The Dos and Donts of Hotel Pantry Planning

By Janine Roberts Director of Sales and Marketing, Tradavo | April 03, 2011

In any industry, there are basic tenets and practices that industry experts rely on as common knowledge. But in an industry like hotel retail, where two industries cross over each other, many basic retail practices are misunderstood or completely overlooked because the professionals in charge of overseeing the effort typically come from a hospitality background rather than retail

Unfortunately, this creates a scenario where fairly simple, yet costly mistakes are made when it comes to planning for, supplying, and managing a hotel pantry or gift shop. Many of these revenue mistakes are made by well meaning managers trying to create a clear-cut financial plan for their retail effort by setting budgets, selecting vendors, and closely managing overall Cost of Goods spent on the pantry but end up limiting the revenue and profitability potential of the retail operation.

Budgeting for Retail

Hoteliers are experts at managing budgets and procurement down to the penny. Cost conscious managers know exactly how much can be spent on FF&E, food service, and payroll on any given day.

Unfortunately, hotel retail is often treated like an operational cost rather than the profit center that it should be. Working on a fixed budget for retail can be a detriment to profitability. So long as product is selling and margins are set correctly, the ROI is immediate. Sales should be the determining factor in what is ordered, not an arbitrary number that could cause costly out of stocks when product is moving and there is no money left in the budget to re-supply.

Often I walk into a hotel pantry and find numerous facings missing leaving half empty shelves and a lack luster appeal to a potential buyer. When asked why so many holes, more often than not the response is, We are waiting to place an order after our budget is renewed at the first of the month. These out of stocks can costs hundreds even thousands of dollars a month in a busy market.

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Social Media: Engagement is Key

There are currently 2.3 billion active users of social media networks and savvy hotel operators have incorporated social media into their marketing mix. There are a few Goliath channels on which one must have a presence (Facebook & Twitter) but there are also several newer upstart channels (Instagram, Snapchat &WeChat, for example) that merit consideration. With its 1.86 billion users, Facebook is a dominant platform where operators can drive brand awareness, facilitate bookings, offer incentives and collect sought-after reviews. Twitter's 284 million users generate 500 million tweets per day, and operators can use its platform for lead generation, building loyalty, and guest interaction. Instagram was originally a small photo-sharing site but it has blown up into a massive photo and video channel. The site can be used to post photos of the hotel property, as well as creating Instagram Stories - personal videos that disappear from the channel after 24 hours. In this regard, Instagram and Snapchat are now in direct competition. WeChat is a Chinese company whose aim is to be the App for Everything - instant messaging, social media, shopping and payment services - all in a single platform. In addition to these channels, blogging continues to be a popular method to establish leadership, enhance reputations, and engage with customers in a direct and personal way. The key to effective use of all social media is to find out where your customers are and then, to the fullest extent possible, engage with them on a personal level. This engagement is what creates a personal connection and sustains brand loyalty. The February Hotel Business Review will explore these issues and examine how some hotels are successfully integrating social media into their operations.