Minibars: Automation boosts ROI

Infared sensors and completely networked intelligence help the Smart Cube keep inventory and track guest use.

Minibars have long been a revenue-generating staple in many hotel guestrooms, and new technology gives hoteliers brand new opportunities for increasing return on investment.

“The whole market has shifted to automation, since the demand for hassle-free operation has really dominated the industry for the last three or four years,” said Walt Strasser, EVP of Minibar Systems. “We have introduced features like software automation, including automatic reconciling. We’ve even automated with some chains’ guest entitlement programs, putting intelligence into the software to run the minibar automatically.”

Minibar Systems’ Smart Cube reduces the amount of space needed to install a minibar, while allowing hoteliers to network the devices into their property-management system.

“Smart Cube is next-generation because of its open-shelf technology and use of infrared sensors,” Strasser said. “Each product sits on individual infrared sensors, so there’s nothing mechanical. We built all this with completely networked intelligence that keeps inventory, tracks guest use and helps inform staff members.”

This lets hoteliers better manage labor costs and keep tighter control of minibar inventory. It also eliminates the need for costly cabling from room to room.

“Automation reduces labor costs to as little as possible, because where hotels had four staff members they now have one,” Strasser said. “There are also other intangible service benefits, like not having to post charges after a guest’s check-out.”

Other vendors offer systems that can even keep track of minibar inventory during an electrical or Internet outage.

“We’ve installed Zigbee wireless minibars in many hotels, with the capability so that you don’t have to deal with a third-party network,” said Roger Abram, president of Innovative Hospitality Concepts. “It’s a self-standing system in the event of a power failure, so your charges are still coming in and you can perform every function. Anyone who tells you wireless technology isn’t necessary today is sadly mistaken; this is the wave of the present and the future.”

Minibars part of guestroom design

New innovations give hoteliers new options at reduced cost and size.

“The main thing we’ve been focusing on for the last two years is design and technology,” said Roger Abram, president of Innovative Hospitality Concepts. “Minibars are kind of a boring product in a way because they look like a box with little appeal in some cases. So we’re integrating the minibar with overall guestroom design.”

While energy efficiency and connectivity have been available in the minibar space for a few years, new options give hoteliers the option of reducing their minibar’s in-room footprint.
“One of the most exciting bars we’ll be rolling out is the Flat eFridge that hangs on a wall and is only 9 inches deep,” Abram said. “It is elegant [and] the first unit in the industry that has such short depth.”

The Flat eFridge can be mounted on a wall or can stand free in a guestroom, while being customized to match the look of a property’s décor. It features fully automated posting of charges and a computerized energy-savings system that can reduce the energy use of a unit in a vacant room.

The new flat eFridge has a happy hour feature that allows hotels to offer flexible pricing.

Wondering which products can help generate more revenue from your guestroom minibar? Here’s a list of 2011’s top sellers in several categories.

◾ Water (Fiji, Evian)
◾ Soda (Diet Coke, Coke)
◾ Energy Drink (Red Bull)
◾ Juice (Knudsen’s Orange Juice, Tropicana Cranberry Juice)
◾ Beer (Heineken, Miller Lite)
◾ Spirits (Grey Goose vodka, Jack Daniels, Ketel One vodka)
◾ Food (Pringles, M&Ms, Peanuts, Snickers, Kit Kat)

Source: Sandeep Sharma, VP of account management, Minibar Systems

Minibar mangement can increase revenue

While automated minibars offer great revenue-generating potential, hoteliers still face obstacles to making the most out of their investment.

“If you take a look at the technology that has evolved, we’ve gone from minibars that were very sterile looking with a barrier between products and guests,” said Roger Abram, president of Innovative Hospitality Concepts. “You were looking at product that literally looked like a vending machine.”

New advances in door technology have allowed hoteliers to better showcase their products and give guests a domestic feel.

“What changed was establishing an open architecture in the bar,” Abram said. “You remove the obstacle between the guest and the product. Now the guest can touch and feel the product, and they have a grace period before they’re charged. In terms of guest utilization, you want to make the bar very accessible, similar to a guest opening his refrigerator at home.”

Accessiblity and flexibility can lead to more sales, according to Walt Strasser, EVP of Minibar Systems.

“Operators want versatility because they can come up with cool, funky ways to display and sell more product,” he said.

Green technology will also come to the forefront, but isn’t quite there yet.

“Our units today are all certified green and can be recycled, because we manufacture for the world,” Strasser said. “We make our products for the European Union, and they are way ahead of the U.S. in terms of restrictions on what products and materials can be used.”

Europe has more stringent restrictions on energy use than the U.S., so a environmentally conscious hotelier may want to look overseas for their minibar vendor.

“You can only do so much when it comes to energy consumption, because all units use energy to cool,” Strasser said. “We use this logic in our heating and cooling systems that regulate energy as efficiently as possible.”

Minibars will become more integrated into the overall revenue generation of hotels.

“We want to make the bar much more inviting from an aesthetic standpoint using technology today,” Abram said. “Now, when the guest ends his happy hour downstairs in the lobby bar, hoteliers can extend happy hour to the guestroom. A hotel can promote a discount for buying a beverage from the minibar, like you market every other food-and-beverage outlet in the property.”

Charging guests high prices for minibar items can lead to reduced revenue and guest satisfaction.

“A hotel has to consider that they have a profit center right in the room,” Abram said. “The question is how to promote guest utilization and generate revenue without the guest feeling deceived or ripped off by a product that costs an exorbitant price.”