The hospitality industry encompasses a wide range of services from hotel accommodation to restaurants to event planning to theme parks, among many others. A sector experiencing buoyant growth, hospitality and tourism spending is a large part of the Australian economy, with almost three quarters of hospitality businesses having indicated anticipating an increase in profitability over the next few years. This is being driven by factors like high occupancy rates for hotels, and increased demand from key emerging international markets.
Like most industries, the hospitality industry faces economic challenges and is particularly vulnerable to fluctuations in the exchange rate which can make Australia expensive for international tourists and make overseas holidays cheaper than domestic ones for Australian customers. The industry also suffers when consumers become more conservative with their leisure spending in uncertain economic times. Our consultants however are experienced in advising businesses on how best to stimulate the domestic market and adapt to the changing domestic demographics influenced by, for example, the ageing of Baby Boomers and the concomitant increase in the Grey Nomad market sector, or the influx of technologically-savvy Millennials into the market.
Understanding and adapting to technological change is vital, with many businesses in the sector increasingly pursuing an online model—for example, hotel rooms are now chiefly a web-based commodity, which allows smaller operations to reach bigger audiences and enhancing marketing efforts. Technology also enables businesses to implement dynamic pricing models in response to changing demand patterns.
One of the most pressing issues confronting the hospitality industry is cybercrime. The industry relies heavily on processing credit card details and often has poor security in place, resulting in potential payment system vulnerabilities and data breaches, presenting opportunities to hackers. Operators also must be compliant with the Payment Card Industry Data Security Standards (PCI DSS), which can be challenging since hospitality businesses frequently use a multitude of discrete systems (eg reservations, accounting, sales, food services, and often integrating the external systems of retail merchants). As well as advise on technology generally, we can help you manage the challenge of cybercrime by providing strategies for improving IT security support and increasing security awareness amongst employees.
Another challenge for the hospitality industry is sustainability. Energy costs are expected to multiply over the next few years, so businesses must increasingly invest in energy-efficiency in order to provide attractive returns. Here, our consultants are also able to advise on options and strategies.
As with many other industries, human capital is an ongoing challenge in relation to staff training and retention, and issues like penalty rate structures. Further, specific to this industry, the use of the transient labour pool at seasonal leisure destinations is likely to be greatly affected by the new Government regulations regarding working holidaymakers/backpackers. Our consultants are able to advise you on how best to manage