Where Resorts Lose Money and How to Stop the Leaks

For resort owners and operators, profitability isn’t just about driving revenue. It’s about plugging the leaks that quietly drain margins day after day. Many of these leaks are hidden in plain sight, often dismissed as “the cost of doing business.” But left unchecked, they add up to millions in lost revenue and missed opportunities.

At Brittain Resorts & Hotels, we’ve spent decades refining operations across thousands of keys. Along the way, we’ve identified the most common places resorts lose money and the strategies to keep it from happening.

OTA Overdependence

• The Leak: Heavy reliance on online travel agencies means paying commissions of 15–20% on bookings that could have been captured directly. For some properties, OTAs account for 40–70% of business, which quietly erodes profitability.
• The Fix: Use OTAs as an acquisition tool, then capture guest data to feed loyalty, remarketing, and repeat campaigns. At BRH, our OTA dependency averages just 15%, thanks to disciplined direct-booking and acquisition strategies.

Inefficient Check-In and Guest Service Workflows

• The Leak: Long lines at the front desk, manual data entry, or slow guest response times cost more than guest satisfaction — they inflate labor expenses. Every extra minute per transaction compounds across thousands of arrivals annually.
• The Fix: Invest in pre-check-in data collection, mobile keys, and SMS-based guest communication platforms. These tools shave time off routine processes, reduce labor dependency, and free staff for higher-value service moments.

Underutilized Ancillary Revenue Opportunities

• The Leak: Guests are willing to spend more on convenience and experiences, but many resorts leave money on the table by failing to offer upsells like early check-in, late check out, vacation protection, or curated packages.
• The Fix: Build ancillary revenue into the guest journey. Offer flexible check-in/out options, sell cancellation protection, add birthday/romance packages, and leverage F&B or local attraction partnerships. These programs enhance the stay while boosting margins.

Weak Rate and Inventory Discipline

• The Leak: Poorly managed revenue strategies — from giving OTAs last-room availability to inconsistent rate parity — this leads to missed revenue and a weakened negotiating power. Over-discounting in shoulder seasons also erodes brand value.
• The Fix: Implement a disciplined revenue management system (RMS) that manages rates dynamically across all channels. Protect direct bookings by controlling contract terms with OTAs and ensuring your website remains the best place to book.

Energy, Maintenance, and Preventable Breakdowns

• The Leak: Outdated systems and reactive maintenance drive up utilities and repair costs. For example, a broken HVAC unit or elevator not only costs money to fix but also impacts guest satisfaction, leading to lost repeat business.
• The Fix: Adopt both predictive and preventative maintenance and energy management systems. Proactive monitoring reduces unexpected failures and allows operators to optimize utility usage. Every dollar saved in expenses is a direct gain in NOI.

Failure to Capitalize on Guest Feedback

• The Leak: Ignoring guest surveys and online reviews doesn’t just hurt reputation — it creates recurring service issues that reduce repeat business. Dissatisfied guests cost more to replace than satisfied ones cost to retain.
• The Fix: Close the loop with pre-stay, on-site, and post-stay surveys. Identify promoters, activate them for reviews, and resolve pain points before they become patterns. Advocacy and loyalty compound revenue over time.

Overdependence on Contract Labor

• The Leak: Resorts that fail to build and retain a loyal employee base often find themselves turning to costly contract labor to fill gaps. While contract staffing can be a useful stopgap, long-term overreliance drives labor costs up and erodes culture. Guests also notice inconsistency when service staff turnover is high.
• The Fix: Invest in recruiting, training, and retention programs that build loyalty within your team. A stable, long-tenured workforce not only lowers costs but delivers better guest service — fueling repeat stays and positive reviews. Contract labor should be a supplement, not a foundation.

Ineffective P&L Management

• The Leak: Many properties focus heavily on topline revenue while neglecting detailed P&L analysis. Overspending on labor, failing to control product purchasing, or missing vendor savings opportunities can quietly eat away at profit margins.
• The Fix: Implement disciplined financial management practices, including:
  • Weekly/Monthly deep-dive reviews of labor efficiency and scheduling. Weekly for properties who are struggling with consistency
  • Vendor audits to ensure best pricing on supplies.
  • Benchmarking costs against industry averages and peer properties.
  • Using AI-driven analysis tools to spot trends and opportunities faster.

Proactive P&L management ensures revenue growth translates into true profitability, not just higher topline numbers. By tightening controls, leveraging data-driven insights, and holding every department accountable, operators can protect margins, strengthen NOI, and create long-term financial stability for both owners and the asset itself.