The COVID-19 impact has had a major impact on people in all industries. One industry in particular that has been affected by this outbreak and pandemic is the hospitality industry. This industry has been challenged due to the fact that far fewer people are traveling than they did a few months ago. While lower occupancy is putting a strain on all hoteliers, it could affect independent hotel owners and managers more significantly than corporations.
To ensure that they are able to remain in business, finding a way to cut costs is important. However, some hoteliers may be concerned that cutting costs could hurt their service upon reopening, which could impact business even more. Fortunately, there are several ways that hoteliers can save money while still providing great service.
One way to save money during this time is to focus on being more efficient. Today, there are many tech upgrades a hotel owner can make that will drastically cut their energy usage. If you are not able to make this investment now, you can still find ways to reduce energy by making sure lights are turned off, air conditioners and heaters to unused rooms are not on, and having all team members make an effort to be more efficient.
Having outstanding staff is very important for any hotel. However, to ensure that you are not overstaffed, you need to manage your staffing levels based on the occupancy each day. For example, if you have fewer people in the rooms, you do not need to have as many housekeeping staff. However, you need to ensure you still have enough people to provide a good service to customers.
Cut Borrowing Costs
Another way that hoteliers can cut costs is by cutting their borrowing costs. One way that you can do this is by getting the most out of business credit card accounts. Hotel owners and manages should look into credit cards that are designed for small businesses. For example, a credit union credit card for hoteliers could come with lower interest rates and also provide points and rebates that can provide even more financial benefits.
Negotiate with Vendors
During any period of time where hotels are going to be less full, most of your vendors are also bound to feel tighter and more compressed. Due to this, it can be a great opportunity to speak with your vendors and try to negotiate new vendor contracts. This could help you to lower your operating costs, which is savings you can carry forward for a long time even after the reduction in occupancy is over.
When occupancy is low, it is natural for a hotel owner to try and save money by avoiding more serious repairs. While it may seem that you can get away with not making repairs for a period of time, you still need to make sure that you are keeping the property in good condition. When you make repairs that are necessary, you can reduce your future capital costs and save money in the long run.
For independent hoteliers, finding ways to cut costs during this challenging time is very important. For those that are concerned that cutting costs will result in reduced service and poorer customer service, it does not have to be that way. Fortunately, there are ways that hoteliers can cut costs while still offering great service.