Over just a few years, the business environment facing hoteliers has changed radically. The new realities, if not permanent, are at least likely to persist for a while, and include the following:

• Consumer’s value mind-set and sense of empowerment, contributing to real declines in average rates

• Potential of war and additional terrorist activity, coupled with general economic uncertainty and a shorter booking cycle in all segments, rendering forecasting more of a guessing game than at any other time in recent history

• Increased competition from nontraditional sources (cruise ships, corporate housing, time-share)

• Potential shift to new ways of conducting business

Companies that develop effective strategies for dealing with the impact of these issues, rather than hoping the issues will quickly fade away, will be the winners.