Discounting by hotels helped to attract more visitors in February, according to preliminary hotel figures released 19 March 2013 by PKF Hotel & Hospitality Consultancy Services.
In London, a 7.3% drop in room rate to £111.79, compared with £120.54 a year earlier, resulted in a 4.9% increase in occupancy from 74.7% to 78.4%. Rooms yield consequently fell by 2.7% to £87.68, compared with £90.11 in February 2012.
In the regions, room rate was reduced by 9.5% from £59.13 to £53.52, which drove a 10.9% rise in occupancy to 71.7%, compared with 64.6% a year ago. The result was a 0.4% increase in rooms yield from £38.20 to £38.36.
Govinda Singh, Director for Hotel & Hospitality Consultancy Services at PKF, commented: “With the economy remaining in the doldrums, hotel operators across the country have shown that they are increasingly willing to discount and offer packages to tempt customers through the door. The results suggest that this tactic has had a degree of short term success for many of them.
Stop gap but not long term solution
“This type of skilful revenue management can be an effective stop gap measure but it’s not going to provide a longer term solution to the challenges facing the hotel sector. I’m sure that the industry will be urging the Chancellor to use his Budget to introduce measures to kick-start the economy and help strengthen business and consumer confidence.
“Measures tailored specifically at the hotel and hospitality sector – such as a potential reduction in the rate of VAT on labour intensive services like catering – will also be welcomed and could provide a much-needed boost to the industry’s top line.”