MLOS (Minimum Length of Stay)

What is an MLOS? – Explanation

When people talk about an MLOS, they usually mean a MinLOS. With it, you set your guests a minimum number of nights they must book if they want to check in on a particular day. You might combine this with a specific rate. This can make sense when demand for rooms in a certain period is very high, as it lets you avoid lots of shorter stays that could otherwise leave rooms empty.

The MinLOS should not be confused with a MaxLOS, where you set a maximum number of nights.

The goal of the restriction

The aim of this restriction is to increase your occupancy by limiting which types of booking are allowed and which aren't. This only works when demand is particularly high and there is displacement potential – for example, when short-stay bookings would prevent longer ones. The MLOS is therefore a revenue management tool for segmenting and selecting bookings. You use it to select the bookings that are more profitable for you and your hotel because guests stay longer.

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MinLOS examples

• Many holiday hotels that see particularly high demand at weekends apply a MinLOS restriction for the weekend. This prevents single-night bookings from displacing bookings for the whole weekend.
• Holiday hotels with extremely high demand even set a MinLOS of 7 days during their peak seasons. This is typically the case for hotels in ski regions, where winter demand for week-long holidays is so high that guests may only arrive on one day of the week – and then only on a 7-day cycle.

MaxLOS examples

• The MaxLOS is a restriction that is used very rarely and only makes economic sense in a few cases. Here you set the maximum length of stay a guest may book. One exceptional case where it is useful is preventing visa bookings – bookings made to apply for a visa, which usually have a long length of stay but often aren't realised.
• Another reason for a MaxLOS could be that you expect a closed group for a certain period for which you need all your capacity. If that group is more profitable than individual bookings, you should keep those dates free. One way to do this is a MaxLOS for the days beforehand.

The problem with the MLOS

The underlying idea is that high-value bookings are realised so capacity is used optimally. The problem, however, is this: in very few cases is demand as strong as a ski region in peak season. Usually there aren't enough high-value bookings to fill every room. The result: potential bookings for a shorter period are filtered out and rejected from the outset – even though there would still be enough capacity for them. This is damaging and, in most cases, means lost revenue. You should therefore only set an MLOS when you are completely sure that you will fill all your capacity despite the restriction.

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An alternative approach

We recommend avoiding hard restrictions where possible and instead staying bookable whenever you have free capacity. But be careful – not at any price! The far better option is to set your prices dynamically and to favour longer bookings through better conditions.

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Find out now how happyhotel lets you set your prices flexibly and dynamically, and how you can use this to manage your demand!

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