What’s the biggest threat to profitability at your property? 

Many owners would say it’s some combination of guest expectations, rising operating cost and labor challenges. Despite RevPar and ADR both inching upward, margins are shrinking. Owners need to get smarter about how they run their operations. They need to contain and eliminate vulnerabilities.

One often overlooked threat is water management. Many properties continue to manage their plumbing the same way they always have. But they need to evolve, because outdated water management is flushing your profits down the drain. 

Here are three ways you could be putting yourself at risk, and what to do instead.

1. Compromising guest satisfaction

You and your team work hard to make sure your guests enjoy their time at your property. Every detail matters. And while the things guests say they expect are cleanliness and friendliness, you can’t overstate how important a nice hot shower with good water pressure is. The reality is that, for most guests, plumbing is like a bridge. You don’t think about it until it isn’t working. 

Inconsistent pressure, temperature drops or even scalding can and will result in dissatisfied guests. And that means bad reviews. In a world where roughly half of hotel bookings come from OTAs, you simply can’t afford the damage to your reputation—and revenue— that poor water management can bring.

Kelly Harrill, EVP for Koury Hospitality, puts it this way: 

“We work hard to find customers and keep them. When something goes wrong, it’s very, very hard to get them back. They go back home, and they say, ‘it was really nice…but we had no hot water.’ That's what people remember.”

Today’s guests expect immediate resolution of issues. Being able to respond quickly is critical. Better yet is being able to address issues before they get to the guest. 

The old method of plumbing maintenance, reacting to things as they crop up, leaves you to find out about problems from your guests. At which point you can start diagnosis and repair. The better approach is smart water management. Broadly, this refers to a combination of hardware and software that monitors your plumbing system and alerts your team of any problems. Instead of finding out that the top floor doesn’t have hot water from angry guests, you can see in real time that the hot water flow rate is dipping, and dispatch your staff to address the issue.

Smart water management gives you the ability to minimize plumbing system disruptions and keep heads in beds.

2. Inefficient operations

Utility costs are out of our control. The unit cost to supply a bed space with a year’s worth of hot water is what it is. Given that constraint, you have to find efficiencies in your system to drive expenses down. 

But the old way of managing your water system provides limited opportunities to optimize your energy and water consumption. Sure, you’re probably using low-flow shower heads. You may have installed low-flow toilets as well. Maybe you even invested in high-efficiency boilers. But unless you have real visibility into your whole plumbing system, you’re fighting an uphill battle against waste.

Hidden leaks. Excessive water consumption. Spiking energy bills. They’re lurking in your plumbing, draining your profitability. And yet, you don’t even know they’re there. You might just see the signs.

Picture this: You get a call from the ownership group. Someone in accounting has noticed that your water bill is up 25 percent from the same period last year. And now you’re on the hook to provide a full analysis. 

Where do you start? You probably have your engineering team make a visual inspection, moving section by section through as much of the system as possible. This is the old approach, and it costs dearly. 

The first cost is labor. It takes a lot of maintenance hours to do this kind of investigation. The second cost is opportunity. Your staff are going to be pulled off of other tasks while they try to root out the problem. The third cost is guest satisfaction. Inspecting your entire water system this way is disruptive. It can mean closing areas of your property, shutting down amenities and, worst of all, entering guestrooms. And all of these costs mean you’re pouring money down the drain.

Instead, savvy owners are leveraging smart water management systems, like Nexa. These enable you and your staff to monitor your entire plumbing infrastructure remotely. Water bill spiking? No problem. Instead of sending maintenance on a snipe hunt, a network of sensors can pinpoint any leaks. More than that, you’ll be able to identify inefficiencies in your system.

You might know that the average insurance claim for a commercial leak is nearly $90,000— a clearly devastating financial blow. But what you might not realize is that a lot of hotels die the proverbial death of a thousand cuts from small inefficiencies that add up over time. For instance, cold water seeps into your hot water loop. The effect could be negligible at the tap, but over time the extra energy needed to continuously reheat the water could cost you a small fortune. Smart water monitoring can help you find and neutralize this kind of profitability threat.

3. Reactive maintenance

There are a lot of ways hotel owners can cut costs: automated check in, reduced linen service, even LED lighting. Maintenance, on the other hand, is one of those expenses that comes with the territory. But that doesn’t mean it has to be a drain on your profitability. If you’re maintaining your property reactively, you’re not getting as much out of your property operation and maintenance (POM) outlay as possible—and you could be putting yourself at risk.

Reactive maintenance is just what it sounds like. Something breaks, a guest complains, equipment fails, a bill spikes unexpectedly. Then, and only then, does your engineering team start to get the problem sorted. 

As we’ve seen, this approach to maintenance can negatively impact the guest experience. But it can also expose you to significant risk. Imagine you have a catastrophic leak. The fallout goes beyond dissatisfied guests. You’ve just lost available rooms for an extended period of time, because you had to close a whole bank of rooms for repairs and mold remediation. The soft goods have to be replaced. And your staff has to divert their hours to this one issue, pulling them off of routine maintenance, causing delays.

Reactive maintenance means you’re always playing defense. Want to plan for phased equipment upgrades? It’s going to be difficult, because you don’t have any idea what equipment might fail at any moment. Trying to keep insurance rates down? Good luck—you just had a major leak event, because you didn’t know your supply line was leaking until it was too late. Looking to stretch your maintenance budget? Not going to happen, since your team has to be on site at all times to monitor and respond.

Smart water management resolves these issues. With real-time visibility into your entire system, your engineers can maintain equipment proactively, with minimal downtime. Better still, you can start planning expenditures predictively. See ahead of time when system components are going to fail, schedule maintenance or replacement, and rest easy knowing that you’ve neutralized a threat.

The better way to manage hotel plumbing

The most successful hotel owners are rethinking how they manage their properties. Smart water management is a way to transform an invisible, often outdated system into a strategic asset.

In an industry where small inefficiencies compound into significant losses, a water system that quietly wastes energy, strains engineering teams and leads to guest complaints is an active threat to profitability—it just remains unseen until it’s too late.

A smart water management system, like Nexa, offers a seamless solution that integrates with your existing infrastructure. It’s more cost-effective than you might expect, with many customers achieving a 3X return on investment within the first year.

Now is the perfect time to modernize your approach to plumbing system management—reducing waste, improving efficiency and protecting your bottom line.