What are the trends in procurement in the Middle East hotel industry for 2015?
One of the key trends in procurement is the move towards a paperless technology with more web-based purchasing and online procurement. However, while procurement software such as Market Boomer will streamline the process, I believe this will encourage more of a focus on price rather than quality with buyers opting for the best price rather than the best quality.
Also known as green or sustainable procurement the idea of responsible purchasing is one that is going to be a major consideration in the years ahead.
As we all become more environmentally aware we need to look beyond the traditional factors of quality, price and stock availability and buy products that are environmentally green with a lower carbon footprint.
Procurement is considered the backbone of the hotel, and it is becoming more efficient with the use of the right technology accompanied by a well-thought out strategy and centralised standards. The challenges ahead lie in the increased supply of hotels in Dubai as this will make it challenging to negotiate better rates. In addition increasing costs in the supply chain in general will be reflected in the cost of items. Since 90% of food and drink goods are imported Horeca, is obliged to buy imported goods that are more expensive and often lacking in taste of locally grown items.
Will any new locations emerge within the destinations in which you operate in 2015 and beyond?
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Dubai is currently expanding beyond the existing boundaries and we see further opportunities coming up around the new TECOM developments and around the Jumeirah Village and the Jebel Ali area because of the port, free zone and expansion of Dubai World Central. Other areas to watch are the rejuvenation of the Deira waterfront and the key areas of Abu Dhabi: Saadiyat, Yas Island and Reem Island.
We see the same in Muscat where there has been a positive growth in hotel performance, further promoting hotel investment across the city particularly along the coast and inland towards the airport and the proposed new airport. Likewise, the same trend has been supported by the government and ministry’s initiatives in ensuring the infrastructure and the ease of doing business. Saudi Arabia has taken a similar direction, not only within its key cities but also in secondary cities where we see the conversion of small airports into national and regional airports, further allowing transportation and accessibility to various future offerings.
Our Park Inn by Radisson brand has been able to respond positively to this trend and we are now taking advantage of this momentum to strengthen our presence in key markets and secondary areas. Of particular interest is the northern expansion of Riyadh and Jeddah’s eastward expansion inland, and northward expansion towards the expanding airport.
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