What should I do with my hotel staff?
Shortly after confinement, I opened a hotel whose launch was disrupted by the pandemic. I recruited new employees, I trained them at my expense and we are doing very well. However, I have noticed that business is not as good as it used to be. The company can only pay five of my 10 employees. I used my savings to pay for the rest. I can’t keep doing this. Please help me find a business solution as I don’t want to lose my properly trained staff to other businesses.
The hospitality industry has had a tough two years, and it will take time to rebuild and get back to pre-Covid-19 levels. The initial upward trend post-lockdown I believe was a response to customers wanting to get out and enjoy time away from home. Over time, some of the realities, rising cost of living, rising fuel prices, etc. will impact purchasing power and customer experience. Indeed, they will begin to reduce the “luxury” and focus on the essentials. The ultimate factor that determines whether you stay open for business is the number of customers who walk through the door. I think it’s important to review your environment and establish if your competitors are going through the same thing. It gives the impression that you are visiting their establishments and watching their journey. You can also do market research and find out if you have any businesses in your area and find out if they have catering services for their staff i.e. do they have a staff canteen and how is it managed. You may find that they don’t, and given the appreciation many employers have for staff welfare, they may be open to introducing you as a service provider.
Another option to pivot your business is to open it up and provide space for meetings. This option allows a small rental fee to be charged as the group also purchases food and beverages. While collecting relevant data, you will need to spend time adjusting your business model and ensuring that your pricing and cost of operation are correct. You are right to use your savings to keep the business afloat is not sustainable. The above options may also require you to downsize as you change direction, so you should be prepared for this possibility.