They sleep here, but where do they go to eat?

There was once a short conversation between myself and a well-known figure in the hotel industry which will remain forever stamped on my memory. We were talking about the profit opportunities of bedrooms compared to the hotel restaurant, and the problems associated with both.

The hotelier's response, delivered in a charming Italian accent, may sound apocryphal, but I record it faithfully.

The moment of enlightenment came when he leaned forward, lowered his voice and gave me his considered judgment on hotel restaurants. The problem with them, he explained, was that you could kill people with food, yet you don't even make a profit on it. Beds harm nobody and you can serve the same thing night after night. Food was, he concluded, a necessary evil for hotels.

No profit on food

I could not possibly tell you who made such a profound comment on hotel restaurants, yet even if you puzzle over who the speaker was, the point is clear enough. Hotel restaurants cannot match the profits from bedrooms.

Banqueting and bars are money-spinners and, as a single element of food and beverage, breakfast can be profitable. Yet lunch business is all but non-existent for 99% of hotels and dinner is an operational loss-maker.

Fine if you are a "foodie" destination hotel, or in a location where there is no high street competition within walking or easy cab distance, but for many urban and town centre hotels, 25% restaurant usage on a 100% room occupancy is pretty good going. Yet what confounds understanding is that those guests will still want to eat - people don't go on a fast when they stay in hotels.

Throw into the argument this piece of anecdotal evidence I got from the manager of a pub-restaurant who has a roadside lodge at the back of his car park. Within two miles of his pub and lodge there was a reasonable choice of Italian, Asian and two other pub-restaurants, yet he reckoned to get at least 50% of the people staying in his lodge eating in his restaurant each night, or taking bar snacks. Those that did not book through the lodge reception were easy to spot as besuited single diners.

Is it that hotel guests have an uncontrollable urge for fresh air before food, or is the mistrust and dislike of hotel restaurants so ingrained that guests are compelled to distance themselves from the F&B side of the hotel?

What puzzles me further is that you can walk down a hotel's bedroom landing and see empty room-service trays outside the doors. These guests apparently have no problem with the hotel food or the prices, two grumbles regularly made, but would prefer to eat in solitary confinement rather than a restaurant. That's sad in the extreme.

Questionnaire proof

Operational performance and guest questionnaires on a hotel restaurant must make fascinating, if depressing, reading.

I'm sure that every chain hotel does them, but I bet that not one would reveal the comments and figures for fear of showing just how unloved and underused the hotel restaurant is.

So what is the point I am making? Reflect on the opening paragraphs again and the attitude toward the hotel restaurant held by its owner. Is his a maverick viewpoint, or one that is quietly held by many other hoteliers?

Given the choice, with no detriment to bedroom business, would the hotel be more profitable without a guest food operation than with it? When sales are set against operational costs, the answer in many cases is "yes".

Under-investment

This is why there is so much under-investment in hotel restaurants in the food, the staff training and the atmosphere, and why so many hotel restaurants are locked into the law of diminishing returns which says that because there is a poor return on departmental investment in the hotel restaurant, don't throw good money after bad.

Better to spend this year's capital expenditure budget on refurbishment of bedrooms, where there is growing demand and greater profit. A restaurant that is unloved by its owner is never going to be loved by its customers.

This is not a problem with a single solution. It may be a problem with no solution, but there is one intriguing question every hotelier should ask themselves the next time they puzzle over an empty restaurant and full bedrooms: if your hotel restaurant was a stand-alone business on the high street, how long would it survive?