Nigeria’s Transcorp Hotels powers through the crisis
 
Nigeria’s Transcorp Hotels powers through the crisis
30 JULY 2020 8:09 AM

When the full weight of COVID-19 hit Nigeria, its largest operator, Transcorp Hotels, decided to keep its two hotels open and sought out innovative ways to continue operations.

REPORT FROM NIGERIA—Nigeria’s largest hotel owner and operator by room count, Transcorp Hotels, has different reopening strategies for its two hotels based on booked and likely occupancy rates, according to its CEO.

CEO Dupe Olusola, who took the company’s helm in May, said staff at the 133-room Transcorp Hotels Calabar on Nigeria’s southeast coast, and 677-room Transcorp Hilton Abuja, in Nigeria’s capital, have focused on ancillary revenue while planning for the assets’ recoveries.

Speaking to Nicolas Pompigne-Mognard, founder and chairman of Dakar, Senegal-based business consultancy APO Group, at the virtual Africa: Hospitality Tomorrow conference, she said the forward-looking optimism is not due to an absence of hurt coming from the crisis.

“COVID-19 has been really challenging. We immediately saw a drop in all of our numbers. In Abuja, where we rely on international travellers and business with the government, we saw performance drop to 5% occupancy in the first few months of lockdown,” she said.

Olusola said at one point her open, 677-room hotel had exactly 33 guests, all of them long-stay.

“But we still took the decision not to close down and to keep staffing at a minimal. It has been tough,” she said.

Revenue per available room dropped 38.5% year over year, and outlet revenue dropped 49%, she said.

Pompigne-Mognard said the Addis Ababa-based African Union, which represents all 55 African nations, has calculated that the hotel and hospitality industry in the continent has lost approximately $55 billion since the beginning of the COVID-19 crisis.

Transcorp Hotels has used the unwanted down time to train and re-train its approximately 1,500 staff members and to engage with guests and loyalty members.

Olusola said she learned a great deal from the decisions and strategies of the hotel firm’s parent company, Transnational Corporation of Nigeria, which has interests in energy and agriculture. The company did not close, and many staff continued to work on site at the power plants it owns.

Off to the movies
Decisions she and her team made included making masks mandatory in outlets and displaying throughout the property “very elaborate videos of the (necessary hygiene) protocol, so it is clear what guests can expect and how they can help.” Also, as many offerings as possible were moved outside, which she said she realized was easier in a warmer country.

She also is sending her guests to the movies.

“We launched a drive-in movie theater, which conforms to rules of social distancing but also gives the sense of going out,” Olusola said.

“We’ve worked closely with the (Nigerian) Ministry of Health so that we have all the validation, to go the extra distance to reassure guests, but it also goes down to the small things, such as there being fingerprints on the (in-room TV) remote control—the things no guest wants to see,” she said.

She said each changed and added feature must accentuate the guest experience.

“We are mindful that some costs are not sustainable but are needed right now. Now is the time to regain confidence, when for many it is the first time they have stepped out of their homes,” Olusola said.

“We pushed room service, and kept only one restaurant open,” she added.

“One of our critical success factors, not shutting down, is of great advantage. I know not everyone has the luxury to do this,” she said, adding it was equally important to have a conscious knowledge of the operational parts that hoteliers have less control of on a daily basis.

She said decisions on where to cut costs were very practical, such as the electricity savings from closing six of the nine elevators in the Hilton property.

“Restarting a hotel after it has closed down is a completely different discussion,” she said.

The group also has two hotels in its pipeline, the first in the former capital of Lagos, the second in industrial- and oil-based Port Harcourt, with a combined investment of $240 million.

The existing Abuja asset also is set to get a convention center.

“We’re looking outside the country, too,” Olusola added.

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