Travel association UKinbound has announced that the top challenges for its members in 2020 include a negative perception of the UK resulting from Brexit, alongside recruiting and retaining staff.
These results were revealed during its Annual Convention in Bristol, which took place from 5-6 February at Mercure Bristol Grand Hotel.
The results were collected as part of the association’s January 2020 Business Barometer member survey. The survey was compiled by Qa Research, which also looked at business operating conditions in Q4 2019.
The survey additionally found that only 48% of tourism businesses believe they will be ready for Brexit by the end of the transition period on 31 December 2020. Results showed that visitor numbers, bookings, customer orders and yields remained the same.
One in three respondents said they were experiencing growth from the US market, while Germany and France continue to be the most sharply declining markets.
In Q4, China was the second leading growth market for members, with some suggesting this will be a pivotal market post-Brexit. However, a number of businesses said their 2020 optimism has wavered due to the coronavirus outbreak.
Joss Croft, CEO, UKinbound commented: “It is encouraging to hear that many of our members are experiencing strong forward bookings and that they’re confident about business in 2020.”
Croft continued: “However, there are significant challenges now and ahead for our members due to the impact of the Coronavirus on the Chinese market, negative perceptions of the UK and the looming prospect of the end of Free Movement. Our members are already struggling to recruit employees with foreign language skills and are worried about the administration involved in recruiting non-UK employees post Brexit.”
Croft concluded that UKinbound will work with the government to ensure the new immigration policy “treats the tourism industry fairly and if needed, we will campaign for an extension to the transition period so that businesses have enough time to prepare and adapt.”
Millennium and Copthorne Hotels has warned investors that the hospitality industry faces ‘intensifying’ challenges in the near future in the form of staff shortages and competition from the growth of Airbnb and serviced apartments.
The company’s chairman Kwek Leng Beng made the comments as it revealed a drop in pre-tax profit for 2018 to £106 million – down 28 per cent on 2017 in constant currency. The fourth quarter was particularly hard, with profits falling 76 per cent to £7 million.
Beng blamed “a range of geopolitical and global economic headwinds”, including US and China trade relations, Brexit and increasing minimum wage levels in several markets.
The company also saw revenue per available room fall 7.4 per cent in London, mostly driven by the closure of its Mayfair hotel for refurbishment. Excluding that property, revenue grew 3.3 per cent. The hotel is set to reopen as the Biltmore, Mayfair in the second quarter of this year (new bedroom pictured).
Millennium and Copthorne says a particular challenge in the UK is the effect of Brexit. It claims to be struggling to recruit EU workers, “which currently comprise more than half of the London workforce”. Minimum wage increases in the UK have also reportedly added to cost pressures for the group.
Looking ahead, Beng said: “The board’s priority is to evaluate and develop new and innovative strategic plans to meet the challenges facing our fast-changing operating environment. The shortage of talent – from rank and file to senior management – is intensifying with many new hotels being built around the world, not to mention the growth of Airbnb and serviced apartments. Any hospitality business that wants to progress will need to evolve and embrace these changes to stay relevant and profitable in the immediate and medium term. Restoring profitability in our New York hotels also remains at the top of the board’s objectives.
“Meanwhile, we continue to invest in and reposition our hotels. We look forward to our Mayfair hotel being rebranded and opened as the Biltmore, Mayfair in the second quarter of this year. This is the first opening under Hilton’s new LXR Hotels & Resorts collection in Europe. This also will mark the group’s debut in the London five-star deluxe market and it is our aim to fast-track our lost earnings growth at this hotel after it re-opens.
“2019 will be another challenging year for the group, with significant capital projects underway and several large hotels earmarked for major renovations. These investments will be carefully managed and phased to deliver the right returns to shareholder and underline the group’s intention to maintain strict control of costs throughout the business.”
Millennium and Copthorne Hotels operates the Leng’s Collection, M Social, Studio M, Millennium, Grand Millennium, M Hotel, Copthorne and Kingsgate brands.
In September 2018, the group’s CEO Jennifer Fox stepped down after just three months in the role.
by Paul Kennedy MBE, Director and Owner, Kennedy Integrated Solutions
When I was asked to write about this subject with its long title it initially felt like that old school task of writing about the history of the world in one short essay. Well, now like then, I have decided the topic is too vast, too diverse and too subjective to try to cover a large range of topics so I am just going to focus on a small number. I am NOT going to talk about Brexit because like everyone else I don’t have the answers; I am NOT going to talk about Trump despite having a keen sense of humour and I am not going to claim that what I say identifies the challenges and achievements which are the most important as the criteria to judge which are, are simply too complex.
As I look back and peer forward …
… the industry I joined almost thirty years ago feels very different indeed. The first achievement I think worthy of note might be viewed as an academic one and this is how the meetings and events industry in all its guises and definitions has gained much wider political and policy making recognition.
At a macro perspective there is now a methodology which can measure the gross economic impact of our industry at a national level and this can indicate the contribution to GDP, employment levels and the generation of taxation revenues. Who would have thought that in the UK there would ever be a cross party all parliamentary group which acts as a voice for the work that our industry colleagues contribute to the wider economy? This economic value is currently being explored and championed further by the discussions around the subject of the knowledge economy and how the world of meetings and events can and arguably should be aligned in the quest to attract events to a destination.
Such strategic thought of say trying to attract meetings in subjects and industry sectors which are relevant to local economies, their talent pool and academic and research agendas is now to many an obvious thing to do. The Iceberg initiative founded and championed by that clever man James Latham is an example of real joined up thinking about how the destination supply side of our industry can think more strategically about the type of business it could and arguably should try to acquire.
The second area of my ramblings …
… once again focuses on the supply side and its explosion at a global level. Almost every day I read about a new meetings hotel being opened or planned; there are as I write something in the region of 40 new convention and event centres being planned, expanded or opened in Europe alone (Blackpool, Aberdeen, Gateshead, Newport in the UK to name just four) and the opening up of the myriad of new air routes many relatively low cost, presents the meeting, event or incentive planner with an incredibly increase in choice.
This destination competitive landscape will I believe continue to grow rapidly-there are it is reported 5000 towns and cities in Europe alone and the thirst for something new and different among meeting planners from all sectors would suggest that venues and hotels and the cities and region in which they are based will need to keep spending their marketing budgets as competition increase well above current levels.
My personal view is that digital marketing and face to face business development activity will become ever more dominate and that traditional trade press will become increasingly marginalised in the battle to acquire inbound meetings business .
But how have meetings changed?
This alone is one of those topics which spurn many books and much commentary. The transition for meeting planners from a more traditional focus on meeting logistics to meeting content is now well established across all sectors.
The discussions around meeting design, meetings architecture (pioneered by Maarten Van Este) and the ROI of meetings (championed in Europe by Elling Hamso) for example have really aided the debate around the value which meetings and events bring to organisation, and continue to drive the evolution of content and ideally the increase in delegate satisfaction and experience. If any organiser is failing to embrace issues such as these then perhaps as planners they will personally become less valuable in time.
Technological development
I guess there would be howls of derision, not least from Jacqui Kavanagh, if I did not mention technological development. Well although technological developments impact on all elements of our business and many elements of consumer life the old arguments that technology would lead to a dramatic reduction in meetings now surely has been consigned to the waste basket (it seems modern offices no longer have a waste bin for each desk!)
There is little doubt that technology has massively widened how we can plan and deliver meetings and research suggests that despite virtual conferencing increasing still further and replacing some small scale business and other meetings, the underlying trend for meetings continues to rise as economies grow and national boundaries open up.
There is strong evidence that in some sectors the number of delegates at mid to large events has and will continue to decline; in the world of international associations the challenge about how to attract younger generations into membership and then to attend meetings is of growing concern; intuitively it seems to me that this challenge must be associated with how today we all acquire, access and process information and for some will greatly influence how they choose to be part of a community or association.
I have selected just a small number of topics which have and will continue impact my career as a meeting and event planner and supplier. There are many more subjects I could of course have selected but none of the above or those issues not discussed, have been more impactful or important that the network of friends and professional colleagues with whom I have had the pleasure and privilege of working meeting and conversing with.
I can only ponder that the interaction with other professionals or like- minded and inquisitive individuals is why the world of meetings and events exists and continues to build, continues to enthrall and motivate and why I believe will for the long term continue to play a pivotal role in the lives of the many tens and tens of millions who attend meetings every year.
Kennedy Integrated Solutions advises destinations at a city, regional or national level, venues and venue groups, event companies and individual business executives about how to make their businesses grow and their organisations to become more effective and successful.
