Hospitality Suppliers: Surviving The Economic Downturn

Hospitality Suppliers have been affected by the recent economic downturn as much as the next industry sector

. The question is "how do they survive"?

Industry research suggests that a significant proportion of business has shifted from five star luxury establishments and hotel chains to three and four star establishments. This appears to be because a lot of hotels and guest houses cater to a significant amount of business users, such as sales representatives and for business conferences. As businesses tighten their budgets they are sending their employees to stay at three and four star establishments as apposed luxury 5 star. This shift should represent an increase in demand for hotel supplies by the smaller establishments. Now obviously smaller hotels etc are not going to have the same size of budget as large hotel chains and five star establishments for their guest amenities so some adjustment is required.

This also means that hospitality suppliers supply mainly luxury guest amenities at luxury prices have not got access to the same level of demand as they had in times gone by. The solution to this problem is to meet the demand where it falls and this means hospitality suppliers need to offer budget prices and products.

This does not mean that hospitality suppliers have to compromise significantly in quality of goods, it simply means that less of a focus should be put on luxury and decadence and more of a focus on offering value for money. Another thing that goes out of the window with luxury is choice. Again this does not mean that there should be no choice whatsoever, it means that there should be a limited choice which offers a range of goods from mid-range to low budget.

Hospitality suppliers can do this by discontinuing lines of stock that are pricey and not big sellers while at the same time exploring new ranges of toiletries that appeal to their now budget conscious customers. Other ideas include offering smaller amounts of fluid etc. For example where a hotel supplier may have previously offered 35 ml tubes of shower gel, they could now offer 25 ml tubes. Let's face it if a guest is provided with something for free, they are highly likely to use it BECAUSE it's free. If you gave a guest 150 ml of shower gel, you can bet that at least 80% of them would actually use it all, even though that much is not actually needed. A nice knock on effect of this is that there is less of an environmental impact.

To summarise, what is needed for hospitality suppliers to survive the economic downturn is some common sense, the knowledge to make some serious decisions and good knowledge for the demand that the market provides. Remember, it's all about supply and demand.

by: Hamad Subhani

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