Vacation Rental Channel Management Programs have come a long way. Still, some have a ways to go.
This article focuses on specific market analysis and data applicable to the development and operation of dual-branded hotels. Much has been written about the dual-brand concept over the last several years, particularly related to the asset type's benefits and challenges. Instead of providing another such piece that rephrases the same concepts in different ways, this article will focus on data collected from our work with dual-branded hotels over the last several years. While a review of the history of dual-branded hotels and some basic concepts are necessary, this article will hope to provide new data and prove, or disprove, some commonly accepted themes related to dual-branded hotels in the United States.
In recent years, the global hospitality industry has done its part to confirm the adage that necessity is the mother of invention. Shifting tides of taste and technology have re-shaped what people want and expect from a hotel stay.
As the pace of revenue growth continues to decelerate for U.S. hotels, the capability of hotel operators to control costs will determine the ability of a property to increase profits from year to year. According to the 2018 edition of Trends® in the Hotel Industry, total operating revenue increased by just 2.0 percent in 2017 for the average hotel in the survey sample. Fortunately, by limiting the growth in operating expenses to 1.9 percent, managers at the Trends® properties realized an increase in gross operating profits (GOP) for the year.
In hotel management agreements, hotel chains and owners regularly negotiate what is referred to in the industry as key money. This is the case when competing hotel chains invited to tender by owners are prepared to invest significantly in the long-term management of high-end properties considered strategic for their development. Often considered as proof of a hotel operator's genuine interest in managing a specific property, key money can be a valuable resource enabling a hotel chain to expand on new markets and in strategic locations, without having to allocate significant costs to such development. The brand is thus able to invest in a selected hotel, transforming it into a flagship property.
It was the spring of 1995 and I had recently transferred from one hotel back to the regional base and into a newly created position as the regional operations analyst. The job was tailor-made for me. The position was the brain child of our regional vice president. I was to assist him in the review of operational financial performance for the hotels in our region. In the year that followed I learned so many valuable lessons from our work and his experience, style and, above all else, his common sense.
The U.S. has been hit with the longest streak of crises—mass shootings, natural disasters and security breaches—in the past decade. Hoteliers need to better prepare and develop plans for not if, but when crises strike.
When investing in hotels, recent year-over-year trends in revenues and profits, along with current performance values, are two of the metrics most frequently evaluated. Investors need to balance the current levels of a property's occupancy, ADR, revenues and profits, with the recent direction of the changes in these measurements. In an attempt to time the market, some people prefer to invest in hotels that are currently achieving low levels of revenues and profits, but are coming out of the bottom of the cycle and achieving strong gains on the top and bottom lines. Others prefer hotels that have are approaching, or are achieving, peak levels of performance.
Much progress has been made over the past 40 years in the accommodations sector! The new chain concepts have enabled the hotel business to develop considerably in France and Europe and, for some, in the rest of the world. Hotel groups are now number 1 on the old continent and the French hotel industry is one of the largest in Europe. This industry is thriving with very positive growth prospects and it is in full development. More tourists are arriving from all horizons and going to all destinations, what could be better!
When we cross the bridge in the hospitality financial world to the greater business world, the concept of an asset and how it is used comes full circle. I am going to explore what is unique about hospitality assets and how we record and use them. I am only going to talk about current assets in this article.First of all, an asset is something you have paid for or earned previously that can be used to generate more income. That is the critical test: Can you use this item to make more money, to create more economic activity? If you bought it or created it previously and can use it to generate more income, it is an asset. Items like tenderloin, tequila, guest and city ledgers are all good examples of things you can use to make more $$. You prepare the tenderloin and tequila and sell it for four-six times what you paid for it. You can use guest and city ledgers once they are collected to buy more tenderloin and tequila. And on it goes.An asset is part of the balance sheet and it can travel over to the sister statement, the P&L, as an expense or cost of goods sold. In hospitality, current assets typically consist of cash, accounts receivable, inventory and prepaids. That's pretty much it for a hotel. For sure there are others but on a hotel balance sheet, you will always find these four. In other industries, current assets will be made up of what is unique to that business. If making cars, assets are probably cash, steel, wire, tires. If selling clothes, current assets might include cash, sweaters, and jeans. Each different industry is unique.One thing you will not find that my workshop students find interesting when we talk about assets is people. We always say that people are our number one asset in the hotel business. Brand slogans and company cultures are built on this steadfast ideal. In most cases, it is true that our people are our most valuable asset. However, we do not account for this value on our balance sheets. We do not account or measure this on any device, report, app or valuation. It is sad that we have not figured this one out. Note to self: Think more about how we can do just that, put an economic value on our most important asset.Some unique aspects of hotel current assets that trip people up are the guest ledger and the city ledger. These sound like descriptions of an institution locked in a time warp. Let's demystify them. The word ledger simply means list. The guest ledger is the value of the accounts in-house for all our current guests, their rooms, taxes, restaurant charges, parking, etc. It is a total of what each one owes the hotel while in-house. Imagine if you will that we line all our guests up in the lobby, each one owes us money and the sum of all the guest accounts is the total guest ledger. And guess what? You can use this money to make more money. The city ledger is the value of all the credit arrangements and the resulting billings that the guests and groups have made with the hotel.The city ledger, when you think about it, is unique to the hotel service world. We extend our guests credit! Can you imagine your airline giving you a master account? Never. So why do we extend credit like we do with our guests? The answer is twofold. One, we have always done this. In our business, the practice of extending credit goes back to and beyond time, even before currency. The second more apparent reason is our competition does too. This means we also need to give credit or we risk losing a competitive edge. Now that I think about it, the whole credit world in hotels is ripe for some disruption!Here are some principles to help understand current assets:
If you're looking for a career where no two days are alike, managing a hotel ought to be right up on your list. The number of details involved in our profession is mind-boggling; virtually every decision we make is an opportunity to strengthen the operation as a whole - or to weaken it. In order to be a successful hotelier, you have to be able to change directions quickly and solve problems on the fly.
Five CEOs, some 90 brands with more on the way, and an estimated combined worth of hundreds of billions of dollars. Five leading hoteliers from Accor, IHG, Hilton, Wyndham and Choice, were on stage together in Berlin for a panel discussion entitled 'Evolution of the Brands' at the recent International Hotel Investment Forum.
One of the hallmarks of the early 21st century that we are currently will be the gradual shift away from a traditional, corporate-based model of capitalism to a crowd-based one. We're seeing this with the rise of cryptocurrencies like Bitcoin and we're seeing this in the travel industry with global, billion-dollar entities like Airbnb. While legislation will help to level the playing field so hotels have a fighting chance, it will be impossible to reverse this overarching trend.
It may sometimes seem like modern cities are made entirely out of concrete. It's a useful and versatile material and there's a reason why it's used by so many commercial properties. However, it isn't the only option out there for constructing large buildings.
One of the most important tasks of the hotel maintenance department is to cut the overall expenses by protecting its assets – building, equipment and supplies, through preventive maintenance measures. These measures are not restricted only to maintenance crews. They should be formulated as a set of guidelines for all staff to follow.
This year, some analysts talk about how the cycle is "getting long in the tooth" since we have been expanding for over 90 months. Since the tourism industry is resilient and still growing, success is very possible for another several years. Further, 2018 will be very prosperous with tax reform, strong consumer confidence, a durable job market and a robust global economy.
This study presents the current lending environment for hotels. It consists of four topics, (1) lending parameters, (2) availability of debt by project and chain-scale segment, (3) loan characteristics, and (4) an outlook on lending criteria.
Owning a holiday home is a dream come true for many people. A cosy cottage on the edge of the wild frontier can be an ideal family gateway, while a large coastal house may lure groups of tourist with deep pockets. But things are more complicated than they may seem. Regardless of whether you are building from scratch or just sprucing up, there are many moving parts to grasp, including the costs, design, décor, features, taxes, etc.
Starting a business may seem like something so far-fetched at the moment the idea strikes, that it may sound almost impossible. However, every successful company, from your local successful vendor to Apple has a humble story about a spark that ignited a franchise behind it. Owning a construction business is no exception; it takes guts and a note of fearlessness to get things running, but also a ton of work - from dealing with promotion and marketing, to figuring out how to cover the costs of your new startup. Planning ahead, commitment, passion and focus are the pillars of a successful construction business. Commit and start planning ahead right now!
Here is a sobering statistic. According to the Five9 Customer Index 2017 report, 77% of customers in the B2C space will not do business with you again if you give them bad customer service the first time they do business with you. This is huge. That means that more than three-quarters of your customers will not give you a second chance if you don't give them the customer experience they expect the first time around. Now, while the survey is focused on retail and consumers, don't be fooled into thinking someone in the B2B space is exempt. The numbers are different, but the concept is valid for any business in any industry.