Sustainable Hospitality Sector ROI
In this article, Lucienne Mosquera talks about sustainable Hospitality Sector ROI (return on investment) and describes how you need more than just hard work to achieve it!
Coming from a family business background, I learned from a young age that very hard and honest work does not guarantee success.
Far from it. My late father, who was utterly passionate about his quality product and who had big visions and plans, was unable to share them with his team. Although his business was situated in the perfect location, it was never able to grow and achieve its full potential.
Thus, doing whatever it takes to add value and produce quality was a given to me. But my complete focus, when starting my career, was on finding the ‘magic’ combination that would turn this approach into commercial success.
It will therefore come as no surprise that I chose to work in a number of Michelin Star restaurants, whilst studying Hotel Management in Den Hague (The Netherlands). I learned there that there is no compromise when it comes to exceeding high standards and quality, and that the guest is at the very heart of the business.
But were these two critical key ingredients enough to generate commercial success? Not if we go by the statistics. Of the five restaurants I worked in during the late eighties, only one remains open today (Parkheuvel in Rotterdam). While I believe there never can be too much focus on the guest, too much passion and perfection is often the underlying reason for poor performance in top end restaurants.
Fast forward a few years when I joined Forte Hotels Plc as a graduate trainee. In the first few years I worked in operational management and I then joined the accountancy ranks. This led me to my final, London based, position in Forte, as Financial Controller of the Worldwide Sales and Marketing team, where I reported to the main board.
Did I find the ‘magic’ ingredient of commercial success in Forte Hotels? I think I did. In Forte Hotels I learned that first and foremost, hotels and restaurants are businesses. You may find this an obvious conclusion, but making profit was a mere afterthought in the businesses that I had worked in previously. Obsessive passion and personalities had come in the way of success.
Whilst on paper Forte’s core activity was hotel management, its largest source of income was from property. The day-to-day focus of senior management was on strategic development and ensuring that operational income streams and capital investments were maximised. This allowed the company to grow from the purchase of the Café Royal in London in 1954 to the 5th largest global hotel chain in the nineties.
All good and well, I had identified the key success criteria, not only for business growth, but for sustainable hospitality sector ROI: sharp strategic planning and development. But in its quest for maximising profits, Forte hotels lost touch with its teams on the ground and forgot to capitalize on the strengths of its core activities and other key criteria for success: Maintaining Quality and Exceeding Customer Satisfaction.
This untapped opportunity to provide shareholders with a much greater return, did not go unnoticed in the market. In 1996 the Forte Group was faced with a hostile takeover bid from Granada that ultimately succeeded with a £4.0 billion tender offer.
Before I took the plunge in 2015 to start HBD, I worked for over ten years with the Anglo Hispano Group, a niche food and drink wholesaler in Gibraltar, specializing in the development of hospitality outlets and real estate property.
In that time, we streamlined the companies business foundations and the group was able to grow and develop its core business and restaurant portfolio, quadrupling turnover and profit.
Gibraltar had, until the mid-nineties, a relatively local focus and businesses worked in a protected environment, alongside each other, rather than having to compete against each other, in order to maximise their profits. This environment did nothing to sharpen up focus on sustainable hospitality sector ROI.
Everything altered with the internet and technology revolution in the mid-nineties, forcing the business community into rapid change in order to compete on a global level. Many businesses were caught out and were unable to understand why something, that was working so well before, did not do so anymore. It is tough to be in such a position. Many took the let’s-do-more-of-the-same approach, with little success and blaming external factors, such as new competition, for their demise. This has left many businesses in a catch-22 situation, unable to move forward and failing to tap into the huge potential of this new global market place.
Last year I was presented with the opportunity to develop Hospitality Business Development Limited. Launching a company later in life, when you’ve already acquired skills, made contacts and accrued relevant experience, makes all the difference in the cut-throat world of business.
The first few months were all about consolidation. After all, what did I know about algorithms and online marketplaces? However, I did know that combining the vast opportunities that technology and the online world presents with my expertise is the ‘magic’ ingredient needed to create commercial success in hotels and restaurants and deliver sustainable Hospitality Sector ROI.
It’s been nearly a year ago since I started to develop Hospitality Business Development and I could not have predicted just how hard I would have to work, not just physically, but continually needing to change, adjust, correct and improve, to stay ahead of the game for my clients.
My business partners critique my every move, pulling no punches if they think my ideas do not add up. This is brilliant and has enabled us to build a new type of business that is able to maximise its support to hotel and restaurant owners and investors.
I’m now acutely aware of the pleasure of building something that works and that helps other people.
Would you like to know more?
Download our latest White Paper entitled “Why Return on Hotel Investment Can Significantly Underperform” or contact me, Lucienne Mosquera (Managing Director) for an informal conversation about your Investment.Contact