2004/2005 B&B Trends and Statistics

What's on the horizon for the travel industry in 2005? A rising importance of the internet in your business approach because it is playing a bigger role in tourism and business success than ever before. Travelerrs are looking for more authentic experiences, traveling more frequently for shorter stays, and demanding value for their money. Improve your customer service, provide a quality experience, and get the word out about your bed and breakfast and thrive.

       The hospitality conference I attended in London was the usual eye opener for me. Being in Europe, the conference had a distinctly European focus with shared information regarding how the ten new members of the European Union are going to affect the economy and business.

       Part of the discussion was on the supply and demand of tourism and how the internet is impacting business. Though information gathered during the International portion of the meeting doesn't apply to you directly today, it will before long -- tourism is becoming more of a global market daily.

       The travel statistics on occupancy, room rates, and trends that I gathered from Randy Smith of Smith Travel Resources (STR) are of importance to you so I'll share those nuggets, translated to the B&B industry.

Project Attrition
       One area I hadn't heard discussed before was project attrition; projects that are dropped along the development path. The statistics mirrored my observations of what happens with aspiring innkeepers. Historic attrition for projects:

• pre-planning phase - 75%
• planning phase - 60%
• final phase - 15%
• under construction - 3%

Travel Trends
       Travelers are looking for an "authentic" experience, a trend I see as great news for the B&B industry -- especially the B&B inns that have focused on a carefully define market niche. At the same time, travelers are looking for value for their dollar spent, and because of Internet accessibility they will be comparison shopping. You can expect to see trips being shorter and more frequent, and booking more at the last minute.

       These trips will more and more frequently be booked by your guests based on Internet research rather than through a travel agent. There are more single people traveling, fewer kids, more pets, and the average age is increasing. The new acronym for your aging guest is SKI -- Spending Kids' Inheritance. Take note: the SKI generation is more demanding of quality. Because these are active, healthy people, you will also see your guests being interested in activities and wellness products (like spas and gyms).

       Overall you will see an increase in demand for quality, luxury goods, convenience, security, and relaxing recreational facilities. Because today's travelers are looking for value and quality, you will see an increase in your shoulder-season business too.

Travel Statistics
       There continues to be a growth in all sectors but the economy sector. For the B&B industry I translate that to B&Bs with shared baths and minimal guest services will suffer the most. The more a B&B offers in the way of luxury, privacy, choices, and a quality experience, the better it will do.

       Occupancy and room rates are increasing, slowly approaching those pre-9/11 numbers. Nationally the occupancy rate is about 60.5% and the average room rate is $85.24. The challenge in reporting such statistics is that there is an inconsistent recovery across the board for markets (urban versus rural versus resort) and segments (luxury to economy). Further, the rising cost of operating expenses like utilities and insurance is making an impact on profit. And the rising interest rates, or the threat of rising rates, will make it harder to get into the business and keep your budget manageable.

       However, the economy is in general looking up. Projections for 2004 2005 indicate:

• Disposable personal income will rise about 3.4%, money you can expect to see spent at your B&B
• Unemployment will drop
• Occupancy rates will increase about 1%
• Average room rates will increase to $86.03, an increase over what they were in 2000

Forum
       I have created a new tool for you to communicate with others who understand your business to share ideas, tips, and advice. I have added a Forum to my website, a place you can go to ask questions, share experiences, and just generally talk about whatever is on your mind regarding your B&B dream or reality. If you are a vendor, this is a great place to talk about your services, focused on how you can solve a problem for an aspiring or active innkeeper. Bobbi Zane, the editor and publisher of the Yellow Brick Road newsletter, will co- moderate the Forum with me. You have great resources available to you, just by registering as a user. Registration is required before you can post; it's free.

       To participate in this Forum, go to B&B Talk . Register as a user. Confirm your registration with the email that's sent to you. Jump in and talk.

Innfo Newsletter
       Because spam filters are getting more stringent as everyone's spam problems grow, I'm migrating the publication of this newsletter from email based to Internet based. I have found that 15-25% of my emails are getting rejected and want to try to reduce that number. I will email you an announcement that the newsletter is posted on my site so that you can go there to read it at your heart's content.

       My plan for informing you about the newly posted Innfo is via the membership on the Forum's Usergroup Innfo. After you register on the Forum (don't forget to confirm your registration so you can get in and post) you need to add your name to the Usergroup called Innfo. When I have posted the eZine to my site I'll email you to let you know it is there.

       I haven't decided if I will continue to publish Innfo through Topica or not. To be sure you continue getting this eZine and you want to be on the announcement list, register on the Forum now (you have to click on the link that is emailed to you before you're an active member) and then add yourself to the Innfo Usergroup. Do it now, before you forget. This way you'll be sure to always know when a new issue is posted.