Running a tourist hotel in the UK can be challenging. Consumers are returning to hospitality after a difficult, few years for the industry. That said, even with the promising signs of recovery the sector still faces a perfect storm of challenges in 2023, and with hoteliers still worried about the financial success of their business, but we know that with the right guidance hoteliers can turn things around.
We are experts in hospitality, and we know it’s possible to turn around a struggling hotel. Using our experience and knowledge of the sector here’s our five key strategies to financially turning around a tourist hotel in the UK.
1. Conduct a Financial Analysis.
The first step in turning around a hotel is to conduct a thorough financial analysis. This involves reviewing the hotel’s financial statements, including profit and loss statements and cash flow statements. The analysis should identify the sources of financial losses and areas where costs can be cut. Identifying the correct GP% margins are being hit, will clearly illustrate if the issue is operational. By understanding the hotel’s financial position, you can develop a targeted plan for turning the hotel around.
2. Improve Operational Efficiency.
Improving operational efficiency is a critical step in turning around a hotel’s finances. This can include optimizing staffing levels, modifying payroll costs to each season, reducing energy consumption where possible, engage with a bonafide energy broker or consultant. Streamlining processes such as check-in and check-out, there are lots of bolt ones to your PMS systems that will allow pre check in & out, meaning you need fewer trained reception staff on duty. By improving operational efficiency, you can reduce costs, in turn increasing profitability, and with a good use of tech, increase service and guest satisfaction, win win!
3. Increase Revenue.
Increasing revenue is another key strategy for turning around a hotel’s finances. There are several ways to do this, including dynamic revenue management, adding new amenities, and targeting new markets. For example, you might consider partnering with local attractions or businesses to offer package deals that attract new customers. Additionally, you could consider renovating rooms or investing in new technology to improve the guest experience. Think about TREVPAR rather than REVPAR. If all operational teams are tuned into this, revenue and profitability will grow.
4. Improve Guest Experience.
Improving the guest experience is critical to turning around a hotel’s finances. A great customer experience means return business, recommendations and in today’s age of digital reviews with platforms such as Trustpilot and Google, prospective guests will be researching past guest experiences. Think about how you can provide an exceptional customer service, upgrading amenities, attentive staff, and ensuring that rooms are clean and comfortable. By providing a positive guest experience, you can increase customer loyalty and generate those positive reviews.
This can be done by TRAINING YOUR TEAMS within an inch of their lives. If in doubt, TRAIN, TRAIN, TRAIN!
5. Develop a Marketing Strategy.
Developing a targeted marketing strategy is another key component of turning around a hotel’s finances. This can include investing in online advertising, building a strong social media to enable loyal custom. This creates ‘raging fans’ who will become in turn ambassadors of your property. Having an online strategy will increase organic bookings and decrease OTA spend. Your secret weapon in growing your business is having a database that is GDPR compliant and marketable. Using past guests’ details to entice them back with events or offers, or generating prospective guest data from your social media activity and sending them personalised and targeted communications.
How is your business performing?
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