Has business been feeling slow lately? Despite the influx of customers, has it been more difficult to breakeven? Don’t worry. You’re not alone.
2018 wasn’t a good year for business, particularly in the hotel industry. Recent statistics show that there was a hotel profit plunge by at least 5%. The factors which led to the dip in profit have been traced back to increased labor and overhead costs.
With this in mind, hotel owners may want to backtrack on the profitability of their property and start reconsidering their options. If you’re a property owner who hasn’t fully decided on what to do with the recent dip in hotel profitability, then the following statistics may make you start taking positive action:
A Recent Plunge
Data shows that the decline in the profitability of hotels has been gradually increasing through the years, but was never more so felt in November of 2018. November marked the third month of the previous year that US hotels experienced a declining profit, marking the steady decrease in profitability of hotels and the interest of clients to avail of their services.
Causes for the Drop in Profits
However, the cause of the 2018 plunge isn’t all about the declining interest of clients. In fact, client interest has remained throughout the years. What has truly pulled down the profit of hotels is the labor cost and increasing overhead costs of hotel maintenance. With this in mind, hotel owners should begin to ask themselves whether keeping their property is worth it, or whether there are more viable actions one can take to remain maximizing their profits.
Next Steps
If you’re reluctant about the remaining value of your hotel property, it may be best to start talking to hotel brokers who can assess the value of your property and help you find a worthy buyer who will give you your hotel’s price in return. A hotel for sale by owner is highly lucrative in the market and may attract many potential buyers.
Knowing your value is essential in leveraging your property in the market. One thing you’ll need right away is the right brokerage firm to talk to. If you’re still struggling to find your worth and are unsure of how to get your property on the market to interested buyers, NewGen Advisory is the firm for you. Our brokerage firm ensures only the best services for all of its clients, ensuring a win-win situation for everyone.