“The Success Story of Upgrading From Class Suites To Class Signature” …Stephen Omamuli, CEO, Class Hospitality Ltd.  

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Stephen Omamuli, CEO, Class Hospitality Limited

To say that Stephen Omamuli has become a reference point in hospitality business in Nigeria would be stating the obvious. His relentless efforts as distinguishing the services provided by his outfit, Class Hospitality Limited, a wholly hotel management and consultancy company, is attributed to passion for quality service. Omamuli, a service-oriented expert in a class of his own, in this interview, dwells on his passion for hospitality, the idea behind the new, elite-based hospitality arm, Class Signature, his plans for the future, and more. Enjoy…

 

Can you share with us the progress from Class Suites to Class Signature?

Class Suites was just a showcase of what we can do; hospitality and hotels. Initially, we set it up to show investors and hotel owners who are interested in consultancy and consultants to manage their hotels to see what we could do. But we decided to up the game with Class Signature to show guests that we also can present a luxury style hotel at a budget rate, a hotel that can give all the little perks like an ironing board, iron in the room, wireless and nicely laid out room and more.

 

What are the things that make Class Signature unique?

What really motivated us is the Hilton brand. We decided to study the Hilton brand and the Hilton growth and we discovered that among other topnotch hotels, Hilton still falls under the budget hotels but offers the luxury style. So, when we started the upgrading from Class Suites to Class Signature, we decided to make our guests more comfortable in terms of where we locate our suites, the layout of the rooms and every other thing. We decided to change them to make our guests more comfortable.

 

How many hotels do you have now under Class Hospitality?

We actually decided to reduce the numbers because Class Hospitality which is the parent company was the company managing Class Suites and other brands. But we noticed that there was conflict of interests managing other brands. As consultants, when we steer the ship to the left, the owners want us to come to the right vice versa. So, the conflict of interests always affects the quality of service we render to our customers. And at the end of the day, those that suffer the effect are the end users of the hotels. They are not bothered about what happens behind closed doors or in the boardroom, but they end up suffering for what went wrong between the consultant company and the owner.  So, we decided to refocus and do just Class Suites and Class Franchise. As an investor, if you are coming in, we are going to sell our franchise to you and our management package would be to manage Class Suites on our franchise. That was how we reduced from seven to three.

 

Where are those three located?

When we reduced to three and when we did the refocus and cut off other brands, we then decided to have just two brands of Class, which is Class Signature, our premium brand, and Class basic brand which is our budget brand that every class can afford. But those seeking extra brand to provide the luxury that they need, those that are willing to spend a little more for the class they desire, Class Signature is for them. That does not mean that we are compromising the standard of the Class Budget. Class Budget still remains higher in standard than the basic hotel you get around our competitors.

 

Please, share your dream for Class Hospitality.

My dream for Class Hospitality is to expand to the extent that Class Suites as a brand would be well sought out for by other investors in different locations. We are going to make sure that we have a Class Suites that is managed by Class Hospitality in Abuja; our focus is Abuja, Port Harcourt and Kano. We are not cut out for having 100 or 150 rooms; we are more focused on the budget style and small-sized hotels that are spread across individual needs of our clients. We are still looking at maintaining the 16 to 40 bedroom hotels and ensure that we meet the needs of our guests.

 

How did you get into the hospitality business?

Hospitality business, I would say, I went into because I discovered that I’m a service-oriented person. I love to see people happy. Whenever I do things that make people happy, like getting someone a glass of water, you are looking for a location and I meet your need, you are looking for a good restaurant to eat and I meet your need, and so on, I discovered that I derived joy in that. So, I discovered that the only place that I can also derive happiness apart from my legal profession was in the hospitality business. That’s why I decided to come into the hotel business where I can really meet people’s needs.

 

Looking at the growth of Class Hospitality, what is the secret, how have you been able to stay afloat, especially looking at the finances?

Firstly, in terms of growth, I would say the most important thing is consistency. We have been very consistent in doing what we are in the business to do; in making sure that we are transparent, we are honest with our customers, we provide them quality services on affordable rates, we do what other people would call after-sale service, we ask after their welfare and satisfaction and how we can do more to make them more comfortable. And they keep coming back. For growth and finances, I would say, basically, one of the things that has been my watchword is a Richard Branson quote; ‘if a project comes to you and you are asked to do it, first of all accept it, and you then go out and look for how to do it’. Our growth has been to the grace of God, and the fact that we have been really focused on what we like to do, first, and we decided that at each stage in our business, we always set targets in the sense that we have achieved to this extent, we can now move to the next level. The satisfaction of being in one particular level has always been what has propelled us to the next level.

 

From your experience, would you say it is better to carve a niche in the area of budget hospitality or go for the big multi-rooms hotels?

Statistics has confirmed it that the budget style hotels, the boutique style hotels account for over 65% of total rooms globally sold in hotels. So, if we look at the total volume, if we have one million rooms globally, small-sized hotels of between 10 and 40 rooms, amount for 65% of the total occupants in it. The remaining 35% is for the big hotels. The reason is that we have more of the small-sized hotels, and if you have one big brand hotel that has, say, 200 rooms, you have about 40 or 50 small-sized hotels around it that each has between 15, 20 and 40 rooms. If you do the statistics, you would discover that the small-sized hotels are more in number. And people tend to lodge in the small-sized hotels more because they feel at home more in them.

 

What would you advise anyone that wishes to come into the hospitality business?      

The first is for you to seek professional help and professional advice. A lot of people are tricked into believing that ‘what is it in hospitality, is it not to just sell rooms, sell drinks and sell food?’. No, it goes beyond that. There are professionals. Apart from people going to study kitchen and hotel management, hospitality management, hospitality is a professional sector. We have people that are gifted in food management, drinks, housekeeping, and other areas. So, my first advice is for people to make sure that they consult professionals. As an investor, what you need at the end of the day is the money. So, if you need the money really, sit down, consult the professionals to put you through the right things to do so you do them properly. But in Nigeria, we have a lot of investors coming into the business with a huge amount of money, running the business by themselves and running it down. Then after running it down, they now run out to look for professionals to come and salvage the situation. But then, it might be too late. My second advice is, hotel business is capital intensive. You don’t invest a hundred million Naira and expect to make it back in one year or six months. But a lot of investors that we have here, after spending money to build the hotels, they desire to make that money back within six months to one year. And when the money is not forthcoming in six months and one year, there is conflict of interests and huge problem arises. But we that are professionals, we don’t have projections, we do everything and we realize that for that investment, you need five years to get returns. Now, in those five years, are you not going to be making money? You are going to be making money. If you spend N500 million or a N100million and you are making money every year and you are recovering your investments in five years, it is something that is good.

 

One thing that is visible is that there are so many hotels around. While some are doing well, a lot of them are closing up. What is the difference between those that are successful and those that are closing up, what do you think they are not doing right?

The difference between those that are succeeding and those that are not succeeding is the intention behind the setting up of the hotel. If you don’t get your intention right from the outset, you are already doomed for failure. The second reason a lot of hotels don’t do well is because the owners take out money from the hotels and don’t put money back. Customers need clean sheets, they need clean towels, and they expect to see renovations. Someone using your hotel does not want to come back three years after and see the place in the same condition. You need to do things that will entice them to make say that ‘oh this hotel is well maintained’. So, apart from the fact that they don’t put money back, maintenance is another major problem that is affecting a lot of these hotels. Also, we have to look at the source of income. The get-rich-quick thing, getting money from other sources, and thinking that the hospitality industry is also another get-rich-quick scheme whereby you can put in N100million and get it back in three months. So, these types of investors get frustrated midway and they end up either selling the property or giving it out to consultants or leave the business completely.

 

What do you see as the future of hospitality business in Nigeria?

The future, honestly, is for those that are really focused, those that are patient, those that are innovative and those that are moving with global standards. The future that we are talking about is online. The OTAs, which I call online travel agents, are taking over the core business of marketing hotels. So, most hotels are closing down their marketing departments. What they have is their business development and accounts management departments. So, the future, if you ask me, has gone online. And the future is also about competition because the proliferation of hotels has made a lot of people sit up and has made a lot of people realize that it is not business as usual. The patience level of an average customer five to 10 years ago used to be 30 minutes and one hour. But today, the patience level of an average customer is between five and 10 minutes. When customers don’t get what they are looking out for, they know that within a 100 meters from your hotel, there is another hotel. Hospitality is a good industry, it is something that has encouraged a lot of people to invest. But at the back of your mind, you must always remember that it is a long term project. But the future is bright, especially for professionals.

 

Where do you expect to see the Class brand 10 years from now?

Ten years down the line, Class Suites would be a brand that investors would be looking out for. The Class brand is an indigenous brand, it is a Nigerian brand. Our big time investors that have the cash are going for foreign brands. What are these foreign brands doing, they are making the money locally here and repatriating the profits they are getting from Nigeria to develop their own countries. Now, our home governments are not encouraging us as well. If they are encouraging us, you would see investors in Kano, Kaduna and all over Nigeria looking out for local brands. If Class Suites is doing well in Lagos, it should be able to do well in Kaduna, Jos, Bauchi and elsewhere in Nigeria. In the near future, I want to Class as a brand, as we are pushing it as a brand. The success of hospitality is revolved around investors. Investors are the people that move businesses. So, in this industry, investors should focus, look inward and make sure that they encourage local brands.