Hotel industry stares at 2001 like difficult times

As in the immediate aftermath of 9/11, India’s luxury hotel lobbies now resemble the desolate, dreary and decrepit main piazza of the Italian town of Codogno the Covid-19 Ground Zero – shocked and awed by a man-made disaster that held global travel in a choke.

What is worrying is that the hospitality business was not firing on all cylinders, even before the lockdown last month.

Occupancy in India slumped 67 per cent on March 21, three days before the three-week, nation-wide lockdown was imposed. It might be an encore of 2001 – and the scale of revenue and job losses will be exponentially higher, said several industry players.

Experts say, this year the hotel industry would not be able to recapture even 20 per cent of the previous years’ revenue as the global pandemic takes its toll on the business.

A whopping 87 per cent of the business in India is domestic and industry veterans expect the industry to bounce back in about six months after the lockdown is called off.

“In India, we have a very strong domestic tourism market, and we are optimistic that domestic business will be a key factor in the industry’s recovery”, says Puneet Chhatwal, MD & CEO, The Indian Hotels Company and president of Hotel Association of India.

“People will take more short breaks within the country. There is an expected slow-down in new hotels/rooms supply as well. Some existing supply will cease to exist in its current form, especially in the unorganised sector” adds Chhatwal.

The international travel driven occupancy may take anywhere between 12-18 months. And everybody expects quick and dramatic change of the industry landscape.

“I see the front desk vanishing. The phone will be your reservation, your front desk, your concierge and your room key. Robotics will start playing a big role in delivering guest requests for extra linen, water may be even dinner,” said Sanjay Sethi, the CEO and MD of Chalet Hotels, asset owners of brands like Marriott,Hyatt and Accor.

Hoteliers say the whole concept of buffets will be questioned and reworked. Several hotels may have to skip the front desk. “The first casualty could be the high degree of personalisation of services offered, especially in luxury hotels. The guest’s wariness of close quarter interaction would be met through the electronic face time and digital app based access to the rooms, spas , business centres, gyms ; typically ushered into by a friendly hotel staff. All this will make checking into a hotel never the same again, says Patu Keswani, chairman , Lemon Tree Hotels.

This aversion to physical contact will play up in the short term and hoteliers have to be wary of that, experts warned. “I foresee lots of government advisories against banquets, conferences and large group movement. There may be a control on number of people at weddings. That’s a big dampener,” says Saurabh Gupta, partner at Hotelivate, a hotel consultancy.

Invasive screening processes will come in and body temperature will be checked before entry into the property, adds Gupta.

Hotels have already started investing in air quality monitoring systems and indoor air filtration as customers become more demanding after the pandemic. Hygiene procedures in the hotel will become more rigorous. All this could make the guests feel invasion of their privacy, but the hotels will have no other option.

The global supply chain disruptions could see some of the exotic dishes like Japanese Kobe meat, exotic beluga caviar, Matsutake or Fugu ( pufferfish) going off the menu of the luxury hotels in the short term.

Digitisation has increased the level of personalisation with the use of sophisticated data analytics.. There will be an evolution in consumer behavior with personalization through digitization at its core.

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