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2019 Trends in Hospitality Training and Development Study

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2019 Trends in Hospitality Training and Development Study July 29, 2019 Introductions Colby Hutchinson Jennifer Swan Melissa Doolin-Koehne Best Western Hotels & Resorts First Watch Restaurants TDn2K @swanstyle1 @loverofguac [email protected] [email protected] [email protected] H U M A N F I N A N C I A L G U E S T C A P I T A L C A P I T A L FEEDBACK PERFORMANCE PERFORMANCE PERFORMANCE 2.6 million employees 31,000+ units 61,000 units 193 Brands $72 Billion Sales 200 brands Founded 1995 Founded 2009 Founded 2013 272 Brands 230 Companies 43,000 Restaurants Powered by: Powered by: Powered by: 90 Minutes of Fun State of the Workforce Trends in Industry Trends Training What do you think? Respond at: PollEv.com/chart19 What do you feel your company is winning in? Poll Everywhere CFOs Forecasting a Recession 38% 67% 84% PREDICT PREDICT PREDICT Recession Recession Recession Q1 2020 Q3 2020 Q1 2021 Source: CFO Global Outlook- Duke University Average guest check grew more than visits % with positive comp sales % with positive comp traffic 64% 53% 56% 54% 50% 48% 30% 27% 22% 21% 15% 5% Total Quick Fast Casual Family Casual Upscale Industry Service Dining Dining Casual Source: TDn2K Source: Black Box Intelligence The Game is Changing Industry Average Performance 2018 Q2 2018 Q3 2018 Q4 2019 Q1 2019 Q2 Comp Sales 0.6% 1.1% 1.4% 0.9% 0.2% Comp Traffic -1.8% -1.4% -1.6% -2.0% -2.9% Comp PPA/PTA Growth 2.5% 2.6% 3.0% 2.9% 3.1% Comp Food Sales 0.8% 1.5% 1.6% 0.8% -0.2% Comp Beverage Sales -0.8% -1.0% -1.0% -2.9% -3.2% Comp Dine-In Sales -1.3% -1.3% -1.9% -2.5% -3.3% Comp To-Go Sales 7.5% 8.0% 9.2% 10.1% 9.5% Source: TDn2K Black Box Intelligence How to Prepare for 3rd Party Delivery Be ready for high volumes of delivery orders Customize your delivery offerings Make necessary staffing changes - Ended in September 2018 - Down in June ‘19 - Driven by Avg. Daily Rate Source: Smith Travel Research Flattening occupancy predicted in 2020 Occupancy ADR RevPAR Chain Scale % change % change % change Luxury -0.2% 2.4% 2.2% Upper Upscale -0.3% 2.2% 1.9% Upscale -0.3% 1.8% 1.5% Upper Midscale -0.2% 1.8% 1.6% Midscale -0.2% 1.7% 1.4% Economy -0.3% 2.1% 1.8% Total U.S. -0.2% 2.2% 1.9% Source: STR Chain Scale forecasts, June 2019 How to Prepare for Declines in Traffic & Occupancy Basic Revenue management training for managers is essential Training to Maximize ADR & Average Guest Check Make necessary staffing changes Domination by parent companies JD Power guest satisfaction rankings | Economy Microtel (Wyndham) 797 Travelodge (Wyndham) America's Best Value InTown Suites Days Inn (Wyndham) Super 8 (Wyndham) Red Roof Inn Economy Average 756 Extended Stay America Econo Lodge Motel 6 Rodeway Inn Howard Johnson (Wyndham) Knights Inn 668 650 700 750 800 850 900 Source: JD Power, July 2019 JD Power guest satisfaction rankings | Midscale Wingate (Wyndham) 846 Candlewood Suites (IHG) * LaQuinta (Wyndham) * ^ Sleep Inn (Choice Hotels) Best Western (BWH) AmericInn (Wyndham) Hawthorn Suites (Wyndham) Midscale Average 810 Baymont (Wyndham) Quality Inn (Choice Hotels) Ramada (Wyndham) 782 650 700 750 800 850 900 Source: JD Power, July 2019 JD Power guest satisfaction rankings | Upper Midscale Drury 876 Hampton Inn (Hilton) Home2 Suites (Hilton) * Fairfield Inn (Marriott) TownePlace Suites (Marriott) Holiday Inn Express (IHG) Upper Midscale Average 835 Best Western Plus (BWH) Country Inn & Suites (Carlson) Wyndham Garden (Wyndham) Comfort Suites (Choice Hotels) Holiday Inn (IHG) Comfort Inn (Choice Hotels) Clarion (Choice Hotels) 797 650 700 750 800 850 900 Source: JD Power, July 2019 JD Power guest satisfaction rankings | Upscale Best Western Premier (BWH) * 862 Cambria Hotels (Choice Hotels) * AC Hotels (Marriott) * Hilton Garden Inn (Hilton) Hyatt House (Hyatt) Springhill Suites (Marriott) Hyatt Place (Marriott) aloft Hotels (Marriott) Courtyard (Marriott) Staybridge (IHG) Homewood Suites (Hilton) Upscale Average 840 Residence Inn (Marriott) Wyndham (Wyndham) Doubletree (Hilton) Crowne Plaza (IHG) Radisson (Jing Jang) * Four Points (Marriott) 650 700 750 800 850 900 Source: JD Power, July 2019 JD Power guest satisfaction rankings | Upper Upscale Hard Rock Hotel * 866 Gaylord (Marriott) * Marriott (Marriott) Kimpton (IHG) Renaissance Hotels (Marriott) Hilton (Hilton) Hyatt Regency (Hyatt) Upper Upscale Average 847 Embassy Suites (Hilton) Autograph Collection (Marriott) * Omni Hotels Westin Hotels (Marriott) Delta Hotels (Marriott) Hotel Indigo (IHG) Sheraton (Marriott) 829 650 700 750 800 850 900 Source: JD Power, July 2019 JD Power guest satisfaction rankings | Luxury Ritz-Carlton (Marriott) 881 Lowes Hotels Park Hyatt (Hyatt) * Four Seasons Fairmont (Accor) Luxury Average 861 JW Marriott (Marriott) Grand Hyatt (Hyatt) St. Regis (Marriott) * Waldorf Astoria (Hilton) W Hotels (Marriott) Intercontinental (IHG) Trump Hotels * Sofitel * Andaz (Hyatt) * Conrad (Hilton) * 841 650 700 750 800 850 900 Source: JD Power, July 2019 New Brands Emerge Robust pipelines indicate future growth Active Properties Rooms Room Count In Pipeline In Pipeline Marriott International 1,269,288 2,790 471,000 Hilton Worldwide 886,994 2420 371,000 InterContinental Hotels Group 784,678 1,828 267,000 Wyndham Worldwide 705,043 1,400 176,000 Jin Jiang International 680,000 3,161 345,000 Accor 648,998 1,031 184,000 Choice Hotels 564,828 1,050 85,500 Huazhu (formerly China Lodging Group) 379,675 924 90,000 Source 10k from SEC Financial Reporting Workforce Trends Biggest Challenges & Opportunities in 2019 Staffing pressure is real 3.6% national unemployment rate (May 2019) 38 states have unemployment rates of 4.0% or lower Source: Bureau of Labor Statistics Open Positions: 900,000 per month Bureau of Labor Statistics Restaurants report they are understaffed 69% 93% hourly FOH hourly BOH Source: TDn2K Severe management understaffing reported in restaurants 52% 19% Managers General (non-GM) Managers Source: TDn2K Turnover in lodging has reached critical levels Up to Increase in GM Turnover GM Turnover * Estimated for new from 2016 hotels Current Open postions * Source: Bill Crawford, American Hotel & Lodging Assoc. Travel Weekly Jan, 2019 Turnover Remains Extremely High Restaurants Lodging 105% 94% 52% 53% 40% 28% Front of House Back of House Unit Level Manager Voluntary Terminations Increasing Percentage Of All Terminations That Were Voluntary 2017 2018 75% 77% 69% 67% 63% 67% FOH Hourly BOH Hourly Manager* Source: TDn2K People Report Hourly Staff Are Leaving Quicker Hourly Front-Of-House Hourly Back-Of-House 2017 2018 2017 2018 60% 60% 50% 53% 43% 42% 40% 40% 29% 25% 19% 20% 20% 17% 0% 0% Less than 30 days Less than 90 days Less than 30 days Less than 90 days Source: TDn2K People Report Cost Of Turnover Per Employee $1,816 $10,361 $13,996 Per hourly Per restaurant Per General employee manager Manager (excluding GM) Source: TDn2K People Report How are unemployment and turnover impacting your training? 5 min - Table Activity Why are your employees leaving and what can you do about it? Why are employees leaving? Hourly employees Management Job abandonment Higher compensation Personal Reasons Immediate promotion at another company Higher Paying Job Poor Work/Life Balance Source: TDn2K People Report Old ‘Seasoned’ is the New Orange Work-Life Balance is important 11% of General Manager’s strongly agree that their job allows them to spend enough quality time with family and friends Source: GM Connect – powered by Gallup and TDn2K Source: GM Connect – powered by Gallup and TDn2K Restaurants Offering More Money To Attract Talent Source: TDn2K The Best Have Better Servers & GM’s (Sales & traffic) 28.6% 48% 23.5% for Turnover 17% Net Sentiment Genereal Genereal Manager -5.1% Knowledge Server +31% Best Rest Best Rest Source: TDn2K People Report What is Working to Increase Retention Most Effective Retention Measure 2nd Most Effective 3rd Most Effective Non- Improved Improve growth Flexible managers selection/recruit. & development scheduling Managers Improve growth Improved Increase Pay (excluding GM) & development training Increase General Improved Improved employee Managers training selection/recruit. recognition Source: TDn2K Why did you pick what you did? 5 min - Table Activity Trends in Training 2019 Results Investments in Training & Development Increasing (Investment as % of sales) 1.75% 1.50% 1.10% 2014 2016 2018 One-Third of Companies Increased Training Headcounts Restaurants Lodging Use of External Resources is Increasing (percentage of companies) 75% 67% 2017 2019 Many Companies Increasing External Training Spend Restaurants Lodging 75% 39% 39% 25% Increased Spend vs. Prior Year Expect a Spend Increase Next Year Training Reporting to Human Resources More Often Use of E-Learning Solutions is increasing Most Restaurants Planning Investment in E-Learning Next Year 91% 33% Restaurants Lodging 9.9 Hours a Day 6.3 hours 3.6 hours Source: 2019 Brand Internet Trends Report Most E-Learning Still Done Through Desktops at Work (Percentage of companies offering each option) Restaurants Lodging 86% 72% 68% 43% 36% 29% Desktop / laptop Tablets provided by the Employees' smart computer at work employer at work phones How do companies handle e-learning on/off clock for non-exempt staff? 5 min - Table Activity Investment in Leadership Development for Managers lowers turnover 10% or more of total training Less than 10% of total training 122% 108% 81% 87% - 27% - 35% BOH Turnover FOH Turnover Investments in HR Training for Managers lowers turnover 10% or more of total training Less than 10% of total training 111% 103% 86% 74% - 25% - 29% BOH Turnover
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