More overused clichés in the hotel industry
 
More overused clichés in the hotel industry
04 NOVEMBER 2015 9:08 AM

STR Analytics is back to explain more overused clichés in the hotel industry, including: meat on the bone; black swan; and more.


The hotel industry will probably never have a shortage of overused clichés. First, we explained such gems as “runway” and “supply creep.” Now we’re back to explain three more overused hotel industry clichés.
 
Meat on the bone
This term is heavily favored by hotel brokers and refers to the need for the hotel to continue to grow profits after it sells. For example, if you buy a hotel at the peak of a cycle, there’s no room for it to increase value so you don’t have any true upside potential if you want to flip the hotel a couple years later. Some brokers would tell you, “We’re in the seventh inning and almost out of runway.” So, if you buy a hotel right now, it might not have any meat left on the bone for you to enjoy.
 
Black swan
The term dates back to 1867 and is used to describe something that is unexpected or not believed to exist, and its mere presence results in the would-be undoing of the logic of any system of thought. In modern usage, a black swan is an event that comes as a surprise, has a major effect and is often inappropriately rationalized after the fact only with the benefit of hindsight. 
 
In 2008, the failure of Wall Street’s banks—paving the road for the Great Recession—was truly a black swan event. Since then, black swan events for the hotel industry have included: Government sequesters; the euro prices; and debt-ceiling battles. 
 
However, most pundits use the term black swan as something recognizably bad on the horizon. But black swans, by their nature, are a surprise and not always necessarily bad. The 50% decline in oil prices last year was a positive black swan for most U.S. markets.
 
Disruptor
Not a lot of explanation is needed here: A disruptor is something that disrupts. For the hotel industry, an example of a disruptor would be Airbnb. The only issue we have here is that the term “disruptors” is used so much it starts to sound like a villain from a movie or maybe the name of a Transformer.
 
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  • Joel Ross November 4, 2015 5:37 AM

    you are sort of generally right describing black swans but the 2008 bank failures were forseen by many people outisdde the hotel industry. In fact as early as spring of 2007. Read Bernanle's book and you will see they did not see the depth but did see the coming storm in 2007. It was not a balck swan at all to those who were looking at the capital markets. Sequesters, Debt ceileing battles etc are not black swan events-they are simply Washington doing its usual dysfunctional behavior that we have all come to expect. A true balck swan is 9-11 or a similar event. Lehman was a black swan but not the collapse of the financial markets-at least not to a lot of us. There is no such thng as a positive black swan event. It only relates to bad shocks to the system.

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