According to a report in 4hoteliers.com, industry-wide discounting by Phuket hotels cost the industry in Phuket USD 300 million in room revenue in 2009, as per the Phuket Hotel Market Update report. Room rate cuts averaged 20 per cent across the board last year, leading to the loss compared to 2008 room revenue. Despite tourism arrivals rebounding back to 2007 levels, a key blow to fundamental hotel metrics hit profit margins.
Bill Barnett, Managing Director, C9 Hotelworks, author of the report, mentioned that the 2 P's - Pricing and Pool Villas - represented dynamic drivers as average room rates and revenue available per room (RevPAR) declined. “Bottom lines have been hit as hoteliers scrambled to induce demand and meet increasing consumer pressure for lower rates. Virtually every chain scale tier was affected with the exception of the budget and economy segment,” added Barnett.
The Phuket Hotel Market Update summarised that 2.9 million tourist arrivals visited Phuket in 2009 with an island-wide average occupancy of 64 per cent. Average rates and revenue per occupied room slumped by 20 per cent and 22 per cent versus 2008. |