The two pricing models
Almost every property manager in the Caribbean charges one of two ways:
- Flat monthly fee. Often $300–800/month, regardless of how much your property earns. Some companies layer a small percentage on top (5-8%). The pitch is predictability.
- Revenue-share. A percentage of bookings revenue (typically 15-30% in this region). Nothing if your property earns nothing.
CHM operates on revenue-share exclusively. This isn’t a marketing position — it’s a structural choice that changes the entire incentive landscape for both us and the owners we work with. Here’s why.
What flat-fee gets wrong
Flat-fee pricing creates a perverse incentive: once your manager has signed you up, they get paid the same whether your property is at 30% occupancy or 90%. There’s no operational urgency to optimize.
This shows up in concrete ways:
- Pricing complacency. Dynamic pricing requires weekly attention. If the manager gets paid regardless, they tune pricing once and leave it.
- Channel laziness. Listing on 35 OTAs takes work. Listing on 3 is easier and costs the same to the manager.
- Slow guest response. A 4-hour response time can cost a booking. Flat-fee managers don’t see that cost.
- Maintenance deferred. Fixing a broken AC immediately versus next week — the manager doesn’t feel the difference; the guest review does.
None of this is hypothetical. We’ve taken on properties from flat-fee managers and seen the same patterns repeatedly: outdated photos, single-channel distribution, prices set in spring and never adjusted, guest reviews trending down.
The revenue-share alignment
When the manager only earns when the property earns, every operational decision sharpens:
- Pricing gets tuned weekly. Every dollar of ADR matters to both sides.
- Distribution maximizes. More channels = more bookings = more revenue for everyone.
- Response time tightens. Lost bookings are lost dollars on the manager’s side too.
- Maintenance moves. A broken AC means a refund and a 1-star review. Both sides feel it.
The math
Here’s where flat-fee proponents push back: “But isn’t a percentage more expensive?”
Sometimes. Often not. Let’s run a real example using one of our portfolio properties (illustrative numbers):
Scenario: 3-bedroom Punta Cana villa, year 1
| Flat-fee model | Revenue-share (CHM) | |
|---|---|---|
| Annual revenue | $48,000 | $84,000 |
| Manager cost | $9,600 ($800/mo) | $16,800 (20%) |
| Plus % overlay | $3,360 (7%) | — |
| Total mgmt cost | $12,960 | $16,800 |
| Net to owner | $35,040 | $67,200 |
The revenue-share model costs $3,840 more in management fees — but the owner takes home $32,160 more in net revenue. Why? Because the revenue-share manager is structurally motivated to drive bookings.
The flat-fee model only wins when revenue is so low the percentage exceeds the flat. By definition, that means low-occupancy properties — which is also the case where you most need an operationally hungry manager.
”But what if my property is consistently full?”
Fair question. If your property is genuinely capped on demand (e.g., a small studio in a saturated location), the percentage model can theoretically cost more than flat-fee.
In practice, this almost never happens because:
- Most “consistently full” properties were optimized that way under good management — and reverting to flat-fee will degrade them.
- Even high-occupancy properties have ADR ceiling room. A flat-fee manager will leave $5-15k/year on the table that revenue-share would capture.
- Direct-booking growth (which we incentivize because we earn the same %) compounds over years.
What revenue-share doesn’t fix
Honest disclosure: revenue-share isn’t magic. If your property has structural problems — wrong location, dated finishes, bad amenities — no pricing model will save it. We’ll tell you that in your free property analysis.
What revenue-share fixes is the manager incentive problem. You still need:
- A property worth marketing.
- A manager with the operational capacity to deliver.
- A market with enough demand to convert.
CHM’s revenue-share model is the foundation for the kind of partnership that compounds over years. The math gets better every year as repeat bookings grow, ADR optimizes, and direct-booking percentage climbs.
How to evaluate a manager (regardless of pricing model)
Before signing with anyone — flat-fee or revenue-share — ask these:
- What’s your contract length and exit terms? (Should be 12 months max with a reasonable exit clause.)
- How many OTA channels do you manage? (35+ is the bar. 3-5 is a red flag.)
- How often do you adjust pricing? (Weekly during peak. Monthly minimum.)
- Can you show me a sample monthly statement from another owner? (If they hesitate, walk.)
- What’s your average response time to guest messages? (Under 1 hour during business hours, under 4 hours overnight.)
- Do you charge for vendor work, and is it marked up? (Some managers add 15-30% on top of vendor costs. Avoid.)
If a manager can answer those clearly and the math works for your property, the pricing model matters less than the answers. CHM happens to be revenue-share — but the underlying point is that aligned incentives, transparent reporting, and operational depth are non-negotiables.
When to call us
If your current setup feels like the manager is on autopilot — flat photos, slow responses, pricing that hasn’t moved in months — your free property analysis will tell you whether CHM is a fit, and what we’d realistically project for your property under our model.
