Comment: COVID-19 is a global challenge

Gates Hospitality chief executive and founder Naim Maadad talks about how the hospitality industry should be tackling the coronavirus issue

Naim Maadad
Naim Maadad

A couple of months into the New Year, coronavirus has evolved from a health risk in one city into the threat of a global health epidemic

Health officials in China have published the first details of more than 70,000 cases of Covid-19, in the biggest study since the outbreak began.

Data from the Chinese Centre for Disease Control and Prevention (CCDC) found that more than 80% of the cases have been mild, with the sick and elderly most at risk.

The research also points to the high risk for medical staff and puts the overall death rate of the Covid-19 virus at 2.3%.

In Hubei, the worst affected province, the death rate is 2.9% compared with only 0.4% in the rest of the country. China's latest official figures put the overall death toll at 1,868 and 72,436 infections.

From a hospitality perspective, here are some measures any hotel operator, investor or anyone in an individual capacity should undertake:

• In any moment of crisis the most vital aspect is a steady flow of information vide communication and being transparent. A special mention of appreciation is due for the industry companies in travel, tourism and hospitality who have shown the large heartedness to waive off cancellation charges and assisted their loyal customers to arrive at a solution best suited to both parties involved. This is the ultimate opportunity to win the hearts of your loyal clients and make it a lifetime relationship.

• Retain staff, don’t lay them off to save costs. Instead, manage resources wisely. This includes temporarily shutting down unused blocks of the hotel and synergising the food and beverage offering to efficiently deliver experiences.

• Keep all stakeholders informed as all would appreciate transparency and a healthy analysis of the financial risks at play. It would act as a catalyst in the negotiation of the interim arrangements till such time normalcy returns globally in the hospitality industry.

• Brainstorm among those of have handled such crisis situations in the past and have an action plan ready on how to tide over the challenges ahead.

• Support Chinese guests and businesses. There is no excuse for racial profiling.

The hospitality industry has already dealt with an Asian virus that affected travel trends, and may be able to take some lessons from history. The 2003 SARS outbreak caused a 28% drop in travel demand (citing data from STR partner Tourism Economics).

“While it is understandable to look for comparisons with the SARS outbreak that began in 2002, it is important to consider the significant differences in the market over the last two decades,” STR area director – Asia Pacific Jesper Palmqvist said in a statement. “

Palmqvist added: “Dependence on smartphone technology, the widespread use of social media, significant differences in hotel inventory, greater volume in international arrivals to mainland China and overall economic conditions make it difficult to use that previous outbreak as an indicator this time around. There is also greater potential for hotel performance impact in other markets around the world because of the increase in Chinese outbound travellers.”

The hospitality industry has emerged from crises before. At the time of the SARS outbreak the travel industry was “truly on its knees” due to fears of contagion. Bill Marriott has advised hoteliers to close off the lower floors of their properties if they were struggling for bookings. “In doing that, you're giving your guests an upgraded experience from what they would normally get, but you continue to trade.” A very creative idea indeed.

About the author
With more than 28 years of hospitality experience globally, Naim Maadad is the founding CEO of Gates Hospitality, which owns and operates hospitality concepts including Ultra Brasserie, The Black Lion Public House & Dining, Bistro des Arts, Reform Social & Grill, Publique, and Folly by Nick & Scott. It also has ownership of Six Senses Zighy Bay.

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