Hyperlocal Supply Chains Are Emerging As Hospitality’s Next Big Asset

A buffet in a restaurant at Vivosa Apulia Resort.

Vivosa Apulia Resort

For decades, many luxury hotels built their competitive edge by sourcing the best premium ingredients from all across the world.

However, geopolitical instability, rising transport costs and climate disruption are increasingly contributing to fragile global supply chains and forcing hospitality businesses to rethink this model.

This shift has led to the rise of hyperlocal supply chains. Once considered a “nice-to-have” sustainability improvement, today, a growing number of hotels and resorts are increasingly treating them as valuable strategic assets.

In destinations from southern Italy to remote Pacific islands where climate shocks, expensive logistics and remote operations are major hurdles, local sourcing has become even more crucial in recent years for more resilient operations.

Why Global Hospitality Supply Chains Are No Longer Enough

Several worldwide hotel supply chains have traditionally been built for efficiency, not resilience. As such, they often prioritise the shortest transport routes, most cost-effective logistical solutions and consistently available ingredients.

However, climate change is now heavily disrupting agricultural production across the world. Extreme weather incidents are affecting availability and pricing for both seasonal produce like tropical fruits and staples like coffee, cocoa, meat and dairy items.

This is impacting everything from hotels in overtouristed cities and luxury islands to remote hospitality operations in dense jungles.

In southern Italian tourism hotspots like Puglia, hotels are currently struggling with logistical and cost-related bottlenecks due to the impact of the Russia-Ukraine war and wider Middle-East conflicts.

This has led to longer shipping routes, port congestion and inflated freight and insurance premiums, while also making it much more difficult to source seasonal imported ingredients. As such, these hurdles highlight the vulnerabilities of relying on far-off suppliers.

Hotels are also facing increased risks around temperature-sensitive ingredients due to unpredictable cold-chain reliability and freshness.

Increasingly volatile climate events in several parts of the Mediterranean, has also made it more difficult to rely on produce grown in neighbouring countries in the same region, forcing hotels to look even closer to home.

“Longer periods of drought, irregular rainfall and higher summer temperatures have increased pressure on agricultural production in southern Italy. Seasonal availability and pricing of some fruit and vegetables can fluctuate more than in the past,” Veronica Milo, general manager at Vivosa Apulia, an eco-resort in Puglia, told Forbes in an email.

She added: “Working closely with local producers and maintaining a diversified supplier network helps improve resilience while allowing menus to adapt naturally to seasonal availability.”

Other agricultural and maintenance inputs such as fertilizer, oil, natural gas and metals have become much more expensive too, signalling an issue that goes far beyond just food supply chains.

Similarly, resorts in remote locations like French Polynesia also face soaring logistics and transport costs due to their remoteness, with high import dependence due to several ingredients not being available locally. This can make them very susceptible to transport delays and weather factors too.

As such, more local sourcing models are emerging as the old global model feels increasingly fragile.

How Hyperlocal Supply Chains Are Taking Shape

Today, a number of hyperlocal supply chain models are emerging around the world.

One of the most common is through regional integration. As an eco-resort in the protected Ugento Coastal Natural Park in Puglia, Vivosa’s sourcing approach focuses heavily on building closer relationships with regional producers and preserving local biodiversity.

This means prioritising seasonal procurement and local ingredients, over imported ones, in order to support local agricultural systems, which leads to the surrounding landscape also becoming part of the resort’s operating model.

In 2024, Vivosa sourced 77% of its goods and services from hyperlocal suppliers within 20 kilometers of the resort, with the remaining coming from provincial and regional suppliers.

Similarly, 76% of the resort’s employees lived within 20 kilometers in 2024, with 16% living within 20-60 kilometers.

This hyperlocal sourcing approach extends to other parts of the resort as well, such as its furnishings as well. These are made primarily from locally sourced natural materials, such as olive wood, with flooring reflecting shades of Leccese stone.

The paint used for buildings is made of natural lime from local kilns as well, along with all wall paints being water-based and chemical-free.

To reduce reliance on energy imports and boost its energy independence, the resort has also implemented a photovoltaic park. Installed on shading roofs over all parking areas, it saves 415, 877 kWh per year, through the use of alternative energy sources.

However, this connection with the surrounding landscape extends beyond procurement. Given Puglia’s significant drought issues, Vivosa also uses treated wastewater from its own treatment plant to irrigate its gardens and pine forest during drier summer months, helping reduce pressure on local water resources.

The resort also creates business opportunities for a range of local Salento suppliers, especially during the Traditional and Cultural Salento Market, where local companies are invited to the resort every week to showcase and sell their products. Similarly, it also partners with local suppliers for food and artisanal handicrafts excursions for guests.

Another way hyperlocal supply chains are being used is to establish circular independence. This approach is especially crucial in remote, hard to access locations, where every import can become a logistical burden and create supply chain vulnerabilities.

The Brando, in French Polynesia produces all of its own water via reverse osmosis and implements closed-loop waste and water management systems. Rainwater and wastewater are heavily treated and recycled for agricultural use.

Similarly, the island’s organic gardens supply most of its food, with its composting facilities turning organic food waste into garden compost. Other waste like glass, cooking oil and aluminium are used for local construction, recycled or converted into biofuel, often in partnership with local Tahitian companies.

The resort also maintains its energy independence, with electricity generated through a mix of solar energy and biofuel generators running on locally sourced coconut oil. Zero-emissions transit is implemented across the island too, with walking, cycling or electric golf carts being the main sources of transport.

The Business Case For Going Local

One of the biggest advantages of prioritising more local sourcing is added protection against supply chain volatility.

By sourcing much closer to where the actual hospitality operations are, businesses can better hedge against port disruptions, shipping delays, fuel costs and other logistics-related bottlenecks. This is especially in the case of rural and more remote hotels.

Another important factor is that the demand for authentic, sustainable experiences has been steadily growing in the last few years.

According to Booking.com’s 2025 research, 53% of travellers are now conscious of tourism’s impact on local communities and the environment, with 73% wanting the money they spend to go back to the local community. 69% also want to leave places better than when they arrived. The survey spans almost 230,000 respondents across 35 markets.

Travellers are now increasingly looking for things like authentic experiences and sustainable zero-mile products.

As such, hospitality businesses which are implementing hyperlocal supply chains now may be in a better position to attract this increased demand in the coming months. This can be a crucial differentiator in an already crowded luxury market for building a stronger destination identity.

In Vivosa’s case, authentic local gastronomy has become a core part of the guest experience, with regionally sourced fish such as salmon, monkfish, cuttlefish, as well as other ingredients such as olive oil and coffee deeply embedded into its everyday dining offerings.

“The focus is on maintaining a consistently high-quality dining experience rather than offering identical ingredients year-round. Menus evolve with the seasons, highlighting what is at its best locally,” Milo noted.

She added: “Increasingly, guests appreciate authentic regional cuisine and understand that seasonality is an important part of a genuine sustainable luxury experience when it is communicated clearly.”

Maintaining control and visibility over supply chains is another factor supporting the rise of hyperlocal models.

In cases of far away, third-party logistics providers, verifying credentials, quality control, customization and traceability can still be a challenge, making supplier reliability unpredictable. In contrast, building direct relationships with local operators and verifying these key metrics first-hand can be much easier when it comes to hyperlocal supply models.

Establishing circular independence through energy, water and waste recycling facilities on-site like The Brando can also provide significant operational efficiencies, with resorts being able to scale or adapt them as needed. This also greatly reduces exposure to external supply fluctuations.

The Trade-Offs: Why Hyperlocal Models Still Struggle To Scale

Despite offering significant advantages, hyperlocal supply chains still struggle to grow in many hospitality contexts.

One of the biggest reasons for this is smaller supplier capacity, despite increased resilience and transparency. As a result, they may not always be able to supply the amounts needed by larger hotels. They may also struggle to meet hospitality timelines and guarantee the quality needed.

“Local producers are often smaller businesses with limited production capacity and are more exposed to weather variability. Building long-term partnerships, diversifying suppliers within the region and planning procurement well in advance are essential to maintaining both quality and reliability,” Milo explained.

While some of the easiest categories to source include fresh fruit, vegetables, wine, dairy products and natural stone, others, such as medical supplies, advanced technology and specialist hospitality equipment remain tricky to always source locally.

Another major factor is the difficulty of scaling across global hospitality brands, due to the same products and suppliers not being available everywhere. It can also be extremely challenging to maintain the same quality standards across global properties under these circumstances.

Maintaining quality standards can be especially challenging in luxury properties where guests expect a high level of reliability and consistency.

Seasonality can also affect local products and the quantities available. In cases of resorts located in busy Mediterranean areas like Vivosa, seasonal sourcing can often fail to meet demand during peak times like summer.

As such, hyperlocal supply chains can face significant commercial pressures, especially in situations where more operational flexibility is required due to changing demand patterns throughout the year.

In cases of local suppliers who are also organic, climate vulnerability continues to create real pressure, as in several cases, they are unable to use conventional chemical pesticides or fertilizers even if harvests are poorer.

Other times, hospitality businesses can hesitate to make the upfront investment needed to find and retain local producers. This can sometimes be higher due to reduced opportunities of scale and organic products.

Similarly, implementing the facilities needed for circular independence like The Brando, such as on-site water treatment and bottling plants, energy sources and more, can require significant investment as well.

The Next Generation Of Hospitality Supply Chains

For years, hospitality mainly measured sustainability by what happened after products arrived, including reducing waste, lowering emissions and boosting recycling.

However, hyperlocal supply chains have shed much-needed light upstream, focusing far more on where products come from, how they’re produced and how they reach their destination.

As such, a new hospitality sourcing model is now emerging, where procurement is no longer just a back-of-house function, but a consistent source of resilience, differentiation and long-term value.

The future of hospitality supply chains may thus not be about abandoning global sourcing entirely, but about building procurement models which are deeply connected to the places hotels operate in.