Business

Thursday 30th January 1997 00:00

Ask Ewan Plenderleith what he feels about the effects on business of the end of the ceasefire in Northern Ireland and he doesn't seem too worried.

As general manager of Radisson Roe Park in Limavady, Plenderleith is running a 64-room hotel for which the bricks and mortar were laid before the ceasefire. Consequently, the hotel was never counting on tourist business.

"Any that come along are a bonus. The province has to be the backbone of our business," Plenderleith says.

Radisson Roe Park is looking to the home market. Already 40% of business comes from the local area and a further 20% from mainland UK. The rest comes from America, the Republic of Ireland and Europe. On the basis of this business, Radisson Roe Park enjoys an average occupancy rate of 69%.

Three factors have so far contributed to the success of the hotel in Northern Ireland: its conference facilities, golf and leisure, and the Radisson name.

Since opening in June 1995, the hotel's conference business has built up a portfolio of 12 Northern Ireland-based companies. Some of these companies provide the hotel with more than 1,000 bed-nights every year and in return for their loyalty, they receive the best corporate accommodation rate of £55 per night.

Other conference customers pay up to £70 per night, depending on how much business they bring to the hotel.

Plenderleith is currently working hard on yield management. Although occupancy is running at an average of 69%, achieved room rate is roughly £50.

The hotel is attracting business that Plenderleith feels doesn't justify a reduced rack rate. Although he won't be rocking the boat with his top companies, he is looking at other companies that bring less business to the hotel than in the past.

"We want to achieve a higher average spend per person," he comments.

Conference facilities consist of the Roe Park Suite which caters for up to 440 people or, alternatively, divides into three rooms catering for 130 people each. A further five meeting rooms each hold between 20 and 40 people.

In addition, of the hotel's 64 rooms, five are executive rooms which double up as conference syndicate rooms holding a maximum of 12 people.

The hotel's extensive conference facilities also double up for banqueting use. Banqueting revenue each month amounts to £40,000 on average. This banqueting business helps the hotel to maintain an overall gross profit from food of 70%.

"We absorb the cost through kitchen management and shrewd purchasing and negotiation," explains Plenderleith.

Conference and banqueting at the hotel are not the only areas that require shrewd management. Plenderleith has to ensure the hotel's two restaurants, the 80-cover Courtyard and the 130-cover Coach House, maximise on revenue as well.

The Courtyard is generally used by hotel residents, and weekend leisure-break customers add to its business.

The informal brasserie-style Coach House was built alongside the golf facility to cater for golf club members but is also used for conference lunches.

Plenderleith keeps the latter restaurant busy by giving golf club members a discount, thus encouraging them to use the facility. It also hosts jazz buffet lunches, and a monthly jazz weekend takes up a third of rooms as well.

"As a revenue generator this area does a lot of our business," says Plenderleith.

The golf and leisure club facilities, which include swimming pool, gym, dance classes and beauty treatments, bring their fair share of revenue to the hotel. Radisson Roe Park is the only hotel in the province with an 18-hole golf course and more than 50% of guests make use of it. Currently, 400 golf club members pay £500 a year and some 430 leisure members pay £300 per annum.

Finally, the alliance with Radisson Hospitality has played a part, and accounts for 10% of overall bookings.

"There are a number of benefits to using the Radisson name. They are there to advise but they don't tell us what to do. The company has strong purchasing power so we can buy at advantageous rates," says Plenderleith.

Despite the hotel's success in building up local business, bookings were hard hit last July when trouble broke out a few miles down the road in Derry city.

"Bookings went from 40 to four and I can't say how much we lost in terms of the phone not ringing," says Plenderleith.

Companies from the UK and the Republic with subsidiaries in the provinces, that would normally come to do business and play golf, decided to hold their meetings closer to home.

The loss of business represented between £50,000 and £70,000 off the books. Fortunately, bookings did not take long to pick up again. Within a fortnight, occupancy was back up and August showed an occupancy of 75% compared with July's 62%. Now, six months on, the news is good.

Plenderleith and his 70-strong team are optimistic. Most weekends in May are already booked up with conferences, taking up 30 to 60 rooms at half board.

Planning permission for a further 37 rooms has been granted and the work is likely to go ahead over the next 24 months.

Demand for these extra rooms has been proven through the hotel's Fidelio reservations system which records bookings that cannot be accommodated. Enquiries about the hotel have increased by roughly 65% year-on-year.

"It is such a new property that our business is growing all the time. Last year's conference business is coming back and we could have sold Christmas and New Year twice. There is a strong indication that we are making our mark on the Northern Ireland market," concludes Plenderleith.


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