In the wake of the coronavirus, and the issues it created—including a labor shortage—hoteliers are working to get their arms around food and beverage service.
That topic, and many more, were discussed by a quartet of industry professionals during a recent Profit Talks webcast moderated by David Eisen, HotStats’ Director of Hotel Intelligence, Americas. Joining him were Lisa Carlson, SVP of Operations, Chesapeake Hospitality; Janine Williams, CEO and founder, Impulsify, which creates grab-and-go spaces for hotels; Devin Burns, VP of Rooms, Food & Beverage, Omni Hotels & Resorts; and Ron Loman, SVP of Operations, Real Hospitality.
“The pandemic has led to a reset in operations,” Eisen said, setting the stage for the conversation to follow. Among the greatest shifts has been the focus on—or addition of—grab-and-go outlets in lieu of full-service restaurants or room service.
“The hotel pantry was considered an amenity or even a cost-center before the pandemic but in full-service it has become an essential offering,” said Williams. The shift has generated healthy income for hoteliers.
“We’re seeing food service running about $35,000 to $50,000 a month in sales from [grab-and-go outlets] at about 60% profit, and our select-service hotels are running $4,000 to 10,000 a month,” Williams said. “They used to dabble in the hundreds of dollars.”
That spike in revenue isn’t just due to increased volume, she noted. “In the past, we’d often see a massive departure from the fine appointing of the lobby and restaurants and then the grab-and-go space was an afterthought. That really changed during this period—we’re seeing the brands step-up. We’re in about 1,000 hotels now and tracking what guests are buying; it’s definitely not Kraft Mac n’ Cheese. They expect full-service hotel kitchens to prepare quality offerings.”
Where Do We Go for Dinner?
Hoteliers also are working to maximize their restaurant spaces, while contending with the labor crisis. And the stakes are high. According to HotStats, from January to June 2019, total food revenue per available room clocked in at $60.07, while total beverage RevPAR was $14.95. Those metrics fell off in 2020 and for the first half of this year, they came in at $13.36 and $5.41, respectively.
“Pre-pandemic, at all of our property types, guests expected room service—often 24 hours a day, seven days a week—a lobby bar, a sports bar and more,” said Burns, and Omni filled those venues, based on high hotel occupancy, and staffed accordingly. “Post pandemic, the days of taking that static model forward is yesterday’s news, and we’re analyzing where can we condense offerings. At some properties, we’re serving coffee in the morning at the bar where drinks are served at night, because it’s efficient.”
Others also are reconfiguring spaces. “We had to rush into outdoor dining,” Carlson said. “We certainly activated spaces we never would have thought of, like edges of parking lots. That’s here to stay.”
“As we go into the fall, we’ll consider which outlets make the most sense,” said Loman. “Resorts are doing well, so that’s afforded us a chance to look at repurposing some spots. Condensing areas is huge because of the labor challenges.”
All adjustments are being made against the backdrop of hotels having trouble recruiting and retaining workers. But hoteliers can drive efficiencies in F&B operations, said Carlson. “We’re becoming bar centric, everything F&B related is coming out of one outlet instead of two or three, and we’re using the bar all day. It’s about taking the footprint and making sure we’re operating as efficiently as possible.”
One approach to that is deploying technology, Williams said. It may not be a fit across the board, but makes sense in some places, such as for self-checkout in grab-and-go outlets. “You need to be selective on where hospitality is offered. It’s not hospitable to have someone wait in line for 10 minutes to buy a bottle of water.”
She added, “Technology can be an asset to an experience and a hospitable option in the labor crisis and beyond.”