What is Safety Minimum Price (SMP)?

The Safety Minimum Price (SMP) is a feature designed to ensure that your minimum nightly rate never drops below a certain threshold. This threshold is based on your historical booking data, specifically the Average Daily Rate (ADR) you received last year for similar stay dates. It helps prevent underpricing, especially for bookings far in advance, by automatically setting a safety net for your minimum prices.

Why Use Safety Minimum Price (SMP)?

Many users may unintentionally underprice their listings due to incorrect settings or market conditions, which can lead to lower-than-expected bookings. For example, if your property was booked at $500 per night last year in July but you accidentally set a low base price this year, you could get bookings at $300 per night. This situation can cause disappointment, especially when preventable. SMP safeguards you by ensuring your minimum price is in line with what you’ve successfully charged in the past.

How to Use Safety Minimum Price (SMP) and What Do the Options Mean?

Please note that Safety Minimum Price is only available for Property Management Systems (PMS) or Channel Managers which provide PriceLabs with Nightly Revenue details for every booking/reservation. If your PMS does not support providing us with Nightly Revenue details, then you won't be see the option of Safety Minimum Price.

1. From the Pricing Dashboard, "Review Prices" then click "Edit" on the Customizations panel
   
2. Go to the Seasonal & Minimum Prices tab and enable the toggle for Safety Minimum Price

Here are the options you’ll encounter:

• PriceLabs Recommended: This setting looks at last year’s ADR for the same dates and applies it to your current rates, ensuring you don't go below the successful price points of the past.
  
• Note the % input box in the above helps with determining the inflation impact. For example, if you want that for the coming year, you want your SMP to be 10% more than last time of what you charged your guests.
  
• You might not want to keep this number very high. 110% is safe choice, you can also choose a number that is smaller like 100% or 105% (signifying no or 5% raise respectively)
• Do Not Apply Safety Minimum Price: SMP will not be used for your listings. The minimum price that you have set for your listing will be in effect.
  
• Custom Option: In this mode, you can customize SMP by adjusting it based on specific date ranges, holidays, or other preferences. 
  

Please note that Custom option in Safety Minimum Price is for advance use-cases, and this option can be enabled for your account by reaching support@pricelabs.co

Using SMP at Group or Account Level

You can apply SMP across multiple listings or groups if you manage several properties. By setting SMP at the group or account level, you ensure that all properties under your management benefit from historical pricing intelligence. This is particularly useful for property managers overseeing large portfolios where manual adjustments for each property would be time-consuming.

1. If your account (i.e. your PMS or Channel Manager) does not support giving Nightly Revenue (without taxes, fees etc.) to PriceLabs, you won't be able to see the option of SMP.
2. If you are applying SMP at Group level, and if you manage listings with multiple PMS/Channel Manager, then SMP will only apply to listings in the group whose PMS/Channel Manager supports Nightly Revenue (without taxes, fees etc.) to PriceLabs.

Using SMP for Pricing Profiles

If you use Pricing Profiles to segment your listings (e.g., high season vs. low season), SMP integrates seamlessly. 

Key Benefits of Safety Minimum Price (SMP):

• Prevents Underpricing: Ensures your listing doesn’t get booked at a significantly lower rate than in previous years.
• Customizable Control: Allows you to decide when and how SMP applies to your listings.
• Protects Far-Out Bookings: Especially useful for long-term dates where market fluctuations may cause prices to dip unexpectedly.
• Effortless Setup: Easy to implement for both small hosts and large property managers, with scalable options across accounts or individual listings.