Bailey predicts price war over all-inclusives
Former Montego Bay Chamber of Commerce president, Lee Bailey says the influx of new rooms is putting a strain on the island’s all-inclusive hotels and has chided the Government for neglecting to ensure that the new players offered a greater mix.
Bailey also complained that the authorities had neglected the small hotels, many of which, he said, were now unable to compete with the large, new hotels.
“I want to make it clear that I am not against new investments,” Bailey told the Observer at the weekend.
“However, what we are doing now is inviting investors, and all the stock is all-inclusive. We should have looked at the stock and say, ‘ok, we have experts here’. And while I welcome competition, why should all 7,000 rooms be all-inclusive?”
Bailey was obviously referring to the new Spanish hotels being built along the island’s north coast that are adding 7,000 rooms to the accommodation sub-sector.
According to Bailey, the Government should have insisted that some of the new hotels offered EP (European Plan) packages. The administration’s failure to do so, he said, had resulted in the product being diluted.
“It will result in a price war,” said Bailey, echoing an earlier complaint from the industry that the Spanish hotels’ cheap room rates would drag down prices at other properties.
“One Negril hotelier told me last week that she can’t compete with the new hotels, so since they need to find accommodation for their staff, she was converting her hotel into an apartment complex; and this is someone who has been in the industry for close to 30 years,” he said.
The Government, he said, should not ignore the local hoteliers who invested in the country, particularly during the era when no one wanted to.
“They should be allowed to flourish,” he said, adding that Jamaican hoteliers had taken the all-inclusive concept and perfected it.
He said that the addition of new all-inclusive hotels would only take business away from restaurants and other entities outside of the hotels.
“So I’m saying, competition is good, but not at the expense of an industry,” said Bailey. “We now have an opportunity to structure tourism and widen the benefits.”
