August 20, 2019 – Hotels in Dalmatia achieve the best results after experts analyze the success of hotels in Croatia for Slobodna Dalmacija.
“Hoteliers did well in the first half of the year according to all available data, and according to the announcements, this trend continues in July and August. I think 2019 will be a very good business year for hoteliers in terms of revenue, and those with 4 and 5 stars did better in the first six months of this year than last year.
The specificity of this peak season is that it is asymmetrical, it has shifted in 15 days in terms of time, business and traffic for a lot of reasons, but it will not significantly affect the operation of hotels. There is a trend that 4 and 5-star hotels are doing fantastic, and those who are worse off and have not seen an investment are operating in a market that is looking for lower prices, so their financial results are significantly worse. Because you cannot get a customer with higher-spending power if you have poor quality,” says professor Zdenko Cerović, a Ph.D. from the Faculty of Tourism and Hospitality Management in Opatija, who co-authored the Benchmarking (Business Analysis) study of the Croatian hotel industry until the beginning of July this year.
Together with him, hotel operations in the first part of this year were also analyzed by Dr. Sandra Janković and Sonja Hvaliček.
The material analyzes the operations of 114 Croatian hotels from all coastal regions and the continental part of the country, with a total of 23,500 rooms, which is more than 40 percent of the total hotel capacity in Croatia. Data on occupancy, prices, revenues and earnings were found for 25 hotels in Istria, 26 in Kvarner, 46 in four Dalmatian counties and 17 continental hotels. Key revenue management indicators by region say that in June alone, as in the first six months of this year, hotels in Dalmatia are doing the best.
In June, they achieved an average price of 139 euro per room, which is 15 euro more than hotels in Istria and almost 40 euro more than hotels in Kvarner. Also, the total income per night in hotels is the highest in Dalmatia – in June, it was 103 euro per night, which is 16 euro more than the average of Croatia. In the same month, the income in Istrian hotels per night was 80 euro, while in Kvarner 77 euro, according to the data.
“Such financial results are completely logical given that Dalmatia has a long season and good prices in hotels, and a great deal has been invested in hotels in Zadar, Šibenik, the Split region, the Makarska Riviera, and the islands to Dubrovnik. Dalmatia has made a step up in the quality of its hotel offer in a number of hotel houses, followed by good prices, the growing season, and good income. Since April, the monthly accommodation revenue per available hotel room in Dalmatia has been the highest in the country due to the highest average room rates,” explains Cerović of this year’s hotel business in Croatia.
Asked if the revenue of hotels would be affected by the fact that part of their capacity was put into “last-minute” sales at lower prices due to slow sales, Cerović replied that this would not affect the hotel’s income because it didn’t happen often enough to affect their earnings.
“Although the story of the need to invest in quality in our tourism is already known, all the way to birds on branches, nevertheless, the exact data best confirm how significant the value for money is in revenue. Specifically, revenue management indicators by the category of the hotel in the survey show that total revenue per night is by far the highest in 5-star hotels, reaching 154.20 euro per night in June. At the level of all six months, it is 114 euro per night, and for comparison, the revenue per night in 4-star hotels in June was 80 euro, while in 3-star hotels it was 49.5 euro. And the average room price also depended on the category of accommodation, so in June, 5-star hotels sold for 206 euro on average, 4-star hotels had an average price of 103 euro, and 3-star hotels in June had an average price of 67.4 euro.
This does not mean, of course, that Croatia should have only the highest category hotels, but the 3-star hotels must be modernly decorated, equipped and renovated, and thus can achieve better prices and higher revenues in its category, experts say. Guests want to know that they have not overpaid, and everyone goes into a financially monitored category and looks for the best service for that category. Nobody can say today ‘it doesn’t matter what kind of hotel I am, I will always have guests’, because that is no longer the case, as the financial results of investing in hotels and resting on laurels show best. “
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