Lots of people dream of owning a B&B or a motel in the country. Christina Brookes has lived this dream. In a brave move she and her partner John moved to Tasmania from Sydney to take ownership of a modern motel in historic Ross.
Christina tells her Business StartUp story and also talks about what was involved in selling their business. Fascinating!!
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Are you thinking about starting a business? Want to find out more about what it takes to get started? Then head over to www.healthynumbers.com.au/bsrq/ and take the Business StartUp Readiness Quiz
Or you can read the entire transcript of Christina’s interview here.
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Happy reading! Now here is the full transcript of the podcast.
INGRID: Hello and here we are with Christina Brookes fresh from the sale of her Ross Motel and welcome Christina.
CHRISTINA: Thank you.
INGRID: Thank you. I’m just wanting to jump right in here, how long ago did you get involved with the motel?
CHRISTINA: Well we actually settled on the purchase on 1 December 2009.
INGRID: So it is 5 and half years. And why did you buy this motel?
CHRISTINA: Well the opportunity arose at a time when I was, you know, a little bit discontented with the executive secretarial position I had, and this opportunity arose and I seized it!
INGRID: You seized it. Had you thought you’d be running a motel at this stage in your life?
CHRISTINA: No, I never thought I’d do anything like that.
INGRID: What did you want from the business from the start? You bought a business that was already in existence, so what were your expectations?
CHRISTINA: Well I didn’t really have any expectations. I thought I knew enough about accommodation, I worked in hotels and clubs, I knew about customer service, umm so I thought it would be a bit of a snack really. But of course it wasn’t, like all businesses. I didn’t really have any expectations I just thought I’d be able to do it.
INGRID: And so you just got on with it?
CHRISTINA: Yes.
INGRID: When did you realise it wasn’t going to be a snack?
CHRISTINA: Probably the first couple of weeks when we were doing the handover with the previous owners, and I realised that I didn’t have any idea about how accommodation, and booking accommodation, worked. We were just coming into the year that websites were becoming really important, and we had a website for the motel but it wasn’t anything spectacular. And it was all linked to a booking, what they call a ‘book now’, but through a company. I found it quite confusing to start with.
INGRID: So you knew about customer service and hotels, but the all important getting people into your hotel was…..
CHRISTINA: Yes. I hadn’t worked with websites and didn’t realise booking through websites is as important as it turned out. But you learnt very quickly.
INGRID: Yes, you sink or swim.
CHRISTINA: Yes you do sink or swim.
INGRID: So I guess that was the point where it became very real.
CHRISTINA: Yes, it did become very real for me because I’m a hands-on person.
INGRID: I usually ask people, you know, when did they realise that the customers wanted what they were producing because sometimes people come up with something new to market, or might be something that they care about. When did you really feel like customers really wanted your motel?
CHRISTINA: I think when you start getting repeat customers.
INGRID: How long did that take Christina?
CHRISTINA: About 6 months.
INGRID: And what sort of people were they?
CHRISTINA: What I call intra-state customers. In Tassie you get a lot of people who drive but who don’t want to drive from Burnie to Hobart and drive back again, they are quite happy to stop off for a night somewhere in the middle. And we were the only motel.
INGRID: Ahh, so you were the only motel? So that was a real point of difference for you?
CHRISTINA: It was.
INGRID: It was, wasn’t it?
CHRISTINA: Yes, the only motel mid way between Launceston and Hobart.
INGRID: And did you capitalise on that as part of your promotion?
CHRISTINA: Yes.
INGRID: On that, how did you find new customers? So there was the website and the ‘book now’ button, what other sorts of things?
CHRISTINA: We went down the road of the local advertising, in the newspapers, but none of those things worked. I mean, the first year is a suck it and see thing. You try things. Umm and then you just realise that the website area, and going through people like booking.com and wotif.com, and you can eliminate the ones that don’t give you any bookings, and you encourage, its all rate driven. So, you have to work out which companies give you the best amount of bookings for your exposure.
INGRID: Did you have a way of tracking that?
CHRISTINA: Yes, we had to have a paper system because my partner couldn’t work anything other then a paper diary so we just went through the diary and you can work out what percentage is coming from each source.
INGRID: Did you do that every month, or every quarter?
CHRISTINA: It was just a visual ongoing thing for us, but if at the end of the year, there were a couple of websites that didn’t produce anything, agencies, you just canned them.
INGRID: So you had a review?
CHRISTINA: So you had to update them on a regular basis and you’d keep updating because you might be full, or you don’t want to have a double booking. And then you say I don’t know why I keep updating this website because I don’t get any bookings from them, so I’d say ‘good night’ (laughs).
INGRID: Good night (laughs). So did you have ones that were more successful? I know you had quite a lot of nights in your year where you were 100% booked after the first couple of years, once you got some traction.
CHRISTINA: But the other thing is if you are in Tasmania, particularly, its event driven. So there is a lot of local events, agricultural show, the Ross Marathon, local sheep dog trials, gun dog trials, all those sorts of things that wouldn’t make the news nationally, provide a lot of room nights for the locals.
INGRID: Nice.
CHRISTINA: And there is no direct competition. So if you are the only motel in the middle of Tasmania that has ensuite facilities other then the local pub which has room as well but you have to go down a passageway to share a bathroom, that’s not competition. And B&Bs don’t compete with the motel because they are a different type of accommodation. Some people want to go into heritage accommodation and other people want to be able to watch Foxtel and be guaranteed that they will have an electric blanket on the bed and it will be warm and cosy and comfortable.
INGRID: And you were able to provide that?
CHRISTINA: Yes.
INGRID: I know at some point during your time at the motel you changed all the televisions because of the change in technology.
CHRISTINA: Yes, there was a changeover. Tasmania was one of the last states to legally have to change, the government did the switch over, but the televisions when we bought the motel were the old boxy type, and not whizz bang at all. People are much more technology driven now then they ever were.
INGRID: Hmmm yes.
CHRISTINA: And you know, flat screen TVs were essential. And you can get good deals today, so it’s not like putting televisions in 10 years ago when it was a big exercise.
INGRID: How many rooms did you have?
CHRISTINA: We have 14 rooms including 3 family units with 2 bedrooms and ensuite, and 7 queen rooms.
INGRID: And so televisions had to be replaced?
CHRISTINA: So we had to get 14.
INGRID: I’m going to pursue the television question because I know your business partner, who is also your partner, this was one of the big sticky points.
CHRISTINA: Yes yeah.
INGRID: Could you talk a little bit about partnerships? Not so much your personal point of view, but the business point of view. And the difficulties of….
CHRISTINA: With 50-50?
INGRID: Yes 50-50 and also the impact on decision making on that.
CHRISTINA: Yes, it is high impact on a relationship whether it’s a business relationship or personal, but when it’s personal and business it impacts probably more. So yeah, its very difficult when one of you can see the road you should go down, because you are competing with ….when people book to come and stay, people from interstate for instance, people from Sydney and Melbourne have a certain expectation about the level of accommodation they are going to enjoy. And when they get to their room and see a very old fashioned TV, they are not going to be too impressed and you are not going to get them back or get a good review on Trip Advisor.
INGRID: Is Trip Advisor important to you?
CHRISTINA: It became very important.
INGRID: Because 5 years ago people were just starting to surf.
CHRISTINA: Well now they go to Trip Advisor, and go to Booking.com, they also have a review of your property. Or lodger review. And if you don’t stack up people won’t book. And in fact if they have old box televisions they will make a comment about that.
INGRID: And it diminishes your ability to compete?
CHRISTINA: Yes that’s so true. Yes very important.
INGRID: And so you were very much drive about that customer experience and keeping the rooms at that very high standard and you had a business partner who you could see that was important but thought that cleaning a room should only take 30 minutes, and that was the difference?
CHRISTINA: This was somebody who doesn’t clean, and doesn’t know about thorough cleaning. So I was looking at it from the perspective, and I’ve spent my life cleaning my own house, so I thought I can’t clean and do a bathroom in 30 minutes, not to the standard that people want to come in and say ‘isn’t it lovely and clean.’
INGRID: And it feels clean when you walk in.
CHRISTINA: Yes.
INGRID: And that was another area, you were very involved with the community. You were very, right from the beginning you wanted to employ locals, you certainly weren’t doing everything yourself. The two of you weren’t cleaning, mowing the lawns…
CHRISTINA: No.
INGRID: So you were very proactive in engaging the community. Why was that important?
CHRISTINA: Well I think its important to build relationships with people that you employ, and also that those people don’t feel they are exploited and they have positive comments about you. I think that’s very important. We have a lot of, churn, like every place staff-wise, people want to go off and do something bigger and better, or they didn’t want to clean a room anymore, or they wanted to do something else. We also encouraged a lot of the people who were casual cleaners to do a bit of reception work if they were able. Or to meet and greet guests, and have a chat to the guests, that sort of thing. We encouraged people who we knew would do well in that sort of sphere, we’d let them sit in on a Saturday, and do that sort of work as well.
INGRID: Nice. That brings me to another question, that I didn’t pre-empt you with. But how do you get a day off when you are running a motel? A 24 hour day 7 days a week.
CHRISTINA: We were luck in a way, one of us would go and the other of us would stay. Most weekends or during the week id go off and do something and he would look after the motel, and vice versa. If we wanted to do something together, bearing in mind, that we were together 7 days a week, 24 hours a day, sometimes it was really nice not to be together. But if we did want to do something together, we had been approached by this wonderful couple from Victoria, within the first 4 weeks that we took over the business they rang, and they said that they wanted to come to Tasmania and they were looking to bring their van over and stay in a caravan park and do cleaning and whatever. And so, we checked their references and they came over and she was fantastic, she could do everything that I could do. And he was great in the garden and doing the painting or whatever, and they used to come over annually, so that gave us the opportunity to go overseas or do whatever we wanted to do.
INGRID: Then you come back to Australia, fantastic. So when you came to sell, and that didn’t happen quickly, what triggered that?
CHRISTINA: Well we knew it was going to take at least a year, and as it turned out it took nearly 3. Tasmania was going through a bad time as far as the State Government was concerned. The economy was in the doldrums to do with the timber industry, the green movement, one thing or another was causing a lot of difficulty in the local economy. And of course at that time, it was a time when there was a booming mining industry in WA and Queensland, and so the Australian dollar was quite high. Umm, we thought well, you know, perhaps we should think about getting out of Tassie. But, well, we put the place on the market to start with, and our figures weren’t good enough, so you can’t have overseas trips and have really good figures as well, so when you make a really concerted effort to sell you have to buckle down.
INGRID: And make the numbers ok. So you spent the next year…..
CHRISTINA: Well we put the place on the market, and we didn’t get a nibble. So we took it off. Then we thought about it again, and then we put a concerted effort into getting the figures up. And we had somebody who didn’t quite get across the line, but we got the offer we wanted, so we knew we had priced the property correctly. Then we just put it back on – relaunched it. Had a bit of a break in between advertising it again, and we just put it out there. And the irony was, it was people who had stayed at our property 2 and a half years ago, and they came and thought about it, but because the figures didn’t stack up then, they didn’t make an offer. But then they went away and circumstances changed, and because they knew the property and knew exactly where it was in Tasmania, and they made an offer and we accepted.
INGRID: Fantastic.
CHRISTINA: It was.
INGRID: And did you have any….was it walk-in walk-out?
CHRISTINA: Yes.
INGRID: So purely they walked in and you walked out?
CHRISTINA: Well yes, there was a bit of a handover. That was part of the contract.
INGRID: But you didn’t have to do any sort of earn out or stay for a guarantee?
CHRISTINA: No.
INGRID: Did they look at forward bookings?
CHRISTINA: Well they knew what the figures were. The settlement date was the 1 July so they obviously, we hadn’t……..we didn’t leave them all the bookings. What we did was, they could look at the diary for the month leading up to when they came, and they had all the bookings for 2016, what we had, for 2015-2016. So they could see that we were fully booked for the Ross Marathon and fully booked for certain periods in the new year, and especially, rifle shoot and things like that, the big annual events.
INGRID: And they are a lot of repeat customers?
CHRISTINA: Yes, yes.
INGRID: Christina, buying a motel isn’t cheap. Without going into a lot of personal details about it, how did you have the money to buy a motel?
CHRISTINA: Well, I sold my property, and my partner sold his, and then we got a bank loan for the difference.
INGRID: Right.
CHRISTINA: And we were very fortunately that we only had a small bank loan, and we didn’t have any problems getting that. We were able to service that without any issues.
INGRID: And you had to sell personal properties?
CHRISTINA: Yes.
INGRID: But you had somewhere to live – didn’t you? As part of the motel.
CHRISTINA: Yes, one of my requirements was that I wouldn’t live anywhere I didn’t have a really nice house.
INGRID: Yes, somewhere nice to live.
CHRISTINA: Yes, because I didn’t really want to sell what I already had, which was nice, and then move into something inferior (laughs).
INGRID: That was in any way inferior (laughs). Now just a few questions about business in general, and I know you came from a family of business, your parents had a business. So you already knew a bit about being in business and you’d been involved in your business where you worked as an Executive Assistant, you’d worked in hospitality, so you’d been in business even if it wasn’t your own.
CHRISTINA: Yes.
INGRID: But when you started that business, what is one thing you really wish you’d done differently back 5 years ago?
CHRISTINA: I really wish I’d done more research about actually being able to manipulate the websites and the rates, and known more about that aspect of the business. Because there is a lot of tweaking that you can do if you are IT savvy enough. So…….
INGRID: And it took you a while?
CHRISTINA: I don’t think I ever really got across that. I don’t think I did. I think I should have done. But it’s very difficult to run a business and go off and do anymore training when you haven’t got any one else. It wasn’t a small small business but it was just small enough to be difficult to go away for a week or a fortnight and so something intensive.
INGRID: Hmmm. Yes.
CHRISTINA: Which really on reflection is what I should have done.
INGRID: So that is something you would have done differently? And this is a different question, what do you wish you’d known about motel businesses or Tasmania?
CHRISTINA: I wish I’d known about how cold it was going to be (laughs), and how that affects business. Because it is seasonal. There are 3 months of the year, well we were open 365 days of the year, but a lot of businesses in Tasmania shut. So that makes it very difficult when people do come from interstate and expect everything to be open when its not. So there’s a bit of a double whammy in that regard. Yeah, it’s hard running a motel business when the hot water might freeze in the morning and you don’t get any hot water till after 10am which is normally check-out time.
INGRID: So what did you do?
CHRISTINA: There’s not much you can do – just apologise to the guest, and
INGRID: Offer them a kettle of hot water (laughs). In the old days I guess that was why they had those jugs and bowls…
CHRISTINA: Yes all of that. And it might only happen 2 or 3 days during the winter, but those might be the days when you’ve probably got 100% occupancy. (laughs). No that’s very unusual in the winter, but I suppose you could have a corporate booking or whatever.
INGRID: Something like that. So who apart from you, apart from yourself, has been your greatest asset? Obviously your partner has been your best asset, but…..
CHRISTINA: Hmm, I think the couple that we had were fantastic because she was great sounding board for me. Which is really helpful as the warmer months came in. Women need sounding boards more then men. And we had a very switched on couple from Queensland who operated the local post office and they were directly behind us in the motel and they were a great help because they knew all the local people and they were in business too, and they were able to share a bit of local knowledge with us. That was really helpful.
INGRID: And I know you really did – being part of the local community was a big part of the whole thing for you.
CHRISTINA: Yes, well I thought it was really important. You know, you buy your coffee from the local bakery, you buy your things from the local shop as much as you can. And people get to know you.
INGRID: Yes.
CHRISTINA: And if somebody comes in and says ‘where’s a good place to stay?’, then they will recommend you. Which is what they did.
INGRID: And they may not have seen you as they were driving past, so…..
CHRISTINA: That’s right. That’s right.
INGRID: So if someone came to you and said they were going to buy a motel, or a B&B or something to do with accommodation, what would you say to them?
CHRISTINA: I would say, do your research. Make sure the place has reasonable bathrooms because bathrooms are expensive to renovate, very expensive. You don’t want to buy a dilapidated property. If you are going into a dilapidated property go in with a partner who knows how to do something. Don’t go in with a partner who doesn’t know how to change a light globe or wield a paintbrush.
INGRID: Now Christine. Is this advice for life, or advice for business? (Laughs). Now what are the 3 characteristics you have that have made you successful in this business?
CHRISTINA: I think liking people, I think that was paramount. Liking employing people that you like, so you get the best out of the people who work for you. Having your staff onside is half the battle wherever you work.
INGRID: Do you think you are able to do that – choose good staff?
CHRISTINA: Yes I think so, being able to choose someone you relate to, or you can talk to. Yes all of that. And I think that’s important, and just having, or knowing that you can afford to keep going during the quiet times. That’s the most important thing in business, is having that buffer, so you can draw down if you need to. And that you aren’t running on empty at a time when you might not have as much throughput as you would in the middle of the peak season.
INGRID: Because that cash flow is all important.
CHRISTINA: Yes, it’s all important.
INGRID: I think that your sense of humour is part of your ability to be successful as well. So if someone came to you and said they wanted to start a business, do you think having your own business is a great idea?
CHRISTINA: Yes I do. I do. You know, I’m sad that it’s gone. It’s left a bit of a hole. I’ll have to see what I can do to fill the hole.
INGRID: There could be another business out there for you.
CHRISTINA: (Laughs). I don’t know about that. But there’s something.
INGRID: There’s definitely something. Christina thank you so much.
CHRISTINA: My pleasure.