How Low Do You Go?

I am from the lovely seaside town of Ocean City MD. If you are from Ocean City, you LOVE the beach, Thrashers Fries, Dolles’ Popcorn, Steamed Crabs, and walking along the famous boardwalk. “Hitting the Boards,” is an activity young and old enjoy. Most shops do not close until midnight or 1 AM, and my entire life it has been safe to stroll until those hours. Our kids took their first jobs on “The Boards,” and we never once worried about their safety or that of their co-workers.

Last summer, “The Boards,” turned into something that shocked both locals and vacationers alike. It became a dangerous, crime riddled gathering place for thugs, drug dealers, and murders. It became something we had never seen. Nightly property damage, fights, and even a few deaths occurred. Businesses were closing as early as 8 PM in order to avoid what would happen after dark. It became a strange place to those of us who had lived in OCMD our entire lives.

When talking to locals about the cause, they were numerous and varied, but everyone agreed on one thing-COVID had caused oceanfront hotels to drop their prices so low, that now gang members and ne’er do wells could afford to come to a town that was one outside their price range. In attempting to make a buck, the hotels had discounted themselves so low that their property was being damaged and businesses in town shut down at early hours in order to avoid the dangers. The cost to lives, the town, and the hotels mounted to point where it became untenable.

In hospitality, there is such a thing as pricing yourself too low. There is a temptation to do so when occupancy is needed, but you can indeed cut prices to the point of damaging your income and your reputation.

Rule #1-Know Your Breakeven

Knowing your break even is one of the ingredients in setting nightly minimums. It is not the ONLY data point to consider when considering rate management.

Regular Rate $45 per night

Break Even $25 per Night

In the above scenario-any rate below $25 per site night results in a loss.

Rule #2 -DO NOT diminish your brand

As in our Ocean City example above, lowering rate did indeed increase occupancy, but it greatly increased costs and damage to the brand. Room damage, glutenous behavior at the breakfast bars, and reputation damage are just a few of by products the OC hotels faced in the aftermath of the deep discounts. According to Hospitality.net

“Discounting rates too deeply, even as a stop-gap measure against demand loss can yield negative effects for parks and the overall market. Nobody wins in the aftermath of a price war. Discounting rates in order to increase occupancy will induce higher costs on a per-site night basis and decrease profit margins. Perhaps the most deleterious effects lie in the long term, and these effects may not warrant consideration as parks struggle with the immediate challenges of their day-to-day operations. A better solution to discounting is to offer additional value to the customer without sacrificing rates.”

Rather than reducing rate, consider bundling a golf cart, a free pizza, or a free rental bike. These can be valuable add-ons without slashing rate. Once your reputation is diminished, and good guests are chased off by rowdy ones, it can be very hard to get them back.

Keeping these few items in mind, you can work on a strategy that achieves revenue goals without the pain of diminishing your brand.

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Pets Mean Profits

For those of you who offer cabins or cottages-there is often a struggle between allowing pets in these units or prohibiting pets from in roofed accommodations.

As with all things AOS, we allow the data to do the speaking.

Below is a graph showing how much more pet friendly units are booked compared to non-pet units. For this particular sites, type Pet Units booked 4 times more often than non pet units. A pretty staggering statistic.

Added to this, a per day pet free of up to about $35 per night can be added to pet friendly units.

The most often cited argument against pet friendly units is, “Pets will damage my cabins.” I can assure you, after 20 years in the industry, inebriated adults and kids have done much more damage than pets. If you build your units with pets in mind, you will have easy cleanup and damage will be minimal. Use LVT Flooring, easy to clean surfaces, and upholstery which easily vacuums, you will have little to no damage and ease of cleaning.

Keep a few pointers in mind. Limit your units to 2 pets. Provide a broom and dustpan, and even a pet blanket for covering furniture. Remember, you cannot charge pet fees for Service Animals. Most of all, embrace this money making trend and count your green.

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“It Ain’t Braggin If It’s True”

The above quote has been attributed to Will Rogers, Dizzy Dean, Yogi Berra and Bear Bryant. Thus, we were not sure to whom we should assign the credit.

We do know, however, where to assign credit for some of the amazing numbers our Snowbird, Sunbird, and Winter Texan parks have seen this winter. Our great staff at the corporate office, the staff at our parks, and the great owners who let us do our thing.

With spring upon us and their should seasons approaching, we would like to share some highlights (names are not shared to protect the data)

Park A -Florida January and February NOI 63% over budget

Park B- Arizona Revenue up 300% Since AOS Takeover in January

Park C- Rated 10/10/10 by Good Sam February 2020

Park D-(PA) Bookings up over 50% from same time last year

All in all, a pretty good end of 2020 and start to 2021 if we say so ourselves.

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Extra Extra Read All About It

If you are already and AOS client, you received an email this week regarding the latest upgrades to our service offerings.

If you are not, let us share what we are rolling out in the Month of April.

#1 Marketing Dashboards

Our new marketing dashboards are a dream come true. Our marketing team -working with our software developers -have created amazing dashboards to give our clients and us real time snapshots of how our marketing efforts are performing. All social and web channels feed to these reports, and even more impressive, with a small upgrade fee, even PMS booking revenue can be tracked. This data allows us to further dictate how dollars are being spent and how those dollars are performing.

#2 Risk Management Courses

Starting in April, all GM’s will be required to participate in our online Risk Mitigation Courses taught by our insurance and legal experts. Topics include: How to Deal with Difficult Guests, Removing Difficult Guests, Safe Propane Pumping, Pool Safety, Dealing with the New Class of RV’ers, and many more. These courses will equip the AOS team, both on and off site, in how to navigate these sensitive topics.

AOS is in serious growth mode, and appreciate all the clients who have entrusted us with their portfolios. Looking forward to a great summer season!

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Whoops-We Did It Again

We are excited to announce one of our newest resorts, Resort at Canopy Oaks, has just achieved the highly sought after 10/10/10 Rating from Good Sam.

There are very few parks across the US that win this rating. In fact, AOS had the first park EVER in the State of MD to win this award-and now-we have done it again!! Congrats to the owners, staff, managers and AOS team for making this happen.

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New Jersey By Way Of Tampa

We are excited to present this week to the New Jersey Campground Owners Association in our backyard of Tampa Florida.

Their annual convention is being held here in our Sunshine State and we look forward to a week of meeting, greeting, and teaching.

Rachel will be presenting on Tuesday, doing meets and greets at our booth, and Kathleen will be presenting Thursday.

We are looking forward to seeing all our friends from the Garden State. This is always a show with great vendors and a superb leadership team.

NJOCOA welcome to Florida!!

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High Fives All Around

The famous Will Rogers is know for the saying, “It ain’t bragging if its true.”

In light of this, I guess you will forgive us if we celebrate the fact that an AOS park just landed in USA Today’s as one of the “Ten Most Popular Camping Resorts in America.” In fact, it came in number two overall in the US.

However, don’t take our word for it.

2. Castaways RV Resort & Campground (Berlin, Maryland)
Also located in Berlin and minutes from Assateague Island’s wild horses, this Ocean City-area campground has venues including Jackspot Tiki Bar and the dog-friendly Bark Beach, as well as paddle boarding sites and a camp store. It has 5,957 advance reservations for 2021. 

This popular resort was designed and managed by none other than the team of Ron Beard (AOS Land Planner) and Kathleen Walsh (Operations). In fact, “Bark Beach” was dedicated to Kathleen’s lovable lab, “Abigail.”

This stunning resort has everything one would need to make a camping vacation a true Five Star Experience.

We love working our magic for our guests and adding amenities that turn a camping trip into a memorable vacation.

This park was purchased from the original developers by a national REIT and they are now reaping the rewards of our amazing land plan and amenities.

Let us replicate this success for you at your park and allow us to turn your “Dreams into Destinations.”

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The Processing of Poo

A few years ago, a children’s book hit the shelves entitled, “Everyone Poops.” Though I have not purchased this particular book for my littles, I am sure it is a fascinating read.

In the RV industry, the processing of waste is a HUGE deal. I write about it often and as we say here at AOS, “Sewer Drives Everything.”

To that end, we are thrilled to have a leading expert in not just waste, but RV waste, as part of our AOS team of experts.

When you partner with us to “Process Your Poo,” our Scope of Work includes:

  • 1.  Provide technical assistance required to select a suitable system for resort. 
  • 2. Assist in obtaining necessary permits environmental permits.
  • 3. Provide objective information regarding type of plant required. 
  • 4. Recommend the most cost efficient and reliable system for the needs of the resort.
  • 5. Review the design plans once engineer has submitted them to the Owner. 

Wastewater plants intimidate the most seasoned developers. RV Wastewater Plants are an entirely different animal. Make sure you do not wade through these waters (no pun intended) without the counsel and direction of an expert in systems FOR RV PARKS!!

A little investment now can save big for you later, both in construction and operational costs.

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Thank You CARVC!

Thanks to all of you who joined me during my seminar yesterday. It was indeed a joy to meet so many new people!

As promised, here is a link to a PDF copy of my presentation. Let us know if you have problems accessing it and we will mail it directly. Our rock star Assistant, Jenna, can be reached at 800-579-9796 and she will make sure she gets it to you,

Please contact us if we can assist you in your park operations. We offer full 3rd party management of parks and many all staffing, hiring, firing, training, technology, and marketing.

We also do full land plans and economic packages for our clients. We would be honored to help you make your outdoor dreams come true!

Thank you again for having me. Hope to see you soon on the road!!

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