Do you work with the hospitality sector? Tired of doom and gloom? Want to plan for great customer experiences and get the most out of your operations?
There is no doubt that cost of living pressures are making customers think twice about spending money. There is also no arguing inflationary pressures on operations. However, this is not the first time we find ourselves in an inflationary environment. When there is volatility in demand and prices, the key to success is focus. This means being informed and making good decisions. It is time to make sure your forecasting and operations are data driven.
Despite the economic back drop, hospitality revenues are generally holding up. There are fewer customers, but customers are spending more. Better demand forecasting and product mix understanding will help better align operations.
Food costs are rising but are they "unpredictable"? No. When prices change faster they can still be forecast. However, models need to become more sophisticated, taking more demand factors and related prices into account.
Labour costs are high! True, but they will not rise exponentially. Better understanding demand and staff requirements will drive better labour productivity. When costs are higher, make sure you are using resources in the best way!
"No-one is expanding in this environment". Not really true. Fewer operators are expanding, however these are great conditions to secure good deals on new sites. Given the market backdrop, a detailed understanding of what works across different sites will help focus expansion plans on the sites with the highest sales potential.
"You can't sell a business in this climate". True that deal volumes are lower and valuation multiples have come off the peaks, but there is always demand for good businesses. A sharp focus on understanding the market, forecasting demand and managing costs will drive value. Any business sale or funding opportunity will always be driven by value.
Algospark is helping the hospitality on numerous fronts:
Get in touch to discuss how we can help you get more out of data and successfully manage through prevailing business conditions.
info@algospark.com
