2023 Construction and Renovation P2P Trends
We are halfway through the second quarter of 2023 and see the hospitality industry looking forward to trends taking shape. While these trends have been on a gradual incline over the recent years, industry experts predict the rest of this year will witness a significant increase in renovation and conversion projects as well as new construction trends in relation to the procurement processes.
With renovation and conversion projects becoming more prevalent, hoteliers can look forward to engaging with experienced procurement partners. Likewise, with new construction projects on the rise, hotel and resort owners are acquiring procurement strategies and technologies that enable them to manage procurement processes more efficiently amid the economic climate.
As companies in the hospitality industry look forward to the remainder of 2023, developing ongoing growth and scaling strategies to coincide with these shifting trends will become all the more crucial. Here’s what you can expect and how to prepare.
Renovation and Conversion Trends
Renovation and conversion projects are experiencing a particular increase this year. However, to reduce costs and maintain their market position, many hotel owners are choosing to renovate their existing properties rather than construct new ones. Such renovations include refurbishing guest rooms, public spaces, and amenities like restaurants and fitness centers. Conversion projects, on the other hand, involve reconstructing existing buildings like warehouses or office buildings into hotels and resorts. The key trend is expansion in the select service properties which is an outgrowth of the industry's incline out of the pandemic period.
For procurement, these trends have presented the hospitality industry with a unique set of challenges. Renovations and conversions often require the procurement of various products and services—from furniture and construction materials to equipment and technology. Plus, many of these projects hold fixed timelines for completion, which can make it difficult for companies to manage procurement processes.
To address these challenges, many hotels are adopting new procurement strategies—one of which is engaging with procurement partners who specialize in the hospitality industry. With access to the required expertise and resources needed to manage complex procurement processes, these partners can ensure projects are completed effectively, on time, and within budget.
New Construction Trends
Another major trend hoteliers can expect in the hospitality industry is new construction. Though new project announcements have returned, many are slow to start due to the current lending environment.
Extended-stay, midscale, upper midscale, and upscale projects are the focus—many of which will feature cutting-edge design and technology, as well as innovative amenities and services.
However, as the construction of these new properties demands a wide range of construction materials, equipment, furniture, and fixtures, cycle times are relatively slow.
Fortunately, procurement can address many of these challenges. Like renovation and conversion trends, companies are hiring partners who will have experience in managing complex procurement processes to ensure the necessary materials are received and deadlines are met with little to no delays.
How BirchStreet’s P rocure-to-Pay Solution Can Help
As the processes of renovation, conversion, and new construction all involve aspects of the entire procurement cycle, many companies are opting for a robust procure-to-pay solution to streamline operations and guarantee projects are completed efficiently and effectively.
As the top P2P (procure-to-pay) solution used by 9 of the top 10 global hospitality brands, BirchStreet System's P2P service is a cloud-based platform designed to optimize procurement and supply chain operations for the hospitality industry. It provides a comprehensive suite of tools for sourcing, ordering, receiving, invoicing, and payment processes, all in one centralized location.
Using highly specialized automation technology, the system works to streamline procurement processes, reduce manual errors, and increase overall efficiency. Additionally, hotels can gain real-time visibility into procurement data, enabling them to make better decisions and optimize their supply chain operations.
Plus, with a solution that helps hotels manage vendor relationships, negotiate better pricing, and reduce costs, BirchStreet’s procure-to-pay system ultimately improves companies’ bottom lines.
About BirchStreet Systems
BirchStreet Systems powers hospitality and food and beverage enterprises with a comprehensive procure-to-pay business solution. As the global leading provider of spend management solutions in the hospitality industry, 15,500 enterprises in over 130 countries subscribe to BirchStreet to connect with a network of more than 450,000 suppliers.
Established in 2002, BirchStreet is privately held and is headquartered in Las Vegas, NV with offices in California, China, Singapore, India, and the UK. For more information, please visit www.birchstreetsystems.com.
