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Accommodation and competitive advantage

Michael Porter, one of the foremost business gurus and frequent contributor to Harvard Business Review, quite often states that increasing barriers to entry for an industry will help sustain profitability of those companies already taking part in the industry. Many of his articles state that increased growth isn’t always a good thing, and that securing unique competences through design and unique employees will be crucial to secure sustainable competitive advantage for profitability.

The accommodation industry in Whistler is clearly facing pressures from new market entrants. For example, there are four certain entries into the market that have the potential to erode market current share and decrease occupancy; The Four Seasons, The Pan Pacific, Nita Lake Lodge and the future IROC development. Although the Four Seasons and perhaps Nita Lake will likely attract many different market segments to Whistler; the other two, The Pan Pacific and the future Intrawest Resort Club likely will not. All of these projects have all been accepted by municipal planners and are set to be fully completed in the coming years and nothing can be done to stop that. On the other hand the Hyatt and Boot Sites, two large areas of land directly beside the village, have not yet received development permits for accommodation.

The competitive pressures from new market entrants, combined with tourism, education and industrial economic growth in Squamish just waiting to be released, means that the demand and competition for frontline and management employees within the Sea to Sky corridor is bound to heat up. Providing resident employee housing in the great community that we are may be the only way to ensure that Whistler and its many hotels secure a future work force and a vibrant community.

Based on these assumptions; would it make sense for Whistler’s accommodation sector to purchase the current Hyatt lands to create a barrier to entry for new competitors? What about the Boot hotel site?

From a municipal standpoint, could it potentially make sense to restrict the development of the accommodation units and therefore reduce demand for new employee housing?

Perhaps the municipality and local accommodation industry could partner together, with hotels purchasing the Hyatt or Boot lands for their employees and the municipality shifting tourist accommodation zoning to resident housing. I don’t have specifics of the purchasing costs or the exact economic benefits, but hotels would gain by not losing market share and by ensuring a reliable workforce, and the entire community would gain by having less housing pressure, happy residents, happy local business owners and happy visitors.

Dan Wilson

Whistler

It was an idyllic day for the Remembrance Day ceremonies outside the firehall on Thursday. The sun was shining; the community turned out by the hundreds; the fire department did a great job in hosting the event. I remember in years gone by listening to the ceremony, looking at the lovely views and feeling blessed that our family has the very great fortune of living in a peaceful, safe and beautiful town. Same sentiments this year with one very notable exception.

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