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Hotel Management - Work With Thy Neighbor

Jon Sholter


Today, in less than 3 minutes, we are going to cover the following: Why your relationships with your neighbouring hotels are underrated.

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Competition in the hotel industry is fierce.

We are consistently being benchmarked against each other, and unfortunately, there is only one top spot. With constant comparisons, sometimes rate integrity, relationships and trust go out the window.

How do you combat this spiral?

The Golden Rule

Work With Thy Neighbor

Over civilizations, the world has become more peaceful due to increased trade and interconnected best interests between nations.

Even when you look at recent conflicts, most of the countries involved in those conflicts do not actively work or trade together. Of course, this rule is not absolute and has exceptions. However, the fact remains, working together builds trust and mutual benefit.

If you want to minimize all the negatives of competition, then perhaps finding ways to work with your neighbouring, competing hotels might be your answer.

What negative actions might be minimized?

Labour Competition: No one likes to get top talent poached from their properties within their market. Would your neighbouring hotel do that if a strong working relationship was formed?

Rate Competition: Of course, you cannot fix rates with your competitors. This being said, there can be an improved market understanding when hotel leaders communicate with each other. There can also be some friendly callouts if someone is doing their best to destroy any sense of rate integrity.

Sales Competition: No one likes getting their clients poached and undercut. Building relationships with fellow hoteliers may keep the competition healthy instead of cutthroat.

What kinds of activities can I do to build this relationship?

Friendly Conversations: Coffee, lunch, phone calls to ask questions and build relationships. These shouldn't be daily activities, but they should be worked into your quarter, diligently.

Mutually Beneficial Contracts:

Perhaps negotiating with neighbouring hotels to gain more buying power with local suppliers. Items such as security and parking lot maintenance are contracts that may make sense to collaborate on, among others.

Sales Overflow: If you're filled up, it only makes sense to help your client find a hotel. We know this has risks, but it may be worth it if you have built enough trust between your neighbouring properties. If you leave the client out to dry, they may find a place and not return in the future. If you help them find another hotel, at least the law of reciprocity might play a role in the client's and the competing hotel's future considerations.

Hotel Management

Does working with your neighbours mean you'll create a utopian hotel market? No, but it may help.

Is there always going to be that outlier Owner/Manager/DOS that leaves you scratching your head? Yes, but focus on what you can control.

Your bottom line and your market ADR will thank you.

As always, thanks for reading.


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