Recession-Proof Hotel Business Strategy

April 19, 2022
Recession-Proof Hotel Business Strategy

As the hospitality industry recovers from pandemic-related drops in occupancies, ADR growth, and available workers, now is the perfect time for hotel leaders to enhance their hotel business strategy by reflecting on two things: how they stayed afloat during the global pandemic and how to remain successful during future crises or economic fluctuations.

Over the past several decades, we’ve witnessed many slowdowns as a result of global or national events. Fortunately, we’ve managed to navigate our team through all of them. Much of our success during these times, and the success we’re confident we’ll see in the future, can be attributed to one of our most powerful values: prioritizing our team.

To hotel leaders looking to make their business more resilient during market slowdowns and global crises: focus on keeping your team strong, happy, and healthy. It is the best investment you can make to stay successful regardless of market behaviors, world events, or other external forces.

Resist Knee-Jerk Layoffs

“The hospitality industry at times has had knee-jerk reactions to large downturns in business. In an attempt to cut its way to prosperity, the industry leaves people unemployed,” according to Chris Ardolino, Narsi’s Vice President of Operations.

While we understand this initial reaction to downturns, hotel leaders can cause lasting harm to their own businesses and the industry by laying off employees immediately. As Chris argues, “The unemployed then seek out industries with greater stability and reliability, thus reducing the hospitality-minded career pool.”

A better solution that offers long-term benefits for both hotel companies and the hospitality industry as a whole is to prioritize your existing team. Doing this makes recovery from downturns more effective and faster. There is no ramp up time for training. There is no downtime in providing outstanding service.

Emphasize Cross-Training and Well-Being

In response to the severe economic downturn caused by the Covid-19 pandemic, we at Narsi  practiced what we preach. 

“Our industry suffered some of the greatest losses in headcount during the pandemic,” says Chris. During 2020 and 2021, millions of hospitality workers left or considered leaving their jobs

“It felt important as industry leaders to prioritize the physical and mental health, overall well-being, and employment security of staff across the entire portfolio,” he continued.

Rather than leading with layoffs or furloughs, we decided to put our people first and the business second. Harnessing the talent and dedication already present in our existing associates, we creatively cross trained, increased cross functionality of staff, and introduced team members to a refined career path.

Lead with the Heart, not the Head

Chris sums up our leadership values perfectly: “The pandemic reinforced in us as leaders that compassion, patience, camaraderie, loyalty, stability, and assurance should be the primary behaviors we lead with.” 

Hotel leaders would be wise to adopt similar values in order to stay successful during market fluctuations. “We are in the hospitality business, yet our industry at times forgets that hospitality,” he says.

Regardless of the challenges we faced during the pandemic, we committed to prioritizing our team and adopting a “do no harm” philosophy. By leading with our hearts first and our minds second, we’ve been able to retain top talent and keep associates on an upward career trajectory not just during the pandemic, but through all of the market changes we’ve witnessed during our 40 years in business.

Prioritize your Team Daily

Keeping your team strong and resilient to withstand any market fluctuations that arise requires the conscious decision to prioritize your team every day. 

“In our industry, it is important to continually train, promote from within, reward, value, motivate, and take a personal interest in our team’s personal growth and development, regardless of business levels,” Chris explains.

Leaders in the hospitality world have an obligation to ensure that we are helping team members reach their maximum potential. Investing in team members isn’t just a way to make them feel good. It’s a strategic business decision with concrete implications: reduction in turnover, increase in employee satisfaction, and increase in retention, all of which contribute to the growth of every stakeholder involved.

About Narsi Properties

Narsi Properties is a private family-owned Hotel Development & Management company based in North Carolina. Founded in 1978 on principles of trust, authenticity, and family, we take pride in our community, guests, and team members as the cornerstones of our company values. Our philosophy of positive reinforcement ensures a comfortable and unique experience for hotel guests, in turn reassuring our investors and stakeholders of our consistent reliability and superior performance.

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