Round 1 – U.S. and European Hotel Performance Trends in a Downturn
The latest round of HFTP Hangouts kicked off this week with a data-driven session presented by HotStats. This session provided an in-depth overview of current operational and profitability data from hotels in both the United States and Europe. Their data was illustrated in this accessible presentation and included trends in GOPPAR and TRevPAR, flow-through and flex, year-over-year percentage changes in hotel profits, and break-even occupancy percentages.
After addressing these trends, the presenters and attendees discussed what they envision for hotels in the future.
Here are some of the main takeaways from their session:
- Unsurprisingly, hotel revenue is in a state of flex. Hotels are driving every penny to the bottom line. It is interesting to see how hotels are able to compensate for loss over time. We need to continue to track flex to see how much hotels can save during the downturn.
- Budgets have been thrown out of the window. Hotels can no longer look to the budget for financial decision-making. Instead, they must turn to market data in order to make smart decisions for re-staffing, re-opening, and re-evaluating costs.
- Profitability is a long-term game. The world has endured “black swan” events before, but nothing to this degree. The economic impact of the Covid-19 pandemic is roughly three to four times greater when compared to similarly disastrous events like the 9/11 terrorism attacks or the great financial crisis of 2009. It is going to take a proportionally longer amount of time to get back to the revenue levels pre-pandemic. Hotels need to prepare for this. It will be vitally important to track the process of recovery over time.
Round 2 – Important Considerations for the Hotel Re-opening Process
This week’s HFTP Europe Hangout was presented by Howard Field, industry advisor and HOSPA founding member, and David Nicolson, vice president of finance, Europe for Jumeirah Group, who presented several considerations to aid hotels in their re-opening plans. Here are some of the main takeaways from this session:
- Look after the asset. Make sure that your property is well-maintained and protected against crime. Close it down properly, inform your insurance company of the preventative measures you took to guard against crime, and schedule regular checks by a security company. In London, a few hotels have already been broken into, and you do not want that to happen to yours during the shutdown.
- Keep stakeholders informed of your plans. Have open lines of communications and transparency with your insurance companies and banks. Look to your auditors for advice. Create effective communication plans with your guests and staff on the measures you are taking to ensure their safety, health and well-being.
- Re-train staff on hygiene. This is important to safeguarding your employee and guest health. Understand that these measures will come with additional costs, to include personal protective equipment (PPE), housekeeping, room servicing and cleaning materials.
- Re-evaluate current services. For example, what will valet parking look like? Room service? Dining options? Guests may need to park their own cars. Buffets may be completely eliminated. Properties with large banquet revenue will need to re-think their models.
- Challenge any uncommitted spending. Perform a zero-base budgeting. Record evidence of all of your financial decisions. Understand that it will take time to break even. You may be able to save money in some areas, but there will be more costs in others – including on new hygiene practices as mentioned earlier.
- Do not forget your furloughed employees. Remember that open line of communication that was mentioned earlier? Having one with your valued staff on furlough will also be important to establishing and maintaining good will. Keep in touch with them and check on their welfare.
Round Three – What Does It Take to Work from Home Successfully?
The final HFTP Hangout of the week was hosted by Profitsword COO John Crutchfield, MBA and covered best practices for managing your staff away from the office.
Here are the key takeaways and the areas of operations you should address to make sure the transition to remote work is a success:
- Use the company VPN. Make sure to have enough bandwidth; this is a common problem.
- Ensure all of your staff is set up with the appropriate firewalls, malware and virus protection.
- Make sure your home internet connection is secure.
- Set your status on your communication platforms. You do not want to have to guess when someone is unavailable or busy in another meeting or phone call. Also, make sure to set your status to “out of office” if you are on PTO.
- Use noise cancelling headsets
- Limit distractions. Many of us work home alongside spouses, children, and pets.
- Update the boards. What does this mean? If you use a virtual whiteboard, it is good to track workflows so that you can visualize the progress of a task as it moves from the “to do” pile, to “in progress” and finally, to “done.” This is great for transparency, accountability and tracking productivity.
- Develop a routine.
- Maintain regular hours.
- Create a morning routine. This helps you maintain regular hours. It also improves mental health and work productivity.
- Get up every hour, if possible. This should even be considered a medical necessity, and it improves both mental and physical health.
- Get some outside time. This is a perk of working from home that you should definitely take advantage of. It reduces stress and improves both mental and physical health.
- Create an end-of-day routine. This helps you line up what you are going to do the next day, and it is important for work-life balance.
- Set boundaries.
- Keep a dedicated office space if you can.
- Schedule breaks and take them.
- Discuss ground rules for your space.
- Attend scheduled meetings and contribute.
- Encourage other staff members to speak up. People can withdraw, especially if they are more introverted.
- Over-communicate and understand things can get lost in translation.
- Socialize with coworkers (and laugh daily!). This is extremely important, as quarantine can feel very isolating. It is important to remember to have fun while you work and enjoy those you work with, even from far away.
Ready for the next round of Hangouts?
HFTP Hangouts will continue through May. Visit the HFTP website for a schedule of upcoming Hangout sessions and register to attend.
Briana Gilmore is the HFTP Communications Coordinator. Briana can be reached at Briana.Gilmore@hftp.org or +1 (512) 220-4017.