I'm the founder of Boostly. You can go and find out more by going to boostly.co.uk if you want to get the full back catalog of all the podcasts go to boostly.co.uk podcast and whilst you are in itunes before you leave, go leave one of those lovely five star reviews and I shall see you next time for episode five season six of the Boost Hospitality Podcast.