The Colombian hotel market is currently in a price war with ADR falling, occupancy flat, room supply growth exceeding demand growth. The forecast is for this to continue with chains entering the market using a discount price penetration strategy. The government is giving tax breaks to stimulate investment. It’s an economic recipe for profit loss for the thousands of small independent hotel owners.
OTAs are thriving in this environment and over-reliance on them and price discounting by hotel management is problematic. In order to achieve sustainable profitability, what is needed is a long run vision by owners, managers and OTAs to improve the situation for all.
View Dr. Carroll’s presentation HERE
This presentation was given at several universities, the Columbia Hotel Association and several events sponsored by some consultants in the area. An associated paper prepared for Cayuga Hospitality Consultants also makes this point.
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