Evaluation of financial consequences of closure or temporary conservation of hotels in various regions and cities most affected during the pandemic: cases of Geneva, Bali, and the Maldives

Abstract

Object: This study evaluates the consequences of closing down hotels and scaling down operations by other hotels. The work answers how the closure affected the communities living in the cities under this study. The study focuses majorly on the economic impacts of the actions taken by the hotel owners to close entirely or reduce operations. The study seeks to determine how the closure and temporary conservation affected different people.
Methods: Interviews, online survey, statistical tools and instruments, quantitative research, random sampling, structured questionnaire, analysis and synthesis.
Results: COVID–19 caused a severe recession since its invasion in early 2020. Many people had to deal with the consequences it brought along, especially in economics. These consequences led to several businesses’ closure, with the hotel sector taking the biggest hit. The hit was because of the travel restrictions that were imposed on preventing any further cases of a pandemic. As a result, many hotels opted to close their operations and convert their premises into other functions, such as quarantine centers. The hotel sector suffered massive financial and workforce losses, as some experienced employees opted for other jobs. Many hotels are still working on various stabilizing the businesses after reopening. However, the effects will be long term because of the severe financial crises during the closure period. They may regain their balance, but it will take time to get back to normal. Tourism is among the main factors that sustain the hotel industry in Bali, Geneva, and the Maldives. Many countries will still observe strict measures regarding their immigration policies, which will mean a slow resumption of tourist operations.
Conclusions: The hotel owners should also invest in several countries where their customers come from. With such investments, they can refer their customers to visit their local hotels to get similar services they would seek abroad. In such cases, hotel managers should have reserve funds that can shelter them. The hotels can reserve part of their profits to sustain them in another pandemic with a proper plan. Relying on insurance firms is unproductive, since many insurance companies do not cover the effects caused by pandemics. The pandemic affected the world population, and the shutdown adversely affected the hospitality sector. The pandemic attacked the hospitality industry with unseen challenges. The strategies to flatten the infection rate curve like social distancing, lockdowns, mobility, and travel restrictions led to the temporary closure of the economy in the hospitality business across the planet. The closure had a significant decrease in demand among the companies allowed to carry on with their operations. Almost a good number of restaurants across the world were controlled in the operations and only allowed for takeaway services. The restrictions imposed on travel and lockdowns led to a sharp decline in hotel revenues and occupancy.