Choosing the Right VR Software…Decoded

The following post was written by Terry Whyte of Anna Maria Island Condo Rentals, an owner and property manager in Florida and North Carolina. Like many of us, Terry decided to explore the world of VR software with little guidance. So by documenting what he learned, Terry hopes to help anyone in the same position. He will be answering all questions in the comments section below this article. 

​As the great debate regarding vacation rental software continues, I am going to try and provide my knowledge and experience with the hope that it answers questions and provides the necessary framework for anyone looking to transition from spreadsheets to software or possibly change/upgrade software providers.

Technology fascinates me. ​But in the vacation rental world, I've come to understand that software can help anyone regardless of the number of properties owned or managed (including owners with one single property). Regardless of their interest in technology.

There is expensive software and inexpensive software -- it’s important to note that expensive software does not always do everything better than inexpensive software. ​One of the biggest things that I have learned is that humans have strengths and weakness and so does every VR software.

My one hope is that no one looks at themselves and says, “I only have one property so I do not need software.” Software is simply the most efficient ​tool and my belief is ​that the only reason most people have not progressed further into ​this world of efficiency is because they do not know how. ​This was me at one time and was I inefficient. Remember vacation rentals are in their infancy and the landscape can be a bit treacherous to navigate.

As a disclaimer before I begin, I'd like to make clear that I am not endorsing and particular software because a perfect software does not exist. My knowledge is garnered from my experience with ​various ​companies, extensive research, and all features detailed below are what I consider must-haves when evaluating software. This is what makes my assessment different from others. 

​Part 1 of 5

Part 1. The 3 ​Pieces of the Puzzle

​One of the most frustrating learning curves I went through was in discovering that "booking software" is a very vague term and that actually, when people use that phrase (or a phrase like it) they are lumping three different components or utilities into one. Let's begin by understanding the three components...

1. Online Travel Agents (OTA)

An OTA or  in the simplest term is a website commonly referred to as a channel. The channel is where owner’s/managers list their properties for rental and where traveler’s go to search for inventory. Responsibility of the channel is to book accommodations, provide a payment method, send the booking directly to the PMS or Channel Manager (more on this later). Obvious channels are Booking.com, Expedia, Airbnb, HomeAway and TripAdvisor. Defined as a single Channel many Channels are gateways to the most powerful travel websites in the world. E.I.) Expedia’s portfolio consists of Hotels.com, Hotwire, HomeAway, Travelocity, Trivago and more. Booking.com’s portfolio is equally impressive.

2. Channel Manager

A Channel Manager is the middle man/women between the PMS and the Channel. Responsible for pushing critical data received from the PMS including rates, availability, photos and text to the Channels connected and continually syncing bookings received in the PMS across all channels to eliminate double bookings and pushing rate changes. 

3. Property Management System (PMS)

The PMS is the center of a property owner/mangers universe. All data originates in the PMS and is pushed either directly to a Channel or to the Channel Manager (more on this later). Basic functions of a good PMS include storing rates, availability, amenities, photos, text, property location, property specifics including lock codes, programming codes, wi-fi names, wi-fi password, all property specific details, cleaning module, creating work orders, reporting, notifications, reminders, automations, payment gateway, owner portal, guest portal, owner statements and much more….


​Part 2 of 5

Part 2. The Transition Glossary

I think the consensus is unanimous that a website represents the single most important component of a VR business. That is why the first step in selecting software — software that ensures your website visitor does not have to leave your website to go book on some other platform — is critical.

The first moment in the booking process is when people are on your website and click into the booking sequence. Without software, visitors actually navigate away from your website (which opens up the chance of losing the booking to other competitors). With software, and what is commonly referred to as "a widget," the visitor stays on your site and sees an interface — be it an interactive calendar or simple form — that allows them to seal the deal on the spot. With some softwares this seamless transition with the widget is not so seamless. It is critical at this point to look at the company's portfolio and see what the widget looks like once inserted into a website. I have seen too many that go horribly wrong. 

Here's is a glossary-like breakdown of elements that you might want to consider when making the transition.

Channel Management

Probably 1% of all owners/managers are 100% listing site independent. With the continued saturation in the VR industry, channel management/distribution will be critical to anyone’s success moving forward and this will give owners/managers the safeguard to work on independence which can take several years to accomplish.

Almost all new software (including inexpensive options) understands the importance of channel management and does a good job of managing channels. I strongly recommend choosing a PMS that is an extremely strong Channel Manager in itself connecting directly to a multitude of Channels, mitigating dependence on an external Channel Managers. Good software is expensive and typically external Channel Managers charge 3-5% for every booking received that goes through the Channel Managers software. This highlights the necessity of the PMS connecting directly to the Channel. One of the most critical questions you can ask is "how many and which specific channels does the PMS connect directly to?"

Further, none of today’s booking software is perfect and you will likely experience connectivity issues between your PMS and different channels. When you bring in third parties, I have found those issues are compounded.

Eliminating external Channel Managers is not a realistic or endorsed. Good Channel Managers provide a gateway to niche Channels and some of less obvious but hugely relevant Channels in the travel world including Agoda, Despegar, C-Trip, Hotel Beds, Tourico and many more. Good Channel Managers to choose from include Rentals United, MyBookingPal, RedAwning and Beds24

Efficiency

Efficiency benefits a single property owner the exact same way it benefits a property manager with a thousand properties. The single biggest strength of software is the ability to update rates, photos, text and availability all in one location. All changes made within the software are automatically pushed to your website and all channels with a single click. When considering a software, ask whether updating all these items takes place in one interface or whether it’s done in various places. The answer may be the difference between having your weekends off and being stuck behind your desk. 

Rates

In my research, I have observed that one of the biggest challenges facing the vacation rental industry and the hotel industry is market saturation and price sensitivity. Accordingly, I would like to spend some time here talking about creating "rate sets" and assigning rate sets and where that priority fits into choosing the right software.

Rate setting is where VR software really flexes its muscles and this is a critical feature when choosing the right one. Having the ability to create multiple rates sets, assign different rates sets to different properties and push these rate sets to different channels is priceless. Comprehensive rate sets include the season, date band, wholesale rate, floor/discount rate, minimum nights and check-in date.

I have 27 different rate sets all with different date bands, different rates, different minimum stays, flexible check-in/out days and different floor rates that I can assign to any property and push to any channel of choice — all from one interface. Commissions for different channels range from 3% to 18%. Having the flexibility to assign different rate sets to different Channels to offset commissions is critical. In the illustration below I am in my Airbnb Channel. You can see how I can choose any property, choose from 27 rate sets and assign the rate set to the Channel.

When offering specials and last minute deals…instead of having to edit the date range, the daily rate, the daily floor rate, set arrival and departure dates (this can be too time consuming), I simply pick and choose which properties I want to offer, change the rate set by assigning a different rate set and decide which of my 21 channels I am going to push these rates and properties to. After the rate is created, it takes less than a minute to make the changes. Additionally, in regards to rates it is important to note the only rate any OTA will pull from a PMS is the daily rate or the floor rate which ever is assigned. No OTA pulls weekly or monthly rates. 

Sort Order

All OTAs crawl a PMS once per day normally around midnight updating photos and text. However, OTAs crawl booking software at least once per hour updating rates and availability. Calendars are updated constantly throughout the day giving page listings on OTAs such as HomeAway and TripAvisor advantage in sort order…this compared to owners and managers who have to do everything manually.

Cleaning Module

Probably the single most time-consuming mistake I found myself making in regards to cleaning was emailing cleaning schedules. With cancellations, last minute deals, late checkouts, early check-ins and human error…this became a recipe for disaster. Good software should include a strong cleaning module allowing you to create a user name and password to access the cleaning module, assign a cleaner to a property, provide the cleaner with the cleaning date, their personal lock code, next guests arrival date, address, directions link, time started, time completed and add comments. I cannot tell you how much time and energy this has helped me save. 

Work Orders

Not unlike the cleaning module, the right software should also allow you to create a work order, including a single work order, weekly, monthly maintenance work orders which can then be assigned to a vender, sent to the vender, and when complete, send to the owner account.

Overview/Dashboard

Most softwares have a good overview interface built in — this is the headquarters of your vacation rental business. Simplified daily, weekly and monthly arrivals, departures, cleaning, work orders and payments due all in one central location. It will quickly become your most visited webpage online — so make sure you like the look, feel, and comprehensiveness of this feature.

Owner Portal

If you are managing properties for anyone other than yourself, I have learned that the right software can provide a great way to communicate with owners. All I do now is create a username, password and grant as much or as little information as I desire for my property owners (if you are a single property owner, you can provide this access to freelancers, contractors, or assistants). The way I set mine up is when a booking comes in, the respective owner receives an email notification that a booking has been made, they can then log on, see the dates and the net amount coming to them. You can also grant owners permission to enter their own bookings and block dates for personal use. I do not enable this feature but have observed that others find it useful.  

Guest Portal

This is where booking software allows you to really communicate with your guests. In this portal you can generate a user name, password and grant the guest assess to their vacation from the minute they book until departure including details regarding the rate, amount paid and amount due.

Additionally the guest portal can double as the place to share everything from a travel guide to a digital welcome package containing every bit of information the guest will need for their entire stay including directions, lock codes, wi-fi name, wi-fi password, electronic instructions, restaurant suggestions, things to do suggestions, check out instructions, it is almost endless. Keep in mind this is property specific and this is time consuming. But once it’s set up, it will change your life!

Management Company Specifics

This factor of booking software is mostly for property managers and it is defined by all pertinent information regarding property details such as lock codes for guests, cleaners, venders, programming codes for locks, emergency back-up codes, property phone number and wi-fi codes. If you only have one property, this could just act as a central and simple way to stay organized.

Reporting

Reporting functionality in VR software options can be almost limitless and unbelievably valuable. Reporting can include arrivals, departures, dates booked, dates cancelled, payments made, payments due, payments overdue, payments summary, owner balances, occupied properties, open properties, booking details, specific extras, monthly account balances, agent booking summary, commissions, occupancy report, rental analysis by property – by week – by month – by year. Reports can be easily produced, shared or downloaded via PDF. Great if you plan to grow your business and need snapshots at your progress along the way.  

Notifications / Reminders / Automations

I have found that most software companies have a place where you set up your automated emails ranging anywhere from booking confirmations, balance due reminders, frequently asked questions, pre-arrival instructions, check out instructions, post departure communication and retargeting. Notifications or reminders could be achieved using other applications, but I find it extremely time-saving and convenient to do so in one central place with the right booking software.

Guest Personal Details

In the booking summary most vacation rental professionals collect information such as birthdays, wedding dates, spouse name, family members, hobbies, interests, special requirements and pet details if applicable. This can be invaluable for retargeting and the best softwares include some level of personal detail-keeping front and center. This allows you to make special gestures for guests and your team to be on the same page.

Booking Status

I have various booking statuses such as critical importance, contract sent, contract received, deposit receive, balance received, security deposit received, directions sent, security deposit returned. Booking statuses help me keep track of all my future, current, and past guests at a moments notice...and no matter how many properties you have, this will free up your brain space in order to focus on more meaningful things.

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Quote Settings

The right booking software can offer currency adjustments, tax settings, cleaning charges, commissions, deposit amount, enable instant book and display terms and conditions. This is helpful if you host guests from another country or have particular nuances in the way you charge.

Credit Card Processing and Tracking

With the demand for instant book and millennials playing a much bigger role in the travel world, it is not that far away when the only form of payment will be via credit card. The best booking software’s out there do all this seamlessly and this function alone can make a booking software's fee worth it's weight.

Insurance

Offering cancellation insurance through affiliate companies like CSA, Travel Guard and RedSky can make you stand out from your competition — it also helps provide your guests with a convenient peace of mind and you with an additional source of revenue. The only caveat is that insurance companies demand detailed reporting such as guests name, full address, date booked, number of nights booked, trip cost, premium charged, commission earned and premium remitted. If your software does not have a direct integration with the provider here...you are in for a reporting nightmare. This is why it’s worth asking if these integrations exist (before it’s too late).

Accounting

In most cases (but not all) the biggest difference between expensive and inexpensive software lies in the accounting functionality, which primarily includes owner statements, disbursing owner payments, vender payments, tax reporting, issuing 1099’s and 1042’s. When software does not offer a good accounting module the industry standard is Quickbooks and almost every vender uses Quickbooks. Everyone has a year-end so accounting is important and when choosing a software, "you get what you pay for."


​Part 3 of 5

Part 3. All Things Considered, Here's How To Choose

Now that you have all the elements that can be featured in various booking softwares in front of you, and you know roughly what is important to you (and what is not) you'll be faced with some more serious decisions. In this short section, I'll share my best advice for making that final call. 

Comparisons

When searching for software, the single best approach is live demos with handful of select companies. The first thing you will notice is that not one software is remotely similar to any other software in both looks and functionality. They are all so vastly different and the challenge of choosing can be overwhelming. Which is why drilling down to the components you want (our list above is a good start) is a way to cut through the confusion. I would recommend pulling 3-5 that you would like to live demo and reaching out to make that happen. 

​When ​you navigate onto a property management softwares website they normally have a short animated video which is absolutely no help. They do this because they want to get you into a screen share demonstration. 

There is a solution to this. Almost every software ​has very good training videos which you ​gain access to after you have signed on the dotted line. However, in my experience, almost everyone of their videos is available for free on YouTube.

On every PMS website on the top menu bar you will see a “features tab.” Click on that tab and you will get a drop down box displaying all features offered. Make note of every feature and then go over to YouTube and search for the companies training videos, there is a good chance you will find it. Take special notes of what ever feature is designed to do and how it can help you. The real benefit here is if you are familiar with the ​company's software before your live demo it will much easier to follow and understand the demo. YouTube is how ​I acquired that knowledge. 

Cost

The costs of these softwares can range from less the $50.00 per month to as high as $350.00 per month. Often the number of properties that you will be connecting to the software determines your monthly rate. Additionally, it is not uncommon to pay 1% of the nightly rate (excluding taxes and fees) for every booking generated from a channel. Bookings made through your website are generally exempt from this fee. But not always.

Set-up Fees

These can range from no fee to (the most expensive I have seen is) $5,000.00. These fees are normally negotiable by up to 50%. It is worth noting because this is your leverage, that pretty much every PMS is built for the hotel industry. With so many new good softwares coming on line some companies will wave the entire setup fee just to get your account.

Data Migration

A critical question to ask: "Who is responsible for transferring all my data onto your platform and at what cost?" This can be extremely expensive and time consuming. I am not knowledgeable enough about the dos and don’ts here. But you will want to ask what the process of moving over all your existing information/data looks like — if your experience is like mine, the responses will vary. 


​Part 4 of 5

Part 4. What Software Can Do For You

I compete in the Florida market which has two seasons. Peak season Dec. 25-Aug. 15 and low season Aug. 16-Dec. 24. Before switching to software I could keep a property like The Beach Palms at or near 100% capacity in peak season. In low season my goal was to produce two weeks rental per month but I was only able to deliver one week per month. After switching to software this is what that same properties calendar looks like and the last booking I took for this property was July 16. “This is what software can do for you.” It has freed up my time to do more marketing, optimized my rates, and ultimately made my job much more enjoyable.


​Part 5 of 5

Part 5. Predictions 

The vacation rental industry is predicted to grow to a $167.9 billion industry by 2019. Special acknowledgement and homage paid to the three pioneers of the vacation rental movement who are in no particular order Matt Landau, Heather Bayer and Alan Egan.

My prediction, there will be a new software come to market built specifically for vacation rentals or a hybrid vacation rental/hotel platform that will be so far superior to any software anyone has ever seen and it will shake the travel software world to its core. 

It is hard to get through a day now not hearing Artificial Intelligence is coming, it will be as big as the internet and it will change the world as we know it. Artificial Intelligence is already here, see Siri, see Alexa. Now is the time to embrace technology. Read what Jay Walker Priceline founder and current CEO of Upside recently had to say about technology:

"This is really the end of the age of automation; [online travel booking sites are] a Model T Ford with a Ferrari engine,” “There’s no question that the phone and mobile changes everything, then you add augmented reality, artificial intelligence, and big data… this version of online travel is going to seem like a dial phone."

Not all of the above elements are going to be important to everyone. It is my hope that you can pick and choose what is important to you and use it as a guide and prepare yourself to ask the right questions at the right time.

I am happy to answer any questions or comments in the comments section below!

 Matt's Takeaway 

  

Choosing the right vacation rental software is a daunting task. And Terry's write-up is as comprehensive and unbiased as they come. My big takeaway is to understand the elements like ingredients in a recipe. And then put them together to match your taste. There's no perfect software out there just yet. So give extra weight to the people and the company values behind ​the software. ​​And accept that some software is better than no software for the time being and prepare to reassess in 1-2 years time.

Software:

As the great debate regarding vacation rental software continues, I am going to try and provide my knowledge and experience with the hope that it answers questions and provides the necessary framework for anyone looking to transition from spreadsheets to software or possibly change/upgrade software providers.

Technology fascinates me and I have done extensive research on software and continue to do so. In the vacation rental world, software can help anyone regardless of the number of properties owned or managed, including owners with one single property.

There is expensive software and inexpensive software and it’s important to note that expensive software does not always do everything better than inexpensive software. One of the biggest things that I have learned is that humans have strengths and weakness and so does every VR software.

My one hope is that no one looks at themselves and says, “I only have one property so I do not need software.” Software is simply the most efficient process. My belief is the only reason most people have not progressed further into integration is because they do not know how (this was me at one time and was I inefficient). Remember vacation rentals are in their infancy and the landscape can be a bit treacherous to navigate.

Disclaimer:
I am not endorsing and particular software because a perfect software does not exist. My knowledge is garnered from my experience with a few different software’s, extensive research and all features detailed below are what I consider must haves when evaluating software.
 
Defining the differences between OTA’S, Channel Manager’s and PMS.

Online Travel Agents/OTA’S:
An OTA in the simplest term is a website commonly referred to as a channel. The channel is where owner’s/managers list their properties for rental and where traveler’s go to search for inventory. Responsibility of the channel is to book accommodations, provide a payment method, send the booking directly to the PMS or Channel Manager (more on this later). Obvious channels are Booking.com, Expedia, Airbnb, HomeAway and TripAdvisor. Defined as a single Channel many Channels are gateways to the most powerful travel websites in the world. E.I.) Expedia’s portfolio consists of Hotels.com, Hotwire, HomeAway, Travelocity, Trivago and more. Booking.com’s portfolio is equally impressive.

Channel Manager:
A Channel Manager is the middle man/women between the PMS and the Channel. Responsible for pushing critical data received from the PMS including rates, availability, photos and text to the Channels connected and continually syncing bookings received in the PMS across all channels to eliminate double bookings and pushing rate changes.

Property Management System/PMS:
The PMS is the center of a property owner/mangers universe. All data originates in the PMS and is pushed either directly to a Channel or to the Channel Manager (more on this later). Basic functions of a good PMS include storing rates, availability, amenities, photos, text, property location, property specifics including lock codes, programming codes, wi-fi names, wi-fi password, all property specific details, cleaning module, creating work orders, reporting, notifications, reminders, automations, payment gateway, owner portal, guest portal, owner statements and much more….

The Transition:
I think the consensus is unanimous that a website represents the single most important component of a VR business. That is why the first step in selecting software — software that ensures your website visitor does not have to leave your website — is critical. That first moment in the booking process is when people are on your website and click into the booking process. Without software, visitors actually navigate away from your website (which opens up the chance of losing the booking to other competitors). With software, and what is commonly referred to as a widget, the visitor stays on your site and sees an interface — be it an interactive calendar or simple form — that allows them to seal the deal on the spot. With some software’s this seamless transition with the widget is not so seamless. It is critical at this point to look at the companies portfolio and see what the widget looks like once inserted into a website. I have seen too many that go horribly wrong.

Channel Management:
Probably 1% of all owners/managers are 100% listing site independent. With the continued saturation in the VR industry, channel management/distribution will be critical to anyone’s success moving forward and this will give owners/managers the safeguard to work on independence which can take several years to accomplish.

Almost all new software including inexpensive software understands the importance of channel management and does a good job of managing channels. I strongly recommend choosing a PMS that is an extremely strong Channel Manager in itself connecting directly to a multitude of Channels, mitigating dependence on an external Channel Managers. Good software is expensive and typically external Channel Managers charge 3-5% for every booking received that goes through the Channel Managers software highlighting the necessity of the PMS connecting directly to the Channel. One of the most critical questions you can ask is how many and which specific channels does the PMS connect directly to.

Further, none of today’s booking software is perfect and you will likely experience connectivity issues between your PMS and different channels. When you bring in third parties, I have found those issues are compounded.

Eliminating external Channel Managers is not a realistic or endorsed. Good Channel Managers provide a gateway to niche Channels and some of less obvious but hugely relevant Channels in the travel world including Agoda, Despegar, C-Trip, Hotel Beds, Tourico and many more. Good Channel Managers to choose from include Rentals United, MyBookingPal, RedAwning and Beds24.

Efficiency:
Efficiency benefits a single property owner the exact same way it benefits a property manager with a thousand properties. The single biggest strength of software is the ability to update rates, photos, text and availability all in one location. All changes made within the software are automatically pushed to your website and all channels with a single click. When considering a software, ask whether updating all these items takes place in one interface or whether it’s done in various places. The answer may be the difference between having your weekends off and being stuck behind your desk.

Rates:
In my research, I have observed that one of the biggest challenges facing the vacation rental industry and the hotel industry is market saturation and price sensitivity. Accordingly, I would like to spend some time here talking about creating rates sets and assigning rate sets and where that fits into choosing the right software.

This is where VR software really flexes its muscles and this is a critical feature when choosing the right one. Having the ability to create multiple rates sets, assign different rates sets to different properties and push these rate sets to different channels is priceless. Comprehensive rate sets include the season, date band, wholesale rate, floor/discount rate, minimum nights and check in date.

I have 27 different rate sets all with different date bands, different rates, different minimum stays, flexible check in/out days and different floor rates that I can assign to any property and push to any channel of choice — all from one interface. Commissions for different channels range from 3% to 18%. Having the flexibility to assign different rate sets to different Channels to offset commissions is critical. In the illustration below I am in my Airbnb Channel. You can see how I can choose any property, choose from 27 rate sets and assign the rate set to the Channel.

When offering specials and last minute deals…instead of having to edit the date range, the daily rate, the daily floor rate, set arrival and departure dates (this can be too time consuming), I simply pick and choose which properties I want to offer, change the rate set by assigning a different rate set and decide which of my 21 channels I am going to push these rates and properties to. After the rate is created, it takes less than a minute to make the changes. Additionally, in regards to rates it is important to note the only rate any OTA will pull from a PMS is the daily rate or the floor rate which ever is assigned. No OTA pulls weekly or monthly rates.

Sort Order:
All OTA’S crawl a PMS once per day normally around midnight updating photos and text. However, OTA’S crawl your software at least once per hour updating rates and availability. Calendars are updated constantly throughout the day giving page listings on OTA’S such as HomeAway and TripAvisor advantage in sort order…this compared to owners and managers who have to do everything manually.

Cleaning Module:
Probably the single most time-consuming mistake I found myself making in regards to cleaning was emailing cleaning schedules. With cancellations, last minute deals, late checkouts, early check-ins and human error…this is a recipe for disaster. Good VR software should include a strong cleaning module allowing you to create a user name and password to access the cleaning module, assign a cleaner to a property, provide the cleaner with the cleaning date, their personal lock code, next guests arrival date, address, directions link, time started, time completed and add comments. I cannot tell you how much time and energy this has helped me save.


Work Orders:
Not unlike the cleaning module, the right software should also allow you to create a work order, including a single work order, weekly, monthly maintenance work orders which can then be assigned to a vender, sent to the vender, and when complete, send to the owner account.

Overview:
Most software’s have a good overview interface built in — this is the headquarters of your vacation rental business. Simplified daily, weekly and monthly arrivals, departures, cleaning, work orders and payments due all in one central location. It will quickly become your most visited webpage online — so make sure you like the look, feel, and comprehensiveness of this feature.


Owner Portal:
The right software can provide a great way to communicate with your owners. All I do now is create a username, password and grant as much or as little information as I desire for my property owners (if you are a single property owner, you can provide this access to freelancers, contractors, or assistants). The way I set mine up is when a booking comes in, the respective owner receives an email notification that a booking has been made, they can then log on, see the dates and the net amount coming to them. You can also grant owner’s permission to enter their own bookings and block dates for personal use. I do not enable this feature but have observed that others find it useful.  


Guest Portal:
This is where booking software allows you to really communicate with your guests. In this portal you can generate a user name, password and grant the guest assess to their vacation from the minute they book until departure including details regarding the rate, amount paid and amount due.

Additionally the guest portal can double as the place to share everything from a travel guide to a digital welcome package containing every bit of information the guest will need for their entire stay including directions, lock codes, wi-fi name, wi-fi password, electronic instructions, restaurant suggestions, things to do suggestions, check out instructions, it is almost endless. Keep in mind this is property specific and this is time consuming.   But once it’s set up, it will change your life!

Management Company Specifics:
This factor of booking software is mostly for property managers and it is defined by all pertinent information regarding property details such as lock codes for guests, cleaners, venders, programming codes for locks, emergency back up codes, property phone number and wi-fi codes. If you only have one property, this could just act as a central and simple way to stay organized.

Reporting:
Reporting functionality in VR software options can be almost limitless and unbelievably valuable. Reporting can include arrivals, departures, dates booked, dates cancelled, payments made, payments due, payments overdue, payments summary, owner balances, occupied properties, open properties, booking details, specific extras, monthly account balances, agent booking summary, commissions, occupancy report, rental analysis by property – by week – by month – by year. Reports can be easily produced, shared or downloaded via PDF. Great if you plan to grow your business and need snapshots at your progress along the way.  


Notifications / Reminders / Automations:
I have found that most software companies have a place where you set up your automated emails ranging anywhere from booking confirmations, balance due reminders, frequently asked questions, pre-arrival instructions, check out instructions, post departure communication and retargeting. Notifications or reminders could be achieved using other applications, but I find it time-saving and convenient to do so in one central place with the right booking software.

Guest Personal Details:
In the booking summary most vacation rental professionals collect information such as birthdays, wedding dates, spouse name, family members, hobbies, interests, special requirements and pet details if applicable. This can be invaluable for retargeting and the best software’s include some level of personal detail-keeping front and center.

Booking Status:
I have various booking statuses such as critical importance, contract sent, contract received, deposit receive, balance received, security deposit received, directions sent, security deposit returned. Booking statuses help me keep track of all my future, current, and past guests at a moment’s notice.


Quote Settings:
The right booking software can offer currency adjustments, tax settings, cleaning charges, commissions, deposit amount, enable instant book and display terms and conditions.

Credit Card Processing And Tracking:
With the demand for instant book and millennials playing a much bigger role in the travel world, it is not that far away when the only form of payment will be via credit card. The best booking software’s out there do all this seamlessly.

Insurance:
Offering cancellation insurance through affiliate companies like CSA, Travel Guard and RedSky can make you stand out from your competition — it also helps provide your guests with a convenient peace of mind and you with an additional source of revenue. Caveat, insurance companies demand detailed reporting such as guests name, full address, date booked, number of nights booked, trip cost, premium charged, commission earned and premium remitted. If your software does not have a direct integration with the provider you are in for a reporting nightmare. So it’s worth asking if these integrations exist before it’s too late.  

Accounting:
In most cases (but not all) the biggest difference between expensive and inexpensive software lies in the accounting functionality, which primarily includes owner statements, disbursing owner payments, vender payments, tax reporting, issuing 1099’s and 1042’s. When software does not offer a good accounting module the industry standard is Quick Books and almost every vender uses Quick Books. Everyone has a year-end so accounting is important.

Comparisons:
When searching for software, the single best approach is live demos with handful of select companies. The first thing you will notice is not one software is remotely similar to any other software in both looks and functionality. They are all so vastly different and the challenge of choosing can be overwhelming. Which is why drilling down to the components you want (this list is a good start) is a way to cut through the confusion.

Cost:
Costs can range from less the $50.00 per month to as high as $350.00 per month. Often the number of properties connected to the software determines the monthly rate. Additionally, it is not uncommon to pay 1% of the daily rate excluding taxes and fees for every booking generated from a channel. Bookings made through your website are generally exempt from this fee. But not always.

Set Up Fees:
These can range from no fee to the most expensive I have seen is $5,000.00. These fees are normally negotiable by up to 50%. It is worth noting because this is your leverage, that pretty much every PMS is built for the hotel industry. With so many new good software’s coming on line some companies will wave the entire setup fee just to get your account.

Data Migration:
A critical question to ask. Who is responsible and at what cost. This can be extremely expensive and time consuming. I am not knowledgeable enough about the dos and don’t here. But you will want to ask what the process of moving over all your existing information/data looks like — the responses will vary.

What Software Can Do For You:
I compete in the Florida market which has two seasons. Peak season Dec. 25-Aug. 15 and low season Aug. 16-Dec. 24. Before switching to software I could keep a property like The Beach Palms at or near 100% capacity in peak season. In low season my goal was to produce two weeks rental per month but I was only able to deliver one week per month. After switching to software this is what that same properties calendar looks like and the last booking I took for this property was July 16. “This is what software can do for you”
 

Predictions:
The vacation rental industry is predicted to grow to a $167.9 billion industry by /2019. Special acknowledgement and homage paid to the three pioneers of the vacation rental movement who are in no particular order Matt Landau, Heather Bayer and Alan Egan.

My prediction, there will be a new software come to market built specifically for vacation rentals or a hybrid vacation rental/hotel platform that will be so far superior to any software anyone has ever seen and it will shake the travel software world to its core.

The Future:
It is hard to get through a day now not hearing Artificial Intelligence is coming, it will be as big as the internet and it will change the world as we know it. Artificial Intelligence is already here, see Siri, see Alexa. Now is the time to embrace technology. Read what Jay Walker Priceline founder and current CEO of Upside recently had to say about technology.
This is really the end of the age of automation; [online travel booking sites are] a Model T Ford with a Ferrari engine,” “There’s no question that the phone and mobile changes everything, then you add augmented reality, artificial intelligence, and big data… this version of online travel is going to seem like a dial phone.

Not all of the above elements are going to be important to everyone. It is my hope that you can pick and choose what is important to you and use it as a guide and prepare yourself to ask the right questions at the right time.








About the Author Terry Whyte

Terry is the owner of two condos Absolute Anna Maria & The Beach Sands and the owner of Anna Maria Island Beach Rentals Inc. managing twenty five properties in Florida and North Carolina. With 25 years of experience in the vacation rental business as an owner and property manager he understands the unique challenges of hosting and managing. Terry divides his time between his home in Toronto and his properties on Florida's Gulf Coast.

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  • Matt Landau

    Just wanted to be the first to congratulate Terry on such a comprehensive piece. Really outstanding job of articulating your learning curve. I have no doubt that many owners and managers will read this and benefit from your hard work. Congrats my friend!

    • Thank you Matt.

      Having the article posted on your blog is one of my biggest accomplishments in life and thank you for your help.

      Terry

  • Richard @ Rentivo

    He Terry, I’ll give this a good read! Well done just on a scan. What we have discovered is that there are a million edge cases in such a fractionated market and main points of contention are very complex pricing, channel pricing, money relationship management and power to push to self marketing with tools from API’s.

    I have a question for the group however! There used to be 20 PMS’s now 130+ which do “something”, generally badly. A PMS manages data, getting bookings is very important. So does anybody think that a really good PMS makes sense as a giveaway as part of a marketplace? Booking.com have a similar option of course. Proviso is that the PMS allows other marketplace activities too.

    • Hi Richard,

      Thank you for taking the time for the engagement and I follow you closely at Rentivo.

      I remember reading several times about your kind of frustration with different PMS’s, I think you built your own if I remember correctly and you told me personally in Toronto you would like to see a PMS built and only get paid when they produce bookings.

      Not sure about the giveaway thing but I do believe vacation rentals are producing mass amounts of travel revenue and I believe the future of the PMS world will simple get better and better in a short period of time.

      Terry

      • Richard @ Rentivo

        Read it all now!! Really good and particularly like the note of data transition from systems.

        Some advice on this: Always make sure your commercial T&C’s allow export of your data in a standardized format (CSV etc). I have some recent experience of hostage taking when wanting to leave one system for another.

        I’d be interested in your take on the PMS promotional approach and whether they generally push owners to channels or make strenuous efforts to push to creative and dynamic self marketing websites and social activities?

        The last section on PriceLine commentary is probably pretty accurate. Their crystal balls are bigger than ours, but have to agree. We all need to address this and despite this being spoken by an OTA, it will see advantages for all owners.

        • Hi Richard,

          Sorry for the delay in responding I was outrunning a hurricane.

          Agreed data migration and ownership of data my be the single most overlooked and misunderstood question when choosing software.

          As for PMS promotional approach to certain channels I have not experienced this yet.

          However, I have a good one for you here from Amy’s FaceBook Page:

          VRM Intel
          August 28 at 11:05pm ·
          Would you sign up for a new software or tech system if you knew that they were giving your reservation data to OTAs? We are discovering some interesting stuff in research for “Who Owns Your Data” for the next issue. If you have any info you would like to share–on or off the record–, send to amy.hinote@vrmintel.com

          Stay tuned.

          Terry

          • Richard @ Rentivo

            Hope the wind is at your back……..and the road..lol

            That is an interesting thought and I wasn’t aware that non OTA booked data could be accessed by them. Is this a “data sale” or the sharing community gone mad! Data has the word “privacy” attached to it and should be at the discretion of supplier and receiver. Intermediation without knowledge would see the Data Protection bodies a tad upset I suspect. “Caveat Emptor”

          • Hi Richard,

            Amy is a pretty amazing person. I am really looking forward to hearing what she has to report on this going forward. I kind of have this feeling there will be some PMS companies with some explaining to do.

            Terry

          • Richard @ Rentivo

            For sure, make a good investigative reporter. Should prove interesting.

  • Hi Terry,

    Great article.

    I presented at VR Tech (http://vrtech.events) last night in Edinburgh on a similar topic! As a software company / PMS provider (https://www.booksterhq.com), I was hoping to give the vacation rental managers there an insight into why software is so different.

    Along with your excellent points, it is important to understand the ethos or philosophy of the company that you are assessing. Each company will be building their platform with a target audience in mind (“cheap and cheerful”, “corporate”, “easy to use”) and probably a basic vision of how they build software.

    If you can understand their point of view or company ethos, you will have you a better understanding of why it works the way it does and where the product is likely to go in the future.

    Software is written by people after all, who have preferences and opinions which will be reflected in their Tools…. if you can find a company that has a similar outlook to yourself, you are more likely to get along for the long haul.

    • Hi Robin,

      Very well written.

      I have so much respect for the people who write software. They are very intelligent people and are compassionate computer programers and computer scientists. I tried to make the point so many times about how not one software remotely compares to another software and that is because software is written by real people exactly what you stated.

      I had a chance to look at your product. You have done a nice job and good luck with your product.

      Terry

  • Well done Terry, very good hands-on insights on what matters and the blunt truth about other points for those who are learning, and we still all are 😉

  • John W Johnson

    Thanks Terry, great article, i’m curious about a followup, or some recommendations on the top 5 software apps in your opinion. Not sure how to move forward with the information you’ve given us.

    • Hi John,

      Thank you for the compliment and sorry I missed your interaction when hurricane Irma had me on the run.

      I really don’t have a top five list and the softwares I like you might hate. What I do consider to be critical components of good software are:
      I would not consider any software if it did not have these components:

      ✔️Great Channel Management
      ✔️Rate Flexibility
      ✔️Strong Cleaning Module
      ✔️Strong Work Order Module
      ✔️Strong Reporting/Accounting Module
      ✔️Notifications-Reminders-Automations
      ✔️Owner And Guest Portals
      ✔️Booking Status
      ✔️Overview Interface

      This is the best advise I can offer you:

      When searching for software, the single best approach is live demos with handful of select companies. The first thing you will notice is not one software is remotely similar to any other software in both looks and functionality. They are all so vastly different and the challenge of choosing can be overwhelming. Which is why drilling down to the components you want (this list is a good start) is a way to cut through the confusion.

      This is what I suggest when choosing the right software. You will notice when you go onto a property management softwares website they normally have a short animated video which is absolutely no help. They do this because they want to get you into a screen share demonstration.
      There is a solution to this. Almost every software has very good training videos which you have access to after you have signed on the dotted line. However, almost everyone of their videos is available for free on YouTube.

      On every PMS website on the top menu bar you will see a “features tab” Click on that tab and you will get a drop down box displaying all features offered. Make note of every feature and then go over to YouTube and search for the companies training videos, there is a good chance you will find it. Take special notes of what ever feature is designed to do and how it can help you. The real benefit here is if you are familiar with the companies software before your live demo it will be much easier to follow and understand. YouTube is how you acquire that knowledge before demo day.

      Terry

  • Fantastic article, Terry! I appreciate the depth and wealth of knowledge you present here. You are a great asset to our industry, thank you for sharing your expertise!

    • Hi Debi,

      Coming from you that means a lot to me.

      Terry

  • Matt Landau

    **** IMPORTANT NOTE: Just when this article was published, Terry’s area got a mandatory evacuation from the hurricane. He’ll be sure to respond — after everything is safe and sound that is 🙂 ****

  • gabrielle

    hello thank you, this arrives at a crucial time for me, we have 3 apartments in our house and I spent far to much time updating on all the sites i am listed. i signed up with Eviivo for a 30 days trial but have not seen any changes in bookings coming through new channels. i wonder if i am not to small for a channel manager ? The fear of double bookings penalties made me look for a channel manager but they are really designed for hotels yet. And do not work yet for homeway and airbnb .And as i have integrated it in my own website , the fact that we still mostly used to rent by the week not the night makes it all different game. http://www.munster-alsace.fr/munster
    thank you gabrielle

    • Rimon

      Hi Gabrielle,

      After reading your post, I do believe that we, at Guesty, might be able to assist you in what you might be seeking. We provide an all-in-one cloud based property management platform for short- term rentals including apartments, which among our various features, include a deep integration with AirBnb, Booking.com and many other channels.

      Please don’t hesitate to contact me via my email for more information,

      rimon@guesty.com

      Best,

      Rimon Arieli
      Sales Development

  • Wow Terry, that’s a seriously comprehensive article, congrats! I hope you’re in a safe place, away from the hurricane.

    • Hi Andy,

      Sorry for the delay in responding Irma has had me on the run.

      Thank you for the compliment and thank you for thinking about me during Irma.

      Just got back onto the island last night and I cannot tell you how good it feels.

      Hope you are doing well.

      Terru

  • Dana Young

    Terry, thoughts out to you and other VR owners in the hurricane’s path. Really educational article, thank you. To your point of: “It is hard to get through a day now not hearing Artificial Intelligence is coming, it will be as big as the internet and it will change the world as we know it. Artificial Intelligence is already here, see Siri, see Alexa. Now is the time to embrace technology.” — I’ve spent a lot of time on the application of AI platforms to vacation rentals. There are capabilities for Alexa today that dovetail into an effective VR software strategy. It is certainly an exciting time for the application of tech to VRs.

    • Hi Dana,

      Sorry for the delay in responding. My last three days have featured trying to outrun Irma and thank you for thinking about me and thank you for your leadership in AI for vacation rentals.

      Terry

  • Generali Travel

    Great article. Generali Travel insurance (www.generalitravelinsurance.com) and CSA are providers of vacation rental insurance connected through these softwares. And if you/Matt have any questions, let us know.

    • Hi Generali,

      Thank you for taking the time to interact here.

      After what I have been through with Mother Irma I have whole lot more respect for the value a good travel/home owner insurance.

      Terry

  • Kelly Odor

    Hi Terry. Nice article, and I’m sure it’s going to be very useful in the industry. I hope you are safe from the pathway of the hurricane.

    I’m writing from the perspective of the software company, Avantio, and hope I could add a further point to your conversation on the Channel Manager.

    You made the following suggestion – One of the most critical questions you can ask is “how many and which specific channels does the PMS connect directly to?”. I want to add that it’s also important see what kind of connection they have to the channels / OTAs. There are different types of connections, ranging from ‘iCAL imports’ to ‘Two Way API XML connections’ and the key difference is in the amount, quality and frequency of information that is sent to the channel and back to your booking calendar eg property calendar availability, prices & discounts, accommodation features and rules.

    The difference in the connection can have a big impact on the risk of double bookings and significantly affects the resources you need to manage your bookings. I would recommend that the best connection to look for is the two way API XML connection and the PMS software company / Channel Manager company will be able to give you this information.

    An aspect that we are in complete agreement about is the consideration whether you prefer a Channel Manager which is separate from your software, or included. For full disclosure, in Avantio we offer a Channel Manager (https://www.avantio.com) and we fully believe in providing a Channel Manager which can be stand alone or integrated in our software, so agencies don’t have to deal with any third parties if there are any complications or questions about the connection. However there are other companies who believe that it’s better to be separate for questions of choice, price and channel variation, and it’s worth considering your view on the impact of this set-up on your company too.

    • Hi Kelly,

      I had to evacuate the island I was on and went to Atlanta to escape the storm and thank you for thinking about me.

      Thank you for your feedback. You have made some excellent points regarding what information is shared via the API. I did elaborate and illustrate the differences between a good API feed and a poor one in Matt’s Inner Circle after Matt posted the blog. I could not agree more with your opinions here. I was really worried about over complicating the blog.

      There are a few really good stand alone channel managers that are excellent at what they do because they specialize in only channel management and are not part of the complicated PMS field. I feel very strongly about a PMS being an excellent channel manager in itself and I would never consider any PMS that was not an excellent channel manager. In fact it would be the number one single component of choosing for me.

      I have heard that debate too many times about a separate channel manager. I could not disagree more and a good PMS is expensive and good channel managers are expensive so I do not like the idea of paying for something twice. A good PMS is a good channel manager.

      Thank you again for your help in clarifying the significance of a good API.

      Terry

  • Terrence Theo Butler

    Hi Terry,

    Amazing article and all the points you outlined if they could be found in one software would be a dream come true. I’ve utilized 7 different PMS’ platforms in the last 5-years trying to find the perfect option. Unfortunately all 7 softwares have excelled in certain areas and failed miserably in some of the most basic functionalities that all property managers need to run a successful business.

    You’ve written a great road map on the features that the best softwares should all have. Can you share what software you currently use and or a TOP 5 that you feel meet all of the key points you outlined?

    • Hi Terrence,

      Thank you for taking the time to read the blog and for contacting me.

      My current software is Ciirus.

      I would not consider any software if it did not have these components:

      ✔️Great Channel Management
      ✔️Rate Flexibility
      ✔️Strong Cleaning Module
      ✔️Strong Work Order Module
      ✔️Strong Reporting/Accounting Module
      ✔️Notifications-Reminders-Automations
      ✔️Owner And Guest Portals
      ✔️Booking Status
      ✔️Overview Interface

      Hope this helps and I will be happy to answer any questions you have.

      Thank you,
      Terry

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  • cathie

    Great article, thanks! I’d love to switch from the VR software I’m currently using, but my attempts to find better ones always end in frustration (& huge amounts of wasted time trialling other alternatives)! I’ve only got one property (www.southerlychange.net), & can’t seem to find ANY booking system (including the one I use now!) that lets me set up minimum stay rules the way I want. Let me explain with an example: imagine I’ve set up ‘Easter’ as the 13th, 14th, 15th & 16th all with a 4-night minimum stay. What I want is that if anyone does an online booking for a stay including ANY of those nights, they must book ALL of the nights together as a block (ie. they can add days either side, but could not book a stay from the 11th to the 14th, for example). Got any ideas for VR software that can handle that? I’m hoping this functionality isn’t only available for the most comprehensive/expensive software options, because I only need a basic/cheap solution (website widgets, calendar management, form templates & automated emails).

    • Hi Cathie,

      Thank you for the compliment and I have looked at your website and you have done a real nice job with your photos, videos and floor plans.

      In regards to the rates and dates you exampled it really should not be that hard to find and I know exactly what you are saying because minimum night stays in different seasons is critical to anyone’s success. I really hate to say it but when it comes to having rate/date flexibility you will probably only find it with more expensive software.

      I can honestly tell you if I had one property I would still be using the same software I use to manage 25 properties. What it would cost you annually for one property is probably about one weeks rental income.

      With more expensive software there will be some features you will not need for sure, however, there are just so many features you cannot live without.

      People have asked me so many times can you give me a checklist of what I need. Checklists are a bad idea because you cannot just pick choose and find something tailored to your specific needs. I suggest forgetting the features in good software you probably will not use and really concentrate on the abundance of features that will make you successful.

      I have said it a hundred times I would like to see owners choose software they can grow with rather than outgrow.

      Terry

      • cathie

        thanks Terry, really appreciate the thorough response. I had a feeling I might have to bite the bullet & invest in more comprehensive software!

        • Hi Cathie,

          I could not agree more and I guarantee you will be happy you did. The challenges for all of us going forward will be immense and using technology will put us miles ahead of our competition.

          Terry