Revenue management and social media dominate at HOSPACE

30 November 2012
Revenue management and social media dominate at HOSPACE

Elizabeth Mistry rounds up all the news and topical debate from last week's HOSPACE conference

This year's annual HOSPACE conference for hospitality finance, revenue management and IT was the biggest ever, attracting more than 400 people to the Sofitel Heathrow Terminal 5 last week.

Delegates heard HOSPA's president, De Vere's Robert Cook, speak about the key role social media plays and how he believes that future hospitality leaders will increasing be drawn from the ranks of revenue management.

The Leaders' Panel, comprising Cook, Surinder Arora, owner of the Sofitel Heathrow, Angela Vickers of Apex Hotels, Grant Hearn of Travelodge and Steven Cassidy, vice-president UK and Ireland, Hilton Worldwide, was marshalled by HOSPA chairman Paul Dukes of Kew Green Hotels.

Difficult trading and slow growth in the hospitality sector will shape the coming year, delegates at Hospace 2012 were told.

London saw a pre-Olympic slump, with June and July figures down although the situation rallied with good occupancy and an increase in rates at the top of the market during the two weeks of the main games.

"June and July were down 4.8% and 7.8% compared with the previous year," she said.

"But during the games, rates were up around 43% at the budget/economy level and 100% at the luxury end of the market."

Outside London, this year's big winners were Aberdeen, where the oil industry continues to ensure a high demand, and Belfast, where the Titanic anniversary and a targeted promotion to the area around The Giant's Causeway saw a huge rise in demand.

Hull is also another city that is proving popular, with three new hotels in development.

But the powerhouse remains London. Of the 43,000 rooms currently in the UK development pipeline, 14,744 are in the capital.

After a difficult year, which has seen few properties sold outside London achieve anything near their asking prices, the market looks to be "flatlining out", Barclays' Bob Silk told delegates attending the Finance Panel.

"I think we have reached the nadir," said Silk, relationship director at the bank's hospitality and leisure team.

"Now is the time to buy in the provinces if you can," he said. "But if you don't have to sell, why would you?"

Silk spoke frankly about client expectations telling Caterer and Hotelkeeper: "We have reviewed a great many proposals which are challenging in the current economic environment."

Graeme Smith, partner in the hospitality division at restructuring specialists Zolfo Cooper, said he didn't think there would be a spike in the rate of businesses going into receivership in the coming year.

"The variants between the best operators and the worst operators is a lot wider now. A lot of people are working with their banks who are genuinely doing their best to be supportive," he said. "The main difference is the low interest environment."

This year' s IT panel focused on outsourcing as an alternative to maintaining an in-house IT department.

Outsourcing De Vere's IT requirements to a cloud-based system not only saved money but "took away all the headaches," the group's IT director, Joanne Stanford, told an audience of hospitality finance and IT specialists attending the IT Panel session.

Stanford, alongside Kempinski's senior vice-president for Information Technology, Jeremy Ward, said that she had no concerns about relinquishing control of the IT or of the company's data.

"Control means different things to different people," Ward said, adding: "If you do it in a strategic and secure manner there are no qualms about moving to the cloud.

"Some companies hear the buzzword and just jump in. We moved our eâ€'mail over to Google Apps and it took about two years overall, including 18 months negotiating with Google to ensure we conformed to EU standards. It was easier migrating properties outside Europe."

For Kempinski, the savings have been considerable. Ward said: "Of course we are looking at the long term but with eâ€'mail the savings were immediate. Previously it cost our hotels €140 per user per year and now it costs about €55 per person per year."

Revenue managers are the hospitality leaders of tomorrow, Hospace delegates hear >>

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