AAHOA Vice President Discusses How to Control Labor Costs
In keeping with this issue's theme of cost controls, HX: The Newsletter Editor Laura Koss-Feder spoke with lodging leader and AAHOA Treasurer Biran Patel on how to control labor expenses in today's competitive hospitality market.
Q. What are some new ways that you are managing labor costs and gauging employees' productivity at your own company?
A. We have a new technology platform called Lodging Controls. This software program helps us see when a housekeeper enters a room and also helps us track our engineers. We can see how long they are spending in each room, to make sure they are working efficiently. Most of our labor is housekeeping and front desk requests that go to our maintenance department.
Q. With turnover such a costly area for hoteliers, what are you doing and what do you recommend to curb employees leaving for another job?
A. Providing health insurance and incentive benefits are very important to help retain employees. We also recommend bonuses and paid vacation. Housekeepers, especially, can find work on their own cleaning homes and offices that may be more lucrative. But, they won't have the health benefits or other perks that an employer can offer. Health care insurance is so important these days.
Q. What are some other ways to cut back on labor expenses - such as in F&B?
A. More grab and go concepts and elaborate pantries or mini-markets in hotels are a great way to save. They are less labor intensive than needing to have people serve food.
Q. What about saving on front desk personnel?
A. You are seeing some of the lifestyle brands and boutique properties that cater to millennials offering out self check-in kiosks. This group of travelers is not as concerned about being personally greeted; they want to check in quickly and get to their rooms.
Q. What about cross-training staffers?
A. This can be very effective, and can save as much as 20 percent on labor costs. This is also important, since finding good labor can be difficult in certain markets. A front desk person can be trained to set up breakfast, for example.
Q. I'm hearing that relocations, which can be quite expensive, are down? Is that helping the bottom line?
A. I would say that relocations are down 10-20 percent from five years ago. Relocations are not just costly, but then you have to replace the individual who ha been relocated. Hoteliers now are trying more to retain good top talent, especially general managers and sales directors.
In addition to being treasurer of AAHOA, Patel has been an active member of the association since 2001 and has served on AAHOA’s board of directors since 2014. A native of Birmingham, England, Patel is a second-generation hotelier who started learning the hospitality business as a teenager in the family-owned hotel. He owns and operates multiple branded and independent hotel properties and is a partner in BHP Investment Company in Irving, Texas, which has nine properties.