Despite new variants in the ongoing pandemic looming on the horizon, forecasts see the Philippines’ hotel industry recovering rapidly, surpassing even pre-pandemic revenues as early as 2023. With more than half of Filipinos claiming in a 2020 Statista report that they were planning trips to the beach as soon as travel restrictions were lifted, the Philippine hotel industry is expected to reach an all-time high of $2.1 billion by 2025.
It’s a rebound that Barna Hosco, a hospitality group based in General Luna, Surigao del Norte, is uniquely positioned to capitalize on. According to the company’s managing director, Alex Gari, the pandemic was a challenging time for their businesses, which includes Siargao landmark Bravo Resort, but also a deeply productive one. Though the island’s tourism industry took a massive drop, it also provided time to strategize, prioritize, and ultimately chart a clearer path to success in the years to come.
Data pulled from Google searches around Siargao show an all-time high for interest in the Northern Mindanao island around the end of 2017. While likely related to the Paul Soriano film of the same name that came out in December of that year, trends analysis shows correlated searches in flights, itineraries, and lodging on the island. People wanted a taste of Siargao’s specific brand of island living.
Business was booming for the island’s resorts, especially so for Barna Hosco. What began as a 10-room resort and a restaurant quickly expanded into 20 rooms. Because inventory needed to be shipped in from Manila, they began renting space to store alcohol and food supplies for their restaurant. This spun off into its own distribution business, catering to the other resorts and establishments cropping up across the island.
Demand only grew from there. So between 2017 and 2018, Gari’s team began investing in additional land for their expansion—an expansion that would get pushed back a number of times while the business focused on keeping up with existing demand.
It was during this period of rapid growth that tourism took a sudden turn. Travel bans and health concerns overtook the soaring demand for Siargao’s island experience. According to data from Statista, hotels in the Philippines were seeing steady revenue growth over the past few years, leading up to a 2019 peak of $1.6 billion. In 2020, that dropped over 50% to $770 million.
The downturn sent many firms reeling. Gari says his team needed to pivot towards finding ways to not only cut down on expenses, but also take care of the scores of tourists that were stranded on the island—many of whom ended up staying for months. “We needed to adapt to them, lowering our prices by giving them monthly rates, and keeping them entertained,” he said.
Despite this, Gari looks back at this period as a productive one. Buoyed by their years of success, the team was able to take on the challenges of leaner tourism on the island, while also turning their attention to solving the problems they previously couldn’t, due to growth he describes as organic, but way too fast.
Over the next few, relatively slower months, Gari and his team worked on improving their processes—inventory, stock monitoring, and purchasing—implementing new control systems to better professionalize their operations. They also managed to change their booking agent.
“All that work was very difficult to do when we were handling such high volumes. [During the travel bans], when we didn’t have too many transactions, we could actually work on improving things. It was a productive time.”
All this wouldn’t have been possible, Gari says, if not for the stellar team he leaned on during these months. It’s for this reason that he believes Barna Hosco’s primary commitment continues to be to its employees.
“It takes a long time and a [great deal of] effort to build a hardworking team that you can trust with your business,” he said. “It’s times like these when they need you the most, so taking care of them was one of our priorities. Of course, we’ve been practicing skeletal and part-time work schedules, but we made sure that all our core and local employees always had something to bring home to their families, mostly through food subsidies.”
“We wanted them to know they were part of something bigger than just working in a resort, that they were in a company that was going to take care of them, even in bad times,” he said.
While Gari says a number of staff inevitably had to leave for personal reasons, those that stayed proved to be the backbone of the much stronger team they have today.
“We are hiring again, but those team members who stayed, we promoted them to higher positions,” he said. “They are really the ones who are most committed to the company. So right now we have a really solid team.”
With international travel restrictions relaxing, thanks to rising vaccination rates and better information around COVID-19 variants, the hotel industry is projected to continue growing to an all-time high.
Gari intends to ride that swell, with an expansion plan already underway for his resorts. Barna Hosco will be diversifying its offerings across its commercial property investments: building additional rooms, small-scale apartment complexes, and more full-service villas—all running with more efficient systems by a stronger, more experienced team.
“The systems we put in place were really designed for when volumes pick up again,” he said. “We have a much more professional operation going on. I believe we are much better prepared now than we were prior to the pandemic. We just need those international borders to open up so we can really put them to the test.”
With additional reporting by Marga Manlapig.