Senegambia Beach Hotel is the most significant in the Gambian tourism industry. As a kind of presentation, would you please give us a brief historical background and an overview of the hotel's capacity and services offered?
Senegambia Hotel was built in 1987, by a Norwegian consortium. They took on board The Gambia Government. Over the years they have been different variations in shareholding but presently a Norwegian company owns the Hotel 50% by the Gambian Government and 50% by the name of Selmer Sande A.S.
The hotel has gone through some pretty rough times but since 1992 it is improving and at this point in time is probably the most successful commercial enterprise within the tourism industry in this country.
We have a very high occupancy rate, which is around 80% depending on the years. We have in 1995 embarked in a major investment program and we are now at a point where public areas are more or less done. We will now improve the rooms in a continuous process. This is not necessarily a classic process in this part of the world. Usually people built hotels and exploit them until one day they say that the hotel is too run down and nothing much can be done with it any more. So they review the hotel and refurbish it completely in one go. We were pretty near that point here as well. But the shareholders realized it was better to reinvest and improve permanently although we have to catch up with the original deteriorated situation.
I see some architect's drawings of the hotel on the walls. I guess these are the current renovation and upgrading projects of the hotel you have?
These are some of the projects. The lobby was done two years ago, the restaurant a year ago. This is a continuing effort we recently rebuilt the bar on the beach together with a new terrace at the pool. We have in this hotel five restaurants and five bars so there is still quite some work to be done.
How long will it take for the ongoing projects to be accomplished?
We are auto-financing the refurbishment so we do what we can, depending on how much funds are available at the end of the year. We have a tacit agreement with the shareholders that they will not take any dividends until we have at least finished our major reinvestments. Whatever we earn we put right back into the hotel. In order to accomplish our goals and projects, I would think that we have another five years to go.
I guess you will invest at the same time in new technologies in order to attract more tourists. Which kind of investment are you doing in that way?
Of course we are on the Internet. You can reserve your room via our website online. The hotel is also equipped with an internal computer system called Fidelio, which is the classic computer network system in the hotel industry. Stocks and accounts are also computerized.
Even the tourism industry is more leisure oriented, what do you offer to businessmen traveling in the country as far as Internet connections and facilities are concerned?
Indeed, this is basically a tourist hotel by 97%. But we have also a little bit of other things. In medium terms, that means within the two-three years maximum, I would like to transform the fifty rooms of our main building into a business class floor with rooms that have Internet connections -we don't have it yet-, and direct dial telephones lines- which have just been installed- as well as Satellite TV - already operating-. That should be the first step. Right now the public areas are wide open and not air-conditioned. As we want to target different type of tourists, we will install an air-conditioned executive lounge in the main building that we will use for business travelers. These guests will have their breakfast there, watch Television and have their business discussions.
It is a continuous evolution as every time something new comes up you think of how to integrate it into the system. We do most of the work ourselves, by our maintenance team. Because we have found that if you contracted out within the country for the works you have to do, the results do not always reach the standard we would them expect to have. When we do it ourselves it may be more work for myself but like that at least I know what I am getting. If you bring in a company from abroad then the cost is too high so that is not an option unless we lack the necessary expertise. The problem is that being a long haul middle class tourism hotel, the competition is strong there, and the market dictates low rates to which we have to adjust our cost.
So what is your strategy in order to face the competition?
I do not consider the other hotels as competitors. We are well established, with the highest occupancy rate of all. I would rather say the more Hotels we are the better because it will increase our global potential. And I am not worried. We will always have our share of this potential.
It means that the Hotel is investing a lot in marketing?
Yes, a lot: about three per cent of our turn over. Which is much more than anybody else around. That is one of the reasons why we are doing better than most.
Consequently your turn over may reflect that competitiveness. Would you provide us with some financial figures?
Our turnover is about $ 6 Million US a year.
One of the big revenue generators is conference. Are you going to provide more conference facilities in the hotel?
It is one of the things that we have done five years ago: to provide the hotel with conference facilities and we intend to extend them. We have our own pitch & put golf course here, a driving range, two tennis courts with floodlight, two squash courts, an archery range; everything is provided for tourists. But the business part has to be developed. When you start getting into it, you cannot say from one day to the other 'I am going into business' unless you have something to offer, preferably more than your competitors. We do have now a fully equipped little conference room that can take up to two hundred people, two other so called Executive board rooms that are small conference rooms where can be seated twenty to thirty people, a little 70 seat cinema with video-projector and a big screen and we are looking at more options to satisfy the increasing demand.
We have found an interesting formula that has given instant success. We do not charge for the room, but consider this investment to be an instrument for us to generate additional room, food and beverage revenues. A customer can rent a conference room won the condition that he will spend a minimum in terms of food and beverage turnover. In this case it is something like $ 300 to 350 US for a day's use, which is easy to achieve. You do not get the room for free because you have to spend your money there but you do not have to pay $ 300 US for the room and then whatever you consume inside. This is a very interesting formula for us because at the end of the day it not only gives me additional food and beverages revenue but also new room revenue because we have sub-regional conferences where people come from outside and stay for the length of the conference. We have a conference Manageress here who is looking after that part of our business, arranging nothing but conferences. During a conference when somebody needs something specific there is always that Manageress available that you can talk to, which knows who you are and help you to get what you need. You would say this is maybe a normal thing but is nevertheless highly appreciated.
Offering more facilities means that you expect more tourists to come. Are there some new markets or countries that you are targeting particularly?
We recently started working on developing new markets. Eastern Europe is coming up strongly and we are already present there. But the difficulty is that we need to work closely with the tour operators. For instance if they plan to come here by charter and have to make their calculations bringing, say, 200 tourists per week in back to back operations. So, if these tourist stay two weeks on average, the tour operator would need at least 400 beds in the resort in several hotels of different standing and has to contract for that. The tour operators have to commit totally to the charter airlines but sometimes they do not know until two weeks before departure which hotel and to what extend is in demand. This represents a great risk for the hotelier. They may give us back 200 beds two days before due date and the hotels remain empty as those beds cannot be sold anymore at such short term. This makes our life a bit complicated but we unfortunately have to live with it. So, we have to over-contract and here we are exposed to the risk to end up with some guests without room. We usually contract 120% maximum. There are on average two or three days during the season when we have accommodate some guests in other hotels and we obviously have to pay compensation.
The departure of FTI caused a drastic decline in the tourism industry and affected investors confidence. What has been your reaction towards this decision?
FTI came here in 1997 and they wanted to grow. But they could not get the number of beds they needed at a period when hotels are full anyhow. However, Senegambia managed to accommodate them. The first year, they spent in Germany a million marks on publicity campaign for the Gambia and it was a huge success. But unfortunately, the products turned out not live up to their expectations: problems of Malaria, the bumsters hassling the tourists, etc. The tour operation's ambition at that time was to have one airplane a day. But the company did not go down because of the Gambia. They had a 50 million pounds deficit and Air tours from England who had already bought 30% of the company came in and decided to take over FTI in order to save their investment. And now they are trying to cut all the sectors where they believe they loose or cannot make sufficient profit, and the destination Gambia is unfortunately one of them. They are still here this winter but I believe they will be moving out in spring. However, depending on how this winter goes, they may come back next winter. But we have to remember that before they arrived we managed to be successful. So, it is possible to deal without them, we simply have to reposition ourselves.
| FTI did a great job for some time; they managed to get tourist down here, three planes a week, even during the lesser rated summer season. But they made a strategic mistake by wanting to enforce their all-inclusive package. The local people and authorities did not react well to that initiative because they thought the local businesses around the hotels would die. Due to our presence in the Senegambia area, many local bars and restaurant set up and that of course lowers our margins as we cannot compete with them price wise and they take a lot of business away from us. On the other hand this forces us to be competitive with the edge that we certainly have better installations.
During the tourism workshop hold in this hotel two days ago, a new brochure has been presented which will be used to promote the country overseas. What is your feeling about the Government's revitalization project and the promotion of The Gambia overseas?
Our slogan "the Smiling Coast" is already fifteen years old. Although this is a good slogan, I believe it tends too much to say that what we are selling is beach only. However, we may say that there is also the local folklore, cultures and traditions, ecotourism, but what most of the tourists want is lying on the beach, go to restaurants, get sun tanned and go back to their country. Some of them never move from this hotel. There is a potential to diversify the tourism industry but at the same time there is a need for huge investments in the development of infrastructures. The Gambia River has a great potential. But imagine you have 300 tourists going on a boat and then getting off to visit a village, you need to have all the facilities to welcome those people properly: buses, roads in good state, restaurants and toilets, etc. That is the reason we need investors to come and develop those areas.
Don't you think some investors may be deterred by the taxes such as the expatriate tax, airport taxes, etc.?
To be honest, I believe the taxes are not too high, they are reasonable provided business is normal. Certain taxes are not tied to the business evolution and this may create difficulties. Another subject are imports. We all have to pay taxes and custom duties on imported products and it is of course impossible to sell those goods or the food at the same price as it is in Europe, but on the other hand this is compensated as local expenses such as in human resources are very low. What I am saying is that the overall tax burden is quite acceptable.
The tourism industry is highly affected by an inadequate power supply situation as well as a high cost of energy. Do you foresee an improvement of this situation in a medium run?
We pay between 350,000 and 500,000 Dalasis a month on electricity bills at a rate of 2,54 (22 US cents) Dalasis per KWh. As 85 % of our needs have to be satisfied by our own two Megawatt power station the actual cost is even higher as we cannot produce at 2.54 Dal. per KWh. We use about 100000 liter of gas oil per month and we are paying the same price as the petrol station. This really hurts.
Concerning the Tourism Development Areas (TDA) Plan launched by the Government, how do you think the latter should make efficient the use of those areas?
The problem here is that, if an investor wants to invest 10 million dollars in the construction of a hotel, the Government will give them land in areas yet to be developed the middle of nowhere infrastructurally speaking. The heart of the tourism industry, the TDA area between Senegambia and Kombo Beach remains unexploited. However, I understand from the workshop we had last week that something is going to be done to bring forward the development of this area. A good step has been made by the Ministry of Tourism who demolished most of the illegal beach bar shacks attracting undesirable elements. However, I believe some beach bars should be re-built but in a proper way, with all safety and hygienic standards in carefully selected locations. And as far as the bumster issue is concerned I believe those demolitions will not have any effect on them because they have always existed and will continue to exist. The real problem lies in their behavior when they are not wanted. Maybe if something had been done about it ten years ago when the problems started it would have been useful but today it is almost too late.
Our readers are always looking for some financial figures: would you please give us some of them like, occupancy rate, numbers of employees?
Our occupancy rate during the winter season is 90 - 95 %. In summer it varies considerably. In 1997 we had 85 %. Last year only 65 %. Employment number varies between 270 and 320 depending on the season. That is 270 are permanent the remains seasonal.
What is your growth strategy in terms of upgrading the existing premises?
Our ongoing investment program aims at making the Senegambia a full fledged 4 * Hotel.
Have you plans to enlarge, to build some new blocks?
At present that is not an option.
What is your investment policy in new infrastructures?
A part from refurbishing any new infrastructure would have to be economically viable i.e. increase profits. That would be the case if we increase our conference facilities for example.
Because there are not so many high standard hotels in The Gambia, the question is: how do you face the concurrence and what is your market share?
We wish to position ourselves between the Kairaba Hotel and two small De Luxe units and the likes of Atlantic, Kombo Beach, and Bungalow Beach etc. I evaluate our present market share, all forms of tourism included, at 15 % of total arrivals in the country and slightly higher in terms of generated turnover.
Have you thought about offering facilities for businessmen?
There is a market there and we are presently developing a concept to better satisfy their needs.
What is your opinion on the opening of the new route between Banjul and New York?
This airline will offer new opportunities to develop the US market and particularly the Roots homecoming tourism. However this market is already exploited by Ghana and Senegal and results will only come through particular promotional efforts
Is it an opportunity for the hotel to attract more tourists?
When the time comes I am sure we will have our share of the market.
Do you expect this will attract more tour operators?
Yes but only small specialist from the US.
Tourism industry suffers also from bumsters. Some professionals said that the Government has to deal with poverty first instead of destruct the beach bars. May I have your assessment regarding this issue? Which solution could you implement in order to solve the problem?
As I said earlier it is not easy to solve the bumster issue. Poverty is only one argument. The destruction of the beach bars, most of them illegal and working under appalling hygienic conditions, was necessary. The problem was that they had been there too long already. The need to earn a living is legitimate but not an excuse for breaking existing law.
The secretary of State for tourism and culture Mr. Touray had also presented during the tourism workshop a Guide to investment in Tourism:
Which are the areas where to invest in The Gambia?
Two years a go a new tourism master plan was elaborated by Dutch Consultants and the investment areas clearly defined. The Ministry of Tourism will guide potential investors accordingly.
As one of the most dynamic company in the country, how do you see the future of Senegambia Hotel?
We will always be in the forefront of tourism in this country. We have a large social responsibility as our salaries feed about 5000 people, dependants included.
The hotel has been given a strong support to the chamber of commerce. According to you, what has to be done by the government to enhance the role of the private sector in the Gambian economy?
Private business has to be encouraged by the legislation and whatever other means available. Only a thriving economy makes happy people and generates the funds necessary for development.
What has been the biggest challenge of your career?
In the early seventies I was Project Manager for the German technical Assistance to Morocco and called upon to coordinate the establishment of the Moroccan Master plan for the development of Tourism. This was an exciting period with a major challenge, which has also taught me a lot. Besides that I had the honor tohelp develop a major golf tournament to world wide reputation between 1971 and 1985 (Trophies Hassan II de Golf) and look after 700 VIP's flown in from all over the world as guests at Malcolm Forbes's famous 70th birthday party in Tangiers in 1989.
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