adverse impact of lockdown on Hotel industry
Yash Sapra, INN/Gwalior, @infodeaofficial
Lockdown has indeed created a disastrous effect on the aviation and hotel industries resulting in which they are seeking the government’s help.
If we look ahead the hotels will have to either shut down or run in a very limited manner as per the reports the government has also asked these industries to not to lay off staff and not cut the salaries and wages of the employees and workers working there these industries have drastically gone very sick until and unless you have the external source of capital like holding company.
Many big hotel companies such as ITC group, LEMON TREE group, ROYAL ORCHID, and many more have adversely been affected by the current situation resulting in which their market share has drastically been down.
Already a maximum of hotels is on huge loans so they have to pay a lot of interest and also have to work hard for the repayment of debt. Hotels are also labor-intensive so they have lots of fixed costs which include wage bills besides paying government levies, minimum load charges, among others.
As per the old scenario the hospitality industry on an average witnessing 65 percent to 75 percent or full occupancy, till the end of February each and everything was absolutely fit and fine with the industry and even the first few days of March was fine but when the things starting accelerating and came to the correct path this severe condition of lockdown and pandemic badly triggered the industry at the end of the March which also resulted in the sudden breakdown of the occupancies in the hotels.
Due to some of the money. The industry has already faced a mass – scale cancellations for all travel bookings and hotel accommodation and will continue to do so in the months to come. Some hoteliers don’t see this sector reviving anytime before October 20.
It has also been stated in a report by the Confederation Of The Indian Industry that frequent lockdown and shutdown in this industry have also been expected until the month of December 2020 which can bring this industry to a great threat.
According to a study, it’s known that the hotel industry contributes to about USD 118.9 billion to USD 335.7 billion which is almost 8.8% to 9.16% from 2010 – 2020 and if this industry lacks business it may also affect the economic growth.
