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Hotels during the coronavirus pandemic: The measures hotels should be taking to overcome the crisis

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#Corona crisis - Support | Last updated: On Apr 06, 2020 at 01:05 PM

Hotels are particularly affected by the restrictions caused by the novel Covid-19 virus. Guests are staying away due to the state-mandated contact ban. And there is still no end in sight for this pandemic yet. We have summarised various measures in this article that hotels should be taking now to compensate for the financial losses being incurred during this coronavirus crisis.

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Author: Support-Hospitality | 5 Article
Gastronomy expert

The coronavirus crisis means that most hotels are sitting empty, except for very few guests. No income. But wages, rents and loans still need to be paid. Hoteliers must react to this drastic situation to avoid slipping into insolvency.

Create an overview of running costs

What expenses are due over the next 90 days? Hoteliers need to gain a rapid overview of these expenditures. Loan payments may also be due. Make a start right here, talk to the bank and ask for a deferment of payment. Initially, try to arrange a deferral of ongoing loans for three months. As good customers and punctual payees, hotels should have a strong negotiating hand when it comes to banks demonstrating goodwill at this critical time.

Apply for state aid

Many countries are offering companies financial assistance and emergency aid if they are suffering financially due to the coronavirus pandemic. (We explain what emergency aid is available in Germany, and how to apply for it, here).

Check your service providers and suppliers

Which services are really essential at this time? Which services could be reduced or even cancelled? Is a gardener really necessary at the moment or would it be OK to re-employ him/her regularly once the crisis is over? Can waste disposal costs be reduced? And what about ongoing contracts for copiers, computers, cash register systems, etc.? Hoteliers should also check which deliveries, for example, food or beverages, could be reduced or even put on hold for a while.

Dealing with employees

Good employees are a primary asset in the hotel business. But they are also a high cost factor in this crisis. Hotel operators should check in how far employees can still be kept on – if necessary, also in functions that do not normally form part of their working areas. If things do get difficult financially, it may help to send employees into short-time work (we explain here how to apply for short-time work in Germany). The state then pays a part of their wages. In exceptional cases, businesses need to consider temporary redundancies in order to keep their business afloat in these difficult times. Employees are then financially supported through unemployment money and can be re-hired once the coronavirus crisis is over.

Maintaining communication

Hoteliers should not cut off communications with their customers. Social media channels and newsletters should be used to keep guests informed about the current situation. We have listed a few tips here about keeping sales going during the crisis.

People in the neighbourhood should also be considered as potential customers. Does someone need a quiet workplace because concentration is difficult in a home office situation? Does someone need to go into self-isolation and has no relatives to provide food and drink? Or do university/medical facilities need sleeping quarters for their employees? Hotels can be a haven, even for risk groups and can therefore provide important support for the community right now. 

Putting the crisis to effective use

Hoteliers can ask themselves, particularly if they have large hotels, whether it would be a good idea to close a wing or floor to reduce expenditure for cleaning, electricity, etc. Could this time of crisis be used to carry out maintenance work or renovations that would otherwise be a problem when the hotel is full or which have already been in the pipeline? Are there any ways and means for the hotel infrastructure to help other people during this crisis? Even though hotels are currently facing serious economic challenges due to this pandemic, they will emerge stronger if they show sympathy and responsibility at this time.

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