A success story
Hotel du Vin proprietor Robin Hutson sits back and reflects that year one of trading has been a good deal more successful than he had dared to hope. "Business has been more or less constant in a classic upwards line. We haven't yet seen a blip," he says.
So constant has been the interest that the business has even made a small profit. The first year's turnover of £950,000 produced a net operating profit of £20,000. This may be a small margin, but for Hutson and co-proprietor Gerard Basset, who had anticipated breaking even, it is good news.
The figures include one-fifth of pre-opening expenses to be amortised over five years, depreciation of about £30,000 of fixtures and fittings, but not buildings because Hutson and Basset see them as appreciating, and provision for loan stock repayment, which in reality starts in June 1996 after a one-year holiday.
The small margin also takes into account the efforts made by Hutson and Basset to build Hotel du Vin's reputation. "We gave away a lot of freebies by inviting people to come and try us out," says Hutson. Shareholders ate free for the first six months provided they introduced one other person to the bistro.
Hutson and Basset do not regret this decision. "It got us talked about and made us look full. Now it's paid dividends because it's given us a solid client base for the bistro and that helps drive room sales."
Increasing interest in the bistro and long-term bedroom bookings generated by high-profile cases at Winchester's Crown Court, led to the decision to expand. Now Hotel du Vin has a new bar area and six new bedrooms, bringing the total to 19.
Regular readers of this series will recall that Hutson and Basset had been undecided on whether to expand upwards or outwards. Eventually they opted to do the latter, buying the property next door for £85,000 from cashflow.
A further £250,000, a mixture of overdraft and cashflow, was spent on conversion. Hutson hopes to shed most of the overdraft over the coming year, with the remainder added to his fixed-term loan.
The decision is already proving a good one. Occupancy for the first two weeks of March ran at a healthy 80%.
Also helping to boost business has been intense media interest in Hotel du Vin. Composer Andrew Lloyd Webber, standing in for AA Gill of the Sunday Times, gave Hotel du Vin a favourable review.
The business was also thrown into the spotlight when Oscar-winner Emma Thompson spent a night there following the Winchester opening of her new film, Sense and Sensibility. Hotel du Vin was also named Newcomer of the Year in Egon Ronay's Cellnet Guide Hotels & Restaurants 1996.
Hutson is nervous about too much media interest, however. "We don't want a reputation for being a gastronomic temple. It gives the wrong impression and makes people think we are expensive. I want a place where Armani suits and bikers' outfits sit happily together."
Over the coming months, Hutson and Basset plan to improve the administration of the business as well as look at how to make the most of their newly acquired space throughout the summer. There are even plans to export Hotel du Vin to other cities. Watch this space.
