How I'm beating the credit crunch

ONE of Plymouth’s best-known hotels has beaten the credit crunch to make its first profits in nine years, its owner has revealed.
Joseph Louie, owner of The Astor Hotel, told The Herald his profits are up 35 per cent this year – despite the global financial crisis which has contributed to the closure of hundreds of pubs, clubs and hotels nationwide.
Mr Louie said the key to his success was offering good value and individual attention to customers, who are feeling the pinch more than businesses.

The Iranian-born hotelier called on other city businesses to “put yourself in the customer’s shoes”, and stop passing rising costs on to consumers.
Mr Louie said: “You can’t be black and white. Obviously you’ve got to make money but be flexible – don’t just say ‘this is my price’.
“It’s about the personal approach and doing deals for people; that way you have a customer for life – and they’ll tell all of their friends, too.
“It’s been just over two years since our prices last went up and for the first year we’ve actually made profits.
“That just goes to show that, if you don’t get greedy, you can do fine in this climate.
“Just put yourself in the consumer’s shoes; if all the businesses in the city did that we’d create a lot more money for everybody.”
On the day Chancellor Alistair Darling’s 2.5 per cent VAT decrease was due to take effect, the hotelier, who was recently elected to sit on the board at the Plymouth Chamber of Commerce, called for heavier, permanent cuts in the tax to help encourage spending.
“I think we should be putting VAT down to five per cent,” said Mr Louie. “But it has to be passed on to the customer.
“Our plan is to keep prices down and do better deals. If we all pull together as businesses and do that then as a result it would do exactly what we need at the moment, which is getting people to spend their money.
“Fifty per cent of income goes out of the city and we should try to change that. If I buy a chair from Plymouth then the money will stay in Plymouth – it’s a cycle.
“We’ve got the best opportunity to make things better now; there’s a lot of things we could do to come out of this mess.
“At the end of the day, the people who are the ones offering a genuine service and good value are the ones who’ll be laughing.”

Think of the bigger picture

First of all I would like to take this opportunity to thank everyone who voted for me, and I promise to do my best to deliver what is expected of me as a director of the chamber of commerce.

It seems to me that all we hear about lately is the credit crunch, the regional, national and global financial situation. Turmoil, uncertainty and a bleak outlook, three common terms used by the media time and time again.

Papers, radio and television encourage the downturn in business backed up by some greedy main suppliers who can't wait to put the prices up even on items that they have ordered and paid for before the crunch.

Easy money, a quick one-off profit. This then leads to other businesses taking the easy option and putting their own prices up.

I am a great believer that we can achieve our goals if we believe in ourselves. Pull together and think of the bigger picture.

For years I have been trying to convince small and large businesses in Plymouth to support each other by buying local, keeping prices down and delivering the best to encourage locals to buy local. It’s a circle.

The chamber can unite and guide businesses to achieve this aim and I hope that members can support this by offering ideas and practical assistance. To back this up we need new members to join, fresh ideas and a greater cross section of individuals, companies and industry from the area’s bus- inesses.

I am now going to state the ‘bleedin’ obvious’. While the prices of everything are going up, the majority of people still have the same budget.

Avoid raising prices and treat the clients and customers the way you would want to be treated. Customers have great memories and hold grudges.

It has been a struggle, but in my own business I have managed keep prices level for the last two years and I don’t mind admitting that my takings are 35 per cent up.

It’s not all bad news. The launch of the Plymouth City Development Company is exciting, ambitious and much needed. Its aims are achievable, but only if we all get behind it.

With the determination of the chamber of commerce and the city council plus the many other interested organisations, we can promote ‘our’ Plymouth and use the history and beauty of the city and its surroundings to bring so much more to the city.

Looking forward to hearing your support and comments at: joseph@astorhotel.co.uk