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Pity the status-conscious executive reduced by the downturn to staying in budget hotels. No attentive bellhop grabs his case as he checks in - he must lug his own luggage. Next morning, he is elbowed at the self-service breakfast bar by tradesmen and sales reps. When he leaves, he takes away no souvenirs in the form of towels, bathrobes or shampoo. There was simply nothing in his tiny room worth pinching.
You will agree it is a pitiable tableau, worthy of a charitable appeal in the pages of Management Today. Yet it will be played out ever more frequently across the country as the slowdown deepens.
Travelodge, the second-largest budget chain, has devised recession-themed adverts targeted at beady-eyed finance directors. It boasts that a Big Four bank has restricted travelling staff to staying in its 340 hotels. Large employers who simplify hotel room procurement this way save money on administration as well as charges, and gain deferred payment terms to boot.
Budget chains are snapping up sites whose viability as office developments has evaporated with the popping of the property bubble. They are pondering the opportunities that stalled house building schemes represent too.
The austerity hoteliers believe they can maintain their cracking pace of growth through the current economic turbulence.
According to TRI, a consultancy, the number of budget bedrooms in the UK increased by 9 per cent, to 95,700, during 2007. The biggest operator, Premier Inn, added 4,000 rooms, taking the total to 36,000. "We have a clear line of sight to operating 55,000 rooms in another four years," says Alan Parker, chief executive of Whitbread, Premier Inn's parent. "Companies are trading down in terms of travel expenses. They have found that they do not need to pay £150 per night when [an employee] can stay in a Premier Inn for £50." Industry analyst Melvin Gold predicts that the share of the hotels market commanded by budget chains will treble to 26 per cent by 2027.
That target looks achievable, even if claims that budget hotels are recession-proof prove hubristic. The success of budget chains is just another example of large, well-run companies exploiting brand, systematisation and economies of scale to grab a growing slice of a mature but fragmented market.
We have seen the process at work many times before in industries as distinct as grocery retailing and trucking.
Budget hotels appeal to the naked hunger for a bargain that was awakened in Britons by years of consumer goods price deflation and the advent of budget airlines. No-frills hoteliers eschew such fripperies as minibars, hairdryers and trouser presses. Generally, there is no restaurant either. One budget hotel where I stayed had no pictures on the walls. It was bleak even by the standards of central Asian hotels I visited before the fall of communism. These were at least decorated with jolly photos of Comrade Lenin.
However, "all hotel rooms look the same when you put the light out" as Guy Parsons, managing director of Travelodge, pragmatically points out. Rigorous procedure is one way he keeps costs down. For example, chambermaids have strict deadlines for completing each part of changing a room. They work with the same focused urgency as Formula One pit mechanics, Parsons claims.
Brisk business
This helped Travelodge to generate earnings before interest, tax and depreciation of £46 million last year on sales of £244 million. The pre-tax loss was a stonking £63 million, reflecting the heavy loan payments that make fast growth a necessity for this buy-out company.
Premier Inn, for its part, produced earnings before interest and tax of £178 million on turnover of £528 million in the year to February 28. It has enlisted Lenny Henry to appear in TV adverts that contrast the thrifty comforts of its hotels with the tatty horrors of a traditional guesthouse. One suspects that the cuddly Dudleyan has also been deployed to counteract less appealing comedic connections. Alan Partridge, the naff chat show host invented by Steve Coogan, lodged in a budget hotel "equidistant between Norwich and London" after his career failed.
Roving professionals will feel status anxiety akin to that experienced by sports-casual Alan in months to come, as employers cut accommodation budgets.
Go-getters accustomed to the decadent opulence of the Hyatt or Marriott will find themselves banged up in stark rooms, vainly searching for the hairdryer or marvelling at the diminutive size of the soap.
The more regrettable victims of the budget hotel trend are the small entrepreneurs who will be driven out of business. Guesthouses are losing traditional downmarket custom to the interlopers. Will Williams, who runs a Caernarfon guesthouse, describes the growth of budget chains as "absolutely terrifying". The town already has a Premier Inn. A Travelodge is in the pipeline. "It will kill a lot of businesses," says Williams.
That is tough. But that is capitalism. The beauty of budget hotels is predictability. An advance booking costing around £30 buys a night in a small, clean room and a high degree of anonymity. In contrast, a stay in an unfamiliar guesthouse may expose guests to: a) chintz b) a large dog barking madly behind a flimsy door c) a proprietor who regales them with descriptions of his hernia operation while serving the full English breakfast. As one guesthouse owner grudgingly puts it: "Budget hotels aren't great, but they are consistent."
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