Will your new hotel pass the crash test? (Part 2)
Starting a hotel as a business can be a challenging undertaking. Whether you’re envisioning no-frills accommodation for business travelers, high-end boutiques or a comfortable bed-and-breakfast, you will need to spend ample time researching and planning before taking the plunge because there’s plenty of competition. You will therefore draw up a Business plan. A business plan is akin to a beam of light from a powerful torch when treading in the dark! Most hotel businesses seek initial external financial backing. However, even if you do not require outside financial investment it is a good platform to state clearly what you intend offering, market analysis, outline of the operating procedures, long term objectives. Additionally, a summary on how your services will coincide or differ with the competitor hotels strategies for room amenities, food and beverage services (Some Hotel chains actively look at their F&B part of the business as an independent business unit with a separate business plan of its own) or any specialised offerings will re-affirm your commitment to build and operate the hotel. Really, there is no excuse for not having a business plan – for without one you will find it hard to prove the skeptics, (forget the bank or lending institution), that your hotel will operate successfully.
Hospitality Mindset:
Do you have an ingrained sense of how you want your guests to be looked after so that you can inspire your management team to, in turn teach this to your staff? Guests demand the attention to their needs and if they find staying in your property either stressful or uncomfortable or both – they will not hesitate to complain both loudly and publicly. A TripAdvisor comment recently posted about a hotel in Brazil is what no hotel manager likes to read. Captioned: ‘Lack of hospitality mindset’, it goes on to inform the readers. “The hotel is a modern 36 storied building on the seafront in Boa Viagem. All its suites have a breathless sea view and are very comfortable. It was enough to make it a good hotel, however service is also paramount. In this topic Hotel xxx is a disaster. Room service took over one hour to deliver a food order, air-conditioning could not be put on because there were no batteries in the remote control and maintenance took another hour to replace batteries. No conveniences to shop at hotel or nearby, huge delay on check out, and much more....” Remember that basic law of business? – If you give people what they want, they will give you money. Today, if you take their money and don’t give them what they want, they will tell the entire world what you did or rather what you did not do!!
Market Effectively:
The marketplace is in constant motion, with customer buying patterns and preferences ebbing and flowing in an unpredictable manner. This could lead you to push marketing campaigns with poor aim or one’s that are aimed to mislead. A constant goal should be to make the right offer in front of the correctly targeted customer at the right price and the right time. Don’t create marketing campaigns that get read but cannot be acted upon! Air Asia the budget airline ran a half page advertisement in the newspaper promoting special fares under the banner ‘Buy 1 return Free’. Upon checking their website I discovered that it was not updated with any mention of the latest promo. On calling the Colombo office I was informed by a member of staff, who answered the phone after eight rings, that they had no information on the promo and could only provide me the normal applicable rates. He went on to tell me that the advertisement had been placed directly by the Airline’s head office in KL- bypassing Colombo. When I wished to speak to the Manager, I was put on-hold for a couple of minutes and then informed that he was at a meeting and I was advised to go on the internet (?). Air Asia sent me in circles and chased me to a competitor budget airline where I received a better offer for my planned family trip to Australia. Yes, ‘everyone one can fly’ - not necessarily with Air Asia! The message here is: Don’t create marketing campaigns that get read but cannot be acted upon- both by the customer and by your staff.
So, those of you who are building new hotels, how would you rate yourself in the above ‘crash test’? I hope you all did well – especially because you believe that right now is a good time to build. No one in the industry can foretell how long the current cycle of buoyancy will last… another 4, 5 years or perhaps more? Nevertheless, the distance between the value line and the cost line is shrinking and you simply can’t afford to crash!
Shafeek Wahab – Editor, Hospitality Sri Lanka, Consultant, Trainer, Ex- Hotelier
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