Several people have asked this ancient innkeeper for his views on what the future looks like for the hospitality industry. As Mark Twain said in Following the Equator: “Prophesy is a good line of business, but it is full of risks."
I cannot claim to predict the future, but my years of experience in the hospitality industry have taught me a few things about managing uncertainty by leveraging what we know for sure and bringing highly complex situations back to the basics.
We all know that tourism is our beautiful country's greatest asset. Not only is it of increasing appeal to international travellers, it’s a key driver of our local economy, employing vast numbers of people across the employment spectrum.
The well-known phenomenon of the tourism multiplier effect sees whatever is spent on accommodation increase tenfold as others benefit downstream. It is conservatively estimated that we employ 1,5 million people across the hospitality and tourism sectors.
I firmly believe in the power of breaking down complex thoughts into simple ideas, so allow me to put forward a basic scenario to you: Imagine a bathtub, with water flowing in through the tap and out via a plughole.
Assume now that this bath, when full, represents 100% of the rooms at all the tourist accommodation establishments in South Africa. In our scenario, tourists (be they local, regional or international) flow in through the tap.
When they leave, they do so via the plughole, but the bath is usually 50%-75% full of tourists at any one time. In mid-February 2020, the tub is approximately 70% full of tourists. By March, a catastrophic event occurs, and the plug is removed with a single, unprecedented yanking. All the water drains from the bath in a devastating blink of the eye.
Usually, the water would be replaced by the tap simply being turned on through an array of brand awareness and strategic price and product promotions, stimulating the flow of more water into the tub.
As a result of COVID-19, the tap was welded shut – and remains so until today. The bath is now completely empty of water. As a result, people across our country, but particularly in our industry, are retrenched, debts are not settled and many hospitality businesses – and their suppliers – are facing insolvency.
Exacerbating the problem are the inevitable drastic price cuts we are about to see, limiting these establishments’ ability to recover lost revenue and sustain renewed overheads. Whilst the owners of hospitality establishments agree on an intellectual level that slashing prices is financial suicide, many are understandably so desperate that they will do absolutely anything to attract potential guests.
A positive of this is that local and regional tourists will have a once-in-a-lifetime opportunity to enjoy the many wonders that South Africa has to offer for a fraction of what it would normally cost. With this in mind, it is my fervent hope that the government will recognise the willingness of the hospitality industry to implement the health and safety measures required to turn on the taps and welcome local tourists to their establishments immediately.
This is the first step towards re-filling our proverbial bathtub, stimulating income for this key sector of our economy and allowing our accommodation establishments to recoup lost income, helping prices to stabilise to sustainable levels.
It is imperative that we commence discussions on how to practically open our borders to international travellers. We already have enough of a challenge trying to persuade potential tourists to visit South Africa because of fears both rational and imagined.
Having our global competitors operate when we are closed is just another – avoidable – nail in our tourism coffin. It’s time to open the taps. Colleagues across the hospitality industry join me in our steadfast commitment to implementing the requisite health and safety measures necessary to protect our guests to the very best of our ability.
My plea to our President is to open local air travel and borders immediately and work with leaders across the hospitality and tourism industry to implement the infrastructure required to welcome our international guests back imminently.
The future of our industry and the livelihoods of the millions of its hard-working employees lies in our ability to reopen our doors to travellers as quickly, safely and collaboratively as possible. I for one am ready and waiting to turn on the taps, wrench and heart in hand.
Arthur Gillis’s career in the hospitality industry started at the coalface. He qualified at the South African Hotel School and worked his way up in just ten years from assistant purchaser at a Cape Town hotel to ceo of Protea Hotels. Arthur has been active in all facets of the hotel industry, which itself makes a massive contribution to the South African economy.
On April 1, 2014, Marriott International purchased Protea Hospitality Holdings’ three brands and management company, which had 130 hotels in eight African countries, and had 16 000 associates.
Gillis is now ceo of Platinum Hospitality Holdings, a hotel owning company.
