In 2022; tourism activity was marked by the pandemic and was also affected by other factors such as the war in Ukraine and rising energy costs; among others. Even so; according to the quarterly report 'Tourism Outlook' by the Alliance for Tourism Excellence (Exceltur); tourism GDP reached 159 billion euros; exceeding 2019 activity by 1.4% and already standing above pre-pandemic levels.
Spain is currently one of the most popular tourist destinations in the world; and this sector accounts for more than 12% of the country's GDP. Against this backdrop; we would like to outline some possibilities for minimising costs and guaranteeing the supply chain.
The arrival of good weather is usually associated with an increase in the number of travelers. During 2023; as stated in the same Exceltur report; tourist activity is expected to reach £168 billion; exceeding 7.1% and thus consolidating the recovery seen in 2022. According to the latest data from the National Institute of Statistics (INE); in February 2023 Spanish hotels recorded 16.84 million bookings; which is 23.6% more than in the same month in 2022.
With the aim of helping tourism and hotel companies; we would like to offer four tips for discovering hidden savings in areas of the income statement to guarantee the supply chain and work successfully.
- Use technology to improve operational efficiency: one of the most effective ways to reduce costs is through process automation. The use of technologies such as hotel management software; online booking; and automated check-in and check-out improve operational efficiency.
- Secure the supply chain: ensuring that you have everything you need to cope with the peak in demand without costs skyrocketing is essential to securing the supply chain. This involves maintaining a good relationship with suppliers; based on trust and an agreement that ensures they deliver on time and in the right way; as well as controlling expenditure without compromising quality.
- Implement revenue management strategies: achieving liquidity to meet payments adequately is possible with good optimisation of expenditure and strategic items. In other words; if you save; you will have more working capital available to provide you with those extra resources to give you peace of mind and ensure the sustainability of your business in uncertain times when any external event can destabilise its activity.
- Implement sustainability practices and reduce energy costs: sustainable practices not only help minimise costs; but can also improve brand image and attract more guests. These include reducing waste; using renewable energy; implementing efficient lighting systems; utilising climate control technologies; and adopting responsible water and energy practices.
- Optimise marketing expenses: digital marketing has become the best way to connect with your target audience; establish your brand; and build customer loyalty. Thus; having greater visibility on search engines and social media will increase the effectiveness of the marketing strategy and result in higher occupancy rates and increased profitability for the hotel.
"Tourism is one of the most powerful sectors in our country and this year it has managed to recover after difficult years of pandemic; during which it was one of the most affected sectors nationally and worldwide;" says Eva Linares Baraza; partner at ERA Group. "Optimising costs in the tourism and hotel sector is essential to remain competitive in the market and increase profits."
