Expert perspectives from MGC Global

1.  Focus of risk assessment | The best measures of your risk exposure emanate from (a) the interdependency of your business with the travel/tourism (domestic, inbound and outbound; in all verticals - leisure, MICE, heritage, adventure and niche) and aviation sectors; (b) duration of lockdown restrictions; (c) price elasticity of your customer; and (d) business sustainability (operationally and financially) apart from the robustness of your business model. However, we recommend that you update your risk assessment at an enterprise level.
2. Strategy | Re-assess your strategy for providing experience (such as cuisine, cocktails, weekly menus, etc for home delivery) in the short term, a flexible cancellation policy with loyalty benefits in the medium term; and over a longer term your digital strategy, marketing assets and processes to set your hotel up for future success in the new normal. For those who are facing the big challenge to survive, assess your ability to integrate your business model with the healthcare sector in the short to medium term; and the impact of shifting focus to lower-funnel flow with a realignment of the target demographics with relatively stronger feeder markets. Proactively plan for the rebound in travel demand, to make up for lost revenue.
3. Marketing | Stay connected with guests (past and targeted) through social media and emails with editorial content that recreates an experience with your property. Launch programs with benefits to followers, who share inspirational photos of your property with their most preferred activities in your property and share virtual tours. With tasteful messages and themes, you can retain and enhance your brand positioning.
4. Operations | Maximize revenue by focusing on upselling ancillary services: Increasing ancillary revenue will be critical to success once the COVID-19 pandemic subsides. Create experiential packages with dining and spa inclusions and market your ancillary offerings in unique ways - this will help your hotel increase its average booking value.
5. QHSE | Prioritize your efforts on health, safety, social distancing, housekeeping, cleanliness (including public areas) and digitization (use technology for contactless check-in/check-out and keyless room entry).
6. SOPs | Reengineer your SOPs ensure that these are the state of the art, incorporate enhanced digitization and complete compliances with new regulatory directives and guidelines. Promote the new SOPs through marketing channels to give your guests comfort.
7. Finance | Your businesses is capital intensive (typically debt, which needs to be serviced by payment of interest on debt and repayment of debt) and has high fixed costs. Evaluate the impact of COVID-19 in preparing and reporting your financial statements for the year ended March 31, 2020 and projections (inventory measurement, impairment of non-financial assets, provisions, contingent liabilities and contingent assets, going concern assessment for self, customers & vendors, income taxes, borrowing costs, post balance sheet events & interim reporting).
8. Human resources | Preventive measures in the context of employee health and safety are imperative. Your biggest reputation risk may lie within. 
9. Information technology | Assess the capability of your IT systems and working practices to ensure security and confidentiality; adherence with privacy norms (such as GDPR); enhance the processing integrity of information and data; and optimize availability of your platforms, hardware and software. Cyber-attacks and data theft are on the rise. 
10. Inventory | Update your inventory management parameters (including stocking levels), with emphasis on back end supply chain integration. Assess going concern issues relating to stakeholder in your supply chain.

In case you would like to discuss the above or any other aspect relating to risk management and business transformation, please write to MGC Global Risk Advisory LLP at [email protected].

 DISCLAIMER

The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. It is not meant to be considered a substitute for professional advice in any manner and no one should act on such information without an appropriate and thorough examination of situations that would be specific to the reader.