If you own or manage a hospitality business—or are considering becoming a full-time property manager—you’re probably facing an important decision: Do I need a property management system (PMS)? Should I replace the one I’m currently using?

This is not a decision to take lightly, as it can have a direct impact on the long-term success of your business. A modern PMS (Property Management System) does more than just streamline operations—it transforms every aspect of your daily workflow, from guest interactions to financial management, ultimately improving efficiency and profitability.

That’s why the key question to ask is: "How do I choose the best PMS for my hospitality business?"

Navigating the vast range of options on the market and finding the right answer can be overwhelming.

To help you make the right choice, we asked Marco Vincenzi, co-founder of Ciaobooking, to give us an insider’s perspective on a next-generation PMS and share his insights on what to consider when making this important decision.

Starting with the basics: should you choose a cloud-based or local PMS? A basic system or an all-in-one solution?

To answer this question, I’d like to highlight a particularly interesting statistic presented by the Travel Innovation Observatory at the Politecnico di Milano during the last TTG: today, online sales are the leading revenue channel in the hospitality industry, accounting for 56% of total transactions across both hotels and short-term rentals.

Of this total, 38% comes from direct bookings, meaning reservations made through an operator’s website. Before the pandemic, this percentage was just 23%. This shift means that many hoteliers have realized that structured online operations are the only way to stay competitive. However, it also means that a significant portion of transactions still happens through OTAs and intermediaries, and an incredible 44% is still completed offline through traditional channels.

We see this every day: many properties still don’t use a PMS, or they rely on outdated systems. And we also see what happens when they switch to a modern, cloud-based, all-in-one PMS.

What happens?

From our experience, we’ve seen profitability increase by up to 50% after the transition.

That’s because a cloud-based all-in-one PMS allows you to strategically manage every aspect of your property with just an internet connection. From administrative compliance to accounting, from a booking engine that gives you full control over reservations to a channel manager that optimizes your OTA listings, all the way to detailed analytics and reporting.

This system doesn’t just streamline daily operations—it’s designed to drive revenue. For example, you can set a price and immediately apply it to your booking engine, create offline promotions using the quoting tool, and even adjust markups before distributing rates to OTAs.

Structuring your distribution strategy more effectively helps improve your average occupancy rate and has a direct positive impact on your revenue.

So, can a good PMS help properties reduce OTA commissions and drive direct bookings?

Absolutely—because it enables a truly strategic OTA management approach, eliminating the need for manual adjustments.

For example, you could prioritize platforms that offer lower commission rates or those that attract higher-value guests who tend to book longer stays.

Additionally, having a high-performing booking engine on your website means you don’t have to rely entirely on OTAs with the largest market share. When you can analyze and fine-tune your distribution strategy, you’re no longer working with OTAs out of necessity—you’re choosing them based on what’s best for your business.

For instance, if you manage an apartment, you might find it more beneficial to prioritize a channel like Expedia, which pays you a net rate and attracts longer bookings. This is because, in the vacation rental sector, fixed costs are highest at the beginning and end of a stay. By securing 5-night bookings instead of just 1 or 2 nights, you can spread those costs out more efficiently and improve overall profitability.

What are the signs that indicate a property has an outdated PMS and needs to upgrade?

The most obvious sign is if your PMS is not cloud-based and cannot be effectively managed from mobile devices. However, there are at least three additional red flags:

1. Lack of sales-oriented features: If your PMS is designed only to handle basic operational tasks at your property but lacks essential sales tools like a quoting engine, a high-performance Channel Manager, and an optimized Booking Engine, it is holding your business back. As discussed earlier, these tools are critical for both increasing direct bookings and reducing reliance on OTAs.
2. Insufficient automation capabilities: If your PMS lacks automation for key administrative tasks—such as managing regulatory compliance or handling guest communication—it is outdated. Using a PMS that doesn’t prioritize automation puts you at a competitive disadvantage. The hospitality industry is transitioning from automation to Artificial Intelligence (AI), and properties that are not already optimizing processes will struggle to keep up.
3. A closed system: If your PMS does not support APIs (Application Programming Interfaces), it cannot integrate with external technologies. This significantly limits your ability to adopt new solutions and innovate, preventing you from staying competitive in a rapidly evolving industry.

If your PMS falls into one or more of these categories, it is highly advisable to consider an alternative solution.

What questions should you ask to determine the best PMS for your property?

The most important question—regardless of property type—is: "How much is my time worth?"

This is the key factor. A PMS should be chosen with the awareness that it is meant to free you from time-consuming, repetitive tasks—such as sending booking confirmations or manually synchronizing prices—so you can focus on high-value activities like guest experience, data analysis, and revenue strategy.

What are the must-have PMS features for different types of properties?

To answer this question, let’s look at some practical examples:

For B&Bs and smaller properties, the most valuable feature is automated regulatory compliance management. This not only saves time but also helps ensure accurate handling of sensitive data, reducing the risk of errors and regulatory fines.

For property managers, the priority should be simplifying complexity. Managing multiple properties requires a PMS that centralizes all operations, from administration to maintenance and housekeeping, in a streamlined and efficient way.

For hotels, the PMS must support OTA disintermediation, cost control, and administrative and financial management. For example, fully internalized accounts receivable management is an essential feature that simplifies financial operations.

How can you determine in advance if a PMS truly meets the specific needs of your property?

The first thing to look for in a PMS is simplicity—it should be accessible even for those who start with limited technical knowledge. At the same time, however, it should offer all the potential features necessary to support your growth and evolution.

It is a mistake to assume that the best technology must be complicated. In reality, the best technology is adaptable, allowing you to start with the basics and progressively integrate more advanced tools as your expertise grows.

How long after adopting a PMS can you expect to see the first benefits?

If we consider 100% as the full potential benefit of an all-in-one PMS, you can achieve 50% of that immediately, without much effort, simply by realizing how many daily tasks can be simplified instantly.

For example, the automations we discussed earlier, which are essential for small accommodations, become apparent during the initial implementation phase of the software.

Of course, to see long-term benefits, you need to invest time in training, learning new strategies, and applying the technology effectively.

This is why transparency from the provider is crucial: no software performs miracles on its own, and not even artificial intelligence can fully replace human decision-making. The key is understanding how to interact with technology and leverage it to its full potential.

Summing up: what are the essential steps for hoteliers choosing the right PMS?

First and foremost, be open to change. Accept that today, without a PMS with the features we have discussed, it is extremely difficult to build a profitable and sustainable business.

Second, focus on the features that save you the most time and ensure that the technology helps you sell more efficiently and effortlessly.

As Marco Vincenzi explains, "In many cases, the real obstacle preventing hoteliers from adopting a next-generation PMS is not the technology itself, but the resistance to change."

We’ve created a practical checklist with 25 questions to help you assess whether your current PMS is still the right fit—or if it’s time to update or replace it.