Finance & DevelopmentFinanceReport: Hotel F&B Programs Will Continue to Thrive in 2018

Report: Hotel F&B Programs Will Continue to Thrive in 2018

CHICAGO—A recently completed report from Technomic, a research and consulting company for the foodservice industry, indicates that the hotel food and beverage space will continue to grow this year. The report forecasted a 5 percent increase in consumer spending in 2018 as demand for hotel F&B programs remains strong.

The hotel food and beverage space has experienced 5.5 percent annual growth since 2011. Last year, overall consumer spending increased 4.9 percent—spending at hotel restaurants, bars and lounges, banquets and catering, room service, in-room minibars, and other F&B areas totaled $48.7 billion in 2017.

The report also found that local and regional F&B offerings are more in demand. Featuring local products, including adult beverage brands, has helped hotels compete against restaurants in their areas. Hotels are also increasingly reinventing themselves to focus on social and community spaces. Many new hotels are putting emphasis on flexible lobby and outdoor areas that can help boost social interaction, attracting both guests and locals to their spaces.

Hoteliers are also placing more emphasis on upscale, casual-dining experiences. Upscale eateries appeal to a wider array of patrons and enhance the overall dining experience.

“Hotels use their food and beverage programs as competitive differentiators and are investing to drive unique guest experiences,” explains David Henkes, senior principal, Technomic. “As more options appear for consumers, not only in new and emerging types of hotel properties but also in alternative channels like Airbnb and VRBO, having a strong food and beverage program is more important than ever for continued hotel success.”

According to the Technomic report, banquets and catering are the primary drivers for hotel programs, accounting for nearly 40 cents out of every dollar spent at hotels. These programs account for an even larger part of the overall revenue at upscale and luxury properties that cater to both personal and business events.

Other areas that are receiving more focus at hotels include grab-and-go areas, such as lobby pantries and kiosks; breakfast areas; bars/lounges; and preferred guest lounges that help create a unique amenity for higher-status guests. Hotels are scaling back on traditional F&B offerings such as minibars and room service. However, the report found that breakfast remains a critical touchpoint for hotels and a daypart where hotels can reach more guests.