Hoteliers should take advantage of the downturn (opportunity)

A downturn can present businesses with opportunities, as well as challenges, and strong businesses often capitalize on their position to establish an even greater advantage during these conditions. Businesses that are in good shape to ride the downturn, have greater flexibility to invest, strengthening their position while competitors are hamstrung.

Hotel companies should not automatically halt all investment programmes, sacrificing future growth because of current difficulties. Businesses need to have a clear idea of investment opportunities, best rates of return and risk levels. Generally investment levels are likely to be lower in a downturn due to reduced asset prices and competition for assets. In fact, structural change in an industry can be accelerated by a slowdown, as the most progressive players implement strategies that made sense all along, but may have been difficult to push through in the good times because the ‘burning platform’ wasn’t there.

A downturn can be the making of the best hotel businesses with the strongest brands, as the changes implemented at this time can make businesses much stronger in the long term. If you are an independent, it may also be the time to consider employing a professional management company to enhance profitability in your current operation. It may also be the right time to consider the strength of or even the need for hotel branding and whether this can give you access to enhanced distribution channels. All of this requires your executive team, hotel management and staff to innovate and work hard to reshape and reposition the business for the immediate future whilst not forgetting that the good times will return in a few years.