Hotelier's dire warning

FRIDAY, SEPTEMBER 2: Several Bermuda hotels have been running at a loss for more than two years and could be facing closure before next summer, a leading hotelier has warned.

Mike Winfield, a former president of the Bermuda Hoteliers Association, condemned the delay in producing a strategic plan for tourism.

He said the industry was in “critical condition” and warned “we are fiddling while Rome burns”.

The Cambridge Beaches boss said the announcement, from Tourism Minister Patrice Minors, that the much-hyped masterplan for the future of the industry would not be released until next year was “deeply concerning. We have been talking and talking about this. There were clear and definitive ideas to come out of that retreat.

“There was a consensus that we should be putting this out no later than October to save 2012.

“To find out now that it is not coming out until the beginning of next year is deeply concerning.

“I am not sure the number of hotels will be the same in 2012. There is potential of losing some.”

He said even a small delay in producing a new vision and brand for Bermuda was significant for the shareholders of the island’s hotels.

“How long do shareholders continue to invest money if they are not at least given assurances that the organization responsible for creating demand and ensuring a sustainable environment is in place and making things happen?”

The Annual Job Market Employment Briefs, released on Wednesday, showed 287 jobs were lost in hotels in 2010 — despite no significant closures.

Mr Winfield said the cuts were a sign of how badly hotels were struggling to make ends meet.

“What we are seeing is very clear evidence of the criticality of Bermuda’s hotel industry today.

“Many hotels have been losing money during this economic crisis and there is an obvious impact on the labour force.

“It is the shareholders that pay for that and they are increasingly worried about the sustainability of the industry.”

The Tourism Board held a ‘retreat’ in April to brainstorm ideas with key industry figures with a view to charting the way forward for the struggling industry.

The aim was to produce and publish a clear plan by October to give the island time to market itself for the 2012 season.

But Minster Minors announced last week that progress had been delayed.

Several hoteliers are said to be concerned.

“We can’t procrastinate ad-infinitum,” said Mr Winfield.

“It is my belief that what is required is not rocket science.

Guidance

“There are some definitive steps that need to be taken. We need to know what we want tourism to look like in five years and have a plan to get there. That needs professional input, guidance and management. We should have that in place and we should be moving forward. The state of Bermuda’s industry is not a surprise. We’ve been in a loss position for the last two years.”

He said business had been declining badly for ten years with Bermuda reaching the “critical point” where it could not afford to lose any more hotel beds.

“Look at the number of hotels that have closed. Look at the number of beds on the island.We are half of what we were ten years ago.

“There are lots of people taking decisions about the future of their hotels and looking at different ways of using the land.

“But from a social and financial perspective the tourism industry is vital to the future of Bermuda.

“It provides the infrastructure for International Business. It provides the rationale for the airlift that also supports IB.

“My concern is we appear to be fiddling while Rome burns.

“There is a real potential for further decline in hotel rooms. There’s a point where it becomes unsustainable.

“If you look at our product, I submit that the number of rooms is getting closer and closer to that point where it is unsustainable.

“We can’t afford any further decline.”

He said the first order of business for the tourism board should be to re-establish ‘brand Bermuda’.

“We have to establish the market for the island and a very clear policy of reaching that market and increasing demand.”

To a layman, a delay of a few months in the publication of a tourism plan may not seem like a bg deal. Mr Winfield insists it is.

“Ask any of those ‘laymen’ if they were being asked to invest more money and lose more money without evidence of a plan, how long would they have the patience to do that?”

In response to the criticism, Malcolm Butterfield, Tourism Board Chairman, issued a statement yesterday: “We continue to make significant progress with the formulation of the National Tourism Plan and we will continue to have a measured and comprehensive approach.

 “As the Minister has clearly stated on several occasions, that as part of the formulation of the National Tourism Plan, there will be a series of consultative events in order to gauge the public pulse and views as it relates to revitalising Bermuda’s tourism product.

 “In that regard, the Board is moving ahead with the development and recommendation of some strategic imperatives which will be finalised after the public consultation planned for this month. It should be stressed that these strategic imperatives point the way forward with strategies and actions that provide a basis for the National Plan.”

Maxwell Burgess, a member of the board, said the delay in the plan did not mean that action was not taking place.

“The Department of Tourism and all its people are working feverishly and will work feverishly while we work on a plan.

“What everybody in Bermuda should be aware of is that the work has not stopped while we get on with this plan.”