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Consolidating Vendor Costs and Reducing Expenses by 17% Across Hotel Locations

Industry: Hospitality & Travel

Background

A regional hotel group with five boutique properties was gaining popularity among domestic and international travelers. Their occupancy rates were steady at 72%, and they recently expanded by acquiring a beachfront location. The owners couldn’t pinpoint why profits were tight despite healthy bookings and growing brand recognition. They relied heavily on seasonal income, ran multiple vendor contracts without negotiation reviews, and lacked clear visibility into which properties were actually driving growth.

Their accounting systems varied by property, with no centralized reporting. Each hotel had its own finance staff, tools, and methods for tracking revenue and expenses. There were frequent discrepancies between property-level reports and the head office books. As expansion plans moved forward, the team realized they needed accurate data and strong financial systems to ensure their growth didn’t come at the cost of profitability.

The Challenge

No Centralized Reporting

Each hotel used its own booking platform and accounting software. This made consolidation difficult and delayed monthly reports by up to three weeks. Leadership couldn’t compare how locations were performing or make timely business decisions.

Overlapping Vendor Contracts

Different locations had separate laundry, food supply, marketing, and maintenance contracts. Several vendors overcharged or delivered redundant services. Without a centralized system, they missed opportunities to negotiate better deals.

Irregular Forecasting

Budgeting was mostly reactive. Seasonal trends weren’t mapped out accurately, and cash flow shortages were common during low-occupancy months. They often had to dip into credit lines to manage payroll or vendor bills.

Untracked Operational Costs

Room-related costs (like housekeeping, laundry, amenities) weren’t tracked per guest or booking type. The management had no idea which services were eating into margins, or how much profit they were making per room category.

Missed Tax Incentives

The business hadn't filed for any despite qualifying for tourism-related tax credits and energy-efficient upgrade deductions. Poor documentation and lack of advisory support meant they were leaving money on the table each year.

Our Approach

We began by streamlining their financial structure across all locations. Big 4 Accountants implemented a unified cloud-based system that integrated POS, booking, and accounting software into a single dashboard.

This allowed real-time tracking of revenue, expenses, and occupancy by location. We created a central reporting format and trained each property’s finance team to follow standard procedures for entering data, generating reports, and reconciling accounts.

We reviewed and consolidated all vendor contracts, renegotiated deals, and removed duplicate services. Our team set up rolling cash flow forecasts for seasonal booking trends and implemented per-room profitability tracking using variable and fixed cost mapping. We also worked with their CPA to file for eligible tax credits related to hospitality upgrades and local employment incentives.

The Results

Faster, Unified Reporting

Monthly financials from all five hotels are now consolidated within 6 business days. Leadership has visibility into each location’s occupancy, profit margins, and expenses in real time. This has helped the team make informed operational decisions without delay.

Cost Savings Through Vendor Consolidation

Reviewing and renegotiating vendor agreements, the business cut operational vendor costs by $84,000 annually. This included reducing food supply costs by 13% and switching to a single maintenance provider across all locations.

Improved Cash Flow During Low Seasons

With accurate forecasting, the group avoided borrowing during their off-season quarter for the first time. They set aside a $61,000 buffer reserve over six months and aligned promotional campaigns with expected slow periods to keep bookings steady.

Clear Room Profitability Metrics

Now, management knows the exact cost per room category. For example, premium rooms earned higher revenue but had 30% more hidden costs in upkeep. Adjustments to pricing and guest services led to a 9% improvement in net room profitability.

Tax Credit Recovery

We helped the business identify and claim approximately $49,000 in tax savings, including credits for hiring local staff and implementing energy-efficient HVAC systems across two properties.

Why Hospitality Businesses Trust Big 4 Accountants

In hospitality, numbers tell more than occupancy—they tell you where your business is leaking cash, which services matter to guests, and when to scale. Big 4 Accountants supports hospitality businesses with financial systems that go beyond bookkeeping. We help you understand the real performance of each location, control costs without compromising service, and confidently plan growth.

If you're ready to tighten operations and make sense of your financial data, let's talk. Our team is here to help you turn daily transactions into long-term strategy.