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Indian hoteliers have only begun focusing on non-room revenue streams. From banqueting to spas Hotelier India finds out which areas rake in the big bucks.

While non-room revenue is no brainwave, in the context of Indian properties, non-room revenue opportunities such as banquets, spa and F&B from the local market emerged as focus areas only when the recession adversely affected ARRs.

Jaideep Anand, general manager, Ista Hyderabad estimates that the contribution of rooms to revenue over the past two years has slid by approximately 10 percent. On a positive note however, he points out that another key factor contributing to this trend is a growth spurt in consumer spending, which means that hoteliers at least have their eye on the right target.

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On a similar note, Vivek Kumar, CEO, Sahara Star says, “Sahara Star has recognised that while the guest is very conscious of the cost of accommodation and could shift preferences for a few hundred rupees, he will willingly shell out a few thousands on just one evening at a bar, discotheque or restaurant.

So once you ensure that he spends within the property, you can still earn from him. This can be achieved by innovative F&B arrangements that also work as a draw for the local market which has many restaurants to choose from.”

Nischint Vaid, director of rooms, Courtyard by Marriott, Mumbai International Airport estimates that non-room revenue at their property, for instance, hovers between 30% and 40%.

Chief operating officer of Taj’s Gateway hotels, P K Mohankumar explains their focus on non-room revenue saying, “When a person says that he is visiting the Taj, it could be a housewife who is visiting the salon, a teenager going to the discotheque or a local business person attending a conference or meeting at the hotel or even someone visiting the cake shop to purchase a birthday cake – all of these are our opportunities to earn non-room revenue.”

Banquets and meeting rooms
“Banquet revenues have seen an aggressive growth primarily from the MICE segment,” Anand continues. The Westin in Hyderabad also shares this experience.

“We have a lot of staff working on targeting and servicing the conference market,” shares Amarinder Sadana, revenue manager at the Westin Hyderabad Mindspace.

In Mumbai, the JW Marriott, which is currently renovating its eight year old product, is counting on their renovated meeting rooms to attract corporates considering the increased demand from corporates despite the increased number of hotels (and therefore more banqueting space available) in the north Mumbai belt.

“More corporate business directly corresponds to more revenue. While we cannot accommodate the larger conferences as we have smaller banqueting spaces, we trust that the new meeting rooms to be ready by April will allow us more corporate business,” informs Guy Godet, general manager, JW Marriott, Mumbai.

According to Sadana and Anand there is also immense scope for high end social events. Sadana says that Hyderabadi weddings have huge budgets therefore presenting another lucrative market, which most hotels in Hyderabad thrive on.