The recent recession had an impact in the hotel industry. Personal travel didn't change by a lot. The Business travel, however, drastically decreased, which was where the hotels saw a decrease in revenue. This trend had occurred in the last two years. This year it seems that hotels are beginning to recover from the recession as business travel slowly increases. According to Smith Travel Research Inc. hotel occupancy rose from 62 percent to 67 percent last year in hotels with the most expensive rooms. Also occupancy rose from 62 to 65 percent in hotels across the country. This increase demonstrates that the recession is slowly going away, which is making businessman travel more often. If this increase continues, then hotels can recover from the loss of revenue they had because of the recession, which caused businessman to travel less.
I believe that the revenues of hotels will continue to increase as more and more businessman continue traveling and staying at hotels. Also as the recession continues to disappear, it will benefit hotels. Once people feel confident that the recession is over or that economy is in good shape, they will be more willing to spend money. This has the possibility of increasing personal travel, which will boost the hotel revenues. With both an increase in business travel and personal travel, hotels will be able to recuperate their losses from the last couple of years.
http://www.bloomberg.com/news/2010-11-03/hyatt-third-quarter-profit-rises-as-demand-for-high-end-hotels-increases.html
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I agree with all of the above. Just wondering if you think that maybe motels and other low end hotels saw an increase and revenue during the recession and are actually seeing a decrease as the recession is ending?
ReplyDeleteKyle Davis
P.S. to my team...i wasn't the last one to post a blog! *clap*clap
That's a very interesting question. I didn't look at how motels and other low end hotels were affected by the recession. I would assume that those hotels either saw an increase in revenue or the revenue stayed the same. As the recession is ending, I don't think that those hotels are seeing a decrease in revenue, I think their revenue is staying the same. I would have to make sure this is true though because this is just my assumption.
ReplyDeleteP.S. To Kyle: Congrats for not being the last one! It was really late when I posted my blog and I was surprised that no one had blogged. I almost thought we didn't have to blog this week.