Hotel Online  Special Report

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 Before There’s Trouble: Protect Your Hotel, Restaurant from
Damaging Effects of Negative Media Exposure
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by Joe Blee, March 2006

Not much spreads faster than bad news. One negative story, one angry customer, one accident or even one close call and the result can be a battered bottom line, tarnished brand name, or worse, a closed business.

Resorts, hotels and others in the hospitality recreational industry, along with restaurant owners, are particularly at risk for the damaging effects of negative media exposure. 

Here’s a very real scenario: A customer contracts a food-borne illness that is linked to a particular restaurant and the business takes an instant hit. Even if drastic measures are taken by management to solve the problem and make amends, sometimes the story is damaging, both to the restaurant and to any related chains in other states. Bad news spreads quickly.

Another example: a guest at a prestigious hotel becomes ill from what is discovered to be Legionnaires’ Disease and wide-spread publicity havoc ensues. The hotel moves guests to a new hotel and closes temporarily.  There’s a thorough clean-up job, but by the time they’re ready for business, the damage done may already be too severe. It takes months, even years to recover and recoup the monetary loss.

In either case, a kind of unseen damage may have affected the reputation of the restaurant or the hotel. Will this news seep into the public psyche like so many other negative stories in the past? How many of us have vivid memories of litigation over a hot cup of coffee? Or how about the original Philadelphia location where the original Legionnaires’ outbreak took place?

Given enough time on the nightly news, in newspapers or now across the internet, these stories can leave a lasting mark in the minds of the average traveler, guest and consumer. Businesses have discovered that American customers have very good memories when it comes to bad news.

So how do you handle a worst-case scenario? When it comes to the management of bad news and the adverse media exposure that comes with it, proactive precautions are far better then best-effort reactions. 

The following is a short list of guidelines to help you make sure your hotel or restaurant is ready for any “what if.”

  1. Create a crisis management program to handle negative publicity just as you would have a program to deal with a fire, any natural disaster, accident or security breach.
  2. Train your employees and managers about handling a trade-name crisis that results from negative publicity. Make sure they’re ready with answers because sometimes a “no comment” says more than you intended.
  3. Safeguard your good name. Your crisis management plan should involve steps to circumvent negative press before it leaks too far.
  4. Make sure your insurance coverage is adequate for an attack on your bottom line due to an illness-related shut down.
  5. Examine your coverage to make sure your business can handle a negative-publicity crisis.
  6. Does your management staff thoroughly understand communicable diseases, food illnesses and other health issues? If not, consider providing education so all employees can spot danger zones and quickly handle trouble areas.
  7. Conduct a disaster response drill so you’ll know exactly how your team will handle a health crisis and the resulting publicity. Work out any problems that are revealed.
Unfortunately, many insurance programs available to hotels, resorts and hospitality venues only provide commercial property and liability coverage. Because of this, loss of income from negative media exposure plus brand name restoration and spin control have not been areas where businesses can find assistance from their insurance companies.

Recently, a new product has been made available that does cater to this exact need. Offering coverage for profit loss, this product also offers public vaccinations, business restoration, crisis management programs and incident response expenses. It may also provide marketing and media expertise in response to business interruption caused by a food-borne illness outbreak or other health situations at the business location.

Food-borne illnesses and other health concerns at hotels, resorts and hospitality venues are not just mere possibilities. They are, in reality, a very real part of life. These issues will always be potential hazards.

As a result, hospitality managers and executives are left with two key variables: constantly taking precautions to keep these health hazards at bay and, knowing how to properly handle an emergency should one strike. 

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Joe Blee is a partner with Christensen Group, an independent insurance agency based in Minnetonka, Minnesota. His background includes experience with the construction, commercial real estate, waterparks, and hospitality industries. 


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Contact:

Joe Blee
952-653-1017
jblee@cg-iri.com
 

Also See: Florida's Department of Health Issues Final Report Concerning Alleged Food Poisoning at Hawks Cay Resort in the Florida Keys / August 2005

Survey: Scalding Water Found in Nearly 90% of Hotel Rooms; Legionella also a Risk / December 2004

Chili's Grill & Bar Facing More Lawsuits Over Salmonella Outbreak; Health Officials Claim Dishwashing Sanitizer Stopped Working Several Days Before the Outbreak / June 2004

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