Does profit REALLY matter?
How it has changed since covid, how to measure it and how to improve it.
Jonathan asks if this is an opportunity to reset?
"Profit is the foundation on which value is based" said Perret of HVS, we are seeing a lot of opportunities right now simply because owners are worried about profit. Now is the opportunity to improve those hotel management contracts and relationships.
Looking at transparency, Burstedt said "the operator often has more information than owners when discussing lease contracts, management contracts can be easier to manage" which can place a strain on relationships.
Grove said costs have been gradually increasing faster than revenue in the last few years so this is a good opportunity to reset and start from scratch to asses profitability in hotel businesses.
Lending is not always an option and a lot of owners are financially stressed. With new investors coming into the market, this is an opportunity to improve hotel management contracts and leases, said Coll.
Owen said that costs will not simply be placed on hold, ways to structure how to get cash in and out of a business need to be reviewed and what impact it will have on saleability and profit margins going forward.
In part two of this month's meeting we look at investing in technology and data mining.
This month's panel was hosted by Jonathan Langston and Julie Rey-Gore with guests:
Helena Burstedt, Head of Hotels, Aliseda Inmobiliara
Javier Coll, Group President, Global Business Development, Apple Leisure Group
Finnbar Cornwall, Industry Leader Travel, Google
Michael Grove, MD EMEA, HotStats
Joanne Owen, Global Co-Chair, Hospitality & Leisure, DLA Piper
Sophie Perret, Senior Director, HVS London