Western Cape hospitality forecasts positive growth in Q1

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Based on bookings for the next six months, more than two-thirds of respondents believed their properties would perform the same or better than in previous years. However, some predicted performance would instead be in line with the revenue and occupancy of 2017, before a decline in numbers caused by the widespread drought in the Western Cape.

While this is a positive sentiment for the 2020 year, recording the same numbers as previous years does speak to slow growth for the industry, cautions Richard Lyon, Fedhasa Cape spokesperson.

"We have noticed some changing trends in bookings that may be influencing the industry’s results. Visitors are enjoying shorter stays and are booking closer to their dates of travel. This late booking can result in forecasts changing dramatically from month to month, making it difficult to forecast as far ahead as six months," explains Lyon.

Lyon adds that sentiment among Western Cape members remains positive despite challenges faced by the industry and mixed results over the festive season.

Based on the survey, many of the respondents found festive season occupancy rates were low compared to previous years. However, revenue held steady despite stagnant occupancy rates: During the festive season, more than half of the respondents found revenue was the same or better than 2018.

"What has emerged from these results is that our local hospitality industry appears to be recovering following the drought; however, we are facing a number of challenges – such as load shedding and negative foreign perceptions – which will need to be addressed before we can create long term growth in the sector," adds Lyon.