‘LOCAL HOTEL SECTOR FACING SUPPLY GLUT’

Corporate business has an abundance of choice with new players, says Traders Hotel

THE hotel industry is facing a tight squeeze for corporate business as event planners are more price-savvy because of the abundance of choices available in the country.

Traders Hotel Kuala Lumpur general manager Christian Nannucci said the trend was not due to ringgit fluctuations, which only had minor impact, but because of the new hotels opening in the city, all offering many options and price points.

“The market is very saturated because of the opening of too many hotels, hence stifling demand. There is now less demand and too much supply, creating a price war,” he told NST Business recently.

Nannucci said globally, the leisure market was on the decline.

“This will definitely impact the bottom line of hotels as many are still dependent on the traditional leisure market. These customers spend not only on rooms but also buy food and beverages in the hotel,” he said.

To a question on hotel demand and disruptive technologies such as AirBnB, Nannucci said it did not have any major impact as the hotel market’s targeted clientele was different.

“AirBnB is targeted at millennials who travel for leisure rather than business.

“Business travellers still prefer hotels as they provide full service and amenities for them to enjoy a hassle-free stay,” he said.

Touching on technologies driving modernisation in the hotel industry, Nannucci cautioned that issues such as rate parity would be never-ending when technology becomes more and more sophisticated.

He said, however, that other technology requirements, such as online booking and room control systems via mobile apps, were now being adopted around the globe.

Nannucci said the core focus working areas for hotels to achieve increased cost savings and to boost efficiency in all areas of operation was in consolidation of services, investing in technology and multitasking.

“Technology creates innovation. These are areas that we may look into in the future,” he said, adding that Traders Hotel had just launched its mobile app, which will enable its members to make mobile bookings, check in/check out, manage membership accounts for the hotel’s loyalty programme and points redemption.