The Impact of the Current Recession on the Corporate Hospitality Industry

Abstract

SummaryPurpose

The purpose of this research is to understand how the corporate hospitality industry is defined and the main impacts the current recession has had on the buying and supplying of corporate hospitality.  From the information gathered through the research recommendations can be made for buyers and suppliers to ensure the sector recovers quickly from the recession. 

Methodology

A literature review was carried out to determine previous research in this subject area and the effects on the corporate hospitality industry from previous recessions, therefore giving the opportunity to create comparisons with current research results.  The primary research was carried out using five face-to-face interviews, with structured and semi-structured questions.  The interviews were selected using a purposive sample, using hospitality industry professionals all working within roles and venues that have a corporate hospitality offering.  Therefore all interviewees have tacit industry knowledge and personal experiences of the changes happening throughout the recession.  These interviews have been used to gather incisive information and examples of the changes that have happened within the corporate hospitality industry.

Findings

It is clear from the research that there has been a negative impact on the corporate hospitality sector during the recession.  It has also shown that there are three key impacts within the sector.  These are the increase in use of deconstructed hospitality packages, the increase of media scrutiny on those still buying into hospitality and the increase in return on investment evaluation. 

Research Limitations

All those interviewed were based in venues in London; therefore the impact of the recession could be different throughout the country.  There is also a limited sample used within this study due to project constraints that could also lead to problems if the results were generalised to the whole industry, as they may not be fully representative.

Social and Practical Implications

This research can have implications on how hospitality is bought and sold in the future.  It has implications on how corporate event organisers’ carry out their jobs in the future and the skills they will need to develop in order to meet clients wants and needs in a changing market.  A significant factor in the future could be that businesses will make new commitments to charity and socially beneficial corporate events to gain positive media attention through corporate social responsibility and also to avoid investigation for bribery under possible new anti-corruption laws. 

Value

Although this research does have some location limitations and cannot be used for rigorous statistical tests, the results can be indicative for the industry.  There is limited research available on this specific part of the industry and therefore it can be used to provide recommendations for the future of the industry.

Key Words

Recession, Corporate Hospitality, Return on Investment, Media Scrutiny, Deconstructed Packages, Social Value