Restaurants Are More Important to Hotels Than Ever Before
Although food and beverage prices continue to rise, restaurants continue to be a significant source of revenue for hotels. Restaurants have always been an attractive amenity for hotel guests but with so many travelers wanting a more holistic experience today, restaurants have become a point of emphasis.
According to Hotel Management, “banquets and catering are the primary drivers for hotel programs, accounting for nearly 40 cents out of every dollar spent at hotels. Banquets and catering account for an even larger part of the overall revenue at upscale and luxury properties that cater to both personal and business events.”
That is just banquets and catering, not including the revenues from patrons getting room service or, more significantly, coming down to visit the restaurant itself.
Given the increasing popularity of Airbnb, this is good news for the hotel business. The average Airbnb host provides a bed, but typically not breakfast, let alone its own restaurant. This may be one of the reasons it does not seem to be having any actual effect on hotel revenues, even as the number of people renting through Airbnb is increasing. The presence of a restaurant can act as a draw for hotels feeling the pressure of a changing economic environment. It can provide a draw for events that need to be catered, such as conferences, weddings, or receptions—events which attract people to stay at the hotel itself.
For hotels to continue to complete, though, they will need to begin catering to the new demands emerging throughout the marketplace. Organic offerings, paying attention to food allergies, and especially providing local tastes are all ways to bring people in. Upscale dining seems to be a major draw at hotels, rather than more casual dining. The key is to provide patrons with an experience they cannot get anyplace else when they come to a given city.
The bottom line is that hotels with restaurants actually do very well. They are a major source of revenue, and they are likely helping to keep hotels competitive as the industry continues to evolve in the face of ongoing technological innovation.
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