Michael Macharia: How we will ensure hotel sector recovers from Covid effects

This week, Michael Macharia, the CEO of Kenya Association of Hotel Keepers and Caterers answers readers' questions.

The hospitality industry was worst hit in the wake of the Covid-19 pandemic. What strategies has the association put in place to lift the sector? Ruth Dero, Nairobi

Our industry was among the first to react to reports of Covid-19 and moved very swiftly to set up a meeting with Tourism Cabinet Secretary Najib Balala at the very early stage of the pandemic. This happened in February 2020 even before the first case of Covid was reported in Kenya. That is where we set actions in motion for the short, medium and long-term. We developed a document that would assist the industry to cope with the effects of the pandemic.

The strategy adopted was one of survival at the beginning and had a heavy focus on preserving jobs as well as investments within the industry. This was done by various government ministries including Labour and the National Treasury as well as the Central Bank of Kenya. The second phase was mainly concerned with the safe re-opening and we developed comprehensive “safe travels” protocols while the third centred on the revival of the industry and sustainability, which included marketing plans for both domestic, regional and international travellers. We are currently at the third phase and have put in place measures and steps to ensure that the industry is cushioned from future occurrences.

What challenges have you encountered in the placement and training of trainee students during their attachment? What would you wish changed in their training? Komen Moris, Eldoret

As an industry, we are heavily involved in the placement of students for practical trainings since they form an integral part of the overall customer experience. We work with most institutions to ensure that the training provided is of excellent quality. The main challenge is the standardisation of training curricular. We, though, engage continuously with the training institutions, in the area of curriculum development, where we get the opportunity to share emerging trends and issues within the industry.

We witnessed extreme and severe job losses in the hospitality industry due to the effects of the Covid-19 pandemic when hotels were forced to either totally close down or downscale their operations.

The recovery path appears to be promising following the relaxation of the Ministry of Health protocols and the re-opening of the economy by the government. Going forward, what assurance can you give on job security and sustainability of the sector? Dan Murugu, Nakuru City

Yes, unfortunately jobs were lost. However, we saved more jobs than we lost due to the signing of the tripartite memorandum between ourselves, the unions and the Ministry of Labour. This greatly assisted in mitigating the effects of the pandemic and taught us great lessons with regard to cooperation that will guide us in the future. The relaxation of the protocols by government is a much-needed boost to our marketing activities and will go a long way in facilitating recovery. However, we cannot afford to rest on our laurels and must strive to offer the best visitor experience at reasonable prices to compete in what is now developing into a full global market.

The Democratic Republic of Congo has joined the East Africa Community. I am curious to know how the hospitality sector is positioning itself to cash in on the huge market presented by this? Dan Murugu,  Nakuru City

We welcome the news that the DRC is finally part of the East Africa family. Referring back to the first question, you will note that our strategy for recovery was designed to start with domestic, then regional and finally international visitors. The DRC together with the rest of East Africa feature prominently within the regional segment where we have worked to develop the market since 2012 when we formed the East African Tourism Platform (EATP). The EATP has over the years engaged in marketing activities for East Africa and was the body that recommended a single visa for travellers into the region and movement by use of national IDs. The EATP also helped reduce the cost of air travel within the region by proposing reduced taxes for intra East Africa flights and also conducted joint marketing activities both within East Africa and outside the region. East Africa has the potential of supplying 20 million tourists to itself and that number will increase with the addition of the DRC. My take is that we are ready and have been ready for the DRC for a long time.

A report by the African Economic Research Consortium (AERC) released last year blamed the dipping profits by hotel operators to unsustainable pricing models, over-reliance on foreign clients and soaring operational costs. How are your members responding to these drawbacks? Byron Waihiga,  Nairobi

Think of the hospitality industry as one huge supermarket. Apart from the buildings which are owned, everything else is outsourced, from the beds, linen, furniture, meat (from local butchers), vegetables (from local farmers), soap, drinks (soft or otherwise), electricity and boiler diesel… The list is endless. Our pricing is mainly affected by the macro-environment where an increase in the price of one commodity like fuel will have a knock on effect on all the above-listed services. Government policies such as the introduction of new levies and the complicated tax regime also play a part. The pricing issue is an element that we need to review together with government as well as the entire tourism industry. Under normal circumstances, France attracts 70 million foreign tourists per annum and has never been accused of “over-reliance on foreign clients”. Our strategy is to harness all markets as alluded to earlier and we believe there is massive potential to grow all three segments.

The 9th Africities Summit is almost here and for hotels and restaurants in and around Kisumu, this will be a busy week when their facilities will be fully occupied. How do your members plan to give back to the communities in and around Kisumu who will indirectly be contributing to the successful hosting of the summit? Joram Oduor, Kisumu

We have a very comprehensive CSR programme that is part of our code of ethics. This is a continuous programme that will run alongside the summit and beyond. The summit itself is an excellent opportunity to market Kisumu and the entire region and we are urging players in the industry to be ready. Based on our engagements with the County Government of Kisumu, we are confident that the city is well-prepared and that it will deliver a high-quality summit that will leave nothing but good memories for the attendees.

There has been an implosion in the number of hotels in Nairobi CBD, Westlands and Upperhill, which could be a good sign that the hospitality industry is very much alive and this assures customers of competitive pricing. However, don’t you think it could also be counter-productive since the hotels are competing for the same clientele, mostly meetings and workshops? Celestine Nyawira, Nairobi

The development of new hotels both in Nairobi and other parts of Kenya is a major confidence booster. This is also in line with Vision 2030, which seeks to have five million visitors into Kenya per year, by 2030. The increase in good quality products in terms of accommodation and restaurants is a sign that Kenya is working towards that target. We have some high quality investments that are about to enter the market such as J.W. Marriott in Westlands and the locally owned Glee Hotel which will be situated along the Southern Bypass.

This combined with the reopening of Fairmont Hotels and Radisson Blu (Upper Hill) and the venturing of Sarova Hotels to cities such as Nakuru and Kisumu among other investments are a shot in the arm for the hospitality industry.