Smoother sailing
The challenge for Fowey Hall in its second year of operation was to make money. The key to success was attracting business to Cornwall all year round, not just in July and August.
The 26-bedroom hotel opened in Fowey, Cornwall, in August 1998, and was the fourth property owned by Luxury Family Hotels (LFH). Co-directors Nicholas Dickinson and Nigel Chapman started the brand with the aim of providing child-friendly destinations for an upmarket clientele. LFH bought Fowey Hall for £600,000 and spent a further £1.1m refurbishing it, hoping to provide existing LFH guests with a new experience.
Chapman and Dickinson could see the potential to attract their clientele to Fowey in school holidays and at half-terms, but making the hotel work year-round would make it a profitable investment. For the year 2000, Dickinson is forecasting an operating profit of £230,000 on a turnover of £1.08m. That is a 16% increase on 1999 and follows the £40,000 operating loss in Fowey's first year.
The hotel has introduced a three-tier tariff which offers, on average, a 20% discount in mid-season and a 40% discount in low season. Dickinson acknowledges that this has affected the average achieved room rate - £102 for the year to date against £106 in 1999 - but occupancy and turnover have benefited. Occupancy for the year to date is 49%, against a budget of 46% and last year's actual 42%. Actual turnover is £385,000 to mid-June, compared with last year's £328,000.
"We have to expect that, in order to get people to Cornwall in the off-season, we have to give them a good deal," says Dickinson. "At the beginning, we wanted the reputation of being a good, expensive location. Now that is established, we can give people special package deals and, because of our reputation, those deals seem more attractive."
General manager Hazel Brocklebank is also trying to increase Fowey's business in the leaner months by offering the hotel as a wedding venue. Small afternoon receptions for 40 people can be held without disrupting regular business. Brocklebank's goal, however, is to let Fowey on an exclusive-use basis at times when the hotel is quiet. Already, she has a booking for a wedding in November.
The hotel charges a facility fee of £1,500-£2,000 per night for the use of the hotel, which must be taken for a minimum of Friday and Saturday nights, in addition to renting all the rooms based on the seasonal tariff and a minimum charge of £25 per head on food. It is hoped a few such bookings could bolster the budgets for the slower months.
Perhaps Brocklebank's biggest challenge over the past year has been to bring some stability to the staff team. While the first year was fraught with staff changes, most of the 25 permanent staff have now been there for at least a year. Most importantly, the team has learnt the art of running a four-star hotel in the summer with extra part-time staff, and then paring back the operation without sacrificing quality in the quieter winter months.
The past year hasn't all been perfect. Some of the old drains needed replacing, at a cost of £1,500, and the pool boiler caught fire and £5,000 was spent on a new one three days before the Easter half-term. But these are the vagaries of running any hotel. On the whole, the past year has been smoother sailing than Fowey's first, and the financial investment is paying off.
