Illustrative image (Photo: VNA) HCM City (VNS/VNA) — Hotels need to appeal moreto local corporate guests and tourists to help the hospitalitysector recover, market researcher Savills has said.
Mauro Gasparotti, director of Savills Hotels APAC, saidthat creativity would be key to generating additional revenues, and thathotels should appeal to local corporate guests and tourists.
Hospitality was among the first industries to be hit by theCOVID-19 crisis, and will likely be among the slowest to fully recover.
All categories are affected, from international hotels,restaurant chains and multinational airlines to smaller family-ownedrestaurants and accommodations. This has occurred across theworld with broadly similar dynamics and business consequences.
By responding early, Vietnam has been moresuccessful than any country containing COVID-19, and the recent partial reopeningof restaurants, coffee shops and hotels has given Vietnam a greaterheadstart over other countries.
A report from Savills said that “hospitality is now seeing acareful recovery and hopes of things returning to normal. The sector is slowlycoming back, yet owners are still trying to figure out what will be the 'newnormal' and how long before demand gets back to pre-crisis levels”.
So far, strategies implemented by restaurants and hotels areslowdowns or closures to cut costs, retaining key personnel, and preparingfor reopening.
This has helped overcome a short-term drop inrevenues, but the real question is what level of demand they can expect in thecoming months, according to Savills.
Unsurprisingly, in the short-term, local demand will be thehighest and the only one, the company said.
MICE (meetings, incentives, conferences andexhibitions) business is expected to be one of the last activities tofully resume operations as it relies heavily on crowds of people gettingtogether.
Local MICE activity, which covers Vietnam and mainlyinvolves local companies, is expected to return when the Government deems itsafe. Safety regulations will need to stay in place and companies will have toreduce the size of their gatherings.
“MICE is to be hit by cuts in corporate spending inevents and entertainments for at least the next two quarters. We will probablysee the return of small-scale events first, as companies celebrate in smallergroups or by separate teams. International events held by multinationalcorporations with large numbers of international travellers will possiblyreturn only after travel restrictions are lifted and corporate spending risesback to pre-pandemic levels, which may take a lot longer,” said Gasparatti.
According to Savills, recovery was initially expected tofollow a “V” shape model, which is common in the travel industry and hashappened in Vietnam in the past.
“However, the situation now is very different, and I believemost hotels and resorts should not expect full recovery until well into 2021 asthe global economic impact and evolution of the virus are both stilluncertain,” Gasparatti said.
Safety is a key factor in the travel industry and people willonly travel again when they feel completely safe.
“As mentioned, we will rely on local demand first, especiallyyounger generations of independent travellers, followed by reopening of somesingle key countries, to slowly come back. That said, looking into theevolvement of other countries like China where the government recently allowedhotels to reopen, it took only six weeks for occupancy to reach 32 percent bythe end of March after the drastic fall of occupancy in the month before, andthis was mainly due to local travellers," Gasparatti said. "That hasallowed hotels and resorts to regain business and reopen operations. Wehope Vietnam will once again prove to be a successful example for othercountries to follow."/.
VNA
