GLOBAL REPORT—The entry of brands of scale, such as Marriott International, into all-inclusive resorts is a challenge to management companies operating in the space, sources said.
Rob Smith, EVP of operations at Aimbridge Hospitality, said Marriott and other hotel brands are entering the all-inclusive resort space to reach a customer they didn’t yet have, noting there’s not a lot of crossover between all-inclusive guests and guests of regular resorts.
Marriott is a global brand that runs a tight ship, is consistent, is coming into the space without much help from third-party managers, which is what makes them a challenger, said Federico Moreno, VP of development at Apple Leisure Group, which operates resorts under its all-inclusive division, AMResorts.
Still, Marriott faces a learning curve in the all-inclusive space, he said.
Playa Hotels & Resorts manages all-inclusive properties for Hyatt Hotels Corporation and Hilton. Kevin Froemming, the company’s EVP and chief marketing officer, said Playa led the way for these more mainstream brands to enter the all-inclusive space.
A trend he is seeing in the space is the big brands working with third-party managers, he said.
Froemming added the all-inclusive space has moved from mostly independent resorts to branded resorts.
A perk of big brands being in the space is it gives loyalty members options to redeem points for all-inclusive vacations, which could create a broader customer base in the segment, he said.
Labor retention
All-inclusive resorts are not exempt from labor issues, and managers often must be creative to attract and retain talent at the properties.
All-inclusive hotels tend to have fewer peaks and valleys in demand than other hotels, and as a result of higher occupancies, Apple Leisure Group is able to maintain higher wages for employees and attract and retain staff, Moreno said.
The company has a high retention because many employees grow their careers with the company, he said. Apple Leisure Group also hires full-time English teachers in places where English is not the native language, he said.
Aimbridge looks outside of the hotel industry to staff the all-inclusive properties it manages and invests in training for employees, Smith said. The company also offers an attractive payscale, he said.
Aimbridge currently manages one all-inclusive resort, but plans to manage more in the future. The company had seven all-inclusive resorts, but those were sold, he said.
F&B spending
Food and beverage is a big part of the all-inclusive experience, so spending on F&B must be carefully strategized.
For example, cutting costs around F&B at Apple’s AMResorts properties would be detrimental, Moreno said.
AMResorts focuses on specialty restaurant experiences with à la carte options rather than the more traditional buffets at many all-inclusive hotels, he said.
To save on F&B, AMResorts looks to “optimize supply chains” to get the best pricing for high-quality food and premium spirits, he said.
Aimbridge’s all-inclusive F&B operations typically feature one large buffet and a smaller specialty restaurant, Smith said. “Star” items, or items you typically wouldn’t see at an all-inclusive property, are available for guests to purchase, he said.
Aimbridge also manages F&B expenses by making sure its all-inclusive properties offer a variety of activities and experiences so guests are focusing their time on those rather than spending a lot of time at the restaurant or buffet, he said.