A snapshot survey of the UK hotel industry conducted with the readers of hotel-industry.co.uk throughout December has revealed that the industry is feeling overwhelmingly positive about doing business in 2012. More than 65% of respondents agreed that they felt positive about doing business in 2012, despite the gloomy financial climate.
Hoteliers are by no means oblivious to the ramifications of the current economic situation with 60% citing the potential collapse of the Euro as the key factor that will have the biggest negative impact on the UK hotel industry in 2012.
Other economic factors also concern hoteliers: 43% are concerned about the threat of recession, 23% cited the decline in consumer confidence and 29% identified the higher rate of VAT levied on the UK hospitality industry as an issue.
The 20% VAT rate was a bone of contention for hoteliers throughout 2011 and industry leaders remain convinced that growth in the UK’s hospitality industry is hindered by Britain’s lack of price competitiveness. The UK ranks only 135th out of 139 countries in the World Economic Forum’s Travel and Tourism Competitiveness Index. On the continent, all but two EU member states have reduced VAT on accommodation and attractions.
The business confidence of the UK hotel industry against the backdrop of economic crisis is perhaps down to the forthcoming Olympic Games. It presents an unprecedented opportunity for UK hoteliers and other hospitality professionals.
In the hotel-industry.co.uk snapshot survey, 47% agreed that the UK hotel industry is prepared to capitalise on the Olympic Games. And with good reason: it is forecast that the UK hotel industry will experience a £123 million spending uplift as a result of The Games and F&B will see an increase in excess of £80 million. Overall, the event is expected to attract 350,000 foreign visitors per day and generate an additional £2.1 billion in tourism.
Focus on Guest Services
When asked to identify the areas that their business will be focusing on in 2012, guest services came out on top with 41% agreeing on its importance.
This result is not unexpected. In a highly competitive market with plentiful supply, it is only natural that hoteliers will seek out cost-effective points of differentiation. Improving guest services and the quality of the hospitality experience is the perfect way to improve the brand in a period of economic instability. Also, in the era of online user generated guest reviews, ensuring a high-quality guest experience has become part of a hotel’s reputation management strategy.
34% agreed that they needed to focus on revenue management – this relatively new technology can help optimise a hotel’s inventory and improve the hotel’s turnover.
Other areas to focus on include 34% seeking to establish new partnerships, 31% focusing on their marketing and PR efforts and 28% improving their staff training.