F&B prices harming Dubai

Room rates may have dropped at many Dubai hotels over the past year, but with F&B prices still high many believe the disparity between accommodation costs and the price of a meal is impacting the emirate’s standing as a destination.

According to Frederic Bardin, senior vice president of Arabian Adventures and Congress Solutions International, F&B has long been a sticking point among tour operators.

“It’s almost impossible to eat at a moderate price if you stay in a nice four- or five-star hotel,” he noted. “My impression is that in the past, some hotels, if not the majority, have taken advantage of the in-house clients and put prices up to levels that were too high.

“Now that seems to be changing; we saw a lot of F&B promotions coming up in the last quarter of 2009. I just hope we’re going to see continued improvement in 2010.”

Dusit Thani Dubai executive chef Flemming Schulthess argued that guests were “always looking for an experience, considering criteria such as quality and personalised service”, and asserted that price was not the main deciding factor.

But, as Bonnington Jumeirah Lakes Towers director of operations Martin Kubler pointed out, value has become a central customer consideration.

“I think in the past hotels felt they could put up prices, but the rose-tinted glasses have come off now; firstly because there are fewer tourists and secondly because the clientele has changed,” he said.

“Now we’ve got to look at the needs of the market, and consumers today want value for money.”
The answer may lie in hotels offering all-inclusive packages for guests; but such promotions have traditionally been viewed as ‘low-quality’ options in certain parts of the world — would they work in the top-end Dubai market?

Arabian Adventures’ Bardin insisted it would. “The issue is that the hotels that really want to do this have to be flexible; you need to give people what they want. And all-inclusive doesn’t have to mean low quality, or all-buffet; it’s what the property makes it,” he said.

Indeed, Mövenpick Hotels and Resorts recently unveiled what it claimed was a first for Dubai — a pre-paid all-inclusive offering at its top-end Royal Amwaj property on The Palm Jumeirah.

Surprisingly Rixos Hotels, known for its all-inclusive resort hotels in Turkey, will not offer a similar package at its hotel on The Palm, scheduled to open this year.

Ottoman Palace by Rixos director of business development Yanal Abaza explained: “Dubai has a lot of attractions and we don’t want to limit our guests’ dining experience.

“However, Rixos’ all-inclusive concept is very interesting and in the future it might be considered for Dubai.”

Despite how such packages may have been perceived in the past, it looks like all-inclusive options would be a successful option for the emirate.

As Arabian Adventures’ Bardin pointed out: “By over-charging for F&B, [hotels] are doing a disfavour to the destination. It would be to Dubai’s advantage to introduce the [all-inclusive] concept.”