site.btaRising Prices of Goods and Services Now Biggest Challenge for Bulgaria's Hotel Sector, Survey Finds

Rising prices of goods and services have become the most serious challenge facing Bulgaria's hotel sector, according to the results of the annual national survey "Business Climate in the Hotel Industry 2025/26," conducted in February by the Hotel Forum (HTIF) and the Bulgarian Association of Hotel Executives (BAHE), the organizers said on Wednesday.

More than one third of respondents identified inflation as the main problem for their business, overtaking staff shortages, which ranked second with 28%. This marks a significant shift compared with previous years, when lack of personnel traditionally topped the list.

Occupancy and Pricing

In 2025, nearly 40% of hotels reported an average annual occupancy rate between 50% and 70%. Almost equal shares achieved occupancy above 70% (28%) or below 50% (26%).

As regards the average daily rate (ADR) in 2025:

• 40% operated in the BGN 100–200 range,
• 30% charged below BGN 100,
• around 20% reported ADR between BGN 200 and 300,
• 10% operated in the BGN 300–500 range.

Close to two thirds of hoteliers adjusted room prices in line with inflation last year, with increases typically not exceeding 10%. One fifth did not raise prices at all, and only a small share reported increases above 10%. For 2026, most expect price rises, if any, to remain around or below annual inflation levels.

Cost Structure and Revenue Expectations

According to 60% of respondents, labour costs saw the sharpest increase, followed by costs for goods and services and utilities (18% each).

Revenue expectations for 2026 are described as conservative:

• roughly one third expect growth of up to 10%,
• one third expect no change,
• 15% anticipate a decline - triple the share recorded in last year's survey.

When asked about the most serious current challenge:

• 38% cited inflation and rising prices,
• just over one quarter pointed to staff shortages,
• 16% identified a decline in tourists from traditional source markets.

Political instability in Bulgaria, the international situation and unfair competition were each mentioned by about 5% of respondents.

Labour Shortages: Possible Solutions

Views on addressing the staffing crisis are relatively balanced:

• about one third favour higher wages,
• one third support greater engagement of students through internships and employment programmes,
• 20% see recruitment from abroad as a solution,
• others suggest closer cooperation with labour offices and hiring people aged 55+.

Tourist Structure in 2025

Half of Bulgarian hotels reported a balanced mix of domestic and foreign guests. Thirty percent rely mainly on Bulgarian tourists, while 20% depend primarily on foreign visitors.

Among foreign markets:

• Romania leads (over 50%),
• followed by Germany (30%),
• the UK, Turkiye and Greece (25% each),
• Israel and Poland (15% each).

Smaller shares come from Czechia, North Macedonia, Spain, Ukraine and Scandinavian countries. (Percentage sum surpasses 100 because multiple answers were allowed.)

Investment Plans

Investment intentions remain similar to last year:

• one quarter plan to build a new hotel or expand an existing one by end-2026,
• over half intend to undertake major renovations or upgrades.

Accommodation Type

The survey covered hotels managing more than 23,000 rooms - about 15% of Bulgaria's hotel capacity in establishments with over 15 rooms (excluding guest houses and holiday apartments).

By type:

• 36% are urban hotels,
• 28% seaside,
• 14% mountain,
• 13% spa.

Over 60% have up to 100 rooms, one quarter between 100 and 200, and 15% more than 200 rooms.

Four-star hotels dominate the sample (over 40%), followed by three-star properties (around one third), while slightly more than 12% are five-star hotels.