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2024 Budgeting: How To Improve Hotel Performance in Uncertain Times
HotStats | November 9, 2023
By Tanya Venegas In our previous article, we shared insights and advice from global hospitality experts on how to make the 2024 hotel budget process as smooth and painless as possible. Here, we share five ways to improve budget accuracy and performance in uncertain times. 1. Benchmark Against Competitors In the last article, we discussed the importance of strategic planning, aligning stakeholders, and harnessing relevant data. Another key element of the budgeting process is to benchmark performance against competitors. “Benchmarking is critical,” Pete Sams, chief operating officer of Davidson Hospitality Group, told us. “We l...
How to Make the 2024 Hotel Budgeting Process as Smooth and Painless as Possible
HotStats | November 6, 2023
By Jeannette King, Marketing Manager at HotStats For hotel owners and operators alike, the annual budget is often a grueling and time-consuming process. This year, with persistent inflation, added pressures on cost control, and uncertainty about the economy, the process is as fraught as ever. Are there ways to make the 2024 budgeting process more streamlined and efficient? For insights and advice, HotStats reached out to leading hospitality experts around the world. 1. Start Early but Submit Late Hoteliers often complain that the budgeting process seems to start earlier every year. This is especially true for large hotel groups with mult...
Is the Annual Budget Process Still a Necessary Evil for Hotels?
HotStats | October 26, 2023
By Kathrin Cockhill For hotels, the annual budget process is like a high-stakes poker game in which the owners keep their cards close to their chest and the operators try to guess what cards they’re holding and if they’re bluffing. By the time everyone shows their hands and the year kicks in, the game has often changed significantly, and all bets are off. Does it have to be this way? Today, more data than ever is available to enable operators to budget and forecast based on current conditions rather than rely on outdated projections. But will this serve the needs of owners? For insights, HotStats reached out to hospitality leader...
2024 Budget Planning: What Is Top of Mind for Hotel Owners & Operators?
HotStats | October 19, 2023
Budget season is upon us, and around the world hotel owners and operators are buried deep in data trying to come up with 2024 performance numbers. What unique challenges are hotels facing in the 2024 budgeting and planning process? HotStats reached out to global hospitality leaders to find out. By Michael Grove Chief Operating Officer HotStats 1. 2023 Hotel Performance: Growth Is Slowing In UAE, Saudi Arabia, India, Brazil, and the Caribbean, hotel profit margins in the first half of 2023 well surpassed 2019 levels, whereas they lagged in the UK, Germany, Spain, Poland, and Qatar. In China, hotels experienced tremendous growth rel...
Market Spotlight on Canada
HotStats | September 8, 2023
By Jeannette King Recent data on the performance metrics of the Canadian hospitality market reveals a compelling story of resilience and recovery tinged with a note of warning on bottom-line conversion. Amidst global challenges, the industry has demonstrated its tenacity, with the Total Revenue Per Available Room (TRevPAR) metric taking center stage in this narrative. In a comparative analysis spanning from 2019 to 2023, the trends underscore the transient nature of the setbacks faced in 2022 and highlight the industry's subsequent rebound. Specifically, the TRevPAR metric, which provides a holistic view of a hotel's revenue-generating ...
2023: A Challenging Year for California’s Hotels
HotStats | August 24, 2023
The first half of 2023 proved to be a roller coaster for the California hotel industry, with varying performance across luxury, full-service, and select-service segments. The year started on a high note, especially for luxury hotels, before experiencing a dramatic decline in Q2 across all major areas, compared to the same period in 2022. Luxury hotels’ RevPAR saw a significant boost in Q1 of 2023 posting a 27.2% increase driven largely by a surge in occupancy of 12.1 percentage points. However, this trend was tempered in Q2 which saw a slight decline in occupancy and ADR resulting in a 3.4% drop in RevPAR compared with Q2 of 2022. How...
A Focus on the Margins: US Hotel Performance in the First Half of 2023
HotStats | August 18, 2023
by Laura Resco, HotStats Director of Hotel Intelligence Americas Hotels in the United States saw general pressure on profit margins in the first half of 2023, with Gross Operating Profit (GOP) margin falling by 1 percentage point compared to the same period in 2022. A closer look at brand-scale performance reveals that the extremes were particularly affected: both the luxury and midscale and economy segments exhibited the greatest year-on-year margin declines, as shown in Figure 1. [caption id="" align="alignnone" width="800"] Figure 1 US GOP as a % of Total Revenue, H1 2021, 2022 and 2023[/caption] A major factor influencing this tr...
Global Hotel Industry Faces Mixed Fortunes Amid Rising Costs and Varied Demand
HotStats | August 3, 2023
The global hotel industry is experiencing mixed fortunes as it navigates the post-pandemic landscape. In the United States, the Gross Operating Profit (GOP) margin has seen a year-on-year (YOY) decline of three percentage points (ppt), primarily due to a three ppt increase in total labor cost margin and a 0.5 ppt rise in utilities cost margin. This has led to a 1% ($1.25) YOY drop in Gross Operating Profit Per Available Room (GOPPAR). Undistributed expenses, including Sales and Administration & General (A&G) expenses, have surged by 12.9% YOY, reversing the savings made in these areas during the pandemic. Specific cost items such a...
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