The Olympics and the Hospitality Sector

This summer brings some important historical events with the Queen’s Diamond Jubilee (4-5th June), the Farnborough International Air show (9-15th July) and of course the much anticipated Olympics (27July- 12th August) and Paralympics Games (29th August- 9th September).

This will undoubtedly have a huge effect on the hospitality, leisure and retail industries in Britain.

Debates and discussions with regard to the hospitality sector have been ongoing since the UK won the bid to host the games in 2005, a monumental achievement as we last hosted the Olympics in 1908 and 1948. It is believed that the influx of people during this memorable summer will have a largely positive effect on London with optimism in the Hospitality Sector up to 53.5% according to HotStats Hotel confidence Monitor.

The positives include the chance to revamp Britain’s global reputation as a fast-food eating, loutish and unwelcoming nation. The aim will be to challenge, change and improve these views.

In terms of the hospitality sector, notably hotels in and around London, there is a concern in keeping the price right during and after the Olympic period. The key is to look at past international events, their successes and pitfalls and retrospectively learn from them. Booking hotel rooms, overbooking and attracting clients who will stay on post Olympics if possible are all major issues facing the hotel industry.

The London 2012 organising committee (LOCOG) ensures fair pricing by hotels, taking the average rate of the past three years and adjusting these prices according to inflation. However not all hotels have signed up to this scheme. By not signing up hotels are leaving themselves more open and independent to control their room bookings. This highlights one of the pitfalls of LOCOG in that hotels do not necessarily know where the business is coming from, the guest list and whether people will continue to stay on after the Olympics.

Very recently LOCOG released 120,000 of the 600,000 rooms it had reserved for the Olympics, the explanation for this is simply these rooms are being returned because they will not be needed.

LOCOG claim they are merely returning any surplus rooms for resale however there is concern that the rise in hotel prices would deter people from the capital, such as regular tourists that would visit the UK. Despite this hoteliers are remaining positive.

Overall the Olympics are undeniably a major event in the exposure it brings, promoting and creating improvements to the city. Approximately 11 million visitors are expected to descend on London this summer and there are new hotels opening in London specifically built for the Olympics, such as Holiday Inn, Stratford and Staybridge Suites, Stratford. Travelodge are also scheduled to open 11 more properties across the capital this year.