India might be the new China
Week 16 - Revenge travel really isn't that great. Eco practices make businesses work better and more this week!
TLDR: Too Long Didn’t Read
Revenge travel is maybe bringing business in, but 2019 levels are haven’t arrived yet. You can now sleep in an ex-Mussolini torture sight (the wonders of tourism). India might become Apple's new production hub, and your next big tourist groups might come from there. The war in Ukraine might be over soon or at least some peace talks can start. Kenya’s hotel owners are more likely to financially succeed if trying to implement eco-friendly practices (finding from a recent scientific paper)
1. Main Hospitality News
Germans might allow more migrating to cover the dirty jobs. Revenge travel is not that exciting. IHG might move offices to US. Thanks to the power of tourism you can now sleep in an ex-Mussolini torture prison.
The International Hotel Association in Germany has around 1,400 members from the individual, chain, and cooperative hotel industries, representing over 20% of the hospitality interests in Germany. They are a trade association representing the hospitality sector's interests in politics, media, and the economy. The Chairman of the board welcomes the recent advancement of the Skilled Immigration Act for qualified professionals (starting in 2020) but emphasizes the importance of prioritizing personnel with previous experience in the hospitality industry to address concerns regarding personnel shortages in Germany. Here is the statement in German, if you fancy it.
Revenge travel is apparently still a thing, yet 2019 numbers still have not been reached (Source). Guests spending money on travel, because they couldn’t during the pandemic. Whether it is all actually revenge travel or not, is hard to prove. Importantly we are still at 90% of 2019 levels and according to some the financial crisis has only started. Overall, not much of revenge.
IHG’s shareholders have asked the InterContinental Hotel & Resorts’ CEO Keith Barr to consider switching the listing from the London stock market to New York’s exchange, for sources and factual details read here. He is currently not actually considering the switch but urged the Londoner authorities to encourage more liquidity and to loosen regulations to make the marketplace more attractive. Even dough the Americas, are its most prominent regional market by both revenue and operating profit and IHG currently trades “cheaply” at a current multiple of 13, in comparison to Marriott (14 multiple) and Hilton (nearly 16).
Where cruel crimes were once committed in the name of Mussolini, wealthy vacationers can now enjoy their time out. On the small island of Mamula off the coast of Montenegro, a former torture prison has been converted into a luxury hotel. This has met with massive criticism from relatives and activists. The critical voices state that it should be a museum and a memorial for relatives of the victims. Make up your own opinion by reading the German article.
2. Externalities
India is growing, soon to become another economic world power, Russia might lose the war soon enough. Sudan is collapsing under another civil war. Twitter has listened to its users and restored blue ticks that previous “opinion leaders” had, even though Musk seemed pretty sceptical about it.
Remember that war going on in Ukraine and how it has likely impacted the entire Western trade routes and supplier sourcing? Well, it might be over sooner than expected. It all depends on the new Ukrainian offensive, which can force Russia into peace talks that will inevitably normalize how the rest of the world functions. Who knows, we might even forget how Putin wanted to take over an entire country and start trusting him and his affordable oil prices again.
In the spirit of last week’s news, India is in our scope again! Apple has opened their first 2 official shops in Mumbai and Dehli. There are also talks of India overtaking China in becoming apples export manufacturing centre. India has not only overtaken China in population growth but is also in a good direction to do so economically (or at least come close). Remember translating all your brochures to Mandarin? Well, you might want to do that to… oh right India has 22 officially recognized languages, so just stick with English for now.
3. Academia
India is last in digitalization amongst world economic powers and tourism might change that. Kenya’s hotel owners are more likely to succeed if trying to implement lean-green practices.
In the spirit of this week's core topics India and the digitalization of hospitality, we found a recently published scientific paper on how the Digitalization of India might be led by tourism. The authors argue that India’s digitalization might be led by the tourism sector. A counter-intuitive conclusion, considering how the industry has done everywhere else in the world.
Another very interesting study has just emerged in Kenya. Looking at SME hotels, the researchers have found a correlation between implementing lean-green practices in hotels and the success of the business. This a finding that especially peaks out, considering how likely an SME might go bankrupt in Kenya. The study does not go into other business practices that might isolate the lean-green strategy as the only factor that is impacting any business’s bottom line. Nonetheless, it potentially indicates that if owners care about more long-term factors like eco-friendliness they are more likely to succeed.
4. Readables
Books, podcasts & the big stuff.
Know nothing of this new potential market where you might be sourcing a large chunk of your income called India? We recommend “The Argumentative Indian”, a very complex yet enlightening take on what makes India, India.
5. Tips & Tricks Tools & SaaS
Any new software you can use? Industry tricks you missed? All of that summarized below once a week.
A few industry “experts” have commented on the Metaverse and how should hotels benefit from this new form of social media. If you are interested, check out more here.
Contactless tech. has upgraded from being a trend to being something guests are expecting. Hotel companies were sold a million new solutions to make their own hotel “truly” contactless and (btw) less staff intensive. A recent take on how to actually solve this problem for hotels relies heavily on getting a high-quality base (a PMS that integrates anything else and automates connections seemingly). More on that here.
How does one know if the economy is about to collapse? Apparently, there is a list of indicators stock investors look for when trying to answer this question. Find the list here.
