A logistics wake-up call for the hospitality industry

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New study shows that most executives don't realize the cost-savings potential of having the experts manage their supply chains.

Did you know that smart logistics can deliver a full suite of solutions that can streamline your hospitality supply chain and reduce expenses? Few hospitality industry stakeholders realize that logistics and transportation management can provide efficiency and cost savings, according to a survey conducted by UPS at the 2014 Hospitality Design Expo.

Few hospitality industry stakeholders realize that logistics and transportation management can provide efficiency and cost savings.

Of the nearly 100 attendees surveyed, 62 percent indicated that their greatest daily challenge is managing expenses. Despite that, only 22 percent currently have an ongoing cost-reduction strategy.

It's time for a logistics wake-up call.

Refine an inhospitable supply chain

Whether managing new construction, starting a property improvement plan or running daily operations, hotels and resorts require a constant stream of furniture, fixtures and equipment (FF&E) and operating supplies and equipment (OS&E). Transportation costs can quickly eat into your budget.

Forty-eight percent of the survey respondents reported spending between 3 and 10 percent of their annual renovation/project budget on transportation alone. Eleven percent indicated that transportation costs consume more than 10 percent of their budget. Here's where logistics comes in. An integrated network like UPS's handles everything from packages to pallets. This high degree of integration can help reduce the inbound transportation expenses associated with FF&E, OS&E, retail shops, spas and other amenities.

"Flexible shipping modes can help improve time-in-transit and deliver the most prudent transportation spend," says Alex Ortolano, UPS marketing director for the professional services segment.

Rethink the self-service model

A significant portion of the survey respondents, 45 percent, reported that they managed transportation costs in-house. Only about 1 in 5 reported using logistics providers to assist them in managing these costs. Hospitality logistics doesn't have to be self-service.

In addition to helping you control the shipping mode to fit your deadlines and budget, UPS allows your vendors to bill your UPS account, which enables you to monitor service choices and leverage your purchasing power. UPS vendor management technology ensures that purchase order numbers are on all shipments. This means you can improve cost-allocation accuracy and better understand your total cost of ownership without troublesome purchase order follow-up – which 22 percent of the Expo survey respondents cited as one of their greatest daily challenges.

Logistics can also positively affect guest services. Consider outsourcing your business center operations to experts at The UPS Store® to improve guest service, save staff time and boost your profits. Integrate UPS technology with your lodging and property management system to provide faster notification of packages to be picked up. Your guests will thank you.

Whether handling shipments for guests or for your corporate/front office, a web-based solution like UPS CampusShip® enables desktop-shipping at multiple locations or properties, but with centralized control of service options and costs. End-to-end tracking provides peace of mind.

"The pressure to manage the total cost of goods is high in the hospitality industry, but with UPS, the cost and hours needed to do it don't have to be," Ortolano says.

Answer your logistics wake-up call: Visit our hospitality solutions site.


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