The Adrian Loveridge Column – Besides Tourism What?

Adrian Loveridge

Last week’s column attracted a lot of interest and discussion, with a tiny number inferring that I had a personal agenda, as a hotelier, to obstruct Airbnb and its counterparts, given any opportunity. Nothing could be further from the truth. Since buying a derelict hotel almost thirty years ago, and spending nearly three decades helping to build it into a high occupancy multi award winning boutique hotel, I think my wife and I have a better than average idea what it takes to make a tourism business successful in Barbados.

In the very early days very few merchants would grant us credit with the notable exception of Carters and Company for which we will be eternally grateful. There were also outstanding gestures of goodfaith and vividly recall when we needed a new long ladder to paint the property exterior, the Oran family agreed to barter accommodation and meals against what was then a major unbudgeted expense.

Another overnight stay was a gallon or two of paint and various two week stays were eventually sufficient to buy enough greenheart to replace every single roof of our eighteen separate buildings spread over 138,520 square feet.

Not for single second am I advocating this as a business model to follow for young would-be-entrepreneurs trying to get on the first level of the tourism industry, but our experiences and challenges have given a unique insight into the value of things and how to accomplish goals with very limited resources.

What is very often irksome arising from detrimental comments which seem to be made by blindfolded ill-informed political yardfowls is their clear lack of knowledge and facts. Among these are all the concessions and loans we have received from Government (any), which is so far removed from the truth it’s laughable.

Apart from a reduced rate of land taxes, when we were open there has been absolutely none. So it is irritating when people point out ‘all the Government help you hoteliers’ get. In reality, successive Government’s regardless of party affiliations have put boulders in our way including their foray in the hotel ownership and management and the disaster that became GEMS (Hotels and Resorts Ltd). The Prime Minister at the time of conception was gracious enough to spare me an audience where I virtually begged him not to embark on this folly. The meeting got very heated and it was clear that I was not going to change an already ingrained decision to go ahead. Hundreds of millions of wasted dollars later, you think I would be happy to tell you, I told you so. But when you factor in the damage it has inflicted on our small hotel sector, including the systematic predatory prices practiced by GEMS including the nearby Silver Rock hotel, I can assure you there is no sense of comfort.

No-one can close the door on Airbnb and other shared economy accommodation alternatives now, but we can do all in our power to ensure it is properly regulated and paying taxes like the overwhelming rest of us with one or two exceptions if only to protect the integrity of the destination.

As we get closer to a budget and a general election I marvel at all the fanciful ‘solutions’ people are enouncing –but let’s get real. Any truly informed player will tell you that at least in the short to medium term, the only sector that is going to get us out of the current fiscal malaise is tourism. When our banks, financial institutions and politicians eventually understand this there is just maybe some hope for recovery.

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32 Comments on “The Adrian Loveridge Column – Besides Tourism What?”

  1. Dentistry Whisperer (M. Pharm. D) LinkedIN May 1, 2017 at 5:15 AM #

    So what does Bumuda have? The British pound (Euro!!). Barbados needs a Hertz, Budget, car rental booth in the arrival area.

    Like

  2. Peter Lawrence Thompson May 1, 2017 at 7:58 AM #

    Adrian, I am also a businessman, but I am amused by some of the logical inconsistencies in what you write. You point to your decades of experience and say “Not for single second am I advocating this as a business model to follow for young would-be-entrepreneurs trying to get on the first level of the tourism industry,” but you then rail against the clear best choice of business model for young entrepreneurs in the tourism industry, AirBnB.

    You assert that “Any truly informed player will tell you that at least in the short to medium term, the only sector that is going to get us out of the current fiscal malaise is tourism.” But you don’t seem to see the contradiction in trying to constrain the local expansion of the fastest growing and most exciting segment of this industry: sharing economy ventures like AirBnB & VRBO.

    I am not rich, but I do travel from time to time: over the past several years to Miami Beach, Toronto, Vancouver, Jamaica, New Orleans, Baltimore, San Diego, San Antonio, Paris, London, Oslo. I never stayed in any hotel; I chose instead AirBnB, VRBO, or other Bed & Breakfast. I doubt that I will choose to stay in a hotel again for the rest of my life. The world has changed; tourism businesses will either adapt to these changes or go extinct.

    Like

  3. keeping it real May 1, 2017 at 8:46 AM #

    Well written article. I applaud your tenacity. Barbados need more people like you to cut to the chase.

    However they don’t like honestly and most would rather continue to have their head buried in the sand whilst listening to their Political ‘masters’ who definitely don’t have the masses interests at heart.

    Like

  4. vincent haynes May 1, 2017 at 9:04 AM #

    Due to the dilly dallying by our govt our short term solution can only be the IMF with the tourism sector assisting.

    Like

  5. Robert May 1, 2017 at 9:17 AM #

    Adrian: I perhaps was one of the tiny minority who suggested that your comments regards Airbnb were not entirely unbiased. This is understandable on your part and hold you to no fault. It is all part of your competition and your concern for a level playing field in the industry. I feel however that Airbnb provides an option to tap new markets and with the added benefit of funds remaining in Barbados! I believe that if other hoteliers were as pro active as your self in promoting Barbados, that the numbers would increase!

    Like

  6. David May 1, 2017 at 9:27 AM #

    @Peter

    From your experience lodging at Airbnb how ar:e those jurisdictions regulated compared to a Barbados?

    Like

  7. Peter Lawrence Thompson May 1, 2017 at 10:03 AM #

    @David
    Most of them are in the same position as Barbados with a regulatory environment that is outmoded. AirBnB causes the most problems in cities like Vancouver, Paris, & London: it tends to reduce the housing inventory available for people to lease as their home and so drives up the price of rental accommodation in places that are already unaffordable for working class people.

    Like

  8. David May 1, 2017 at 10:28 AM #

    @Peter

    Given the high cost of doing business as a mature market competing against others in the regions should boutiques like Adrian be concerned? T

    Like

  9. Peter Lawrence Thompson May 1, 2017 at 10:43 AM #

    @David
    Boutique hotels in Barbados need to reinvent themselves. I’m not an expert in tourism, but from a general strategic perspective the boutiques need to align themselves with the segments of the market that promise better growth: cultural tourism in its diverse forms (gastronomy, yoga, sports, music, etc.), appealing to millennials, medical tourism and the like.

    Like

  10. David May 1, 2017 at 10:46 AM #

    @Peter

    Like you not an expert, can’t disagree with the tenor of your comment. Let us wait for Adrian’s intervention.

    Like

  11. fortyacresandamule May 1, 2017 at 11:08 AM #

    AirBnB is not a new business model or concept. People have been doing this for years. My cousin has been renting the top floor of his home to visitors for over 20 years by word of mouth alone. He said he doesn’t need Airbnb. Plus, he is not keen on paying taxes.

    What Airbnb does is providing a formal convenient platform where more people (including government by taxes) can get it on the action. A win-win for all.

    Liked by 1 person

  12. Adrian Loveridge May 1, 2017 at 11:14 AM #

    Peter/David, boutique hotels like ours have been re-inventing themselves for years. In our case, walking tours, gastronomy and yoga (wellness) groups to name a few.

    Like

  13. David May 1, 2017 at 11:40 AM #

    @Adrian

    We are dealing with two key issues here:

    1.regulation
    2.are local boutique aligning and rebranding to market demand

    Like

  14. David May 1, 2017 at 11:42 AM #

    @fortyacresandamule

    The challenge for local players is that the big andtraditional players are subsidized and leak forex based on their booking engine setup.

    Like

  15. NorthernObserver May 1, 2017 at 11:59 AM #

    “Not for single second am I advocating this as a business model to follow for young would-be-entrepreneurs trying to get on the first level of the tourism industry”

    why not? isn’t this how things get done? were you supposed to tap into some grant or borrow beyond your capacity to repay?

    The idea of ‘piece by piece’ doesn’t bode well for many, who want instant success, and the benefits which come from that.

    We all desire free education, health care etc etc, but feel that “somebody else who we think has more money than us” should foot the bill. If we continually displace tax paying entities with non-tax paying entities, no public body will be able to ‘break even’.

    Like

  16. NorthernObserver May 1, 2017 at 12:01 PM #

    public body should be government

    Like

  17. caribbeantradelaw May 1, 2017 at 12:16 PM #

    Just to add another perspective, I agree the airbnb phenomenon should be regulated. I have two friends who have had bad experiences staying at Airbnb properties here and had they not already been acquainted with Barbados would not have come back. This is not to paint everyone with the same brush and it is not to say that I do not appreciate the global trend toward self-service accommodation and the desire, especially among fellow millennials, for a more authentic travel experience. I also agree and believe that it allows locals to participate more in “our industry”. At the same time there are reputational risks to our brand if not all accommodation choices are made to offer at least a minimum standard of treatment.

    Another point is that there is still a minority of us who prefers hotels. I for one always look for a hotel brand with which I am familiar or at least one that has been highly recommended to me by friends so I am guaranteed at least a minimum standard of service, even if it costs more. So while airbnb and similar sharing sites may take a larger slice of the accommodation pie in the future, there will still be a role for the traditional hotel.

    As a disclaimer, I am not a hotelier. This is just my own opinion as someone who travels often for business and leisure.

    Like

  18. Vincent Haynes May 1, 2017 at 12:43 PM #

    As fortyacresandamule has indicated this concept has been around for a long time under many different names of which the cheapest one is “Couchsurfing” where your accomodation can be as small as a piece of your lawn on which the surfer will place his own tent on or a couch in your front room hence its sobriquet.

    My personal view will always be that community based enterprises are always better for the country as it cements the citizens interest in enhancing the upkeep of his surroundings in order to protect his stake.

    Like

  19. fortyacresandamule May 1, 2017 at 1:12 PM #

    @caribbeantradelaw. The ‘reputational risk’ factor I don’t buy. Bad reviews come from 0-star to 5-star accomodation. Any traveller with a modicum amount of common sense would know they can’t expect star service from a no-frills establishment.

    Like

  20. David May 1, 2017 at 2:46 PM #

    @fortyacresandamule

    Small businesses do not have the reputational capital OR resources to withstand sharp criticism especially in a market where the business is unregulated read no standards..

    Like

  21. NorthernObserver May 1, 2017 at 3:07 PM #

    IF you cannot stand the heat, stay OUT of the kitchen?

    Like

  22. lawson May 1, 2017 at 3:41 PM #

    a problem on our news the other night, was a landlord in montreal getting fined by the condo corporation of the building he owned an apt in because the tenants had been renting it out to airbnb people without his knowledge. I am sure the ins and wear and tear may also be a question

    Like

  23. NorthernObserver May 1, 2017 at 4:20 PM #

    Lawson this is now standard. Weekly we hear of persons renting condos and then turning around and renting them out by the night.
    But it doesn’t stop there. For those with children at higher education places, in many cases they rent off campus housing, which requires a May to May lease. Many leave in the summer, and unscrupulous lanlords rent out the rooms. These are perfect because they are furnished, albeit student style.
    Ditto for persons who legally sublet these accommodations where allowed, and then the subletter is actually renting them out by the night.
    Two years ago, when I was selling a condo, i got wind that someone had listed it on a free classified site, for RENT; using the pictures in the sales listing. They wanted to collect the first and last months rent.
    Buyer beware.

    Like

  24. Vincent Haynes May 1, 2017 at 4:29 PM #

    Community houses renting of rooms from all accounts has taken off from couchsurfing to airbnb with a bit of word of mouth thrown.

    It will be very difficult for govt to attempt to rain it in….I have no doubt they will try.

    Govt needs to understand the meaning of free enterprise potential.

    Like

  25. David May 1, 2017 at 5:02 PM #

    Interesting opinion:=

    OPINION

    Airbnb a Problem, Not a Solution, for Homeowners, Renters and Cities

    It’s being picked on by councils around the world. And for good reason.

    By Bill Tieleman 1 Nov 2016 | TheTyee.ca

    Bill Tieleman is a former NDP strategist whose clients include unions and businesses in the resource and public sector. Tieleman is a regular Tyee contributor who writes a column on B.C. politics every Tuesday in 24 Hours newspaper. E-mail him at weststar@telus.net or visit his blog.

    Airbnb

     

     

     https://thetyee.ca/Opinion/2016/11/01/Airbnb-a-Problem/

    Like

  26. David May 1, 2017 at 5:04 PM #

    The following extracted from the link above, reasonable?

    Airbnb and its advocates tend to take a libertarian approach — “it’s my property and I’ll do what I want to, including renting it out.”

    That’s simply wrong. You can’t drill for oil in your backyard, set up a neighbourhood pub in your living room or put a giant neon advertising sign on your roof — nor should you be able to run a hotel from your home without meeting municipal rules.

    I am not universally opposed to home or apartment rentals either. I have stayed in several cities around the world through VRBO, and it can be a good experience if done fairly.

    But in any apartment building or city, rules have to be followed for the protection of both owners, neighbours and visitors — and that must be the guiding principle, not increasing Airbnb’s massive value at others’ expense. [Tyee]

    Like

  27. de pedantic Dribbler May 2, 2017 at 11:56 AM #

    @David May 1, at 10:28 AM re …”Given the high cost of doing business as a mature market competing against others in the regions should boutiques like Adrian be concerned? ”

    Your comment above (and that of Lawson et al), allows an expansion (clarification) of my remarks last week. Then I also weighed in @Adrian and he may have taken that as a critique of his Airbnb screeds; it wasn’t really.

    Adrian has every right to rail against ‘regulations’ which facilitate an uneven playing field when an Airbnber can enjoy ‘tax free’ concessions that his boutique hotel or a registered B&B may not be able to avoid.

    For him (and the industry really) the regulation headache is NOT about the standard of the accommodation because as @Forty noted that is very much a self-regulating process in today’s connected social media world.

    I have enjoyed Airbnb on the business side so I agree that this exciting platform does offer a fantastic ability to push-back on ‘bad’ reviews.

    One cuckoo does not a summer make and just as surely one griper who says – as an example – that the apt was hot and did not have air-con (all marketing clearly noted the presence of fans only) or that there were bugs (because of a few ants they likely caused) will be drowned out by the other reviews that offered excellent gushing feedback on the property.

    Also, it is totally misguided to suggest that the funds remain in Barbados. At least not if you are talking about the money for the rental fees. The model clearly allows any Bajan using a home-share site to manage funds on an off-shore bank a/c (if they can open one)!

    Let’s also appreciate that Airbnb is a ‘conglomerate’ operated by and profited from players in the US. Yes of course the home-sharer is local but the real money and power deal still resides with the corporate smart-folks overseas.

    And finally David, everything about a ’boutique’ venture says loudly that they are matching customers wishes and adapting to change.

    But the Adrian’s of this world now have hundreds of competitors who do not have to worry about the same wages, utilities and other costs.

    I am not a regulator so that does not concern me beyond a moot point. But as a minor competitor it’s game on… Adrian has over 30 years experience… that’s a huge advantage. He will survive.

    Or maybe he will sell for millions and retire quietly to set up an Airbnb cottage on the grounds of his mansion to be called ‘Peaches’!

    When one door closes, they say, you can often brek open a few others. Or something so, anyhow!!

    Cell phones were supposed to presage the demise of telephony as we know it… the telcos have adapted and continue to make money hand-over-fist with explosive phone usage.

    Airbnb presages similar talk of hotel gloom. And as surely they will be dramatic changes and as surely they will be a continued travel explosion around which the Adrians’ will adapt and survive well.

    Like

  28. David May 2, 2017 at 12:20 PM #

    What the advent of Airbnb brings to the fore is the king of focus our decisiommakers must have NOW regarding building the tourism plant. You should know the only significant FDI stream Barbados has in coming from the tourism sector.

    Like

  29. Vincent Haynes May 2, 2017 at 6:41 PM #

    David

    The concept of Airbnb&Couchsurfing,translates into community tourism that we have practiced here for decades…..all that is required is govt support without interference and let the laws of the land apply.

    Like

  30. David May 2, 2017 at 6:52 PM #

    @Vincent

    You are missing the central pont. Why would government give 40 year and other concessions to hotel investors and allow the Airbnb model to pick the bones of that model? The analogy of the LIAT model and Redjet is apt.

    Like

  31. vincent haynes May 2, 2017 at 8:48 PM #

    David

    I fully understand your point and agree with its reality…..which is why the community based tourist product has to be strong enough to with stand those pressures.

    Like

  32. Hants May 5, 2017 at 9:44 AM #

    The rich will keep coming…..

    “4.5 acres of “prime beach frontage” at Clearwater Bay, near popular picnic spot Batts Rock, St Michael is on the market for $27.5 million.

    http://www.nationnews.com/nationnews/news/96317/real-estate-hope#sthash.cPrrlB0W.dpuf

    Like

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