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What it takes to run a successful hotel business

ENTERPRISE
By Mona Ombogo | April 11th 2018
By Mona Ombogo | April 11th 2018
ENTERPRISE
Coral Beach Resort, swimming pool near the beach

Surrounded by an indigenous coastal forest in Ukunda and overlooking the Indian Ocean is Coral Beach Resort. It’s a family-run hotel that’s been in existence since the late 1970s.

Behind its vision is second-generation hotelier Sakayo Mwendwa Joshua, 42, and his wife Gloria Sakayo, who’s the managing director.

Sakayo takes Hustle through what it takes to run a successful hotel business.

Who’s the brains behind Coral Beach Resort?

My late father, Joshua Mwendwa, who was a hotelier.

Back in the 1970s, it was uncommon for anyone of African descent to rise in the ranks of the hospitality industry; most only made it to mid-level management.

My father, at the height of his career, was a restaurant manager. He took so much pride in his work that he got to know most of the repeat clients. One of these was a British citizen who’d lived in Diani and owned a seven-acre piece of land near the ocean.

When she decided to return to the UK, she told my father she was selling her land. He bid for it and though his bid was far lower than many others’, she sold the land to him. That’s where Coral Beach sits today.

Where did he get the financing to buy the land?

He got a bank loan and also pumped in his own savings. The challenge was after buying the land, he didn’t have much money to construct the buildings.

In the beginning, it was just him and one worker, Geoffrey, who’s still with the resort today. Because my father still had a full-time job, Geoffrey did a lot of the leg work.

So how did Coral Beach become what it is today?

We built the place up one structure at a time over the years. The first structures to come up were cottages intended for long-term stay, which was the original focus of the property. The cottages are self-contained and self-catered, though we offer a chef at Sh1,800 a day.

What made you change your focus from long term to short-term stays?

My father and I had discussed it before he died in 2002. We realised we were losing out on a large fraction of clients who just wanted a weekend getaway or a few weeks of vacation.

Unfortunately, my dad never got to see this dream realised. That’s one of the things that drives me to consistently take this resort to its next level.

The hotel industry is extremely competitive, particularly where you’re situated along the ocean front. How do you survive against bigger hotels?

My honest belief is that there is a piece of the cake for everyone. Different hotels and resorts offer different things. For instance, we’re a quieter, more secluded resort.

The kind of experience we want for our clients is an intimate one. We have situations where clients book the entire place, and we organise team building, specialised menus and activities for such groups.

Yes, other hotels offer these packages too, but it’s a totally different experience if an entire venue is shut down for you.

We have clients who have stayed in our long-term cottages for more than 10 years, we have families who want to come and reconnect in a quiet place surrounded by indigenous forest with the backdrop of the ocean, we have honeymooners who want a romantic getaway that isn’t crowded.

So the clientele is there, and there’s enough for everyone. The focus should be on providing exemplary service. If you do that, they’ll come. If they like it, they will return.

The hospitality industry is constantly changing, so how do you stay relevant?

I’ve learned that the best way to do that is to listen to the guests.

For example, in the earlier days as we were renovating, we attended an expo and a guest booked and paid to come to our resort. And then he asked what the size of our swimming pool was. We didn’t have a pool, so he cancelled the cheque and we lost his business.

Three months later, we’d built a pool. We didn’t have money at that time to build the pool, but I had a double cabin pick-up and happened to give a lift to some contractors from a different hotel. They asked me how much the car cost and where they could get one.

I thought about the swimming pool I needed to build. While having a drink with them later, I made them an offer for the car. They bought it. I built my pool.

Aside from grabbing opportunities when they arise, what other skills are needed to successfully run a hotel?

My advice is always to get professional knowledge or hire someone qualified.

I’m a trained hotelier, having studied at Les Roches International School of Hotel Management in Switzerland. After graduating, I worked in the hotel industry for 16 years before resigning in 2016 to focus on Coral Beach.

Most people who fail in this industry fail for lack of knowledge or experience. You can’t rely on guesswork or even figuring it out as you go along. You’ll lose a lot of money and guests that way, and recovery is sometimes impossible.

What are your rates?

For long-term stay at our cottages, we charge between Sh45,000 and Sh95,000 a month, depending on the location of the cottage and the number of rooms. We have garden view and ocean-view cottages.

For short-term stay during the low season, we charge between Sh5,000 and Sh15,000 a night per cottage. This is usually ideal for larger groups or families as the cost is shared, making it more affordable than occupying a single room.

For our hotel rooms, in the low season, we charge Sh4,000 to Sh5,500. We also have apartments that go for Sh4,000 for a bedsitter and Sh5,000 for a one-bed during the low season.

The prices go up during the high season, which is typically between July and early April.

Our total capacity at the moment is 50 guests a night. Eventually, we want to have capacity for 100 guests, particularly for short-term stays.

What do you think is the future of the Diani hotel industry?

I’d say it’s very bright. With the construction of the Dongo Kundu Bypass Highway, which will enable people to cross into South Coast without using the ferry, the time of travel will reduce and accessibility will increase exponentially.

This will open up the Diani area more than ever before. As long as the Government can assure us of security and political stability, the only way is up.

 

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