The past few years have brought about a host of challenges for businesses in the tourism industry. The COVID-19 pandemic brought travel to a grinding halt. International travel to the United States all but stopped, and domestic travel slowed to never-before-seen lows.

In April 2020, occupancy rates in hotels in the United States dropped to just 24.5 percent. During the same month in 2019, those rates had reached nearly 70 percent, just as they had every year since at least 2016.

With the COVID-19 pandemic nearly behind us, the tourism industry is in the midst of a strong rebound. But even as visitors once again flock to hotels and resorts, businesses in the tourism industry are facing a variety of new challenges. Keep reading as we discuss a few of the top challenges hotels face in 2023, and how a destination travel management company like Vibrant Management can help.

Rising Operating Costs

Rising inflation has been a hot topic in recent months. Over the past year, we’ve seen the impact of inflation touch nearly every aspect of our lives, from our utility costs to groceries to vehicle sales.

While inflation is finally showing signs of slowing down, it’s still a challenge that hotels will likely face for the rest of 2023. This makes operating your hotel more expensive, whether you’re keeping the lights on or stocking toilet paper and other supplies. 

Passing these costs onto your guests can have an impact on bookings. But not passing those costs on can impact your bottom line. This year, hotels will be focused on finding a balance as they seek to absorb the rising costs of doing business.

Staff Shortages

The labor shortage that followed the COVID-19 pandemic continues to impact businesses across the U.S. today. In fact, experts are already predicting that we’ll be dealing with labor shortages for years to come.

For hotels, this means finding ways to cope with staff shortages and retaining the employees that you do have. Outsourcing some of your operations to a destination travel management company is one great way to offset the impact of staff shortages. It can also help you to reduce the growing workload for your existing employees.

Changing Guest Demands 

This challenge isn’t exactly new. What guests expect from a hotel has always been something that changes over the years. However, the internet, along with the sudden drop and subsequent rise in travel and other major changes we’ve seen in the world in recent years, have sped up this trend.

After a couple of years of low bookings, hotels are suddenly seeing rising occupancy rates. But they’re also seeing customers demand a variety of new—and costly—changes. 

With more people working remotely, having a dedicated workspace is a growing demand among travelers. Eco-conscious travelers are demanding sustainability in the hotels they stay in. The demand for smart technology in hotels, from digital keys to smart thermostats, is on the rise, too.

Making changes to meet customer demands can help your hotel stand out from the competition. But making all of these and other changes all at once is likely not in the budget. Instead, hotels must prioritize upgrades and changes based on their customer demographic and budget restrictions.

How a Destination Travel Management Company Can Help

From rising operating costs to staff shortages to changing customer demands, these are just a few of the top challenges that hotels and other tourism businesses are facing in 2023.

But you don’t have to face them alone. Outsourcing various aspects of your hotel management to a destination travel management company like Vibrant Management can help you meet many of these challenges head-on.

Our Virtual GM service can take over many of the day-to-day operational tasks that go with running a hotel. This service can help reduce your management staff needs, as well as ensure that the staff that you do have are properly managed and that tasks are being delegated. We offer a variety of other services, from digital marketing to full operation management, that can help your business face the ongoing labor shortage. Reducing your staffing needs through outsourcing and helping your hotel to run more efficiently can also go a long way towards offsetting rising operation costs.

As experts in the travel and tourism industry, we also know that guest demands and travel trends are constantly changing. We can help you prioritize the upgrades that you make now, while still helping your hotel stand out from the crowd, even without making every costly change other properties might be making.

Ready to learn more about how our destination travel management company can help your hotel face these and other challenges? Schedule your free consultation today!