A revolutionary new hotel management concept is to help newly launched BON Hotels make its mark in the cut-throat and overtraded South African hospitality sector.
Launched in Cape Town on November 15, the new hotel management and marketing group is the brainchild of Guy Stehlik, son of Otto Stehlik, who founded the Protea Hotel Group, Africa’s largest hotel management company.
Stehlik says the South African hospitality industry is experiencing exceptionally tough times, despite an increase in international and domestic tourism last year. He says more than 20% of South African hotels are unprofitable, with game lodges, five-star boutique hotels and remote country inns being the worst hit. A current oversupply of hotel rooms is only expected to even out by 2016. “There are scary levels of distress amongst hotels throughout the Garden Route,” he says.
In this climate, BON Hotels could easily pick up management contracts, but Stehlik says the new group plans to be choosy and grow slowly. “We will only get involved where we can make a significant contribution. I believe signing up anything they could get was the downfall of hotel groups that today are either embattled or no longer exist.”
BON Hotels will offer the following contracts: A 100% management service; a marketing and sales management service; and a business rescue and financial assistance service.
He says BON Hotels will differentiate itself by charging only for what it delivers, unlike other hotel management companies that cream off up to 20% of revenue notwithstanding the hotel’s financial circumstances. He says hotel owners will pay BON Hotels a performance-based fee that is linked to the hotel achieving its revenue per available room targets. Fees will be a hybrid of a management, marketing and incentive fee but all fees will be automatically reduced if targets aren’t met.
Stehlik, who owns the Protea Hotel Vineyards Estate in Durbanville, says BON Hotels will also introduce an ‘Owner’s Bill of Rights’ to ensure that hotel owners are kept informed and involved, while also defining their roles.
BON Hotels has already signed its first management and marketing contract for the new Hotel Verde opening at Cape Town International Airport in May. Stehlik says the group is poised to take advantage of opportunities in Dubai and the rest of Southern Africa but wants to establish a foothold in the Western Cape first.