INVESTMENT
Some eat to live ; others live to eat . In China , food and beverage play a role far beyond sustaining life . It has cultural significance , familial significance , symbolic significance .
In an article titled “ Food , eating behavior , and culture in Chinese society ,” which appeared in the December 2015 “ Journal of Ethnic Foods ,” the author writes : “ Food has many symbolic meanings ; it not only expresses but also establishes the relationship between people and their environment as well as between people and what they believe . Therefore , food is an important component of a society .”
It ’ s also an important component of a hotel ’ s P & L , second only to the rooms department . Most hotel guests expect some semblance of F & B in a hotel , varying depending on the type of hotel . For hotel operators , F & B can be a revenue windfall or an expense noose . In China , food and beverage is held in particular reverence , an appreciation which carries over into the country ’ s hotels .
China ’ s pandemic story is one that precedes most . The first country to deal with the coronavirus , it was also the first country to come through it . Rooms
RevPAR in China hit a low of US $ 7.48 in February 2020 , according to HotStats data . By April 2021 , RevPAR was up to US $ 72.48 — a 233 % increase over the same time a year ago — and only US $ 7 less than pre-pandemic April 2019 . Rooms revenue as a percentage of total revenue hit 61.5 % in April 2021 , exactly the same percentage as April 2019 , a sign of total hotel revenue stabilizing .
F & B revenue in China followed a similar trajectory as rooms revenue , hitting a low of US $ 2.47 in February 2020 . Unlike rooms revenue , which took 12 months to get back to YOY positivity ( albeit off fantastical lows ), F & B revenue showed a positive increase eight months after its low mark , up 2 % YOY in October 2020 , as rooms revenue was still down 15.9 % YOY . In China , F & B ’ s march back to positivity was faster and higher than rooms . Between April 2021 and February 2020 , rooms RevPAR increased 868 %, while F & B RevPAR , over the same span , rose 1,544 %.
Historically , food and beverage in China ’ s hotels has contributed markedly more to overall revenue compared to the United States , for instance , which relies more
FOR CHINA ’ S HOTELS ,
F & B SALES NEVER ANCILLARY
46 hotelsmag . com July / August 2021