The Hindu : Karnataka / Bangalore News : Hospitality sector has unwelcome visitor

Online edition of India's National Newspaper
Wednesday, Nov 19, 2008
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Karnataka

Karnataka - Bangalore

Hospitality sector has unwelcome visitor

Chitra V. Ramani

Slide is gradual and measured in swish hotels but it is business as usual for the small ones

Bangalore: The effect of the global economic slowdown can be felt a little more locally. While many corporate giants are crying hoarse about the effect of recession, many sectors are bearing it silently and hoping for better times. The hospitality sector is one such, as revealed by a random check.

Harinder Singh, General Manager, The Grand Ashok, said that while the occupancy at the five-star hotel had not been affected yet, the restaurants have had fewer customers. She said that many of their clients have been approaching them to reduce room rates. “There has been a slight dip in the number of foreign tourists. Bookings for corporate parties have reduced by 25 per cent, while new bookings are low. We have been informed by many companies that only very important travel is being allowed, and this may be reduced further due to recession.” However, the real impact of recession can be gauged by the future bookings over the next few months, she said.

The situation is not very different at The Oberoi, another five-star hotel in Bangalore. According to Prashant Kundnani, Director of Sales, the usage of conference halls has reduced to a certain extent. But the slide is gradual and measured, not drastic. However, he maintained that the dip in occupancy percentage has been marginal, even as the trend was noticed since August this year.

“The Oberoi primarily caters to business travellers. The influx of foreign tourists is almost negligible as Bangalore continues to be a business hub. The reduction of foreign tourists does not significantly impact our business as our business travel patterns continue to be buoyant,” he added.

Anand Rao, Area Manager, ITC Hotels, Bangalore, said that while the occupancy during November has been fairly satisfactory, there has been a dip in the duration of stay of foreign tourists on business trips. “However, there is a visible reduction in the usage of conference halls, catering and restaurant usage, as many corporates are cutting down on costs,” he said.

Nitienaa Arif, head, PR and Communications, The Leela Palace Kempinski, said occupancy had reduced marginally since July this year.

She also said that the usage of conference halls, corporate parties and catering by corporate companies had seen a marginal decrease of two per cent since then.

Seasonal fluctuations

K.N. Vasudeva Adiga, president of Bangalore Hotels’ Association, maintained that the occupancy rates at many of the high-end hotels had witnessed a drastic reduction. The restaurant business of lower-end hotels was not affected, though they continued to experience the seasonal drops and highs. He also said that catering sector had seen a slump with many corporates asking the hotel chains to reduce prices.

P.C. Ram of Ideal Solutions, which caters food to many IT companies in Bangalore, said that they had been approached by many of their clients to cut down on their rates. “We cannot reduce the rates owing to the increase in the cost of essential commodities. We have asked companies that are cost-cutting to remove a few “extra” items from their lunch menu, such as sweets, fruits and salads,” he said.

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