Lodging Insights

//Lodging Insights

Lodging Insights

Focus on property development and success
Logical strategies for lodging
Profitability means cost reduction and increased growth

Lodging and Hospitality has become one of the biggest and most complex businesses in the world. It also has become a proving ground for the most powerful business trends of the past 20 years – including branding, security, and global consolidation. As their investors grow more restive and their customers push to better integrate global supply chains, the world’s hotel companies are coming under increasing pressure to perform. In addition, the economic future of the entire industry is complicated by issues of national pride and homeland security.

Each segment of the industry – including hotels, motels and institutional housing, travel and tour providers, airports, ports, and tourism authorities – faces particular challenges. But a few business imperatives – e.g. achieving scale, defining the scope of the business, and managing increasingly complex networks and partnerships – will likely determine success across the industry.

The special demands on logistics faced by the biggest sectors of the industry – hotels and motels – are forcing them to develop more innovative service offerings and a more disciplined approach to operations. Some companies in these and other sectors are radically redefining the business model. In the last 10 years, for instance, some companies have moved into the fast-growing, $100 billion business of third-party foodservice management, providing restaurant, catering, special event and other supply-chain services to hotels in a variety of methods.

“Lodging and hospitality companies are unlike most of the businesses they serve,” says Mark Peletier, senior practice manager of Lodging & Hospitality, based in the Lausanne office. “They must constantly move inventory; they have to excel at managing pricing, capacity, and network economics. Service providers must be able to sell essentially the same product – an hotel room or event slot – to different customers at different price points, depending on the market and the needs of each customer. Operational excellence is key, but so is pricing and service differentiation.”

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