Hospitality has been one of the worst hit sectors as a result of Covid-19. As of early March, that only 43% were currently trading, with over half indicating that they had less than three months of available cash reserves. The sector also faces the threat of inflation as the economy reopens which could have the impact of pushing up wages at a time when Government support measures are reduced.
However, the use of technology has been fast-tracked over the last twelve months so below we look at four ways in which businesses in the hospitality sector could benefit from drawing insights from data analytics as they reopen.
1. Review monitoring
Analytics focused on customer reviews allows businesses to best respond to online feedback.
Data tools that focus on identifying the use of negative words allow businesses to respond quickly to the most damaging reviews, either because they engage with the review to demonstrate they take feedback seriously or to identify more pervasive issues and take remedial action, such as employee training.
Analytics focused on customer reviews allows businesses to best respond to online feedback.
2. Waste reduction
Wasted food in a restaurant or energy in a hotel is costly for businesses and will negatively impact the company’s sustainability goals. Technology that identifies what your kitchen is throwing away, including those that recognise products through image recording, allows better buying decisions on how much inventory is required and also allows the restaurant to understand what the customer really wants on the table. Tracking room usage in a hotel coupled with smart thermostats and cooling systems means that less money is spent regulating the temperature in rooms that are unlikely to be used.
3. Pricing
When booking a room in a hotel the price and availability of all types of room is readily available. Analysing the prices of competitors both now and historically allows the business to evaluate its own rooms with a competitive edge that does not unnecessarily eat into its margin. Such analytics also allows for dynamic pricing adjusting for the occupancy rate when factoring in variables such as historic trends, the remaining period left to sell the room and confirmation that competitors have no remaining capacity which will increase demand.
4. Management information
Restaurants can use data to analyse which servers achieve the greatest revenue per guest so that they can train colleagues or be incentivised to remain with the company.
Recording what is ordered electronically also allows better information on what meals are selling well – a marked improvement on servers simply telling customers something they want is not available as this information does not reach management. This allows for better inventory and pricing decisions, as well as updating the menu in line with customer demand.
Hotels can use similar concepts to assess revenue per room, for example assessing the impact of add-ons on the overall booking value. This is particularly valuable to chain hotels who will learn what individuals will pay extra for and target their marketing appropriately.
Recording what is ordered electronically also allows better information on what meals are selling well.
How can you fund this investment in new technologies?
The Recovery Loan Scheme remains available to allow businesses impacted by the pandemic to borrow money in order to fund their restart, including investment in some of the above data analytics options.
Where investment in technology requires spend on computer hardware it is likely the recently announced Super Deduction will apply, creating an enhanced Corporation Tax reduction further aiding cash flow.
Furthermore, this autumn the Help to Grow: Digital Scheme will go live which will allow small businesses to get free advice through an online portal on how technology can improve performance for their company.
How we can help
Through our UK Outsourcing team, we can help you manage your business’ cash flow. We can also advise you on whether and how the Government’s Corporation Tax Super Deduction will apply when you are investing in technology. Both will help to ensure that any investment your business receives fully leverages all available reliefs, unlocking more cash as you reopen.
Would you like to know more?
If you would like to discuss any of the above, please get in touch with your usual Blick Rothenberg contact or David Hough using the details on this page.
You can also visit our Technology hub for other insights.