Dave Allan knows a thing or two about how to run a hospitality business – he’s been doing it most of his adult life. He owns three other businesses in regional WA, but his most recent acquisition was his first foray into the hotel trade.
It’s working out well because the Rose Hotel, a 150-year-old Bunbury institution about 170km south of Perth, was named WA’s Best Redeveloped Venue at the Australian Hotels Association Hospitality Awards 2017.
Allan talked to us about upgrading the ageing facilities, the shift in focus to food and beverages and the importance of valuing your time in a highly demanding business.
BusinessesForSale.com: What’s the story? Why the Rose Hotel?
Dave Allan: Bunbury is under-represented in hospitality and The Rose Hotel presented a good opportunity to add something to the local area. The hotel is already well-known – it just needed updating.
It’s about 150 years old, so the accommodation needed some freshening up and separate bathrooms installed. Previously, there were rooms with shared bathrooms – obviously, we needed to cater for contemporary guests.
BFS: What kind of demographic do you attract?
DA: It’s a real mix of people. We try and cater to corporate customers as much as possible as they provide reliable custom. This type of guest is mainly contractors and businesspeople.
However, a decent percentage are tourists.
The Rose is well-located in the centre of town. People can park their car here and know they are within walking distance of everything they need.
BFS: Have you run a hotel before? What’s your history? DA: I own a couple of pubs as well as The Rose with my business partner. My background is in food and beverages, which is why I wanted to boost the offering in the hotel.
This is the first time I’ve offered accommodation.
BFS: What changes have you made so far?
DA: We’re updating and refreshing the decor and bathrooms – things like fittings, fixtures and changing how the reception works. We’re very focused on meeting the demand from our guests.
We’re also making some big changes to the food and beverage offering. The family we bought it from had owned it for about 46 years, so the whole place needed refreshing.
We can now offer our guests a quality meal and casual drink as part of their stay. Every customer gets a food and beverage voucher.
BFS: Do you see Airbnb as a threat? Have you noticed a change?
DA: I’m sure it does have an impact, but we’re not that concerned about it. Our guests only stay a night or two, whereas people tend to book longer stays on Airbnb.
BFS: What’s the top piece of advice you would give someone thinking about buying a hotel?
DA: I would say that people need to place a value on their time when making their calculations – people tend to underestimate how much time it requires.
The perception of any hospitality business is that it’s fun and social, but the reality is different. There’s a lot of back-of-house admin and staff issues to solve, which is fine because it’s all part of the business, but people don’t adequately account for that when they first start.
BFS: If you were going to buy a hotel now, what would you look for first?
DA: Location, for sure. You want somewhere with a mixed demographic and a sizeable population.There’s no point in being tucked away in the middle of nowhere (unless that’s what you want).
You need to be visible – if you’re the first hotel that people drive past, you have the best opportunity to get their business.