|Rethinking Investment: Service Industry Consultant about Assets.|
By Mila Petruk ~ Exclusive Column on the Industry
Thursday, 29th August 2013
What we think is good becomes bad the next day; that's the philosophy of investment, and all the people who hold investment portfolios have to be always there when this next day comes.
But how is thinking about assets changing? As more and more business gets online, as value is placed on items having viral recognition more than physical presence, we have to rethink our investment practice. We have to take care of our ‘next day’.
Being a service industry consultant, I may sound a little bit strange, if not boring. But in my opinion, everyone with money is an investor. Everyone in business is an experienced investor. And everyone with assets is an anxious investor.
So what do we really have to think over? Is there anything on the market we have to consider as new form of investment asset? While traditional investment products are becoming fragile with world politics and too much interest from power groups, we have to start looking for something that isn’t there yet. Or at least there to a lesser extent.
I work in hospitality industry. For us, hoteliers and restaurateurs, a room or restaurant cover not sold at this moment is a loss. We truly understand the importance of timing, proper setting and opportunities available. When launching a hotel, I always tell my clients that it isn’t just about ROIs, it is also about making it an asset which is more expensive than the original cost. When dealing with furnishings and design, we always tend to insert a lot of branding and personal touch to give it a flair of sophistication and success.
And there are assets that truly deserve being treated as such in the magnificent world of hospitality industry. First of all, hotels as real estate in some Eastern European countries make a great asset at the moment. We know the golden rule of an investor: buy when the market is low, sell when the market is high.
Right now with the presence of economic downturn the prices for some of the hotel objects in Slovakia, Hungary, and Poland are very low. Minimal investment in infrastructure can substantially rise prices for these hotels. In 3-5 years as tourism market analysts estimate, Eastern Europe will receive more tourists than Western Europe. And that’s when these hotels can make a perfect asset to sell.
Secondly, hotels are all about guest experience. And throughout history hotels like The Ritz have accommodated very powerful and important personalities, whose photographs, autographs, and even personal items make a wonderful asset to hold. This is just timeless, and we should not forget about that.
However, what I really wanted to put my attention to is wine investment. During the last four years after my first trip to Bordeaux in 2009 and visit to one of the greatest wine estates in the world – Chateau Mouton Rothschild, - I started thinking about wine investment very seriously. Liquid asset which is ‘alive’ and tends to cost more as it matures (if it is properly stored, of course) is in my opinion a fantastic opportunity for everyone who is in hospitality and wants to feel more ‘structured’ in terms of individual asset management.
Needless to say that wines are growing in price as consumption increases (thanks to China). However, risks are still there, so for someone who does not express any interest or passion for this product I would advise taking something else as investment opportunity. As Dragon Capital experts say, one should have at least some knowledge about their investment product.
So… should we book a ticket to France?
This is strictly an exclusive feature, reprints of this article in any shape or form without prior written approval from 4Hoteliers.com is not permitted.
Mila Petruk, CEO & Founder at Milina Outsourcing
Mila Petruk is a hospitality consultant and a founder of Milina Outsourcing which provides project-based consulting and outsourcing services including mystery guest audit, temporary staffing and training support. Being a hospitality industry enthusiast, Mila has a global insight into the developing trends of hotel and restaurant business all over the world. Having graduated from University Centre Cesar Ritz (Switzerland) in 2007 with MBA in Hotel and Tourism Management, Mila has obtained a rich international hotel work experience in Europe and Asia.
Contact Mila at email@example.com or www.moconsulting.com.ua
Mila writes a regular column for 4Hoteliers.com.