5 Steps To Help You Minimise Risks To Your Hospitality Business

We don’t need to tell you that it’s a challenging time for the hospitality industry – after recovering from the pandemic, businesses are now hit with increased operating costs, staff shortages, and growing demand. And there’s no waiting about. In this blog, we’ll detail how businesses can act swiftly to minimise threats.


1. Identify and analyse the risk
 
First, you need to establish what risks your business is actually facing – and how likely they are. We suggest a scale: low to moderate, medium, and high probability. You should also examine the impact severity on your business.

With this analysis, you can prepare effectively – even for those unlikely risks with significant effects. The COVID-19 pandemic is the perfect example. Many organisations weren’t prepared, especially in the hospitality industry, and are still grappling with the repercussions.
 
2. Share the risk
 
A key strategy is to spread the risk with others. Consider partnering with vendors or service providers to minimise impact. During the pandemic, many restaurants that had never offered delivery before joined forces with companies like Deliveroo and Uber Eats. Likewise, some supplied meal kits – a trend that hasn’t disappeared.
 
3. Expand your target audience
 
Appeal to a wider audience to become less reliant on one specific segment. For instance, hotels have historically concentrated on wedding and corporate guests. But, as you’ll know, these aren’t the only reasons for an overnight stay. They can attract a broader market by engaging other audiences, like families and young travellers.
 
4. Devise new revenue streams
 
Relying on one income source is like putting all your eggs in one basket – a risky move. Consider how you can diversify your offerings and add value to your existing services. A good example would be ‘workcations’, providing leisure activities and space for remote working – a trend many hospitality businesses have already cottoned onto.
 
5. Monitor your risks
 
Identifying and putting your plan of action in place isn’t enough. Risk management means staying ahead of the curve and keeping an eye on specific variables. You might need to adapt your strategy, respond to new risks, and tackle threats as they occur to avoid chain reactions and serious repercussions.
 
Minimise risk with the right support
 
Here at Nabarro Poole, we understand it’s a tough time for the hospitality sector. We can support you with our dedicated accountancy services for hospitality businesses. Our budgeting and forecasting can help you reduce risk and thrive despite the present challenges.

If you’d like our support or have any questions, get in touch with our friendly team.