Winning in a Reset Economy: Three Steps to Success
By Brenda Fields Founder, Fields & Company | November 27, 2009
Unless we have been living under a rock for the past year, we would know that the world's economy has plummeted and that the hospitality industry worldwide has experienced an unprecedented drop in RevPAR, the primary indicator of profitability. As the world is adjusting to this new economy, the hospitality industry is searching for ways to recover.
According to Smith Travel Research (August 13, 2009 article by Chad Church), "The outlook for 2010 looks slightly better than 2009, but the industry still is expected to end 2010 with decreases in all three key metrics. Occupancy is projected to end 2010 with a 0.6-percent decrease, ADR is forecasted to end the year with a 3.4-percent decrease, and RevPAR is expected to end with a 4.0-percent decline."
Although this outlook is less than optimistic, there are strategies that can be implemented to turn your business around regardless of your base of business i.e. transient vs. group or the type of property i.e. convention, boutique, or resort or regardless of your marketing budgets. The key is to understand the new economy and how it has impacted your mix of business, they type of business, and new demand periods. Once that is in place you are in a position to establish strategic plans to incorporate the new business environment.
In this reset economy, there is no "one size fits all" approach. The successful business owner/manager is one who understands the new environment; understands his/her business on a micro scale; and will then customize an approach that best fits his/her needs.
This article will address the key components to put your property(s) on the path to success in this new economy and maintain success regardless of market conditions.
The Evaluation Process: