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Learn about manual and derived rates
Learn about manual and derived rates

Learn about the difference between manual and derived daily, and the different levels at which derived rates can be set.

Updated over a week ago

Important to know:

  • When setting up a rate, you can choose to manually input daily rates, or derive daily rates from another rate. To do so, configure the rate’s Pricing > Rate setup settings.

  • Derived rates can be configured at four different levels: rate plan, room rate, channel rate or direct rate. Deriving daily rates at a rate plan level (the highest level) will affect all room rates associated with the rate plan, including the rate plan’s channel rates and direct rates.

Introduction to manual and derived rates

When setting up a rate, you can choose to manually input daily rates, or derive daily rates from another rate.

When you choose to manually input daily rates, it means that you will manage the rate individually, and you will need to manually input and adjust pricing for each daily rate.

When you choose to derive daily rates from another rate, it means the price of the derived rate will be automatically adjusted by adding or subtracting a percentage or amount (or both) from another rate (usually the standard/best available rate).

Using derived rates can help save you time and effort by reducing the need to manually update the price of all your rates. Derived rates are helpful when creating multiple rate plans, as they make it more efficient to adjust pricing across multiple rate plans (for example, for seasonal changes, or for changes across specific channels).

Manual rates

To set up a rate plan, room rate, channel rate or direct rate using manual rates, select Manually input daily rates under its Pricing > Rate setup settings.

Manual rates will need to be input and adjusted manually via the Inventory tab.

If you are using manual rates, you can set a minimum rate in your Property Settings to prevent you setting rates that are too low.

If you have a connectivity integration with inventory updates enabled
If you have a property management system (PMS), central reservations system, (CRS), or revenue management systems (RMS) integrated with our platform with inventory updates enabled, you should only set rates in your integration, as they will be sent to your platform. You will need to set up rates as manual in the Pricing > Rate setup setting.

Derived rates

To set up a rate plan, room rate, channel rate or direct rate using derived rates, select Derive daily rates under its Pricing > Rate setup settings.

By deriving a rate, you are setting it up to automatically update its daily rates by adding or subtracting an amount or percentage from another rate (usually the standard/best available rate). Whenever you update the prices for the standard rate, the derived rates will also adjust accordingly.

For example:

  • You set up a ‘Best available rate’ rate plan using manual rates.

  • You want to set up a ‘Non-refundable’ and a ‘Breakfast included’ rate plan.

  • You derive the ‘Non-refundable’ rate plan from the ‘Best available rate’, with a discount of 10%.

  • You derive the “Breakfast included” rate plan from the ‘Best available rate’ adding an amount of 20 per night.

  • The pricing for the ‘Non-refundable’ and ‘Breakfast included’ rate plans will be adjusted whenever the price for the ‘Best available rate’ changes.

You can derive a rate by an:

  • Amount

  • Percentage

  • Amount and then percentage

  • Percentage and then amount

Here some examples of when you could derive rates from another rate:

  • Breakfast included — increase the rate by a specific amount for daily breakfast included.

  • Release period / advance purchase — discount the rate by a specific amount or percentage if your guests book a certain number of days in advance.

  • Non-refundable — discount the rate by a specific amount or percentage to secure a non-refundable rate.

  • Length-of-stay — discount the rate by a specific amount or percentage if your guests book a certain number of nights.

  • Room views — increase the rate by a specific amount or percentage for rooms with a view, for example an ocean view room would have a higher rate than the best available rate with a garden view.

Note:

  • Unlike manual rates, you cannot directly update the prices of a derived rate on the Inventory tab. To modify a derived rate, you will need to edit its derivation settings.

  • Rate overrides can be added once in a while to create exceptions to the derivation. But, if you find yourself with a derived rate with too many rate overrides, it might be better to set that rate as a manual rate to speed up the customisation process with bulk updates.

About derived rates at different levels

A rate derivation can be set up (Derived from) at four different levels:

  • Rate plan — derivations at a rate plan level (the highest level) will affect all room rates associated with the rate plan, including the rate plan’s channel rates and direct rates.

You can override the derivation settings at a lower level (i.e. at room rate, channel rate or direct rate level), however note that the fewer overrides you create, the simpler it will be to manage your pricing.

  • Room rate — if you wish to customise your room rate’s derivation, you can do so by using the Override rate plan pricing setting. If you override the room rate level, it will then affect the room rate’s channel rates and direct rates.

  • Channel rate — channel rate derivations won’t ignore room rate derivations. Be careful not to add the same derivation at both levels (room rate and channel rate), as this will result in the derivations being applied twice.

  • Direct rate — direct rate derivations won’t ignore room rate derivations. Be careful not to add the same derivation at both levels (room rate and direct rate), as this will result in the derivations being applied twice.

If you set any of your pricing levels with manual rates, the rates will work independently of other levels, ignoring upper level derivations.

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