In the last 12 months, UK hoteliers have had to cope with a recession that not only has had a negative impact on leisure spend but, just as seriously, has also reduced corporate spend significantly.

It's a trend hoteliers will need to recognize and deal with.

To highlight the situation, let's look at some figures.

For example, spend on business trips by UK businesses have been falling steadily for the last four years - from £5.2bn in 2005 to £4.5bn in 2008. Early results for 2009, show a further decline - in the first four months, the number of business trips dropped by 13 per cent compared to the first four months of 2008. There's no indication that this decline has been halted since.

This has been partly offset by the rising corporate spend of overseas visitors - up from £4bn in 2005 to £4.6bn in 2008 - but, again, the figures for 2009 are gloomy. They've dropped in the first quarter by 26 per cent in terms of number and 15 per cent in spend.

There is another sign of business decline, too - the value of the conference meetings market dropped by 11 per cent in 2008 with little evidence to show that there has been an upturn in 2009. Cutting back on conferences and meetings is one of the easiest cost reduction exercises that a business can perform.

Hoteliers have to face up to this challenge. Already, the bottom has dropped out of corporate market for many hotels. At a time of rising unemployment, with businesses cutting costs, corporate spend is especially vulnerable. It will decline even further in the future. Until the recession is behind us - two/three years? - hoteliers can expect ever tighter corporate budgets, which will affect hotel occupancy and revenues.

Even the budget sector, although picking up significant amounts of corporate spend as businesses look to save costs by moving from more expensive three and four star properties, have not been immune.

And here's a thought: as the political parties manoeuvre before the general election, the cutbacks in public spending have hardly yet begun. How much the government and other public agencies spend on hotel accommodation, meetings and conferences is not precisely known but a conservative guess would probably pitch it at over £1bn. A significant proportion of that is certainly likely to disappear as the next government tackles the huge public sector finance overspend it faces.

So the corporate market is weak and will get weaker in the next few years, which is bad news for those many hotels that aim - and, indeed, have been built - primarily for the business traveller.

The answer is for these hotels to attack the leisure market. Recent advertisements in the newspapers by major hotel groups that have traditionally traded in the business market show that they have already recognized the danger of relying on it at this difficult stage in the economic cycle. Some independents have also spotted the danger - and the opportunity.

But the leisure market even if, at £11bn, it is twice as big at the business market, is also under pressure. Customers have to be wooed. Consumer spend is not buoyant and rising unemployment makes it more difficult for people to justify stays away from home. Yet holidays are part of modern lifestyle and short holidays are on the rise and now worth almost £6bn a year - more than long holidays. It is this sector that is undoubtedly the most attractive for hotels today.

So prices have to be cut in order to generate revenue even if at the expense of margin. But adopted carefully and cautiously, special offers and attractive deals can ensure that occupancy remains buoyant. Of course, such price cutting will affect profitability but, more important, it may well ensure survival.