Has there ever been a more exciting time in the hotel industry? As we present Hotelier’s annual Top 35 Hotels issue, there’s an incredible surge of activity taking place. From bold acquisitions to the launch of new brands, momentum has been building for the past few years, bringing renewed energy to this dynamic industry.
This year’s report is historical in the sense that it may be the last one to feature Canadian-born juggernaut Four Seasons Hotels & Resorts in the number 1 position. For years, even though Four Seasons operated only two properties in Canada, the Top 35 Hotels listed Canada’s most famous hotel brand in the top position because it was Canadian-owned and operated. But as of late last year, Canada’s hotel darling broadened its reach and is now part of a new global family controlled by Bill Gates (through his company Cascade Investment LLC), Prince Alwaleed bin Talal (through his company Kingdom Hotels International), and Canadian hotelier Isadore Sharp, through his minority ownership role. Those changes mean that as of next year, Hotelier will report only Four Seasons’ revenues from its Canadian properties. Similarly, the acquisition of the Fairmont brand by Kingdom Hotels and Colony Capital LLC means Canada’s other global giant will also be reporting just the Canadian sales of its brands.
But what’s life if not for the changes that keep everything fresh. From technological advances revolutionizing the business to the pervasive greening now taking place across all industry segments, there has never been a more interesting time to be a hotel guest.
Similarly, increasing globalization and the availability of capital bode well for future development. But there is a caveat on the road to growth. As companies add properties at a breakneck speed and reach for record profits, there’s sometimes a tendency to forget what the hotel biz is all about — satisfying your guests.
As author Chris Zook says in his current bestseller, Unstoppable: Finding Hidden Assets to Renew the Core and Fuel Profitable Growth, reviewed by Diane Brady in a recent issue of Business Week, in today’s ever-changing environment businesses risk failure when they realize their tried-and-true-formula to success no longer works. So what should they do? According to Zook, it’s important to interpret what’s happening in the marketplace and what it means to your core business. “X-ray your organization for hidden assets,” he says, and adapt accordingly. Zook identifies those hidden assets as new segments, geographic markets and services, or support services and non-core businesses.
Not surprisingly, in today’s fast-paced world, his advice to companies is to make changes swiftly, cautioning that, “Only one in 10 companies achieve even a modest level of sustained and profitable growth over a decade, and that percentage is declining over time as the growth cycle speeds up.”