Prior to the COVID-19 pandemic, fierce competition drove the tourism industry. Businesses worked independently, with no sense of shared mission. Now, more than two years on, one industry executive said that's all changed.
On a recent episode of Influencers with Yahoo Finance’s Editor-In-Chief, Andy Serwer, Sandals Resorts Executive Chairman Adam Stewart explained how COVID-19's effects on the economy helped to "unify" players in the tourism industry.
“I saw in COVID, a level of unification amongst competitors, that was second to none,” Stewart told Yahoo Finance. “The cruise industry came together with the land-based hospitality industry, came together with the airlines, came together with associations like the World Travel and Tourism Council.”
Sandals is made up of five brands and has 24 properties in eight countries including, Antigua, The Bahamas, Grenada, Barbados, Jamaica, Saint Lucia, Curaçao and Turks & Caicos.
Supply chain challenges
Stewart said the industry is now bearing the brunt of supply chain issues spurred by the pandemic as well as crushing inflation. For example, though many items sold by the tourism industry in Jamaica are manufactured locally, the country still relies heavily on overseas imports. For instance, Jamaica imported $1.12 billion worth of food in 2021, according to the International Trade Administration. Sixty percent of those imports were for the hotel, restaurant, and institutional sector.
“Just to get all the, what we call in the in the hotel industry, the circulating inventory — So, the linens and the food and all the elements that we can procure locally, but even locally, right now in Jamaica, we're having issues with glass bottles.” Stewart said. “So, for alcohol products, they're just unable to get the raw materials to finish the product.”
Stewart added that the global chip shortage is also creating challenges for his company's work with the automobile business. “Our group is also in the car business. We represent BMW and Mini for this region in the Caribbean, [and there have been] lots of supply issues between chips and different elements made within the cars,” he said.
Fortunately, Stewart says, the tourism industry has been able to tackle global supply chain issues by working together as in during the pandemic.
“Everyone worked daily on this recovery,” Stewart said. “I think you're starting to see it more and more now on the supply chain side of people just trying to do everything they can to get over the hump of these supply chain issues.”
Stewart went on to say that economic adversity has changed the way workers relate to one another in the tourism industry.
“What it's forcing you to do is ... to work your relationships more, from a shipping point of view on, and just moving product from wherever it's made anywhere in the world,” he explained. “And it's requiring a different level of infrastructure. ... We're running a team about 25% larger today than we were in 2019.”
Despite staffing up, Stewart said labor shortages are another challenge facing the industry.
“On the labor side, it's a bit of a big mystery where everyone's going, where they're all going to work. There are a lot of people leaving and moving between industries,” he remarked.
Yet, he says that Sandals, is an “employer of choice” and provides employees with educational opportunities and skills training to move onto other professions. For instance, employees can enroll in Sandals Corporate University, where they can earn a masters degree or even a doctorate.
Stewart reflected, “So when you put it all together, Sandals really, all things being equal, has a lot more attrition and rotation of staff than probably most any other business in this hemisphere.”
Dylan Croll is a reporter and researcher at Yahoo Finance. Follow him on Twitter at @CrollonPatrol.