February 16, 2011
By Staff Reporter
The Irish Hotels Federation yesterday said wage cost increases of between 8-15 percent, insurance hikes of up to 200 percent and electricity rises of 14 percent meant that margins were being squeezed and, in many cases, profitability wiped out.
Murphy said hotels and guest houses were dependent on room sales for their profitability but he said the July CPI showed that hotel room prices had only increase by 1.2 percent a quarter of the rate of inflation against a background of spiralling costs.
“2002 has been a very worrying year for the sector, which directly employs almost 60,000 people. Fifty-one percent of our sector says business is down on last year an extremely poor year given foot-and-mouth disease and Sept. 11,” IHF President Jim Murph said.
“The sector has seen a sharp decline in the number of overseas tourists from all markets, with the U.S. market down 29 percent on the 2000 figure.”
The hotels chief hit out at what he called “inaccurate, hyped and unsubstantiated reports” that there is overcharging in the sector and he said this had not helped the situation.
“Irish hotels and guest houses are offering good value for money, an excellent product, experience and service,” Murphy said. “Criticisms that overcharging occurs are largely unfounded. Unfortunately, there seems to be a rush to point fingers that is not based on proper like-with-like comparisons to other EU countries and the prices they charge.”
Correction
Due to incorrect information provided by the company, a “Businessbriefs” column recently reported that the Hamel Linen Company, based in Donegal, sells its special-occasion wear for girls and Christening robes in Bloomingdale’s and Saks Fifth Avenue in New York. Neither store stocks the Hamel line.