Profitable Trends
in the Lodging Industry

PAII 2006 Conference Presentation

Kit Cassingham

http://www.EnvironmntallyFriendlyHotels.com
970-626-2277

  1. Introduction
  2. Definition of a Green Hotel A green hotel is a lodging property that incorporates various environmental actions into its operation and business philosophy
  3. You could expand the notion of "green" to "sustainable" by expanding your notion beyond the reduction of using resources to that of the renewal of resources balancing the usage of them. Supporting your community becomes a part of that mind set and business approach. For the purpose of including hotels in the Best Green Hotels database, any gesture towards green merits a listing. We want to encourage innkeepers to go green, and then let their guests, the traveling public, and their savings persuade them to the value of taking more green actions.


  4. 3 Reasons to Go Green:
    1. Feel good about doing something for the planet's environment
      1. Community involvement We participate in our communities, volunteer, and give to "the needy" for the same reason. It's sometimes easiest to do these things when we have tax incentives, but many/most of us incorporate this action into our lives anyway.
      2. Lead by example

      Walking your talk is also an educational step that will sway your guests to act more environmentally too. When people see how well green action works, that it doesn't give the feeling of "doing without", they will be more inclined to adopt more green actions of their own.

    2. Make money
      1. The traveling public wants environmentally friendly hotels
      2. The socially and environmentally responsible traveler mirrors the cross-section of Americans
      3. Environmentally and socially responsible travelers are loyal guests
      4. Market to your market niche with specifics of your environmental actions so they can find you and give you business

      Numerous studies show that the traveling public wants to stay at lodging properties that have green programs. AAA has found that 34% of their travelers want a green hotel, one that implements water conservation, recycles, and has a water-wise landscaping.

      This section of the traveling public -- your guests -- have a strong brand preference (read brand as what your guests thin and feel about you, your B&B, your products, and your service). This brand is an insulator from discounting, it's your differentiation from the others. Guests who choose you because of your green action are fiercely loyal -- meaning you will make more money with them than with other guests.

      Marketing to this group will take a different approach than you traditionally have used. Since you don't know what green actions mean the most to them, you need to specifically tell potential guests what your environmental program is. Sell your green program actions as benefits to your guests, being clear that they won't miss any luxury or service. You still have to have the right price point, provide great customer service and have a desirable location. And then your brand, your green program, has to stand for something and be meaningful to your guests. There's no room for lip service in this niche, so be sure to under promise and over provide, esp when it comes to your green actions.

    3. Save money
      1. reduce utility costs -- water, energy and trash removal
      2. reduce labor costs
      3. reduce re-purchase of supplies -- sheets, towels, amenities, and cleaning supplies


  5. Profitable Trends
  6.  highlights are what we see as trends 

    1. "Inexpensive" actions
    2. Many green actions don't take any financial investment and save you water, energy and supplies, which saves you money, from the beginning of implementing that action. These actions include a linen reuse program, recycling, and composting.

      1.  sheet/towel reuse program     (Towel/Sheet Reuse Program Article)
      2. A sheet and towel reuse program saves these plus labor, giving you about a $.55/day/guestroom savings in water, energy and supplies savings. I've seen statistics reflect water and detergent savings, but nothing stating specifically how much energy is saved in a linen reuse program. For each guest who participates in this program, 4.5 gallons of water and 1/8 c detergent are saved daily. If about 70% of your guests participate in this program with the conventional approach, them taking a specific action if they don't want their linens changed, just think how many more would participate if you asked them to take a specific action if they did want their linens changed! In addition to saving water and energy, you additionally save money by not buying sheets and towels as frequently; washing and drying linens wears them out, shortening their life span.

      3.  recycle and precycle 
      4. compost
      5. Recycling and composting reduce your waste stream. If you can recycle about half of your trash, you can cut your waste disposal bill in half. Of the half you can't recycle, about 22% is food and yard waste that can be composted (based on 11% of the waste stream being food, and we've already taken 50% out for recyclables). Composting not only reduces your waste stream, the resulting product also can be used to enrich your garden soil. If you don't have the space to compost, there are composting companies that will gladly take your food waste.

      6. durable and recyclable/compostable service items
      7. not providing newspapers to each occupied guestroom
      8. Lodging properties take great pride in offering newspapers to their guests. What an environmental waste. It doesn't matter if the hotel doesn't pay for the papers, they have to be disposed of, and that costs money. And so many of the papers go unread! Wouldn't it be better to provide papers to only those who requested them? Maybe the papers could be shared, say in the coffee shop or a common area for hotel guests only. One Boston hotel delivers papers to those who request them in reusable canvas bags, which are hung on the guests door. An Austin hotel provides enough papers in the lobby for about 1/3 of their guests from a designated spot in the lobby. There are lots of ways to look generous and to provide great service to your guests, but to do it without wasting natural resources is a good busines plan.

    3. "Moderate-priced" actions
    4. Some green actions take a minor investment but then provide immediate and long-term benefit. Compact fluorescent light (CFL) bulbs, xeric or water-wise gardening, low-flow water fixtures, energy efficient appliances, and gray water systems fit into this category.

      1.  energy efficient lighting  , like LEDs (light emitting diode) and CFLs (compact fluroscent light)  (Energy Efficient Lighting Article)
      2. CFLs cost more incandescent bulbs, but last longer and are cheaper to operate; you save energy costs and labor costs because you don't have to have the lights changed frequently. If lighting accounts for 30% of your energy consumption, and you can reduce that by 80% with the use of CFL, you can realize about a 24% energy savings each month you have them. The color is much better today than even 10 years ago. And when you buy an electronic ballast, you have an immediate on, no more waiting as with the old magnetic ballasts.

      3.  low-flow faucets and showerheads 
      4. Low-flow fixtures and energy efficient appliances have an up-front cost, but there are often tax incentives and financial assistance programs to help with the purchases. And as with the other items in this category of green actions you can take, they will keep on saving your money long after you have paid for their investment.

      5.  xeric gardening 
      6. The concept behind a xeric garden is that you don't have to add more water than is naturally available to keep the garden looking vibrant and beautiful. Even xeric gardens benefit from some additional water during droughts or windy periods, but if the plants are native to your location they'll survive a drought without added water. Planting xeric plants will cost you additional money, if you are replacing an existing garden, and will take a bit of extra water the first few years to help it reach maturity, but once it's established you won't have to water, fertilize or use pesticides.

      7. gray water system
      8. Gray water systems are a controversial topic. So many communities have outlawed them, making this discussion moot in the sense of it being something you can run right out and do. But, by your being educated on the benefits of a gray water system may help you educate your government officials so they will be willing to reconsider allowing them in your community. Gray water is the water that comes from sinks, tubs/showers, washers and dishwashers. If that water is used to irrigate your garden and lawn, you save processed water from being used that way and you help clean the water before it returns to the water table, streams and lakes/ponds where it can be used again.

      9. low- or dual-flush toilets  (Low- and Dual-Flush Toilet Article)
      10.  Energy Star appliances   (website link)
    5. "Expensive" -- in effort and investment -- actions
    6. Green actions that take a large financial investment but have immediate payoffs include individual climate control systems, alternative energy, and energy management systems. These systems let you control not only the climate in your B&B more precisely, but to also reduce your reliance on the utility company, oil -- both foreign and domestic, and have a steadier, cleaner fuel source.
      1. alternative energy
      2.  individual climate control 
      3. energy management system

  7. Promote yourself
  8. Promote your "Green-ness" specifically and loudly. No matter how good it feels to do something good for the environment, it also feels good to make money. Telling prospective guests about your green actions is one way to bring them in to your inn. Don't be shy either. Tell people exactly what you are doing at your hotel, and let them choose you over competition that's not taking green steps, or at least not as many or as specifically as you do.
    1. On your website
      1. use a "green" or environmental link/tab
      2. place text throughout your site
      3. display a logo for the accredidation and associations you have

    2. In your brochure

    3. At your B&B

    4. Sample Best Green Hotel Listings

    If your decide to be -- or already are -- a green hotel, then that is part of your market niche. You want to attract people to your inn who want the experience you offer, people who share your values, and people who will learn from your example. Of course you'll gladly host those who don't care the same way you do, but you really want the environmentally sensitive travelers.


  9. Random facts
    1. 5% of the world's population is in the U.S.
      25% of the world's consumption is in the U.S.

    2. There are about 20K B&B in the U.S., 50K hotels in the U.S.
      Worldwide there are about 50K B&Bs and 100K hotels.
      Based on my research for Best Green Hotels, about1% are green.
      I know there are lots of lodging properties that are green but are not promoting themselves that way online, but how many more are there than I have found? 2X, 5X 10X?

    3. 34% of AAA's traveling public wants green lodging.

    4. Water is an abundant resource -- the earth's surface is 71% water.
      Only 2.5% of all of that water by volume is potable.
      Of the potable water, nearly 70% is frozen, nearly 30% is subsurface, both as soil moisture and in underground aquifers.
      That leaves .008% usable for people.
      Whew! If you like statistics and want to see even more about water, visit Earth's Water, a water supply education page.

    5. One guest participating in a towel/sheet reuse program saves 4.5 gallons of water and 1/8 c of detergent per guestroom daily.
      There are energy savings too, but I've not found any quantification of that amount.
      70% of your guests will participate in a towel/sheet program, saving your about 55 cents/room/day in utilities.
      Each guest participating in a towel/sheet reuses program saves at least $1.00-1.50/day/guestroom in labor, supplies and utilities.

      Do the math for your inn and see what the savings to you would be.
      That savings to you equates to a benefit for the planet as well.

    6. Roughly 20% of processed water is used by manufacturing and industry,
      6% in residential settings,
      and 74% by irrigation/agriculture.

      The pressure on more potable water increases as the population grows, our agricultural needs expand, and business needs increase. You can control your business's needs and help yourself and your guests.


    7. Habitat Suites in Austin, Texas, has:
      - installed an energy savings tool called Smart Systems thermostats- save 328 kWH/guestroom annually
                [I pay $.105203/kWH for my electricity.
                At that same rate, Habitat Suites saves $34,313.89/year.]

      - installed solar PV cells that generate produce 260 kWH/guestroom of renewable energy annually.
                [That equals a $2,630.08 electric savings yearly, at my electric rate.]
      - changed their pre-rinse nozzle and removed their food grinder, saving 365 gallons and 521 gallons of water per guestroom annually
                [I pay 1 cent/gallon of water.
                At that water rate, they would realize a $350.40 and $500.16, or $850.56, annual savings ]

      - replaced common area toilets, saving 346 gallons of water/guestroom annually
                [That translates to an annual savings af $332.16]
      - reduce their waste stream by reusing their plastic cleaning bottles, refilling them from 5 gallon drums that get refilled rather than replaced. This "Reuse vs.. Recycling" of plastic bottles- saves 125,000 cubic feet of material from the recycling process each year.
      - started measuring their progress; a quarterly trash audits allow us to measure the success of their recycling, pre-cycling and trash reduction programs.
      - recycles 2.5 times more material than is put into their trash dumpster.
      - composts their food scraps, creating material to nourish their gardens with
      - installed a salt generator for their swimming pool, removing 350 lbs. or chlorine from the property annually.


  10. Random thoughts
    1. With the hospitality industry being part of the 20% consumption figure, we are significant players in the upcoming water crisis. It's time for the hospitality industry to step up and lead the way in resolving the problem before it becomes a crisis. The price will be high for all of us if our attitudes and actions don't change soon. The economic and public relations benefits of being proactive will be a significant plus for the industry if it is proactive -- and a big black eye if it waits too long.
    2. The cost of energy -- electricity, gasoline, natural gas, propane, diesel -- is going up. That effects every aspect of your life. You can control some of that cost by conserving, by changing your buying habits, and implementing alternative energy at your inn.
    3. Pollution and chemical sensitivities are on the rise. You can do your part to minimize the impact on yourself and your guests by using non-petrochemical cleaning supplies, natural building materials, low VOC furnishings and coverings (including paint, varnish, fabrics and carpets), and fresh air.
    4. The price of water is subsidized by the U.S. government; even more so than the price of oil. If we paid for our water what it cost to get it to us, I have no doubt that we'd be more conserving of it than we are.

  11. Green Links
    1. Green accreditation
      1. Green Globe 21
      2. Green Leaf (Terra Choice)
      3. Green Seal
      4. International Accreditation Leads
      5. ISO 14001
        1. unofficial site
        2. official site
    2. Green PR
      1. Best Green Hotels
      2. Fresh Stay
    3. Vendors
      1. Amenities
        1. Pineapple Hospitality
        2. Herbaria
      2. Cleaning supplies
        1. Seventh Generation
        2. Sun and Earth
        3. Bona  - for hard surface floors
        4. StainSolver
        5. Cleaning Products as reported by Green Guide
      3. Energy efficient lighting
        1. LED Lighting #1 and LED Lighting #2
        2. GE
        3. Greenlite
        4. Westinghouse
      4. Fair Trade coffee
        1. Green Mountain
        2. A resource list of Retailers
        3. Newman's Own
        4. True Brew Coffee

  12. Green Books
  13. 1.   Cradle to Cradle Remaking the Way We Make Things
    Changing the way we think about "softening our step" on the planet is the focus of this book. Minimizing harm isnít the way to go, according to the authors William McDonough and Michael Braungart. Recycling is actually "downcycling", and there are better ways to approach consumption. Mimicking nature and recycling content completely, doing no harm, and finding truly renewable resources for our manufacturing and consumption are the solution to our approach to manufacturing, business, and life.
    Cradle to Cradle
     
    2.   The Ecology of Commerce
    Paul Hawken, the author of this provocative environmental-awareness book, takes the stand that businesses in first-world countries should not only reduce their consumption of resources and energy, but also create climates that are satisfying for their employees. He believes that we need to we, as a society and as business people, need to stop degrading otherís environments, slow our consumption of goods, and take a more human-centered approach to enterprise.
    The Ecology of Commerce
     
    3.   Mid-course Correction Toward a Sustainable Enterprise
    "Do Well by Doing Good" is one chapter title of this book, and the basis of this author and CEOís approach to remaking his business, a commercial flooring company in Atlanta, Georgia. Ray Anderson has embarked on a mission to make his company a sustainable corporation by fighting waste and pioneering the process of sustainable development. He argues that we all need to take care of our environment and its natural resources. Furthermore, not only is doing good the right thing to do, but also itís the smart thing to do.
    Mid-Course Correction
     
    4.   Natural Capitalism
    Business can be good for the environment, according to authors Paul Hawken, and Amory and Hunter Lovins. The premise of this book is that market principles need to be applied to natural resources and other sources of material value. They strive to expose the myriad ecologically smart options available to business and how these options can readily be adopted. Companies can practice a more efficient and profitable business while saving the environment.
    Natural Capitalism
     
    5.   The Sustainability Advantage Seven Business Case Benefits of a Triple Bottom Line
    How do you balance the demands of your guests and employees with the innís bottom line and your ROI? Bob Willard shows that the business benefits of sustainability are quantifiable, and he does so in a language business owners can relate to. You can see the benefits of the "triple bottom line" which is relevant to both short- and long-term goals and priorities.
    The Sustainability Advantage


For more information about green travel tips, read these articles:
Consumers Seeking Green Hotel Eco-labels
Why Environmentally Friendly Hotels
Why Sustainable Travel and Tourism

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