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Once upon a time not too long ago, prior to
September 11, hotel sales in a limited service environment was
reasonably straightforward. PKF was anticipating that this sector would
be the ultimate beneficiary of the economic downturn as customers traded
into this sector from the higher rated full service, mid-market and
luxury sectors. At the time this was written, in late August, the
limited service and all-suite sectors were expected to maintain their
profit levels in 2001. The rules have changed.
Until now, limited service hotels experienced
a slight decrease in demand in most markets but not stunningly in
relation to their full service competitors. Many limited serve hotels
did not use a sales person, rather the GM, who had absolutely nothing
else to do, was expected to function as the sales person as well. In my
experience, most of those sales calls never happened - not because of
the lack of good intentions but the lack of time. However, as long as
everything was relatively rosy, no one admonished the GM for not making
those sales calls.
In those situations where there was a sales
person, it was usually someone with limited sales experience, perhaps
promoted from the front desk. The most common reasons for this was the
position was not very well paid and the job market was so tight that it
was virtually impossible to attract someone with sales or hotel
credentials at that salary. The rules have changed.
The GM who never had time in the first place
now has less time as many hotels have cut staff to respond to the
dramatic drop in occupancy. While this may be somewhat shortsighted, it
is the GM who is picking up the slack at the front desk and performing
front office procedures. There is no way that the GM has the time to
contact all of the accounts and ascertain the conditions of the changes
in their travel policies, their new rate sensitivity and what it would
take to get what little remains of their business.
In an environment where the rules have
changed, the temptation on the part of owners and management companies
is to hunker down - slash the staff to the bone, eliminate all sales and
promotion expense and let the salaried managers pick up the difference
by working additional hours. Those hotels that have been operating a
flabby organization may benefit in the short term but it is not the
strategy that will position a hotel to survive and succeed in the next
six to nine months of uncertainty and potential recession.
Make no mistake - there will be winners and
losers in this new environment. The parameters of success for the
winners won't be as grand as they were a brief twelve months ago but the
penalties for the losers never change. Erosion of the asset and the
ultimate penalty, foreclosure, is the consequence of short-term
thinking. What then, are the steps to take to deal with the new rules of
the game?
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Formulate
a strategy based on possible scenarios. Does anyone remember the
Gulf War and the devastating impact it had on the travel industry in
1991? Those who survived positioned themselves well for the future.
Resist the urge for knee-jerk reactions and take time to sit down
and outline a unified strategy for the next twelve months. What will
be the financial strategy, where is the demand likely to e from
and how can we get it in the most cost-effective way possible? Ask
someone from the corporate office to sit down with the staff and
develop these strategies. If that resource is not available to you,
enlist the assistance of a knowledgeable but neutral outsider to
facilitate the process. Don't wait too long to engage in this
exercise.
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Get
in touch with your accounts now! Many hotels did not adequately
track where their business was coming from in the past when demand
was high. Those hotels have a steeper learning curve than those who
had the foresight to use the tracking capabilities in their
franchise reservations systems. Do not ask the GM to perform this
function - it is not going to happen! If you have a sales person, be
very specific about the direction you want them to take, the deals
they can cut. If you don't have a sales person, get one or contract
to a sales and marketing person who will perform this function for
you in the short term, like the next six to nine months until things
stabilize. The benefit of the latter option is that you incur no
payroll burden and you can hire more expertise than you could afford
long-term.
-
Get
in touch with your guests! Who are your guests - the ones that fall
into the transient or regular corporate category? These are the
guests that 'fall through the cracks' - independent travelers,
consultants, brokers, etc.. These are also the people who will
continue to travel -- it is their livelihood. Find out who they are
and spoil them. Ask the front desk GSAs, they know the guests better
than the GM. The GM should be in the lobby at check-in and/or
chatting with the guests at breakfast at 6:30am.
-
Upgrade
the Guest Service staff! With the airline industry laying off so
many customer service associates, it is an excellent time to hire
people with experience and personality. It is an opportunity to
eliminate those GSAs that were hired because they fogged the mirror
-- the ones who couldn't be bothered smiling at a guest or making
eye contact.
-
Invest
in some short-term training to upgrade the skills of the sales and
customer service staff. If you can't afford to hire experience,
train the staff you can afford. This is an investment you can't
afford not to make. Find training that produces results tailored for
your situation. It can be seminars or distance learning that does
not require time away from the property or the job.
The winners under the new rules will be those
that resisted the urge to react with short-term thinking. The winners
will be the ones who positioned themselves for the future and not just
reacted to the immediate situation. People will travel again by air and
by car. Their requirements of us do not change - a good product and good
service at a fair price. The limited service sector is well positioned
to take advantage of this situation when the shock of the last two weeks
wears off.
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Carol
Verret is a twenty-year veteran of the hospitality business, having
begun her career with Four Seasons and Westin Hotels in Montreal,
Canada.
She most recently was Vice President Sales and Marketing for
Sunstone Hotels before she left in 1996 to start her own business.
Carol Verret Consulting and Training provides consulting and
training services to the hospitality industry in the areas of customer
service and sales.
For a complete description of her services, access her web site
at http://www.carolverret.com/.
comments and feedback are appreciated and can be communicated via
phone at (303) 618-4065 or email Carol
Verret
Be
sure to subscribe to Carol's free monthly newsletter:
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