#HOF23 - The positive impact of Covid-19 on the industry

3 min reading time

Published on 29/06/23 - Updated on 29/06/23

Vanguelis Panayotis

Vanguélis Panayotis, CEO of MKG Consulting & Hospitality ON, opened the discussions for the 28th Hospitality Operator Forum 2023.

After the shock of Covid, then the rebound that followed, and the euphoria that went with it, we are now seeing a return to normal. The hotel industry has come back very strongly, particularly in terms of average price and occupancy. After the summer, we can expect things to return to normal. However, I wish us all all the success in the world in holding the line on average prices.

Are we heading for a tightening of belts or a return to normal?

The strategy of raising key interest rates by the central banks and the Fed is aimed at slowing the economy and inflation, knowing that the only way to do this is to go through a recession. There is no objective other than to raise rates again.

We can therefore expect this recession to take its toll in the end, with a further contraction in the labour market and in economic development. Hopefully, this will only last a few months.

The sector is doing very well, we have very good fundamentals and we're perfectly prepared for a few minor upheavals. We are managing to get ourselves well in order.

Over the last few years, we've put a big question mark over the added value of brands. Is there not a new deal that we can invent in the relationship between the owner, the operator, and the brand today? Many owners have the power to set the rules and ask themselves whether or not they need to create a brand on an asset.

The good news is that the retail offer continues to grow significantly. In the West (Europe and the United States), the average annual supply growth rate exceeds 4% for a stock that is already starting to mature. These are large volumes which are growing year on year, but which slowed down slightly in 2022 with the effect of Covid. In Asia, after a slowdown in supply, the growth rate is 6%. Overall, growth in branded stock worldwide is rising by an annual average of 4% to 6%.

We shouldn't be overly optimistic or pessimistic. The reality is somewhere in between – there are shades of grey. In some cases, there is a need for added value on the part of brands and networks, as well as different types of contracts. At the moment, for example, we're talking a lot about soft brands. As such, we need to look at added value, whether we're an operator-investor or a pure player operator.

To conclude, let's ask ChatGPT to give us three brief examples of key trends in the hotel and restaurant sector in 2023:

  • Personalising the experience.

  • Sustainable development.

  • Integrating technologies.

MKG Consulting

MKG Consulting

Press / Research & Studies / Events / Training

  • MKG Consulting Paris
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