As we enter the critical peak winter season, the importance of revenue management becomes even more pivotal to our economic recovery. Many financial ‘experts’ have been recently quoted as stressing that ensuring added-value in our tourism offerings is vital to our survival, but I am not sure that this is universally understood, let alone overwhelmingly embraced.
While we have had amazing past support for our restaurant initiative, it is still difficult to persuade some players that with a near all-time Sterling low currency value against the US$, that BDS$99 at the current rate of exchange is very close to GB Pounds 40, and probably more, when credit card transaction and settlement fees are taken into account.
Everyone is fully aware that costs have risen well above prices charged, but that is not the customer’s fault and they should not be penalized for our enforced problems.
There also appears to be a lack of universal comprehension about controlling revenue management. Is it better to have your restaurant completely full at 8.30pm every opening evening, or to fill otherwise vacant tables at 6 or 6.30pm for those more senior visitors or younger families, who often wish to dine earlier anyway?
Even if you limit those patrons looking for added-value by accepting a maximum of ten persons per night, six nights a week and 50 weeks of the year, that’s a mind boggling $297,000 annually in revenue, that will have cost you nothing to advertise or promote.
Surely, that goes a long way to increase your serving staff’s service charge earnings, paying the rent, land taxes, utilities, insurance and other standing costs?
It is also a prerequisite that we fully understand where our visitors come from and the increased challenges they face at home.
The ongoing Brexit saga has not only had a profound detrimental effective on currency values, but has directly impacted on disposal income with higher than anticipated inflation, rising mortgage rates, increased imported goods prices and lower house values for a substantial percentage of our cherished arrivals.
Compound this with a monumental change in our non-all-inclusive accommodation offerings with thousands of rooms now being offered through online agencies like Airbnb, Where-to-Stay and many others, opening up multiple choices of less expensive lodging.
It therefore must be patently obvious that we are marketing towards a largely less affluent type of visitor.
A recent media report by an accredited industry expert concluded that across the United Kingdom the average price of a 3 course restaurant dinner, bottle of wine, tax and service was GB Pounds 55.90 for two persons, so even our BDS$99 per person offering is already 45 per cent above that rate.
Their immediate response is often to trade down normal accommodation choices while reducing the average length of stay and spend in the destination.
Every one of these factors has a profound effect and consequence on our industry, and should be fully considered.
I also believe that there is great deal more that our food and beverage distributors can do to stimulate spending within the tourism sector, helping it become more affordable to dine out.
Monthly specials, highlighting particular wines and edible ingredients targeted especially to our standalone restaurants and smaller hotels.
This could also be supported by the more proactive diplomatic or consular missions of the various countries represented here, who currently trade significant imports.
Argentina and Chile perhaps are good examples.
The blogmaster invites you to join the discussion.