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Seven-days wonder

03 November 2005

The Capital Group
Being successful in business seven days a week is all about embracing opportunity, according to Joseph Levin, managing director of the Capital Group, which includes the five-star Capital hotel in London.

Levin describes himself first and foremost as a hotelier, but he also wears a number of other non-hotel hats. Since taking over the family-owned Capital Group from his father six years ago, he has founded several successful companies that sit inside the group's portfolio, including the London Bakery, the Munch caf within Habitat, and 195 Piccadilly, a joint venture between Levin and the British Academy of Film and TV Arts (Bafta).

For Levin, expansion is also about spreading risk. "I grew up in the hotel industry and saw London being bombed by the IRA, numerous economic downturns and all the pain that hotels can suffer, especially at the niche, five-star level," he says. "I wanted a more balanced career, so rather than putting all my eggs into one basket, I started to look at other opportunities."

Levin's first idea was to grow the in-house bakery at the Capital hotel into a stand-alone venture, alongside the then head baker, Thierry Tellier, who is now a partner in the business. "It was very much a gradual process," says Levin. "We baked all our own bread at the hotel anyway, so it was just a question of taking on more staff, then eventually setting up a separate bakery." The business now has 30 clients and Levin is "thrilled" by its success. "It made me realise I could use my skills to do other things and that I wasn't confined to five-star hotels or restaurants," he says.

His next move was to sign a joint venture with Bafta to provide all the catering services, staff and event management at its headquarters in Piccadilly, London, which recently underwent a 2m refurbishment. "It came up by chance but opportunities like that don't come up often, so I jumped at it," he says.

Under the terms of the 10-year agreement, Levin has spent 50,000 on upgrading the kitchens, with another 50,000 investment to follow, which he acknowledges is risky. "Without improving things, though, we wouldn't have been able to achieve what we want," he says. "I'm committed to reaching certain targets here, so growth is important." Taking risks is part and parcel of business, he adds. "If you're not prepared to take risks, you won't grow."

One of Levin's chief principles has been to only develop businesses that complement each other. The London Bakery, for example, supplies Levin's other companies within the group, which means he retains control of the supply chain. Also, all his companies tend to be busy at different periods, which is not only a financial plus but beneficial in terms of balancing peaks and troughs.

With the Capital hotel's quiet season during the summer months, for instance, he was able to concentrate on the Royal Parks public-private joint venture he set up with a business partner last year after winning the tender to supply catering operations in Kensington Gardens.

"That's very much been my design," says Levin. "Not only is it about spreading risk, but balancing high and low demand also allows me to organise the staff's working time more effectively."

With 175 full-time staff in the Capital Group, Levin employs up to 150 more seasonal or part-time employees, providing a mobile workforce. "It has advantages because most of the managers already know each other, so they're happier to work as a team," he adds.

Promoting staff from within and putting them in positions of responsibility in the group is another key Levin philosophy. Many of his staff have been with him for years, such as Sion Parry, general manager at Bafta. Levin explains: "If you can spend time investing in people, it's time well spent. My approach is to trust people and work with the most highly talented managers that I can, because that means I can grow." He points out that encouraging staff to be self-sufficient is also vital for his own time-management. "I can't do everything, although it's lovely to be wanted and have the phone ringing all the time."

Levin clearly believes in being hands-on in a business - he regularly drives the bakery van making bread deliveries around London and he spent several weekends in the summer selling ice-creams in Kensington Gardens. He combines such activities with a proactive sales and marketing approach. "Things are much more competitive today," he says. "If you're not prepared to get out there, bang on doors and promote yourself, you'll be the last one at the trough."

Levin also stresses, in his role as hotelier, how important it is to appeal to different audiences. "You need to go and find whoever it is that finds your product attractive," he says. "In London, for example, the summer is always quiet for hotels and nobody can change that. But you can try to attract new people to your business. We now target female business travellers for our single rooms, for instance."

And he says his approach seems to be paying off. "In the previous 20 years, the hotel would always lose money in one month, but we haven't lost any money in a month for five years. And we had the best August this year in over a decade."

Calcot Manor Child-friendly policies, a luxury spa and a peaceful Cotswold setting have all helped to establish 30-bedroom Calcot Manor near Tetbury, Gloucestershire, as a popular weekend retreat for families.

And when the hotel's brand new 1.5m conference facility opens next spring, managing director Richard Ball hopes to extend the hotel's appeal to the business market too.

Three new meeting rooms, a banqueting space for 120 and a separate kitchen have been converted from an old barn in the hotel grounds, while the old conference space in the main building has been transformed into three further guest bedrooms.

With the hotel busiest at weekends and during holidays, Ball hopes the new business facilities will boost midweek and periods outside leisure peak times such as Christmas and the summer. "Bringing more people to the hotel also gives us the opportunity to encourage use of the restaurant, especially at lunchtime," he adds.

Creating a separate conference space allows Ball to target the business sector more freely, without fears of treading on his leisure guests' toes. "We're predominantly a leisure hotel and we have to protect that," he says. "I wanted to attract more corporate bookings, but the last thing our leisure guests want to see is laptops in the lounges or lots of suited business people around. Equally, corporate clients want our full attention. This way, we can get the balance right."

While preferring to keep the two markets physically separate, Ball nevertheless recognises the cross-over between them. "About 80% of our business bookings come from our reputation as a leisure hotel precisely because our business clients like our relaxed, uncorporate feel and facilities like the spa. And it works vice versa because we get a lot of business from our leisure guests, too."

The hotel's reputation has also proved a launching pad from which to build up business in Ball's outside catering operation, which he set up last year after buying out a local catering firm. "We run it separately from the hotel, but again there's lots of cross-referral," he says. "The hotel promotes the catering side, which in turn builds up the name of Calcot Manor. It's about making sure we have a well-rounded business and that there's plenty to do all year round."

Ball adds that the company, which currently focuses mainly on private parties and weddings, is a serious revenue stream for the hotel.

Over the past 18 months, turnover has reached £1.3m and Ball now plans to target the local corporate market.

"It's about maximising the potential of what we've got here, which is a great reputation and a good existing customer base," he says. "To stay ahead in the hotel business, you need to constantly differentiate from your competitors. Innovation is absolutely critical."

Four Seasons Canary Wharf With its skyscraping towers and shiny glass office blocks, the business district of Canary Wharf in east London probably isn't the first place tourists think of for a weekend break in the capital.

But the 142-bedroom Four Seasons Canary Wharf hotel is keen to challenge that view. "Since we opened in 1999, we've been working on ways to make our product attractive to the leisure sector," says director of marketing Andrew Piert. "That means highlighting the hotel's facilities, of course, but also the benefits of our location."

It's also about targeting the right audiences, adds Piert. "Traditionally, the bulk of the capital's weekend trade goes to stay in the West End - particularly if people haven't been to London before and want to go sightseeing. But we don't want to compete head to head with that market. For us, it's about reaching people who want something a little different."

Weekend occupancy has been boosted by advertising in consumer lifestyle magazines and marketing the hotel facilities, such as its Holmes Place spa, says Piert. Most weekend bookings now come from people who live in London and the South-east. "From asking guests what they want, we've found rest and relaxation is their key priority," he says. "Good food is also very important, and people like the area because of its unusual shops and markets."

The hotel has introduced a number of packages based on those themes. After a successful pilot in June, for example, the hotel now offers a cookery weekend, which includes a riverboat trip to the nearby Borough and Billingsgate markets for guests to buy produce before they cook their chosen dishes with help from the hotel's executive chef. Later on in the year, the hotel plans a tie-up with a local helicopter firm to provide charter packages around London.

As Canary Wharf develops further, more and more people are starting to move into the area, and the hotel is keen to tap into this local market, especially at weekends. An informal Sunday buffet brunch in the hotel's restaurant pulls in an average of 120 covers, comprising mainly families and shoppers, and a Saturday breakfast is also proving popular with local residents. Weddings are another key weekend revenue booster, with the hotel hosting an average of 25 wedding receptions a year.

To develop a strong local profile, Piert points out the importance of PR and marketing tactics. "Our head chef writes a weekly column in the local magazine, and we make sure we're included in local tourism and shopping guides," he says. "You can't reach leisure end-users as easily as you can in the corporate market, where you can speak to travel agents or companies to drive sales. It's much more about building up awareness."

Piert expects the 2012 Olympics, which will take place in and around east London, to have the biggest effect on raising the area's profile, which will, in turn, boost the hotel's bookings, especially from abroad.

"We're starting to get Olympic-related reservations already," he says.

How to be busy seven days a week

  • Understand your business. Analyse its strengths and weaknesses and high and low points. What are your competitors doing that you could be doing?
  • Don't box your customers into categories. The guest wearing jeans on a Saturday afternoon might be the boss of a large local firm that needs meeting space or a midweek conference could lead to leisure bookings. Look at your customers holistically and understand all their purchasing points.
  • Understand different days of the week. If you have a Thursday conference booking, for example, fill Friday night too by offering a rate for partners, or boost Sunday occupancy by targeting business travellers attending early Monday meetings nearby. Midweek can also be very popular with the over-55s and shift workers.
  • Be creative. If you're a three-star conference hotel in an unlovely leisure area, target the weddings market or any relocation companies nearby. If you've got lots of empty rooms at weekends, make the hotel more family-friendly by offering free adjoining rooms for children.
  • Think local. Find out what's going on near you. From local associations to civic centres and sports halls, there are huge numbers of events going on around the country that require overnight stays. But plan ahead because these will often be booked up to a year in advance.

Stuart Harrison is principal of the Profitable Hotel Company. Tel: 01993 706632

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