South Strategy

A hopeful tune

Stephane Fabregoul has been in India for a little over two years with Starwood International. Currently the GM of the yet to be launched Westin Hyderabad Mindspace, he says that times are difficult but hopes are high. By Sayoni Bhaduri

Stephane Fabregoul, GM of Westin Hyderabad Mindspace, believes that business will be back not only to the City of Nizams but the entire hospitality industry. "India's GDP is projected at 6.7 per cent and, with a stable government at the Centre, things are beginning to look cheerful. This provides international companies a much needed confidence to look at India as a lucrative investment,” he says.

Hyderabad has everything going for it as a destination, particularly as a MICE destination with an IT park, an international level convention centre (HICC) and a great new airport. Even as a leisure destination it has a lot of opportunities which the Andhra Pradesh government has been promoting.

With 200-250 companies in Hyderabad, the opportunities for growth are tremendous. "Keeping in mind the progress the country is making, the economy should start getting back on track by the third quarter of this year," he says. But with the corporate segment travelling lesser and opting for cheaper modes like guest houses, hotel operators will have to stay on their toes to fulfil the guest/consumer requirements and keep their business going. Room occupancies and rates completely depend on this trend.

The guest is benefiting with the market scenario with falling room rates. Fabregoul adds, "Correction in room tariffs is always expected in any market; it is a natural progression. But in India, it came quicker than expected with the economic downturn playing a major role." He reasons that the impractical rates existed in the first place due to the gap in the supply and demand in the five-star segment and guests had no choice but to pay the price. But the correction should not be taken negatively - this is a good time to bring MICE business into the country. Where earlier any business from conventions and events was lost to other destinations in the Asia Pacific, India now has the chance to make up for all the lost business in the downturn market.

The Westin way

Most of Westin's business is corporate, but there is always room to grow and develop. So with the state ministry trying to promote links between Hyderabad to other destinations like Hampi and Vijaynagar, Fabregoul is looking at an increase in the number of leisure travellers. "Our biggest markets, as of now lie in the US and the UK with a large number of IT-based companies which are looking at making Hyderabad their Indian headquarters," he says. Within India, he is looking to tap maximum business for the key economic cities of Mumbai, Delhi, Bengaluru and Chennai.

Like any other hotel, Westin Hyderabad Mindspace too expects 85 per cent of its business to come from room revenue and F&B. Other sources of revenues like spa, retail space and deli shop will account for the remaining 15 per cent. However, Fabregoul is looking at different concepts that optimise operations. For instance, he intends to open the hotel's laundry services to consumers beyond its in-house guests. The key lies in relationships he believes even when it comes to strategising promotions. "We will be seeing difficult times even by the time the hotel opens up, so the most important thing to keep in mind while developing our strategy for sales and marketing is the ability to form new relationships and then maintain them," says he. What is built and sustained now, will reap benefits few years down the line is the thought process.

The downturn also allows the most creative and innovative sides of business to come to the fore. "We are always looking at optimising our operations to the fullest by bringing in efficiency. Technology also is a key area that helps us reduce unnecessary costs," says Fabregoul. Incidentally, the purchasing also becomes crucial. Since Westin is an international brand and has to follow international standards, the purchasing effectively takes place from both international and domestic suppliers. "Products and services that we provide to our guests across the Westin brand are often not available in the Indian marketplace, so we get them from our international vendors. However, when it comes to customising certain details, it is always easier to go for domestic vendors," he states. It is not only easier to communicate but details of requirements are also easily explained with fewer chances of mistakes.

Equally important right now is to gear the staff and associates for the recession. He says, "We have also been involved in training our associates and staff to keep their morale up and at the same time improve their efficiency by developing multiple skills." And it is not just the employee, their family also suffers from the insecurity of the scenario, making it important to stay connected with the family as well. "We frequently conduct programmes to help associates and staff cope with various issues they might be facing in life. We also conduct regular training sessions," he further adds.

The way ahead

Fabregoul is confident about the future. As soon as India fulfils its infrastructure requirements, travellers will become more and more confident of coming to India.

The biggest advantage that India has is its domestic travel business. Compared to China, which gets maximum international business but limited domestic travellers, India has great opportunities to grow. "I see India as a number one destination in the next ten years, especially in the MICE segment in the Asia Pacific region," he says.