Saskatoon hotel performance
performance is revenue per available room (RevPAR). RevPAR takes into account the occupancy rate, the average price paid per room (the average daily rate, or ADR), and the number of rooms available in the hotel. Comparing revenue to available rooms creates a standard unit of measure for different-sized hotels that encompasses both volume of business (occupancy) and pricing (ADR).
As in any other industry, another important measure of success is supply and demand. Supply in the hotel industry refers to how many hotel rooms exist. Increases in this number most often represent new construction. Demand refers to how many people have stayed in hotel rooms. Canada had a strong year in 2017 in RevPAR. This overall strength was brought about by impressive RevPARs in Canada’s primary markets – Toronto, Vancouver, and Montreal. In addition, it was a great year for visits as all markets benefited from Canada’s 150th birthday celebrations.
While Canada’s major markets were enjoying this performance, Saskatoon posted lower than average numbers, sliding into the position of being one of the 10 weakest RevPAR growth markets in the nation – dropping by 9.5% year over year.
Analysis of the key performance measures in Saskatoon reveals that poor 2017 RevPAR was a result of declines in ADR. This was brought about by three years of supply outstripping demand.
In 2018, Saskatoon looks to enjoy its first year-over-year RevPAR growth since 2014. Steadily increasing demand and limited new hotel supply will lay the foundation for hotels to strengthen pricing, which will help RevPAR recover.
Source: CBRE Hotels Accommodation Industry Outlook Presentation 2017/2018; STR STAR Summary Reports December 2015, December 2016, December 2017, and May TTM 2018; HVS Hotel Valuation Index Canada–Saskatoon 2018, and additional information provided by Airline Hotels.
Confirmed steps toward a safer workplace
As Saskatchewan workers, employers, safety organizations, and other partners answer the call for a safer workplace, the total injury rate continues to decline steadily in our province. Most importantly, more people are going home safely at the end of every shift.
Comparing 2017 with 2016, the total number of injury claims decreased by 1,001 – that is a decrease of more than 3%. On December 31, 2017, the total injury rate was 5.25%, which dropped from 5.55% the previous year. The total injury rate includes “no time loss” as well as “time loss” claims. The time loss injury rate remained the same as in 2016 at 1.86%.
Source: Saskatchewan Worker’s Compensation Board 2017 Annual Report.
What does Saskatchewan’s innovation report card look like?
The Conference Board of Canada defines innovation as “a process through which economic or social value is extracted from knowledge – by creating, diffusing, and transforming ideas – to produce new or improved products, services, and processes.”
There are two types of innovation: radical innovation and incremental innovation. Radical innovation includes breakthrough technologies (e.g., 3-D printing), new products (e.g., smartphones), and new services (e.g., Uber) and often attracts more frontline news focus.
But incremental innovation is just as important. It is the improvements in productivity, economic growth, and job creation resulting from successful, robust innovation activities. For example, substantial productivity gains are achieved by adopting new information and communication technologies or by implementing more efficient approaches to knowledge management. These
activities result in more resources being available to support spending in education, health, infrastructure, and other areas, improving the success of firms and organizations and the economics and well-being of communities.
Innovation drives an economy’s ability to create more economic value from an hour of work, thereby increasing economic output per capita. The resulting productivity growth creates potential for rising wages and incomes, and thus for a higher standard of living.
To measure innovation performance, the Conference Board of Canada’s report How Canada Performs† evaluates innovation indicators that represent both types of innovation. The report includes an innovation report card that compares the provinces, Canada as a whole, and 15 peer countries. The latest report card was published in May 2018.
The 10 innovation performance indicators presented in the innovation report card cover the three main dimensions of innovation referred to in the Conference Board’s definition of innovation: capacity, activity, and results.
Innovation performance indicators
• Public research and development (R&D)
• Researchers (engaged in R&D)
• Scientific articles
• Entrepreneurial ambition
• Venture capital investment
• Business enterprise R&D
• Information and communication technology investment
• Enterprise entry
• Labour productivity
Entrepreneurial ambition is defined as the proportion of the population aged 18–64 who report early-stage entrepreneurial activity, including attempts to establish, or owning and managing, a new business. The enterprise entry rate is the number of new businesses as a percentage of the number of active (i.e., entrant + existing) businesses in a given year.
In the May 2018 report card, Saskatchewan earned an A on entrepreneurial ambition and a B on enterprise entry, but scored poorly on nearly all other indicators, earning the province an aggregate of D− on the innovation report card. Saskatchewan earned a C for scientific articles – down from a B in the previous report card – and a C for labour productivity.
It is clear that the province’s innovation growth could benefit from focusing on spending and attracting capital for innovation: the province scored D for venture capital investment and public R&D, and D− for business R&D, information and communication technology investment, patents, and researchers.
For businesses to stand apart in Saskatchewan’s innovation landscape, owners’ and managers’ efforts to grow innovation should go beyond maintaining the entrepreneurial spirit. They should be
more willing to prioritize innovation that leads to higher productivity and innovative technology.
Source: The Conference Board of Canada, How Canada Performs,† May 2018.
† How Canada Performs is an ongoing research program at the Conference Board of Canada that helps leaders identify relative strengths and weaknesses in Canada’s socio-economic performance.
* Expert Panel on Business Innovation, Innovation and Business Strategy: Why Canada Falls Short (Ottawa: Council of Canadian Academies, 2009), 27.
First published in the September 2018 edition of The Business Advisor.