VERY RARELY ARE HOTELS OR AIRLINES RUNNING AT 100% CAPACITY ALL OF THE TIME.
The travel and hospitality industry has perishable inventory; when the inventory does not sell it is gone and potential revenue is lost.
BizXchange allows a company to capture the perishable inventory and use it to pay for budgeted expenditures such as advertising, printing and other capital expenditures by making use of otherwise unsold capacity.
BizXchange takes a position in the inventory at full market rate thus providing an alternative to discounting unsold inventory which jeopardizes price integrity. BizXchange purchases the supply at full book value allowing a company to maintain the average daily rate and actualize full market value of the asset.
Additionally these companies are able to expose their product to new customers which increases overall market share and increases additional revenue streams from other income generators such as food, beverage, spa services and the like.
The example below outlines the financial benefits of using barter as a financial business tool:
A 200 room hotel is operating at 90% occupancy per night, each room has an average daily rate of $200
The 10% vacancy represents $1,460,000 per year (or $4,000 per day) in lost revenue
BizX purchases 600 rooms with trade credits, valued at $120,000
Hotel uses $120,000 in trade credits to offset budgeted expenditures.
Hotel marginal costs in providing $120,000 worth of rooms is 18.5% (cost of cleaning and restocking)
Hotel saves $97,800 by increasing its occupancy by less than 1%