It is now a cliché to say “we live in interesting times” but it is also a period full of contradictions and unexpected pressures. There are no few contradictions and behaviours which do leave many questions hanging in the air?
- Many of London’s leading hotels are enjoying quite remarkable average rates. For how long is this sustainable?
- If the average consumer is facing an increase an increase of £600 in bills, then this is naturally going to have its impact on a number of markets, most likely pubs and restaurants. Price increases are only going to serve to make the situation all the harder for the consumer.
- Most forecast that it will take 3-5 years before office density numbers return and most expect B&I to average at around 60% of 2019 levels in 2022 and 2023.
- Research and experts are suggesting that the key to success for all operators will be quality of product and service as well as consumer experiences. However, how many are really adapting to consider the consumer and employee experience? Feedback suggests that less than 20% are as so many are concerned by the overall pressures in the market.
- Research all suggests that the primary concern for all is talent shortages but still:
- Increased investment in talent development is still a difficult argument to make
- There is much work to be done for companies to appeal as an employer to many minority groups and in promoting social mobility.
- Research is still suggesting that sustainability will be also be crucial to long term success but many operators are placing this to the bottom of the investment agenda as other challenges are understandably prioritorised.
- Many are arguing that we are facing a period when there will be a noticeable split between the luxury market and those who will struggle. It is forecast that around 20-25% of restaurant and independent operators may well close as they grapple with the cost challenges. How will this impact on the face on city centres, the return to city centres and on the high street?
- It is also becoming increasingly noticeable that there is need to have the perspectives on younger leaders and consumers at the board table.
The above does suggest that whilst hotels are enjoying a strong period of trading, many other parts of the industry are facing major concerns and challenges ahead.
Who will become the winners and losers of the next year to be faced?
Feedback is suggesting:
- The challenges of the next year will act as a catalyst for new leaders to emerge on boards.
- The hotel sector will split into distinct markets which include:
- Luxury hotels
- Boutique hotels with bespoke experiences
- The budget and business hotel
- Lodging and close to nature
- The experiential hotel which combines work and leisure.
- New experiences will emerge across all market areas from hotels to stadia to heritage sites to the high street. What will attract the consumer?
- How will the sustainability agenda build over the next year.
All is still to be seen but one thing is for sure; there will need to be compassion and care for both customers and for employees. The base pillars of leadership are needed once again.