Covid survival - how are our hospitality businesses?

North Devon Gazette

We are approaching a critical moment for the Northern Devon economy, as the serious preparations for the forthcoming holiday season get underway.  Â

The investment which is now being undertaken to improve the quality and attractiveness of our tourist industry is critical, as is the way in which this area is marketed, both nationally and internationally.  Â

So important is tourism, leisure and hospitality to Northern Devon that it affects almost every business we have. Approximately 25-28% of economic activity is contained within these sectors. Both direct and indirect employment is significant.  Â

Many businesses not directly offering these services are, however, heavily involved in a complex, but well-established, local supply chain network. In short, the good health of this industry is critical to the whole of the Northern Devon economy. Â

The pandemic, and to a smaller extent Brexit, have changed almost every aspect of the industry and has forced hoteliers and accommodation providers to rapidly change their strategies in most parts of their delivery.  Â

They have adjusted on-property systems to be touchless, shifted distribution and marketing approaches to appeal to new travel segments and repriced inventory without background historical data. This has been a hugely challenging exercise.  Â

The test, however, will now come as the impact of vaccines reduces covid from pandemic to endemic and consumer confidence returns. There are strong indications that this industry is now ready to take on these new challenges.  Â

The national picture is encouraging. According to some of the major companies, such as Intercontinental Hotels Group, they are now saying that their business has returned to around 70% of 2019 levels.  Â

Looking ahead, however, they see an even more encouraging position. Forward bookings are currently exceeding pre-pandemic demand. They are even noticing a pick-up in business travel. This is perhaps surprising as the world of hybrid working and video conferencing seems set to stay. It is evident, therefore, that business managers and executives are choosing a blend of business and leisure travel. Â

If it is correct that “business is back”, it is interesting to contrast this with the Doomsday predictions that abounded in 2020, that there would be a 50% cut in business and leisure activity generally. It is perhaps gratifying that even the most experienced analysts can get things so wrong.Â

A similar picture of demand is being reported from both Marriott and Hilton Groups.  Marriott’s volumes have increased around 20% and Hilton around 35%. Â

Looking behind these figures is also interesting, as much of this is generated through domestic demand rather than a resumption of regular bookings from international travellers.Â

Against this background, can we expect a bumper summer this year? Â

It is very difficult to draw any direct comparisons with the experience of last year. Because of travel restrictions, the “staycation” market almost overwhelmed the South West. It has always been anticipated that there would be a rebalancing as international markets reopened, particularly to sunshine destinations. The initial evidence is, therefore, encouraging that not only will things return to normal but that there is a good prospect for this industry to grow.Â

Imagine how difficult it has been for a multitude of business owners and their employees in this sector to know what they should do next. It has been quite literally nearly two years of hell for them.  Fortunately, they have held their nerve and made the right decisions about investing for the future. Â

We should all now do our part in supporting these many businesses with our patronage. We should encourage friends and family to visit and stay in some of the finest hotels and accommodation set in some of the most scenic areas of the country.Â

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