“The whole industry was out of whack.”
“Even if it wasn’t for Covid, a big restructure was needed.”
Mark Fuller, CEO of Sanctum Hotel Group, has survived his fair share of economic crises over the years, managing everything from rock bands, restaurants and nightclubs to bars and hotels.
He believes that despite bleak economic forecasts, there is actually a positive angle for hoteliers who are willing to adapt to the current situation.
A real rock’n’roll hotelier
Mark’s heritage is music. After managing a string of British rock bands in the 80s, he started putting on club nights in the capital. Drawing on his knowledge of the entertainment industry and his celebrity contacts, he opened a number of high-end bars, restaurants and clubs.
“Around the year 2000, I was working with a fairly well-known chef called Marco Pierre White. Sugar Reef was one of the biggest celebrity haunts in London and we welcomed the likes of Robbie Williams, Madonna, the Spice Girls, famous footballers, etc.”
“We called the concept total entertainment, affordable glamour – but it wasn’t really total entertainment because you couldn’t sleep there, although many people tried!”
The natural evolution of Mark’s total entertainment concept was to add beds into the mix, and he later opened the Soho Sanctum Hotel (now The Karma Sanctum Soho Hotel) in partnership with Andy Taylor and Rod Smallwood, “who manage a very small and unknown band called Iron Maiden.”
The rock’n’roll hotel, which fits that genre by virtue of being owned by rock stars and being the kind of place that rock stars want to stay at (Mark hastens to add there are no guitars hanging from the wall!), was designed to give bands a place to relax and enjoy themselves after gigs. It boasts an all-night bar, a hot-tub on the roof terrace, a basement cinema room and luxury-fitted, soundproofed rooms.
“Why not create a hotel that does what it says on the tin? Hotels are licensed 24 hours, why not make the most of it?”
The hospitality industry needed shaking up
When asked what he would have done differently in 2019 if he knew that Covid was just around the corner, Mark jokes “I’d have gone on holiday,” before laying bare what he believes were the biggest problems in the industry.
“2020 was always going to be a bad year anyway. First we had Brexit, bookings tailed off in January and then restaurant groups like Jamie Oliver started going down.”
“The whole industry was out of whack. Customer demands were out of whack. Profit models were out of whack. People believed in a model of 1/3 hard costs, 1/3 soft costs, 1/3 profits, when in actual fact profits had been closer to 3-9% for years.”
Hoteliers need to adapt
Having worked through previous recessions, Mark sees light at the end of the tunnel.
“Everyone is talking about the second spike, but, for me, the bottom line is recovery.”
He believes that hoteliers need to keep their teams flexible by cross training staff and breaking down departmental walls.
“Housekeepers must be able to cook food if required, bar staff must have the skills to work the reception desk if needed. The bottom line is that everybody needs to help each other.”
He sees a great chance for hotels to flourish if they take advantage of the shifts in demand. With people giving up their second homes and businesses doing away with expensive offices now that everyone is used to working from home, he believes hoteliers need to find ways to cash in on the need for temporary offices and meeting spaces.
Mark also views the travel restrictions as an opportunity to capture local demand.
“We’re not going to lose so many people to Spain this year.”
“But it is important to provide a truly personal, truly local experience to each guest. That means finding the right character to be the frontman of your business, somebody who epitomises the local area and understands your brand values.”
Mark mentions that events such as the Save Our Soho al fresco dining experience that he worked on with long-time collaborator (and landlord) John James to get people eating out again in central London can be great ways to create community spirit and drive demand.
He also believes that the shake-up will help adjust expectations for guests and hoteliers alike. It’s important to budget for efficiency.
“For hoteliers, it’s a great time to reduce efforts on loss leaders like expansive restaurant menus and spas. It’s easy for us in Soho, because within three minutes of our front door you can find some of the best restaurants in the world.”
“Guests will accept a restructure that sees the quantity of services drop, so long as the quality of service is maintained or improved upon.”
Mentorship is so important for partnerships
Having made the jump from the music industry to hospitality, from nightclubs to bars and from restaurants to hotels, Mark knows how difficult it is to transition from one genre to another.
“Anthony Bourdain was right – just because you can run a bar, it doesn’t mean you can run a restaurant. Just because you’ve got a restaurant, it doesn’t mean you know how to run a nightclub. Just because you understand nightclubs, it doesn’t mean you understand hotels.”
“It took me a long time to learn, I learnt the hard way. Hotels are not easy.”
Mark says the same principle applies to forming partnerships and venturing into new markets. Specialist and on-the-ground local knowledge are vital for success.
“London operators can’t just roll into Miami, LA, Nashville or New York and expect to understand the business culture and the market.”
Mark stresses that collaboration is so important. Don’t think that you can do everything yourself, work with people who have expertise that complements your own.
“I’ve learnt a lot from my partnership with Andy Taylor, who is not just a rock’n’roll manager, but also a chartered accountant.”
“In the end it all comes down to the pounds, shillings and pence. He taught me that a good hotelier needs to be a good frontman, but also a good accountant.”
Looking to the future
Mark plans to put the customer experience, a rock’n’roll experience in his case, at the centre of everything that he does moving forward.
It’s all about identifying the right staff, with the right skills and character to provide the quality of service that your guests are going to expect.
“People care more about a true personal experience than an elaborate menu.”
Hoteliers need to stay creative. This might mean paring back on certain things to focus on your core services. It might mean finding new sources of revenue by adapting to shifting demand, or even forming partnerships with local businesses in your neighbourhood.
It’s so important to stay lean and nimble. Roll up your sleeves, lead by example and build a team that can turn their hand to any challenge. And remember:
“When you think you’ve learnt everything, you will fail. No matter what age you are, you learn something new every day in this industry.”