The Message Owners Need to Hear Right Now: Control What You Can Control

By Wayne West III, President

In the weeks leading into a conference like Hunter, I tend to have the same conversations with owners and investors. We talk about demand, we talk about supply, and we talk about the usual forward-looking indicators. But it does not take long before the real topic comes up. It is not occupancy. It is not even revenue. It is margins.

The environment we are operating in today is forcing a clearer separation between hotels that are being managed with discipline and hotels that are simply being operated. When expenses were more stable and ADR was moving steadily, a lot of properties could carry inefficiencies without feeling the pain immediately. That is not the case right now. Costs are up across the board, and ADR is not always there to make the math work. Even when business is steady, profitability is harder to protect.

This is why the operator matters so much in this cycle. Not because operations are suddenly more important than they used to be, but because the margin for error is smaller. When the margin is smaller, the basics become everything.

If you are looking for the message that needs to be reinforced at the property level right now, it is this: there has to be a heightened sense of awareness around controlling the expenses that can actually be controlled. That starts with payroll, and it extends to direct operational cost items that are often treated as fixed when they are not. Labor, supplies, contract services, and every line that is influenced by volume all have to be managed with intention.

Payroll is the clearest example. It is the largest expense in most hotels, and it cannot be managed by habit. It has to be managed by demand. Staffing levels must match occupancy levels, and that alignment has to happen quickly. If it takes a month to correct labor, the month is already gone. This is not about cutting for the sake of cutting. It is about running the operation in a way that respects what the business is actually producing.

The same principle applies to direct operational costs. In a tighter cycle, you cannot let purchasing drift. You cannot let waste build quietly. You cannot tolerate “that’s how we’ve always done it” when the numbers are telling you the environment has changed. These items have to be reviewed, challenged, and adjusted. Owners are not paying for a monthly explanation of why costs were high. They are paying for leadership that sees it early and acts.

This becomes even more important when ADR is stressed. There are markets right now where rate growth is simply not coming as easily as it did. Competition is aggressive. Consumers are value-conscious. Group patterns are uneven. In that situation, it is tempting to talk your way through the problem with strategy and forecasts. Strategy matters, but it does not replace discipline. When rate is under pressure, expense control is not optional. It is the lever you can still pull.

From an owner perspective, this is what I would be watching closely. I would be less interested in broad statements about “driving revenue” and more interested in the operating rhythm behind the scenes. How often is labor being evaluated and adjusted? How tight is the property on purchasing? How quickly are contract costs being challenged? How clear is the accountability at the general manager level?

None of this is complicated, but it does require consistency. It requires leaders who are paying attention, who are willing to make changes in real time, and who understand that protecting margin is just as much a part of hospitality as taking care of guests.

The hotels that will perform best through this cycle will not be the ones with the most optimistic projections. They will be the ones with the strongest operational discipline. And in an environment like this, that discipline starts with controlling what you can control, matching expense levels to occupancy, and refusing to count on ADR to do all the work.

That is the message that matters right now.