Make every dollar count – keep the cash in hard times
Running a hotel amid border closures and lockdown upheavals is difficult – and everyone feels the pinch. Australian tourism suffered overall losses of $ 33.7 billion from January to June 2020, and without crucial overseas and interstate travel, hospitality and accommodation are scrambling for support.
We never know what lies ahead – everyone has their ups and downs in this industry for a variety of reasons – but now more than ever we need to learn how to make every dollar count. This means paying for maintenance, personnel, utilities, upgrades, compliance, inventory, and complying with new COVID-19 protocols.
Applying for government grants and assistance is essential, but if you’ve postponed major renovations or structural work for fear of alienating guests, now is the best time to get your plans started. If you don’t know how to finance long-term upgrades, an unsecured business loan might be the way to go.
Keep cash moving by swiveling
If your hotel also has a kitchen or motel, one of the ways to retain staff and maintain cash flow is to turn to online or local takeout. You may want to look to âhybridâ meetings, where speakers use your conferencing facilities but participants attend remotely. Some Singapore hotels have offered “suite dining experiences” where guests stay overnight after dining.
This was also seen in Canberra and Sydney last year when Ovolo Hotels successfully introduced and managed its âRestaurant In Roomâ concept at Ovolo Nishi and Ovolo Woolloomooloo.
Protect your profits – reduce your expenses
Hoteliers will have to plan for the unforeseeable and the unforeseen – and that means protecting profits and making every dollar that comes in count. If you earn income from take-out, hybrid meetings, or âdinners en suiteâ (or maybe even other sources of income), removing non-essential items from rooms, closing sections and Involving staff in cost reduction measures can protect hotel profits. short term to avoid long term difficulties. Sacrifices now can mean viability later. Check out more tips and tricks here.
Right now, with interest rates as low as they ever will be, businesses in the tourism industry may want to apply for unsecured trade finance. While getting approval may have been a bit of a pain in the past, recent rule changes have simplified the process.
Unsecured business loans do not require collateral and can be approved with minimal documentation. Savvy Managing Director Bill Tsouvalas Said Operators Can Use These Loans To Fund Pivots, Improve Cash Positions, Or Make Changes To The Hotel To Make Sure It Is COVID-Safe and More Efficient .
âThese types of loans can help you consolidate your cash flow by acquiring new inventory to fit out dark kitchens, secure bedrooms or consolidate debts,â Tsouvalas said.
âThe terms range from 12 to 24 months and you can also prepay the loan if needed. “
You should approach your financial controller or accountant to apply for as many government grants or grants as possible during these difficult times. Businesses can apply for financial assistance from the state government, while people in COVID hotspots who have lost their jobs due to lockdowns can request payment in the event of a COVID-19 disaster.
The government is also guaranteeing loans under the Coronavirus SME Guarantee Program. SMEs with revenues of up to A $ 250 million that benefited from the JobKeeper payment between January 4, 2021 and March 28, 2021 are eligible for these loans but will need strict documentation. More information is available from the Treasury.
Keep in touch with your colleagues
Most importantly, the hospitality industry must come together to ensure the survival and prosperity of the industry. This means staying in touch with the Australian Hotels Association and keeping an eye on their resources. Seize opportunities and grants as they become available. Only then can they weather this storm.