More than 70 percent drop in overnight stays

The hotel industry is suffering from the corona pandemic. One reason for this is the one-sided focus on business tourism.

All the hotels in Zug are currently missing overnight guests: Due to the corona pandemic and the measures to combat it, the hotel beds are remaining cold. "We have had a drop of 70% to 80% percent in the overnight stays," says Renya Heinrich, Managing Director of Zug Tourism. Tourism in the canton - mainly in the business tourism/business sectors - has almost collapsed since March. Due to the lack of positioning in the areas of leisure and experience, there was only a marginal amount of urban tourism. "Because Zug has never relied on the leisure tourism sector, no Swiss guests, or only a very few, were attracted in the summer," says Heinrich. An overview of the city of Zug shows it clearly: gastronomy and the hotel industry here experienced huge losses, while other cities and destinations were even able to generate very good figures. Renya Heinrich cites Solothurn or Schaffhausen as examples, but also some recreation areas around Zug that focus on leisure, culture and recreation.

Stefan Gareis, director of the Parkhotel Zug and the City-Garden-Hotel, also speaks of a marked decline in sales. He is also president of Hotellerie Suisse – the regional section of the national trade association, and is in close contact with other hoteliers, and has heard similar stories from his colleagues.

There is still a close cooperation with Gastro Zug and its president Barbara Schneider. "We inform the government council (Regierungsrat) together," he says. This benefits both of them and the government, and the current focus is on whether there will guidelines for the festive season. Specifically: "Can we serve guests until 1 a.m. on New Year's Eve? Otherwise, the operation is almost not worthwhile." Needless to say, the two presidents are also considering further questions. For example, how the operations will survive the next few months.

"We have received a great deal of understanding from the government, and especially from the Economics Directorate, and are being well supported."

The companies are doing well, given the circumstances
The situation in Zug is not quite as precarious as that in Lucerne, however, where the hotel industry recently drew attention to its desolate location by setting up empty beds in a local square, and where many businesses are on the verge of extinction. "Until now, most hotels have not required any credit," says the president of the trade association. "Zug is small, the industry is manageable and everyone knows everyone." This is a major advantage, among other things in terms of the cohesion of hotel operators. Many hoteliers are also locals who own their businesses. "The fact that many of these are private property eliminates the pressure of having to pay rent."

The Parkhotel and City Garden Hotel are owned by Zug Estates. The real estate company decided in October to temporarily close the CU restaurant at the City Garden Hotel, while the gastronomy in the Parkhotel will continue to operate. "There's always a bit going on in the gastro and in the hotel." The Parkhotel currently has an average of 20 to 25 guests per day. "This is good for the motivation of the employees, and the guests also appreciate the fact that we are maintaining the operation of the company," says Stefan Gareis.

Working together, the Zug hotel operators have decided to take advantage of the canton's assistance for financial hardship. The relevant forms can be submitted as early as 1^st December. "The hotel sector creates jobs and the companies that are located here rely on rooms being available," explains Gareis. "Thankfully, the Zug hotels can still manage to bridge and, as far as I know,  to pay the wages and bills until the end of the month."

More city travellers should come to Zug In the future, for example to visit the old town.
Photo: Stefan Kaiser (May 1, 2019)
Stefan Gareis              Picture: Patrick Hürlimann
Renya Heinrich, Zug Tourism            Picture: Maria Schmid

A sigh of relief isn’t appropriate for the time being, however. Stefan Gareis expects three more strenuous months. "Zug is not a winter holiday destination." But he is cautiously optimistic about the second quarter of 2021. The promise of corona vaccinations and the warmer weather could lead to a significant relaxation. "Maybe there will even be a boost," he hopes. "Many people will finally want to meet their business partners directly again, and people have a desire for holidays and travel."

Zug Tourism will also focus on domestic leisure guests in the future
Renya Heinrich, on the other hand, does not see the future as rosy: "I don’t expect any recovery over the winter, especially as we still have restrictions and reduced travel activities in the international area." According to forecasts by Switzerland Tourism, business tourism will not fully recover until 2023/2024. Companies will have to rely on home office for even longer, and the new forms of work could remain at least partially in place in the future. The solution for Zug Tourism is therefore also a new orientation. "We are hoping for a relaxation in the spring, and are working hard to attract more Swiss leisure guests to Zug next year, by means of a new strategy and appropriate measures," says Heinrich. An enhancement of the image and targeted campaigns should help with this.

Zug Tourism wants to expand the offer and promote urban tourism. A completely new, additional positioning of Zug in the area of leisure and recreation is urgently needed. "Tourists should come to us to visit Zug," says Renya Heinrich. This area has not been heavily targeted as yet, but the current situation shows that a broader orientation is important. "Domestic tourism is also an important economic factor," she explains.