Under the best of circumstances, running a profitable and effective food-and-beverage operation in hotels can be a challenge—and the past few years have hardly been the best of circumstances. In a recent virtual roundtable sponsored by Entegra and hosted by Hotel Management Magazine, several industry insiders shared their tips on how hoteliers can improve their margins, increase profitability and regain efficiencies in time and labor.
With 130 hotels, primarily in the full-service sector, Remington Hospitality has “to do a great job in beverage and food to deliver on guest expectations and also drive profitability,” Chris Green, the company’s president, said, noting that the company calls its division B&F rather than the more popular reversed acronym. “We've really been leaning into what's happening in beverage spaces, and making sure that we align our menus on a quarterly and annual basis and also our purchasing to go along with what's happening in this I would call it the nouveau beverage kind of forward environment.”
Justin Jabara, president of Meyer Jabara Hotels, predicted that 2024 would be an “exciting year” for the company’s food-and-beverage scene. One of the company’s biggest launches in 2023 was the development of a food and beverage team that “almost” stands independently of the hotel operations team. “The way that we view it is they're not restaurants and bars that are in hotels,” Jabara said. Instead, they are “restaurants and bars that are, by chance, in a hotel and associated with a hotel.”
Koji Akaboshi, corporate director of food & beverage at Salamander Collection, agreed with the importance of strengthening food and beverage by treating the sector as independent from other hotel operations. “That is something that we're going to be focusing on in the coming year.”
Martin Schellenberg, VP of enterprise business development at Entegra, said that localization has become increasingly important to customers. “There has been a bit of a shift in purchasing behavior as to where things are coming from,” he said, noting that many food-and-beverage professionals are looking to purchase locally rather than from large distributors.
Staffing has been an industry hurdle for years, but Akaboshi said Salamander is now seeing increased interest from jobseekers. Retaining employees, however, is the new challenge to overcome, especially when workers do not feel inspired or feel overwhelmed by the pace of the job. Jabara agreed, and said his company also is “spending a large amount of time and training and investing” in team members.
Akaboshi sees training as a key way to keep team members engaged and coming back day after day, but acknowledged that finding the budget to both train workers and pay them a living wage can be tricky.
Balancing a budget can also be challenging as new pricing patterns emerge, according to Green. “We've reached kind of the pricing frontier on some things as we head into 24,” he said, noting that some costs are still continuing to rise. “My biggest concern is if we can continue to drive performance through pricing controls,” he said. Jabara also agreed with this sentiment. “Our ability to outprice inflation is starting to dwindle,” he said. “The pressure on margin is becoming ever more prominent, especially in 2024. … Our ability to purchase and control cost is paramount to our success in ’24.”
While the supply-chain crisis that dominated headlines for a time has largely resolved, it left an impact, Schellenberg said. “Operators have learned how to manage their inventory,” he noted, suggesting that keeping minimal inventory on hand is giving way to focusing on the high-volume items that are used the most. And while supplies may not always be available when expected, “our distributors are able to deliver on the expectations of our operators, almost in the 90th percentile today,” he said.