The Refinishing Touch Blog

Recession has taken a toll on a number of industries, including, as we’ve touched upon here, the hotel business. Companies that have weathered the storm have found unique ways to maintain customer loyalty. Among the businesses that have managed to stay afloat? The modern day jam band.

Bands like Phish and moe. have established a business model that is almost entirely different than other artists. They don’t sell many records, they keep concert prices low and they encourage taping at their show. Although this might seem to hinder the band’s success, when Phish announced a tour in March 2009, it had 10 million requests for 400,000 tickets at $50 each. By keeping tickets relatively inexpensive, Phish promotes a community concert experience. Devoted fans can travel to shows at a fairly low cost, and do it alongside their peers. This experience keeps Phish fans coming back.

Hotels are charged with the same task: generating loyalty amongst travelers. By giving customers what they want, they will return, and what more and more travelers want are environmentally-friendly facilities. If hotels are trying to meet customer demand, establishing green practices isn’t a bad place to start. Battling unfavorable economic conditions requires thinking about more than short-term gain, but about cultivating long-term relationships and financial viability. Taking steps to become environmentally conscious sounds like it fits the bill.

‘Widespread Panic’ is a jam band, not a prognosis for the hospitality industry. Hotels, like jam bands, can learn to appeal to customers and keep them coming back.

Labels: consumer trends, economy, Environment, Going Green, Hotel Industry

As the economy as a whole continues to recover from last year’s recession, individual industries are facing their own unique hurdles to overcome. The hotel industry is no exception, as noted by the recent decline in the Hotel Industry’s Pulse index (HIP), the real-time monthly composite indicator of business activity throughout the hotel industry, similar to a GDP measure. This includes indicators such as revenue generated by consumers staying at hotels and motels, room occupancy rates and hotel employment. Despite increasing by 2.8 percent in December of 2009, the HIP fell in January, signaling a slight hiccup in the hospitality industry’s economic recovery.

Still, this slight drop doesn’t mean that the hotel industry is heading for another sharp decline. As with any recovery effort, there are going to be bumps in the road, with some months seeing an improvement whereas others see decline. Although January saw a slight decline in the probability of business improvement when compared to December, it still saw a strong probability for improvement of 96.4 percent.

The HIP is a useful indicator of the timing and degree to which the hotel industry and the U.S. business cycle sync, and with December historically seeing a bigger boost in consumer travel, it makes sense that January would fall slightly in comparison. As the hospitality industry continues to improve and learn from the lessons of last year’s economic difficulties, the HIP is sure to reflect those changes with increasing numbers and a more positive outlook.

Labels: HIP, Hotel Industry Pulse index

Last week the world’s foremost winter athletes descended on Vancouver, kicking off the 2010 Winter Olympics. These Olympics see the realization of more than 12 years of careful planning, and then, only 16 days after they began, they’ll be gone.

The city of Vancouver will be left with more than sporting memories though. In these past 12 years, Olympics planners haven’t just been structuring events schedules and sketching logos; they’ve also been determining what kind of legacy they want to leave in British Columbia. The Vancouver Organizing Committee for the Games (VANOC) took a big step in crafting that legacy by creating the Sustainability Stars program, which recognizes initiatives by sponsors, partners and VANOC itself that promote social, economic and environmental sustainability.

Sustainability Star awardees thus far include Purolator, which created a battery-operated electric delivery vehicle called the Quicksider for Vancouver’s couriers. The Quicksider generates 99 percent fewer greenhouse gas emissions than traditional courier vehicles. The City of Vancouver’s LiveCity Yaletown project, paved with recycled rubber tires, also earned a star. More sustainable than brick or asphalt, the pavers will be used in other parts of the city after the Games end. Teck and the Royal Canadian Mint’s Metal for Medals program is another star recipient. Teck provided metal from e-waste as part of the winners’ medals, created by the Mint, for both the Vancouver Olympics and Paralympics.

Vancouver and the rest of the world will see its share of memorable performances and world records over the course of the 2010 Winter Olympics, the kind of moments that stay with spectators for a long time. These memories are to be cherished, but the Sustainability Stars program ensures that that Vancouver will see its Olympic legacy throughout the city, in tangible, environmentally-conscious ways.

Labels: 2010, Environment, Green, Olympics, Vancouver

Since 1985, the Foundation for Environmental Education (FEE) has operated Blue Flag, an ecological certification program for beaches and marinas. To date, 3,355 beaches and marinas have received this sustainable development award. The North African country of Tunisia recently received its first six of these, and this number appears ready to increase.

To keep pace with the growing sustainable tourism sector, Tunisia’s minister of Environment and Sustainable Development, Nadhir Hamada, launched an emphasis on beach protection. This endeavor has already proven fruitful; in addition its six Blue Flags, Tunisia has five more beaches in a trial period for certification.

As a growing tourist hot spot for many European travelers, Tunisia’s push for Blue Flag certification appeals to a burgeoning group of eco-conscious travelers.

The Tunisian campaign for tourists can’t lose. Even if travelers don’t take to Sousse and Tunis in droves, the country and its beaches will have undergone a change for the better. Tunisia, if not the most popular vacation destination, can be the most environmentally viable.

In early January, the Obama administration announced an award of $2.3 billion in Advanced Energy Manufacturing Tax Credits, designed to stimulate job growth in the clean energy sector. While the government’s plans are commendable, they need help to succeed. Despite willing workers and an influx of funding, the clean energy movement has been slow to get off the ground. Furthermore, because the term ‘green job’ in the eco-friendly energy sector has such a vague definition and is not held up to any real standards, employers can label any job a ‘green job’ without worrying about accountability.

On top of that, many clean energy projects have been sprouting up, but often without actual jobs in tow. For example, a 36 thousand acre Texas wind farm seemed poised to create a number of jobs, using $1.5 billion of stimulus money, but the project, financed by China’s Shenyang Power Group, fell through. Although it required nearly 3 thousand workers, only 15 percent of those would have been for citizens in the United States.

Luckily, creating green energy jobs while adopting environmentally friendly practices has become a top priority for the government, and the pieces for creating a fruitful clean energy sector are there: a willing administration, an International Labour Organization that sees value in going green, stimulus money and opportunity. With more time and some redirected efforts, decision-makers can take these factors and help turn possibility into actuality.

Labels: Clean energy, government, green efforts, Green energy, Green Jobs

Today we’re excited to introduce Stephen Smoke as our first ever guest blogger. Stephen is an accomplished writer who has penned 28 books, the latest of which, Cathedral of the Senses, will be published this spring. He’s also written and directed feature films, including “Street Crimes,” starring Dennis Farina. Most importantly, Stephen is an old friend of our CEO and founder, Mario Insenga.

We’ve always admired Stephen because of his views on personal and corporate responsibility. His Bill of Responsibilities series of books, which includes The Corporate Bill of Responsibilities, highlights how it is important for both individuals and corporations to recognize the social, economic and environmental impacts of their actions, and provides a guide on how to act in a manner that will benefit everyone. Stephen was nice enough to compose a blog post for us in which he describes how, even early on, he and Mario believed in social responsibility and environmental commitment, and how not much has changed in three decades.

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Corporate Responsibility and the Environment…in the Real World
By Stephen Smoke

In what seemed like another incarnation, Mario Insenga and I were roommates thirty-five years ago in Toledo, Ohio. Although we hadn’t spoken since then, we had experienced some of the best times of our lives together. Recently he tracked me down via the Internet and we arranged to meet in Los Angeles. Since we’d seen each other, I’d written nearly 30 books, most of them novels, and Mario had founded The Refinishing Touch and built the business into one of the most successful and environmentally-conscious companies in the world.

A Google search revealed that Mario’s clients included the U.S. government, Hilton, Marriott and Westin, among many other well known companies. I streamed a clip of him being interviewed on the Discovery Channel about how his company refurbished existing furniture, on site, in a unique and environmentally-friendly way. Furthermore, I learned that his exclusive refurbishing method resulted in a savings of up to 80% on replacement costs, while dramatically decreasing any negative environmental impact that would result from manufacturing and shipping new furniture and disposing of the old furniture. Finally, I read an interview with him in the Wall Street Journal.

When we got together a few months after our initial phone conversation, it seemed more like three days than three decades since we had last seen each other. We laughed about old times till tears ran down our cheeks. Although we had taken different paths and our lives had been shaped by people and events we could not have anticipated so many years ago, when our paths crossed again, we were still friends.

Even back in our halcyon days we felt strongly about the importance of personal responsibility and environmental stewardship. Therefore, it was not surprising when our conversation turned to talk of the environment and personal responsibility. The difference between our college days and now was that now we spoke not from a purely ideological or theoretical point of view, but from a practical, “real world” perspective.

“I put the green in green,” said Mario one night over dinner at a sushi place in Santa Monica. “Lots of companies want to do the right thing for the environment, but then they look into it and determine that going green will hit the bottom line hard. I believe—and I’m living proof of this—that doing the right thing for the environment can also result in increased profitability and sustainability.”

I knew that Mario was “green” decades before it was fashionable to be green. And the more we talked the more I realized he was pretty much the same “save the planet” guy he was back in the day. One important difference was that he now ran a successful, environmentally-conscious business with offices in several cities, a warehouse, and employees all over the world. He was walking the walk, not just talking the talk.

“It’s not about decorating your company PR with ‘green speak,’” Mario continued. “It’s about understanding ‘sustainability’ and how to manage existing assets. Instead of automatically tossing out assets, whether they’re furniture or personnel, consider how to manage those assets or re-purpose them. Not only is it cost-effective, it makes sense for the environment and for your employees.

“I’ve actually seen people drop high-end desks out of a second-story window because they didn’t want to spend the money to dismantle them, or take the time and effort to donate them. Sometimes outdated tax regulations encourage companies to buy new ‘things’ rather than manage existing assets and recycle in a smart way.

“The current financial situation causes people to think differently. Now clients are very interested in saving 80% on replacement furniture, and at the same time they’re genuinely interested in decreasing any negative impact on the environment.

“Another existing asset that can be managed is personnel. Not long ago I needed to hire someone to do in-house marketing. Instead of looking outside the company, I chose an existing employee who already knew my business well. I believed it would be more difficult and time-consuming to train a marketing person who knew nothing about my business, than it would be to teach marketing strategies and techniques to someone who knew my business inside and out. In a relatively short time that person learned the marketing skills needed to do the job, and my expectations for that position have been exceeded.”

While my old friend continued talking about sustainability and managing existing assets, I thought about our friendship.

And about how true it was that some things were truly worth sustaining.

Labels: Corporate Bill of Responsibilities, Environment, green-speak, Hilton, Mario Insenga, Marriott, Stephen Smoke, The Refinishing Touch, Wall Street Journal, Westin

As we saw with the world trade summit in Copenhagen, central government has a long way to go before reaching concrete solutions to environmental problems. Still, there are other ways in which individuals can work to reach their own solutions. A recent article in the New York Times showcased how universities across the country are training postgraduate students to deliver practical solutions to the sustainability issues that many businesses face.

Universities in Massachusetts, Colorado and New York have taken sustainability focused post-graduate programs and included urban environmental issues to better fit the demographics of the student population, most of which live in urban areas. Whether they began their studies in engineering, biology or public policy, doctoral and masters students are now finding value in incorporating sustainable issues into their programs to better fit the jobs they aspire to have.

One of the major challenges for the future is finding ways to equip people with the practical know-how to engage with existing businesses and show them that making the shift to a more sustainable business model doesn't have to mean sacrificing profitability. We here at TRT have worked hard to build a successful business organized along environmentally friendly lines, to work in a way that balances the need to generate income with the desire to work in a way that is sustainable. We know that it's possible, and these programs are great stepping stones to help get people and businesses to realize that too.

According to a recent Reuters article, the hotel industry, while beginning to show promising signs of recovery, faces a slow climb back to pre-recession standings. PKF Hospitality Research expects a drop in revpar (a measure of occupancy and room revenue) of only 1.1 percent, well below the 17 percent drop it experienced in 2009. Additionally, last year's occupancy rate of 55.1 percent is expected to rise to 55.4 percent this year, according to PricewaterhouseCoopers. Although it's a small gain, it's a step in the right direction.

While hotels now must take action to expedite the a long trek towards recovery, the fate of the hospitality industry is tied to the rest of the economy; once more people get jobs, they'll travel more, both for business and leisure. When travelers do return, they'll find that excess is out of style as corporate spending has gotten leaner and luxury purchases are on the wane. Mike Shannon of KSL Capital Partners argues that affordable luxuries are back in style, and makes the claim "It's the $200 Lomilomi massages in Hawaii that are not doing so well."

As customers are adopting a no-frills style for traveling, hotels can follow suit. The hospitality industry needs to find success without a dependency on frivolous spending. Some of this goes into what we discussed about travel resolutions. When travelers walk or take public transit, they save on spending and help the environment in the process. When hotels opt for a linen reuse program, they save on energy expenses and do the same. As hotels and their clientele take the extras out of their traveling, customers will have more money for just that: their traveling.

The economy will eventually improve, but hotels don't have to wait for it. Hotels can find success without excess and adopt practices to help them thrive in any economic environment.