Every hotel general manager wants to increase the bottom line of the hotel to provide more profits for ownership. After room revenue, resort fees, banquet room rental, and food and beverage income, what else is there? Well, a massive profit center is staring hotel managers right in the face every day. However, in most cases, it is not even on the radar as an income producer for the hotel. The space we speak so reverently about is something every property has… the hotel lobby.
There are two ways to generate significant income in a hotel lobby:
- Sellable meeting space
- Food and beverage
Sellable Meeting Space
Most hotel lobbies are already business friendly, but with some light remodeling, that same lobby space can become usable office space for business professionals that are either working from home or traveling.
Work spaces have turned into a business model all on their own. When you look at companies like Regus, they are in essence selling a hotel lobby to business professionals. The difference here is that as a hotel, you have much of what they desire already in place. However, the challenge is to get them to use a charged meeting space rather than just plop in a chair in the lobby.
I recently stayed at a property that had this business model down pat. In addition to free and open lobby space, the property had glassed in a small portion of its lobby to turn it into a mecca for a business professional. Personal desk space, individual TVs, a coffee and snack station, printers, internet access, just about everything one would need in one convenient place. In addition to all of that, they also offered food delivery through room service.
This “optional” office space was offered at check-in for a small daily “resort fee.” At first, I will be honest, I figured I would work from my room and be quite comfortable, probably what most of us think when we are on the road. However, after two days of having to work out of my room, I needed a change, so I paid the fee and relocated to the office “lounge.”
Not only was the space much more comfortable, it also enabled me to network with other business professionals. Being in town for several more days, I happened to notice several people using the space that were not even hotel guests. The daily rate was far cheaper than what Regus and other daily office spaces were offering, and the amenities were far better. This was a previously empty lobby space that was now generating four figures a day, at least five days a week, for the property. It was like adding 10 rooms to the inventory that you know are going to sell out each and every day.
Food and Beverage
Why more properties do not have lobby bars and offer food and beverage to guests in this setting simply does not make sense. Some brands, such as Marriott, have completely embraced this business model. In some cases, there are even self-service wine and beer bars for lobby guests.
Making use of this space could be as simple as adding a dedicated server to make offerings to lobby guests or actually creating a food and beverage outlet in the lobby to be used during higher occupancy days that can take some pressure off the main bar and restaurant.
Going the route of the former, simply adding table tents with appetizers and specialty drinks can create the curiosity factor that gets guests interested in ordering food and drink in the lobby. Keep in mind, the dishes served out there, or at least suggested, should offer a visual impact that will generate even more interest from others in the same area. Think of it as a high school dance… you only need to get one person on the dance floor to open the floodgates.
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Photo By monkeybusiness