Friday, January 9, 2009

How's trade?

Where are the traditional NZ family spending their holidays?

In talking to a few "Motellas" around the traps it would appear that demand isn't as intense as it has been in previous years.

There seems to be a definite change in the mix of people traveling at the moment. We have been hosting an increase of comfortable retirees, Gen Y couples, overseas family and couples visiting, newly immigrated families and couples, and a few one-off stays from couples and families that are not so well off - but are treating themselves.

We have found that the traditional middle class family group of Mum, Dad and 2-kids have been conspicuous by their absence. New Zealand's new beneficiaries, the middle-class "Working for Families" subsidised honky family appear to be doing some navel gazing at the moment and are not confident to load up the credit card with motel accommodation at the beginning of an uncertain year.

Disappointingly, we have also found a decrease in quality longer stay bookings. More holiday makers appear to be less willing to commit and are more likely to chance their arm by turning up unannounced, stay for one night and moving on.

Many "Motellas" will be consoling themselves with the return of a few sales reps from the 5 January. Business trade is the backbone of the motel industry and hopefully rep trade will be able to be sustained through 2009 as businesses try to maintain sales.

A quick scan at reveals that many commercial accommodation providers are already cutting rates to unsustainable levels. To start this strategy at the peak of the holiday season is madness.

A key focus for the motel industry in 2009 will need to be sustainable yield management and quality.

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