Hotel Turnaround Consulting

Is your hotel under performing? do you want it to be turned around?

There are three things that make for a successful business.

  • The first is desirability. If people don’t want or need what you offer, you have a fundamental problem.
  • The second is profitability. If people love what you provide but it costs more to make than you can sell it for, you won’t be around for long.
  • The third is longevity. There’s no point making a fortune today if you lose it all tomorrow. If you sell all your rooms a day, the more days you sell all those rooms, the better.


These three goals are interdependent. Desirability without profitability doesn’t work, and you can’t have longevity without the other two. A smart business decision is one that increases all three, or takes an informed view about the trade-offs between them: a little less desirability for a massive profit hike might be OK, but take that too far and you compromise your longevity when your customers swap to an alternative.

The real difficulty is that you must make decisions about these three goals while the landscape is constantly changing. A business is like a boat floating on the ocean, with currents moving it one way and the wind blowing it another. One minute the water is calm, the next huge waves are crashing over the bow. To keep a boat on course you must consider these factors when navigating.

The same is true with business decision-making, where, broadly speaking, change is experienced within three distinct categories.

  1. What customers want and how they behave can change. Since without customers you don’t have a business, paying attention to these changes is paramount.
  2. Market conditions can also change. New rivals emerge, categories grow and decline, new government regulations come into effect, any of which can impact your success.
  3. Finally, the organisation – the business itself – is always changing. As your business develops, you will find that your capabilities, strengths and weaknesses change. Maybe you have a larger workforce and more cash than you used to, but you aren’t as nimble as you once were, for example.


Now for the interesting part. We’ve got three goals: desirability, profitability and longevity. We’ve also got three changing layers: the customer, the market and the organisation.

Because everything in a business is interconnected, each layer can affect each goal: a change in competition can affect our profitability for example, or a change related to our customers might make our products less desirable.

Every business is in a constant state of flux. The environment is always changing – sometimes a lot, sometimes a little – and so is the business itself.

Whenever the revenues of a hotel start declining, the management team of such underperforming asset all too often resorts to a singular focus on cost cutting to offset dropping revenues of the hotel. This results in a further downward spiral for the hotel.

Business thinking has always been based on an analytical approach: breaking things down into small pieces, then studying them in isolation. The problem is that everything in a business is interconnected – the whole doesn’t behave like the sum of its parts.

Because most frameworks are based on this traditional, reductionist view of the world, they don’t show you how your actions affect the business as a whole, so you may make decisions that have unintended consequences. You might cut costs in the hope of making a bigger profit, but accidentally make your products less desirable by reducing their quality.

The net result is that you sell fewer rooms and become less profitable, not more. You might make changes to your brand designed to appeal to new customers, but end up alienating existing customers and cause them to leave.

How do you find out if your hotel business needs a turnaround?

There are several reasons why hotels underperform. Look out for the following signs in your hotel’s business:

  1. There is a steady or even a sharp decline in occupancy. You think that it’s the market to be blamed but then find out that your competitors are doing good.
  2. More than 70% of your business comes from third party channels
  3. You end up paying over 35% (on an average) of your room revenue in commissions
  4. There is a fall in your ratings on trip advisor and other review sites
  5. There is a high staff turnover
  6. Your regular guests say that “your service standards are not what they used to be earlier”
  7. The most common method used to sell rooms in your hotel is by increasing discounts and lowering room rates
  8. You have to spend frequently on the room upkeep and your maintainance costs are on the rise
  9. There is a lack of cash flow for capital improvements, employee training and sales efforts.
  10. Guests call your reservations to tell them how otas are offering lower rate for your room and ask you to match them if you want the booking
  11. A walk – in guest comes to your lobby and enquires about the room rate. When your staff offers him the best rate (approved by management) the guest checks the OTA sites on his phone and goes ahead to book the same room through the OTA, while at your hotel and you have no choice but to accept the booking.
  12. Guests who stay at your hotel hardly have any meals in your restaurant. (besides the complimentary buffet breakfast of course…)
  13. You have a low rate of repeat guest bookings
  14. It’s high season time and you expect to cover up for the lean season gone by. Your hotel gets sold out first in the market. You are obviously happy but then realise that your competitors sold the rooms at a much higher rate than you.


Do any of the above scenarios look familiar to you? Are you experiencing these in your hotel? If your answer is yes, then know that its time for an overhaul…

Hotel Turnaround Consulting

Is your hotel
under-performing?
Do you want it to be turned around?

There are three things that make for a successful business.

  • The first is desirability. If people don’t want or need what you offer, you have a fundamental problem.
  • The second is profitability. If people love what you provide but it costs more to make than you can sell it for, you won’t be around for long.
  • The third is longevity. There’s no point making a fortune today if you lose it all tomorrow. If you sell all your rooms a day, the more days you sell all those rooms, the better.

These three goals are interdependent.

Desirability without profitability doesn’t work, and you can’t have longevity without the other two.

A smart business decision is one that increases all three, or takes an informed view about the trade-offs between them: a little less desirability for a massive profit hike might be OK, but take that too far and you compromise your longevity when your customers swap to an alternative.

The real difficulty is that you must make decisions about these three goals while the landscape is constantly changing.

A business is like a boat floating on the ocean, with currents moving it one way and the wind blowing it another. One minute the water is calm, the next huge waves are crashing over the bow.

To keep a boat on course you must consider these factors when navigating.

The same is true with business decision-making, where, broadly speaking, change is experienced within three distinct categories.

  1. What customers want and how they behave can change. Since without customers you don’t have a business, paying attention to these changes is paramount.
  2. Market conditions can also change. New rivals emerge, categories grow and decline, new government regulations come into effect, any of which can impact your success.
  3. Finally, the organisation – the business itself – is always changing. As your business develops, you will find that your capabilities, strengths and weaknesses change. Maybe you have a larger workforce and more cash than you used to, but you aren’t as nimble as you once were, for example.


Now for the interesting part. We’ve got three goals: desirability, profitability and longevity.

We’ve also got three changing layers: the customer, the market and the organisation.

Because everything in a business is interconnected, each layer can affect each goal: a change in competition can affect our profitability for example, or a change related to our customers might make our products less desirable.

Every business is in a constant state of flux. The environment is always changing – sometimes a lot, sometimes a little – and so is the business itself.

Whenever the revenues of a hotel start declining, the management team of such underperforming asset all too often resorts to a singular focus on cost cutting to offset dropping revenues of the hotel.

This results in a further downward spiral for the hotel.

Business thinking has always been based on an analytical approach: breaking things down into small pieces, then studying them in isolation.

The problem is that everything in a business is interconnected – the whole doesn’t behave like the sum of its parts.

Because most frameworks are based on this traditional, reductionist view of the world, they don’t show you how your actions affect the business as a whole, so you may make decisions that have unintended consequences.

You might cut costs in the hope of making a bigger profit, but accidentally make your products less desirable by reducing their quality.

The net result is that you sell fewer rooms and become less profitable, not more.

You might make changes to your brand designed to appeal to new customers, but end up alienating existing customers and cause them to leave.

How do you find out if your hotel business needs a turnaround?

There are several reasons why hotels underperform. Look out for the following signs in your hotel’s business:

  1. There is a steady or even a sharp decline in occupancy. You think that it’s the market to be blamed but then find out that your competitors are doing good.
  2. More than 70% of your business comes from third party channels
  3. You end up paying over 35% (on an average) of your room revenue in commissions
  4. There is a fall in your ratings on trip advisor and other review sites
  5. There is a high staff turnover
  6. Your regular guests say that “your service standards are not what they used to be earlier”
  7. The most common method used to sell rooms in your hotel is by increasing discounts and lowering room rates
  8. You have to spend frequently on the room upkeep and your maintainance costs are on the rise
  9. There is a lack of cash flow for capital improvements, employee training and sales efforts.
  10. Guests call your reservations to tell them how otas are offering lower rate for your room and ask you to match them if you want the booking
  11. A walk – in guest comes to your lobby and enquires about the room rate. When your staff offers him the best rate (approved by management) the guest checks the OTA sites on his phone and goes ahead to book the same room through the OTA, while at your hotel and you have no choice but to accept the booking.
  12. Guests who stay at your hotel hardly have any meals in your restaurant. (besides the complimentary buffet breakfast of course…)
  13. You have a low rate of repeat guest bookings
  14. It’s high season time and you expect to cover up for the lean season gone by. Your hotel gets sold out first in the market. You are obviously happy but then realise that your competitors sold the rooms at a much higher rate than you.


Do any of the above scenarios look familiar to you? Are you experiencing these in your hotel? If your answer is yes, then know that its time for an overhaul…

We can help you turnaround your hotel business. Here's how:

At Divine Hospitality Consulting, we believe that a hotel turnaround is a improvisation process with a holistic approach. It doesn’t matter what your strengths and weaknesses are today. It matters whether they are getting stronger or weaker, and what they will look like tomorrow.

Unlike most tools, which force you to take a ‘snapshot’ of the current situation, we help you to identify what is changing, and why. We see the world as dynamic and constantly changing, and help you to make decisions based on the direction in which you’re travelling, not your current location on
the map.

Our Hotel Turnaround Consulting provides you the mental scaffolding to help you:

  • Evaluate and refine product and service ideas
  • Reduce risk by considering the broader impact of strategic decisions
  • Identify the root causes behind business challenges
  • Anticipate the impact of changes in the market and turn them to your advantage
  • Collaborate more effectively across the hotel departments and teams


It’s an all-inclusive solution that helps you to optimize:

  • Quality of your asset
  • Your brand positioning
  • Service delivery
  • Precise and detailed revenue forecasting
  • Margin controls tied to forecast models
  • Revenue generation and increasing bottom-line profits


We treat your business as a single, interconnected system that is inseparable from its environment. We give you the entire picture, allowing you to manage conflicting goals, consider trade-offs and make decisions that improve the overall success of the business, all of which that separates the great from the good.

We can help you turnaround your hotel business. Here's how:

At Divine Hospitality Consulting, we believe that a hotel turnaround is a improvisation process with a holistic approach.

It doesn’t matter what your strengths and weaknesses are today. It matters whether they are getting stronger or weaker, and what they will look like tomorrow.

Unlike most tools, which force you to take a ‘snapshot’ of the current situation, we help you to identify what is changing, and why.

We see the world as dynamic and constantly changing, and help you to make decisions based on the direction in which you’re travelling, not your current location on the map.

Our Hotel Turnaround Consulting provides you the mental scaffolding to help you:

  • Evaluate and refine product and service ideas
  • Reduce risk by considering the broader impact of strategic decisions
  • Identify the root causes behind business challenges
  • Anticipate the impact of changes in the market and turn them to your advantage
  • Collaborate more effectively across the hotel departments and teams


It’s an all-inclusive solution that helps you to optimize:

  • Quality of your asset
  • Your brand positioning
  • Service delivery
  • Precise and detailed revenue forecasting
  • Margin controls tied to forecast models
  • Revenue generation and increasing bottom-line profits


We treat your business as a single, interconnected system that is inseparable from its environment.

We give you the entire picture, allowing you to manage conflicting goals, consider trade-offs and make decisions that improve the overall success of the business, all of which that separates the great from the good.

Ready to begin the transformation of your hotel business?

Your hotel is a valuable asset. We can help you turnaround your hotel into a profitable business

Do you to want get your business back on track, and grow faster?

We can help! Get in touch with us today to schedule a
no – obligation initial meeting to know more about our hotel turnaround consulting services.

Ready to begin the transformation of your hotel business?

Your hotel is a valuable asset. We can help you turnaround your hotel into a profitable business

Do you to want get your business back on track, and grow faster?

We can help! Get in touch with us today to schedule a
no – obligation initial meeting to know more about our hotel turnaround consulting services.