Everyone knows that without profitability, companies can’t flourish. Profitability ensures financial stability and resilience in a competitive landscape such as the hospitality industry. Furthermore, it drives investment in people, technology and future projects. Yet, true business success is not measured solely by financial performance but also by a positive contribution to the environment and society.
Successful hotel management companies see the balance between profits and sustainability as a multifaceted endeavor. Furthermore, they are committed to making informed decisions that align with their core values and promote a sustainable future on various fronts.
Aligning profit with the planet
Environmental responsibility must be at the forefront of a hotel company’s efforts when balancing profits with sustainability. Indeed, there are a few concrete initiatives that can be taken in this direction when developing a hotel portfolio:
LED light installation
To begin, it is crucial to prioritize LED light installation in a hotel project. Despite increasing initial costs by approximately 20 to 30 percent compared to less eco-friendly lighting, LEDs reduce electricity consumption by up to 75 percent. Additionally, their longer lifespan means less maintenance and lower replacement costs in the future. For instance, when comparing LED bulbs with incandescent bulbs, a hotel can save over USD 200 per LED bulb over its lifetime due to 75 percent lower electricity consumption, 30 times longer lifespan and only 25 percent higher upfront cost.
Greywater system
Another important initiative is implementing a greywater system, which recycles wastewater from sinks, showers and laundry for non-potable uses, such as toilet flushing and irrigation. Furthermore, it reduces costs from 40 to 60 percent compared to fresh water consumption. Thus, this system significantly promotes water conservation. It also contributes to lower utility costs and sustainable water management over time. Moreover, if the greywater system halves a hotel’s water bills, this could result in substantial annual savings. Despite an initial investment that is 50 percent more than the traditional system, the payback period would be just a few years.
Insulation materials
The use of advanced insulation materials to minimize heat transfer through walls and roofs is recommended. While such materials can increase wall and roof construction costs by up to 40 percent, the benefits are significant. Besides enhancing guests’ indoor comfort by stabilizing temperatures, these materials improve energy efficiency by decreasing the need for extensive air conditioning.
Proper training
It’s important to highlight that training employees and raising guest awareness is critical to successfully balancing a hotel’s profits with environmental needs. Even simple measures, such as tent cards encouraging towel reuse, yield significant savings that far outweigh implementation costs.
People-centric profit strategies
As highlighted, hotel developers and managers should consider many factors when balancing profits with sustainability. People are equally important as the planet. Consequently, a company should aim to contribute to the social aspect of ESG (environmental, social and governance) through high employee satisfaction and low turnover.
Investing in people always pays off in the long run. Therefore, talent management and retention strategies must focus on employee well-being. Examples of people initiatives include benefits such as air ticket allowances for all employees, not just expats. In addition to encouraging adequate time off to prevent burnout — all of which turn out to be worthwhile investments.
Furthermore, implementing technology that supports a hybrid work culture allows employees to work from home several days a week. While this investment can be expensive, it has proven, in my experience, to boost both satisfaction and productivity.
The results speak for themselves. A sustainable work environment can lead to impressive monthly retention rates of 95 percent, even as a company’s workforce grows significantly.
Sustainability considerations may initially impact short-term costs but yield long-term benefits. Consequently, a business must prioritize doing good – for its people and the planet – to transcend mere profit figures.
