Hotels don’t have to sit back and watch slowing growth and rising costs. According to statistics from STR global hospitality data and a recent article, hotels should be concerned about a changing economy reflected in RevPAR. Although, minimal growth is expected, profitability is minimal. As growth and inflation are curtailed, expenses are predicted to grow, causing concern for hoteliers. Further, as we look to 2017, the stats show that the top 25 markets will decline due to supply. So, now that you have this data, how can you deflect and minimize the effects of this economic cycle?
Investments in technology is a large area where the global hospitality industry can begin to neutralize downward economic cycles. In particular, technology solutions that are cloud based (proven to be a less expensive than on premise solutions) and help streamline and manage spend will provide the greatest help. In other words, Procure-to-Pay (P2P) automation systems not only help companies in economic strongholds, but even more so when profitability is at risk. P2P solutions help the hospitality industry connect with their suppliers, efficiently order and manage goods and inventory, as well as other functions that tie into purchasing, accounting and operations.
Our hospitality customers typically see at 10% to 20% cost reduction and a payback period of 3 to 9 months depending on a company’s gap between its current and desired future state. With these metrics, companies that use P2P systems should can expect this to translate to thousands, if not millions of dollars in spend per year. And, do not discount the soft costs of efficiency and time saved using an automated, online system that can be accessed anytime, anywhere on mobile devices. Moving compliance rates up to over 80% or 90% by buying the right products from the right supplier at the right price can make a drastic impact to the bottom line.
Are you ready to optimize your resources, employees, suppliers and overall spend? If you haven’t already safeguarded your hotel through P2P technology, now is the time to consider it based on industry data and research. For a demo or to find out more information about BirchStreet, please email email@example.com.