Thursday 9th September, JW Marriott Grosvenor House
ExCeL London - 30 Sep - 01 Oct 2021
18 October 2021 - Virtual
Stewart Moore, group marketing director at London-based serviced apartment company Think Apartments, muses on the state of affairs in the hospitality sector.
Anyone who is literate cannot have escaped news of the woes that every aspect of the travel industry is facing. In particular, the hospitality sector is suffering; not only from decreasing visitor numbers, but also from massive discounting by large hotels and chains.
These two factors have come together to create an environment where the average daily rate is being constantly eroded and as a consequence revenue per available room (RevPAR) is down.
However, the industry is now facing two new challenges in the shape of the reservation window and the length of stay. For example, at Think Apartments, we have seen our aparthotel length of stay drop by over 65% in the space of just 12 months. Meanwhile our booking window has shrunk to such an extent that now over 75% of our revenue is confirmed within just 14 days of check-in.
Both of these factors have an enormous impact at the core of a hotel's operations. Late predictability in terms of occupancy means that staffing levels are disrupted, supplies and even linen has to be stored or ordered at shorter notice; all placing pressure on the hotel's infrastructure, operations team and cashflow.
Shorter stays have a similar effect. With more check-ins the front of house team is strained, rooms are turned round much more often, thus housekeeping work harder or have to recruit more staff, and finally, as a consequence, the rooms suffer from more wear and tear. And of course, all this needs to be absorbed in a decreasing average daily rate and this causes a hotel's profitability to drop. Hoteliers have realised that they need to change this situation.
How can the business traveller benefit?
Think Apartments and many traditional hotels are offering discounts for bookings made well in advance. If you can make this fit in with your plans, then it is an ideal option to reduce the accommodation aspect of your travel budget. On the other hand, if you cannot arrange your travel this way, you could perhaps make it a leisure trip!
Another way to take advantage of hotels' woes is to extend your stay. Add in a Friday, Saturday or Sunday, and you may be able to take advantage of special weekend deals that are offered. Again, Think offers these types of deals, as do a number of city centre hotels whose midweek business is predominately corporate.
Without sounding too glib, you have to act soon. Many commentators and benchmarking companies, are predicting a rise, albeit slowly, in hotel rates throughout 2010. As soon as this happens, you can bet that hotels will be stopping their offers as quickly as possible.