Bridging the Gap – Insights from HOSPACE 2024

As proud sponsors of HOSPA, we were delighted to attend HOSPACE 2024 at the Royal Lancaster London last week. Many of you may have already seen some of the event highlights, including UK Hospitality‘s Kate Nicholls in conversation with James Stagg of The Caterer and the Leader’s Panel discussion that closed the afternoon programme. For us, the day was more than just an opportunity to connect and network with industry leaders. It was a chance to reflect on the unique value we offer our clients. We understand that our role goes beyond simply filling vacant positions. Instead, we focus on working in partnership with our clients to support their overall people strategies, utilising our industry experience and insights offer additional value and drive meaningful results.

Design Thinking in Recruitment
We were particularly interested in the engaging fireside chat with Neil Stone of leapSTONE on “Innovation Through Strategic Design”. He provided a compelling analogy that really resonated with our own methodology. Neal challenged attendees to rethink conventional problem-solving: rather than simply building a bridge, first understand whether a bridge is truly the best solution for crossing the river. This mindset connects with our approach and reminds us of the old medical phrase “Prescription without diagnosis is malpractice.”

This ethos drives our work. By engaging deeply with clients to diagnose the root challenges—whether it’s high turnover, a lack of leadership diversity, or difficulties adapting to market changes— we ensure that solutions are both strategic and impactful. Our role is not just to connect businesses with candidates but to understand the overall challenges and help create lasting solutions.

Elevating the Recruitment Process
Another critical takeaway from HOSPACE was the importance of partnerships over transactional relationships. We understand how some businesses still use mass recruitment strategies, inviting hundreds of CVs without offering meaningful feedback or collaboration. While this transactional approach can potentially save some upfront costs (and of course we are slightly biased) it sacrifices the potential value that a strategic recruitment partner can bring.

We have often seen examples where companies can overwhelm their HR team with hundreds of CVs from multiple sources, including our carefully curated candidates. This can understandably lead to frustration and burn-out. By engaging directly with the team and fostering a trusting relationship, we can emphasise the benefits of a consultative partnership, where fewer but higher-quality candidates are presented with context and rationale. This collaboration ensures a much more effective process and inevitably results in a better cultural fit for the workplace.

Addressing Industry Challenges
Unsurprisingly, HOSPACE also highlighted several pressing challenges for the hospitality sector, including the recent budget, workplace culture and evolving regulations. These issues underscore not only the importance of a strong financial strategy, but the significance of a holistic people strategy. For example:

  • Budget: With minimum wage increases and changes to National Insurance rates and thresholds, many hospitality businesses face tightening margins. FM Recruitment helps clients navigate these complexities by identifying candidates who have a proven track record of driving efficiencies and innovation within their organisations.
  • Workplace Culture: As we have discussed in previous blogs, inclusion and workplace culture was again a key topic at HOSPACE, especially in the Prioritising People discussion and Kate Nicholls’ conversation. It is a topic that we are passionate about and work with clients to ensure that hires align with their values and contribute to a cohesive team environment.
  • Regulatory Changes: From the new tipping legislation to employment classifications, the regulatory landscape remains complex. Our industry expertise ensures that our clients are not only compliant but also well-positioned to adapt to these changes and any opportunities that may appear.

Personalisation
One of the standout themes at HOSPACE was personalisation. Discussions emphasised understanding customers on a deeper level—beyond the superficial perks of an upgraded room or complimentary champagne. As highlighted in the panel “Maximising Profit Potential Through Clever Marketing,” hospitality leaders stressed the importance of tailoring guest experiences by understanding the “why” behind their bookings. The same principle applies to recruitment: effective hiring requires more than just matching skills to job descriptions. It demands an understanding of the organisation’s culture, objectives, and challenges.

At FM Recruitment we adopt this approach by digging deeper into clients’ unique needs. For example, instead of simply providing a list of qualified candidates, we collaborate with clients to try and uncover the motivations and goals behind each hire. This ensures that every placement contributes to the client’s long-term success, not just immediate operational needs.

Value Beyond Recruitment
One of the most compelling insights from HOSPACE was the idea that service—both to guests and employees—should be a company’s guiding principle. By viewing recruitment as a service rather than a transaction, we help clients build stronger, more resilient teams. The goal is not just to fill vacancies but to support broader strategic objectives, such as:

  • Ensure a diverse leadership team
  • Reducing employee turnover
  • Improving employee engagement
  • Supporting long-term business growth

Building Bridges
Ultimately, our value proposition is about connection. Just as the hospitality industry seeks to create meaningful experiences for guests, we strive to create meaningful partnerships with clients. By making it our mission to understand each client’s unique set of challenges and opportunities, we can help build the bridge between problems and solutions, supporting businesses as they look to thrive in an ever-changing environment.

And as many of the insights from HOSPACE 2024 show, the hospitality industry’s future health depends heavily on its ability to innovate, personalise, and adapt to these challenges and opportunities. With a strategic partner like FM Recruitment, businesses can ensure that their people strategies are not just aligned with these goals but positioned to exceed them.

If you would like to discuss how FM Recruitment can support your people strategy, then please get in touch.

Chris Denison Smith, Managing Director
+44 20 8600 1160 / +44 7775 711923
chrisdenisonsmith@fmrecruitment.co.uk

Andrea Shaw, Director
+44 20 8600 1162 / +44 7714 236469
andreashaw@fmrecruitment.co.uk

Tairona Lattanzi, Recruitment Consultant
+44 20 8600 1164
taironalattanzi@fmrecruitment.co.uk

 

Navigating Budget Season in Hospitality: Essential Tips for Success

As we enter the final third of 2024, hospitality businesses are preparing for one of the most crucial periods in their financial planning—budget season.  

This time of year is more than just about balancing books and setting targets; it’s an opportunity to align financial goals with market realities, ensure sustainability, and set the stage for future growth. Crafting a successful budget requires a combination of market research, strategic storytelling, effective communication, and the ability to adapt to feedback.  

Here’s our guide to help businesses navigate the complexities of budget season with confidence and precision. 

Market Research and Forecasting
A solid budget begins with a deep understanding of the market and future forecasts. In an industry where trends can shift rapidly due to economic changes, consumer behaviour, and global events, staying informed is essential. The hospitality sector is anticipated to grow at a rate of 5.5% over the next four years, driven by factors like sustainability, wellness tourism, and flexible bookings. Understanding these trends allows businesses to tailor their budgets to meet market demands, such as investing in sustainable practices or wellness amenities. 

Analysing Past Performance
Before looking ahead, it’s crucial to review past financial performances. Analysing year-over-year changes, identifying trends in different market segments, and assessing profit and loss can provide valuable insights. This data helps set realistic goals for the upcoming year and pinpoint areas needing increased investment or cost-cutting.  

Competitive Landscape
Understanding the competitive landscape is equally important. Analysing competitors’ strategies, pricing models, and market positioning can reveal opportunities and threats. This intelligence should be integrated into the budget to maintain competitiveness.  

Crafting a Strategic Narrative
A budget isn’t just a collection of numbers; it tells the story of the business’s past, present, and future. Crafting a narrative from these figures that resonates with stakeholders is key to aligning the budget with the company’s strategic objectives. Highlight successes, such as revenue increases from a new marketing strategy, and address challenges with clear plans for improvement. Align the budget with broader company goals, such as market expansion or sustainability initiatives, to ensure it drives the business forward.  

Presenting to Senior Leadership
Once the budget is crafted, presenting it to senior leadership is the next critical step and the approval of the budget often hinges on how well it’s communicated. This presentation should be concise and well-structured, focusing on key messages and high-level summaries. Senior leaders don’t have time to delve into the details, so it’s essential to highlight the most critical data points and how they align with the company’s strategic goals. Use visuals like charts and graphs to make complex information more accessible and engaging.

Handling Feedback
Receiving and incorporating feedback is a vital part of the budgeting process. Be prepared to answer questions and justify every figure. Feedback should be viewed as an opportunity to refine the budget, demonstrating responsiveness and a commitment to the business’s success. Document all feedback and changes made, as this record can be invaluable for future budget planning.  

Team Engagement
Budgeting isn’t just a top-down process; it involves the entire team. Engaging with team members ensures the budget reflects operational realities and builds a sense of ownership. Department heads can provide insights into specific needs or challenges, making the budget more realistic and achievable. Ensure everyone understands their role in the budget and how it aligns with the broader goals of the business. Providing training and support, such as financial literacy workshops, can enhance the overall quality of the budget. 

Conclusion
Budget season in the hospitality industry is more than a financial exercise; it’s a strategic process that sets the tone for the year ahead. By conducting thorough market research, crafting a compelling narrative, presenting effectively, and engaging with your team, you can create a budget that not only meets operational needs but also drives growth and innovation. As the industry evolves, those who approach budget season with diligence and foresight will be well-positioned to thrive. Embrace the challenge, and let budget season be a stepping stone to your business’s success. 

FM Recruitment is part of Hospitality People Group and we are dedicated to exploring all opportunities to provide insights and support our clients and their people strategies to create lasting value and positive experiences for their employees and guests.  

If you would like to discuss your people strategy further, then please get in touch.  

Chris Denison Smith, Managing Director – FM Recruitment 
+44 20 8 600 1160 / +44 7775 711923
chrisdenisonsmith@fmrecruitment.co.uk  

Andrea Shaw, Director – FM Recruitment 
+44 20 8 600 1160 / +44 7714 236469 
andreashaw@fmrecruitment.co.uk  

Dan Akhtar, Managing Director – HPG Advisory Services 
+44 208 600 1166 / +44 7808 157796 
dan@hpgsearch.com  

Guy Lean, Managing Director – Madison Mayfair 
+44 20 8 600 1180 / +44 7813 009787 
guylean@madisonmayfair.com  

 

 

 

 

“RevPAR to TRevPAR: More Than a Metric – Insights from HOSPACE 2023”

Introduction
As proud sponsors of HOSPA, FM Recruitment’s Chris Denison Smith, Andrea Shaw and Tairona Lattanzi had the privilege of attending HOSPACE 2023 last week at the Royal Lancaster London. Here we share some of their insights and observations. This year’s conference echoed many of the themes and discussions encountered in similar gatherings throughout 2023, however, offered an additional comprehensive and practical insight from the perspective of the UK’s specialist hospitality leaders.  

From the integration of Artificial Intelligence (AI) to an evolving approach to measuring success, the event provided a valuable forum for these leaders to share ideas and strategies for navigating the hospitality landscape. 

The Role of AI: Augmenting, Not Replacing the Human Touch 
As we have previously reviewed, the impact of Artificial Intelligence and its role in the hospitality industry was a popular theme running through the day. However, the narrative certainly seems to have shifted from the worry of AI as a potential replacement for (human) employees to an enthusiasm for a tool that enhances and complements human capabilities. The discussions centered around the importance of preparing team members to effectively utilise these technologies, while also being adept at managing any technical shortcomings. 

Effectively training employees to operate technologies and empowering them with the skills and acumen to intervene when technology can sometimes fall short, is something that the best businesses have been doing for years, and in this sense, AI is just another technology that could otherwise be badly served by a disinterested employee. 

The warmth, empathy, and personal attention that employees should provide, are irreplaceable and often make the difference in guest satisfaction. Therefore, while AI can enhance efficiency and personalisation, it won’t replace the need for human interaction in the hospitality industry. The future of hospitality lies in a balanced synergy between AI and human ingenuity, where technology is used as a powerful tool to augment, not replace, human service. 

Persistent Resourcing Challenges
The UK’s hospitality industry continues to face significant recruitment and retention challenges and this topic was extensively discussed at the conference. The latest Quarterly Recruitment Outlook report from the British Chambers of Commerce reported that 79% of hospitality firms were struggling to fill roles in Q3 2023. While this may be a slight decrease from the previous quarter’s (86% in Q2) the hospitality sector, is still the industry most likely to be experiencing challenges. Industry bodies attribute this to a combination of factors, including the aftermath of the coronavirus pandemic and the implications of Brexit. 

Shift in Revenue Metrics: From RevPAR to TRevPAR
A significant shift in the industry’s approach to measuring success was also evident at the conference. Total Revenue per Available Room (TRevPAR) has overtaken Revenue per Available Room (RevPAR) as the most important metric. This shift indicates a broader focus on the profitability of the entire stay, encouraging hotels to maximise opportunities for incremental spend. 

TRevPAR, unlike RevPAR, considers revenue generated from all departments of a hotel, including rooms, food and beverage, spa, parking, and other amenities. This comprehensive metric provides a more holistic view of a hotel’s financial performance, helping hoteliers identify areas where they can increase revenue. 

In terms of maximising opportunities for incremental spend, hotels are exploring innovative ways to merchandise their space. For example, transforming lobbies into chargeable co-working areas or converting dormant meeting rooms into extensions of the restaurant. These strategies not only increase TRevPAR but also enhance the guest experience by offering additional services and amenities.  

The Evolving Role of the Revenue Manager
The knock-on effect of a more holistic approach to total revenue metrics is the expanding scope of the hotel revenue manager. Traditionally focused on managing room rates and negotiating commissions on distribution channels, revenue managers are now at the forefront of strategic and commercial decision-making. With the influx of new data sets and technology, their role has become more sophisticated, requiring a blend of analytical skills, market research, and critical thinking. 

Revenue managers are increasingly seen as the hub of hospitality commercial teams, tasked with a wide range of responsibilities, including implementing and operating technology systems and aligning closely with sales, marketing, and e-commerce. They are expected to lead and solve complex problems, optimising profit while navigating the challenges posed by new data and technology. 

USALI: First Update since 2015
To further support this evolution, the conference also shed light on the most recent update to the Uniform System of Accounts for the Lodging Industry (USALI). This update, released late last year and the first since 2015, reflects the change in the industry over the past decade, with new schedules and categories for tracking financial performance. The changes included the introduction of the Energy, Water, and Waste (EWW) Schedule, expanded definitions for rate categories, and enhanced guidance for tracking costs associated with Guest Loyalty Programs. The advice from the financial specialists at HOSPACE underscored the importance of financial controllers becoming certified in the system. 

Keeping the Faith – Outlook for 2024-2025
Looking ahead, the industry’s outlook for 2024-2025 remains steady, with a focus on maintaining high rates and profitability. The expectation is that customers are willing to pay more for high-quality experiences that deliver a higher level of perceived value. This offers opportunities for driving incremental spend and repurposing underutilised space for additional revenue. Increased hotel supply in cities such as London, Edinburgh and Manchester will certainly challenge businesses to drop rates but with revenue managers holding firm so far, we may continue to see growth. 

Conclusion
HOSPACE 2023 provided a wealth of insights into the current trends and future directions of the hospitality industry. The discussions and themes resonated with those observed in similar events throughout the year, emphasising the importance of AI as a tool to enhance human work, the ongoing staffing challenges, the evolving role of revenue management, and the significance of financial tracking systems like USALI. As the industry continues to navigate these challenges and opportunities, the focus remains on balancing technological advancements with the irreplaceable human touch in hospitality. 

If you would like to discuss any of the topics that have been discussed here or any other elements of your people strategy, then please contact:  

 Chris Denison Smith at chrisdenisonsmith@fmrecruitment.co.uk / +44 208 600 1160

Andrea Shaw at  andreashaw@fmrecruitment.co.uk / +44 20 8600 1161

Tairona Lattanzi at taironalattanzi@fmrecruitment.co.uk / +44 20 8600 1164

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