HOTEC panelists analyze renovation, offshoring issues
Joanne L. Harris
Miami–Buyers and vendors considered implications of increased room occupancy anticipated throughout 2004 and an increase in development and renovations expected through 2007 during a panel at the HOTEC North America conference in June.
The conference, designed for buyers and vendors, was held at the Turnberry Isle Resort and Conference Center in Miami. The panel, titled “State of the Hospitality Industry in North America,” was moderated by Mike Malley, publisher and editorial director of Hotel & Motel Management, and consisted of three buyers and three vendors.
Larry Carver, president of Carver and Associates, Sally M. Miller, project supply manager at Hilton Supply Management and Daniel Richardson, v.p. of procurement at GF Management represented buyers. Vendors were Gary Rosenthal, managing director of sales for Duralee Fabrics Ltd., Mark Holzberg, president of Bartech North America and Wade Jones, president and founder of All Outdoors and More.
“With an estimated 4.2 million rooms recycled every seven years–that’s 600,000 rooms a year–what should be the first renovation task undertaken?” Malley asked panel members.
“That amounts to 60 million yards in bedspread fabric alone,” Rosenthal said. “Hoteliers want fabric that lasts longer, so supply companies need to get aggressive and develop textiles that last five, six or seven years.”
Most brands look at renovation tasks via their product-improvement program to comply with flag standards, Carver said. Once the compliance list is compiled, management decides what they can afford, what has to be done by flag standards and how to do as much as possible within budget.
“If the results don’t satisfy the standards, then they have to look for more money,” Carver said.
“The demographics of travel have changed,” Richardson said. “Female travelers are becoming more dominant. You have to get their ear and eye for safety and security, colors and fabrics.”
Holzberg agreed that hotels need to consider female travelers. He said a Wyndham International survey found that minibars were important to female travelers who don’t want to leave the room because of security reasons.
As technology quickly progresses, hotels have had to keep up with technology amenities, Malley said.
“First came Internet connectivity, then Wi-Fi and now broadband,” he said. “What’s next in new technology amenities?”
Replies ranged from improvements in automated minibars to cooling systems that are more environmentally friendly. The technology in today’s improved fabrics also plays a significant role in longer wearing materials.
“Technology forces vendors to come out with new products, things that last longer,” Holzberg said.
Jones said cushions, umbrellas and cabanas are made with better quality fabrics for longer wear.
“The durability of draperies and bedspreads is important to the maintenance savings,” Miller said. “Now the fabrics are all made of flame-retardant polyesters, such as Avora.”
Throughout the economic slump, operators have had to tighten belts and reconfigure budgets. Malley asked what operators are doing to make things better.
Carver said they are planning better in this recovery, with a closer eye on money, creative financing or leasing.
“We’re savvy to the latest products and their life cycles,” he said. “Designers aren’t given carte blanche anymore. The biggest change is that renovation turnaround time is faster.”
In the past couple of years, capital funds have shrunk at GF Management, Richardson said.
“We took the $100 chair [instead of the $150 one] to fill a product-improvement program, hoping that capital funding would improve,” Richardson said. “The manufacturers who spend more time developing a relationship with me and the more they work with me with price during the down economy–those are the vendors with whom we’ll develop long-term relationships.”
Miller said brands are suffering from homogeny, and they need to come up with different products, amenities and features.
“Hilton has gone bed crazy with a $12-million project called Suite Dreams by Hilton,” she said. “It not only includes the bed set from Serta, but it also addresses how Hilton dresses the bed, such as going to double-sided print comforters, upgraded linens and pillows.”
Labor always is a huge expense in hotels, and technology can help bring down those costs, said Holzberg. He cited a case in which a New York City hotel’s current manual minibar costs them $1 million a year in maintenance labor costs.
“For a few hundred dollars per room, they can upgrade to a ‘smart’ minibar and save 75 percent of labor costs,” he said.
A final concern for both buyers and vendors is the issue of offshore sourcing, Malley said.
People held off buying furniture for so long that they now want delivery in two weeks, Jones said. Local manufacturers can’t produce items fast enough, so buyers are going offshore for everything from casegoods to outdoor furniture.
The real problem arises, though, when the property receives a poor-quality product.
“They’re stuck with it and they’ve lost their budget,” Jones said.
There are several solutions to the problem. Rosenthal suggested that when hotels buy fabrics, they should ask for samples and ask where the raw materials originate. Some fabric comes from China, but it’s printed in the United States, so it carries a U.S. label, but not U.S. quality, he said.
“Verify that products meet your specs,” Carver said. “Some Chinese factories are state of the art and have good manufacturing capabilities, but there are a lot of charlatans out there as well. We still recommend American or Canadian [companies] to clients whenever possible, because we know there won’t be a problem.”
COPYRIGHT 2004 Advanstar Communications, Inc.
COPYRIGHT 2004 Gale Group