Four Things To Plan for in Your 2023 Hotel Budget

September 13, 2022
Bryan Michalis

It’s budget season! And 2023 is turning out to be an especially difficult year to prepare a budget. Wages have skyrocketed 25% since 2019, and will likely continue to rise with inflation. Hoteliers are struggling to fully staff their hotels. And guests are demanding more streamlined, digital experiences. 

Hoteliers are stretched thin and need to carefully consider the changing hotel landscape for their 2023 budget. In this post, we’ll go over four budget items that hotel industry experts strongly suggest every hotelier include in 2023. Each of these are intended to address some of the most important real-world issues that hotels face today. 

The four things every hotel should include in 2023 are: 

  • Guest-facing technologies
  • Digital Tipping 
  • Budget for 5-15% higher wages
  • Investment in marketing to increase direct bookings  

Hotel Budgeting 101

Hotel budget season is an important time on the calendar (usually around September or October) when hoteliers lay out their financial plans for the coming year. 

When preparing a hotel budget, there are a few things that need to be accounted for year after year, such as employee salaries, the cost of cleaning supplies, new maintenance equipment, etc.   

However, a hotel budget shouldn’t just look back at what the needs of the hotel have been in the past and update numbers accordingly for the coming year. The world has changed a lot recently and hotel budget season is the perfect time to address the new needs and challenges of your guests and staff. Budgets are living documents and wise hoteliers should look at the wider world outside their property to get ideas for what should be included.

1. Guest-Facing Technologies

Guest-facing technology is more in-demand than ever. In fact, 73% of guests now expect a digital first experience when engaging with a hotel. In an industry in which guest satisfaction is everything, it’s easy to see that hoteliers should plan to invest in technology that streamlines and enhances every stage of the guest experience.  

In addition to creating a better experience for guests, the right guest-facing technology solutions can also have a big impact on a property’s bottom line. 

For example, Canary’s modern Guest Management Platform provides a 10-50x ROI by:

  1. Increasing revenue by 5-10% 
  2. Reducing fraud and chargebacks by 75-90%
  3. Decreasing labor costs by 30-50%

No new apps need to be downloaded by guests. No new hardware is required by the hotel. 

Let’s now take a quick look at what type of guest-facing technologies are included in a Guest Management Platform. 

Contactless Check-In & Upsells

Canary’s Contactless Check-In enables guests to check in to their hotel rooms easily from their mobile devices before they ever set foot on the property. 

With built-in Fraud Detection that helps stop fraud before it happens and upsell offers included in the check-in flow, Canary Check-In is a secure solution hotels can trust to help them increase revenue and improve the guest experience. 

Contactless Check-In also makes front desks up to 50% more efficient and helps hoteliers reduce wage bills, which should be considered when budgeting for 2023. 

Here is a customer testimonial about Canary Contactless Check-In with Upsells from the Managing Director of The Mandolay Hotel in Guildford, UK, Matthew Milliken:

“Instantly we can see that we’re making more money from Canary… We’ve gone from doing virtually no upsells… to around £2,000 per month… [and] I've cut the wage bill in half. I'm so glad we're relying on [Canary's] technology for operational areas of our business because it means we're not really feeling the pinch as much as others."

Contactless Checkout 

Canary’s Contactless Checkout solution provides a variety of benefits to both guests and hotel operators. 

Firstly, it enables guests to conveniently checkout from the hotel whenever they’d like without the need to stop by the front desk. 

Secondly, Canary’s Checkout solution lets housekeeping teams know exactly when a guest has left their room and it’s ready to be turned. Hotels that use Canary regularly report up to a 50% increase in productivity from their housekeeping departments. 

Lastly, Canary includes a survey submission form in the checkout flow. All survey answers are sent directly to the hotel; however, those guests that leave a score of 4 or 5 are also presented with the option to share their review on sites like TripAdvisor and Google. This feature has helped hoteliers across the globe improve their guest reviews, which has a direct impact on guest booking increasing guest bookings. In fact a 10% increase in 5-star reviews leads to a 10.2% increase in bookings!

Here is a customer testimonial about Canary Contactless Checkout from the Assistant Director of Operations at Ali’i Resorts LLC in Maui, Hawaii, Sam Chesick. 

"We’ve seen our average star rating increase from 3.5 to 4.6 on Google since implementing Canary’s Checkout solution."

Guest Messaging 

Canary’s Guest Messaging solution enables hotel staff to field guest questions more efficiently and effectively than ever.

Traditionally, most hotels have answered guest questions via the phone at the front desk. But just because something has been done one way for a long time, doesn’t mean it’s the best way to do it. 

In fact, answering questions via the front desk phone has two downsides:

  1. It means that people can end up on hold if someone has called with a question before them.
  2. It can force a front desk into having to choose between answering a guest phone call and helping the guest in front of them 

Here is a real customer testimonial about Canary Guest Messaging from the Hotel Manager at Ace Hotel New Orleans, Yvette Bullock. 

“From contactless check-in to sending messages, it's lovely. It helps tremendously with our check-in scores and allows the front desk to have more face to face time with the guest.”

2. Digital Tipping 

Inflation has put pressure on many people in today’s economy, but frontline hotel staff like housekeepers and front desk agents are feeling the pinch more than most. 

And thanks to COVID-19 and a long-running trend of consumers moving to cards and digital payment solutions, fewer people today carry paper currency than ever. Unfortunately, less cash in the pockets of hotel guests means hotel workers can expect fewer tips. 

To top it all off, the hotel industry is currently in the midst of a staffing shortage. And with lots of open positions, employees that feel they aren’t making a high enough wage are likely to look for work elsewhere. 

To help employees increase their compensation and hotels retain their workforce, hoteliers should consider implementing a Digital Tipping solution that can help increase your employees wages by up to $4/hr, without hurting your bottom line.

3. Budget for 5-15% Higher Wages 

Inflation is also causing a historic rise in employee salaries. In fact, wages rose by an impressive 8.4% from Jan. 2021 to Jan. 2022 - and have exploded by 25% since 2019! 

With inflation still not yet under control, hoteliers should plan to pay their staff more to stay on the job next year. Hoteliers can’t bypass increasing wages - and if they do - they’re going to lose good talent. 

However, the overall hotel wage bill doesn’t necessarily need to increase - and in many cases - can even go down. As noted above, by investing in technology and productivity gains, higher labor costs can be offset by smart investment in a Guest Management Platform and a Digital Tipping solution!

4. Invest in Marketing To Boost Direct Bookings 

Hotels have access to more advanced marketing tools than ever. And with guest-facing technologies making it easier than ever to capture guest phone numbers and emails (even from guests who book through OTAs), 2023 is the perfect time to build out a marketing plan that increases revenue from direct bookings. 

Specific items to budget for when building out an effective marketing include:

  • Local SEO 
  • Website development & optimization
  • Search engine marketing ads 
  • Display marketing ads 
  • Email marketing
  • Text message marketing 
  • Social media 


2022 has seen an amazing turnaround in the hotel industry, but has also left the industry with main challenges that are carrying over into 2023. Hotel budget season is the ideal time to look around the industry and take stock of the challenges and opportunities out there. Guest behavior is changing and the economy presents certain problems that need to be worked through. However, hotels that plan around these changes and challenges by following the advice in this post will be able to thrive into the future as they increase revenue, boost efficiency and improve the guest experience.

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