S U R V I V I N G An Open Letter to Readers of CLH News

By David Hunter, The Bowden Group (www.bowdengroup.co.uk)

Ok we all know that we have been through some ver y difficult times over the last few years

If you are still here VERY WELL DONE but don t get to complacent, ‘’ cos it ain’t over yet’’

I am often asked how can we sur vive ?

There are always things that we can do to reduce the overhead costs in any business:

Working with a Hotel client in the Nor th West of England, we were recently asked to use our weekly eMailed repor t on the business’s Profitability to get the staff ’ s suppor t for reducing usage of gas and electricity

Common sense you might have thought

What happened though really did amaze me

It wasn t just that the units of power used weekly reduced by 20% it was that we COULD save that huge amount just by asking staff to par ticipate

Yes, it IS a bit sad that we COULD reduce power usage so much, but the fact that we did do that shows the power of just talking to the Team, and getting their suppor t

It is clear that the staff feel they have a vested interest in helping the hotel get through an approaching massive increase in Power costs per unit, and that THEY WANT TO HELP

Sounds familiar?

This is the four th Recession that I have worked though in my role , and by now I am ready for the fallout of a Recession but it never ceases to surprise me HOW ever ything changes during and after such a period and it never changes in the same way

I often say that in Hospitality, Profit is largely driven by:

• Sales Overall, and Depar tmental

Bedroom Sales and the Costs of c leaning those rooms

• Food GP%

• Dr inks GP%

• Labour Costs

I promised I wouldn’t write a book for you to print (thinking of the printing costs), so let’s just dip into these one at a time highlighting the bigger issues or the quick wins as there are things we C AN do to help the situation, and we will focus on those

SALES … OVERALL, AND DEPARTMENTAL

We need to up our game on Marketing not just increasing the number of people that come to use our facilities, but increasing the Spend per Head of all of those that do use our the businesses

If we attract some new customers, and get existing customers to spend more per visit we stand an even better chance

There are so many special offers and new packages that we can dream up, to increase customer visits

Bedroom Sales And The Costs Of Cleaning Those Rooms

Yes, we have been tr ying to get more people to book Direct There are a number of ways we can do that but asking guests to book direct in future cer tainly works

As good as the online OTA agencies ARE the more people we can get booking direct with us, the better, as it reduces that extra Commission cost

So look at your website how easy IS IT to book direct with you?

We have also been looking hard at the in-room complimentar y stuff like hairnets for the shower, how many towels soaps gels etc we put out

Many of the Budget operators now will not clean a room unless that is specifically requested However, I am not a great fan of that as its not what we traditionally expect from an hotel

We have been introducing automatic on/off light sensors in bedroom corridors

And some Budget operators have been centrally (at Reception) over-riding the settings that the customer sets on the bedroom heaters turning them off automatically between the late-night ‘’sleeping’’ hours

FOOD GP%

I have a few big tips here:

1 Cost out your menu items in great deta l, and formally, and on a suitable spreadsheet

2 Do those costings ever y single month not twice a year as used to be acceptable

3 Make ver y sure that are ac hieving the r ight level of GP% on ever y single dish There is no suc h thing as an Industr y Standard GP% it all depends on the type of establishment what it is where it is and how it operates

4 Reduce the menu size if you can and use the same ingredients in a number of different dishes reducing the number that you need to buy in

5 Negotiate and renegotiate and seek at least two other supplier s to compare with to get the best purc hase pr ces for what foodstuffs that you need to buy in The tough ones might well be: Fruit & Veg / Fish / Meat / Cheese / Oils

6 Get advice on what your Food GP% SHOULD BE

DRINKS GP%

My best tips here are:

1 Take the time to establish what GP% you need not just overall but per categor y of dr nk (as defined by a licensed stoc ktaker)

2 Make sure that you pr ice accordingly to be able to ac hieve your target GP% overall

3 Get help on the Wines side there is a whole separate pr icing strategy for GP%s on Wines on different types of w ne and on the different g ass sizes Call me f in doubt

4 Tr y to reduce the Wine List a bit if you can that helps with cashflow

5 Get advice on what your Food GP% SHOULD BE

Labour Costs

Here there is no choice you MUST ACT and NOW Labour costs just keep going up never down and the Minimum Wage doesn’t really help us in Hospitality

My top tips are:

1 Do what is known as a Manpower Planning Study

This identifies exactly how many staff member s you need in any one place at any one time in 15 minute intervals throughout the day ever y day and ever y day being different

2 Then do your rota str ictly (as str ictly as possible that is) on the number s that you ACTUALLY NEED

3 You may need to c hange the way you employ people you may well need more Par t Time and Casua employees so that you don’t end up w th too many staff on duty at any one time

4 Get as muc h flexibility nto the manpower system as you can whic h can mean you emp oying MORE people but on LESS hour s eac h

5 Train your staff well, incentivise them too, but most impor tantly, respect them and communicate with them

The ATTITUDE of any member of staff shown towards a customer is paramount, and that often determines whether a Customer returns a second time and more

The above will help but no one should think of it as being easy it isn’t !!!

SURVIVING is what we hope happens when you do all that you possibly can

You also need to be ‘’Relentlessly Optimistic’’ at the same time

Panic , worr y and being miserable are all things that rub off on others ver y ver y quickly

If you think that I can help you at all …

Give me a call on 07831 407984 or 01628 487613

I will be happy to help If you quote ‘’I saw you in CLH’’ the first on-line Video Call session with me will be totally Free Of Charge