pricing

in
Blagdon, United Kingdom
Level 2
796 Views

Hello,

 

I'm new to this community & this is my 1st post.  We are superhosts & are using the professional tools interface.  We've been listing for 1 year & now have lots of good reviews.

 

We have 4 properties, all with different rates.  We will run a season from 20 May - 30 September 2022.  Each week has a different weekly rate.  Peak weeks can only be booked for 7 night stays starting on a Friday.  Shoulder season can be booked for 2 night minimum, starting any night.  Friday & Saturday are priced higher than weekdays.

 

I need advice on how best to use the system. We have the properties listed on other platforms which use different pricing structures.  I want to set prices so the guest sees rates that match as closely as possible to the other platforms.  I'm on simplified pricing so can work with gross figures.  Smart pricing is off. I'd rather not set any extra fees for cleaning etc.

 

I'd love to hear from anyone out there with a similar approach who can advise on setting pricing to meet these needs.

 

17 Replies

Re: pricing

in
England, United Kingdom
Level 10

@Piers24 As you have pro tools on and presumably use  rule sets then these will  you to set different rates/lengths of stay/checkin and out days for different parts of the year.

What specifically are you not managing to achieve?

Re: pricing

in
Blagdon, United Kingdom
Level 2

It's knowing where to start tbh. 

1st qu:  Do the listings need to be live to edit price or can they be paused?

2nd:  Should I work from the screen showing all 4 calendars or go into each separately? ie Can I set rules that are applied to all my listings & is this the way to do it?

Re: pricing

in
England, United Kingdom
Level 10

@Piers24 Ok so lets try and give some suggestions:

1) You need to create a ruleset(s). You will definitely need one that you could call PEAK. This should have a minimum of 7 nights stay with check in/out only allowed on a Friday. You then highlight the dates you want this apply to in your multi calendar and click on add ruleset somewhere on the right hand side. This will allow people to book a fortnight as well.

2) Your listings should have a min stay of 2 nights (we use 3 by the way) and a max of 30 nights if you want to ensure you meet the Furnished Holiday Let tax rules. That said you are not available to host for 220 days per year so this is maybe less relevant. You could make the properties available for longer but at such a high price (in April/October that no one would book (I think that is legal!)

In the pricing section of your listings you should set a base price for each. Its under the smart pricing section and even if you have smart pricing switched off this base price will be used as you open up your calendar. Set this price to the highest you would ever want and then if you miss your calendar opening up then your price will at least be nice and high.

Let us know how you get on. Feel free to tag me by typing @ and then clicking on my name.

Re: pricing

in
Blagdon, United Kingdom
Level 2

@Mike-And-Jane0 thanks so much for your amazing advice.  I've been on it all day & think I've now got my head round it.  Good FHL tip as well!  I may come back to you if I get stuck if that's ok.  It seems like you've got a similar pricing approach as me.  I'm wondering if you've found any decent how-to's for all this.  The info in the help pages is scant.

Re: pricing

in
England, United Kingdom
Level 10

@Piers24 It is highly unlikely that we have a similar pricing approach. Ours is near random and made up as we go along!

Happy to help anytime - One thing I should have said is that you should ignore the Airbnb price tips. If yours are anywhere near these then you are seriously underpriced

 

Re: pricing

in
Blagdon, United Kingdom
Level 2

@Mike-And-Jane0 Yes, I know that much.  I have everything switched off!  One tip for you:  Simplified pricing where you list a gross price, airbnb deduct 15%. With the other system you list a rate, they then add 14.2% on the guest side + 3.6% on our side (service fee of 3%+ vat=3.6%).  That's a total of 17.8% so 2.8% better off with Simplified pricing.

Re: pricing

in
England, United Kingdom
Level 10

@Piers24 I believe you have fallen foul of the mysteries of percentages in thinking simplified pricing is 2.8% better off. I calculate simplified pricing is 0.7% better - The key is 14.2%  and 3.6% are on a lower figure than the 15% is.

ALSO when you come to do your taxes you need to gross up your revenues  by the Airbnb service fees and then take the service fee as a tax deductible expense. In most cases this is a zero sum game but if you are anywhere near the £85000 VAT threshold then simplified pricing could push you into having to register for VAT which would add 20% to your rates and make you uncompetitive.

Re: pricing

in
Blagdon, United Kingdom
Level 2

@Mike-And-Jane0 I stand corrected!  I've run the sums & you're correct (I made it 0.695% better off).  And indeed, we are very aware of the vat threshold.  You've helped me again.  I'll switch back to the old system even though the SP system makes it much easier to set rates that roughly match the other platforms we use (cottages & trip).

Re: pricing

in
England, United Kingdom
Level 10

@Piers24 I think I was slightly wrong as well. My working is shown below.

 

 

 Old structure   
nighty rate100    
guest service fee17.0414.2%+vat   
host service fee3.63% +vat   
      
Guest pays117.04    
Host gets96.4    
      
      
 New structure   
      
guest pays 117.04to match what guest paid under old structure
      
Host service fee21.067215% +VAT   
host receives95.9728    
      
Host worse off by £         0.430.4%   

 

Re: pricing

in
England, United Kingdom
Level 10

@Piers24 a random question. How many TV licences do you have?

Re: pricing

in
Blagdon, United Kingdom
Level 2

@Mike-And-Jane0 hello again.  We have 1 licence.  It's a hotel licence which is valid for FHL.  1 licence covers up to 15 TV's.  This licence is the same price as a regular residential licence.

 

Re the vat  on service fees, I've looked back to 2019 when we started with airbnb & checked the transactions.  We were on the old system & what I found was a guest service fee added of 16.94% (14.12%+vat).  note, this was 15.48% (12.9% + vat) in 2019.  The host fee has always been 3% with NO vat, which I don't understand.  Running my figures with your model we get:

Old system - Guest pays £116.95; we get £97.00

New system - Guest pays £116.95; we get £95.90

Slightly different to your figures but still better off under the old system, with the vat advantage you mention.

Re: pricing

in
England, United Kingdom
Level 10

@Piers24 Very strange - We have definitely been charged 3% PLUS vat.

On the TV licences I have only just realised we don't need the 3 we have but as we have a long term guest in at present due to their house burning down in the village we'll wait until they leave and then apply for a hotel licence.

Re: pricing

in
Blagdon, United Kingdom
Level 2

Screenshot 2021-11-11 091805.jpg

@Mike-And-Jane0  Very strange. Here's a recent record of ours showing 3% no vat & guest service fee of 14.12% + vat = 16.94%

Re: pricing

in
England, United Kingdom
Level 10

@Piers24 Amounts for our current guest. Looking at this we are charged 3%+VAT on the full amount including cleaning fee. The guest, from England if it makes any difference seems to be paying a service fee of 14.2% +VAT on the nightly rate and nothing on the cleaning fee.

How weird is that!!!!

 

Guest paid
£77 x 3 nights
£231.00
Cleaning fee
£30.00
Guest service fee
£41.09
 
Total paid by guest (GBP)
£302.09
 
Host payout
3-night room fee
£231.00
Show breakdowns
Cleaning fee
£30.00
Host service fee (3.0% + VAT)
-£9.40
 

 

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