You’ve built a reputation as the classiest champagne and cigar bar in town and if anyone wants a hedonistic night out, your bar is the go-to spot without question. But you’re not making any money. Why? Because the instances of no limits nights out are declining, customers are watching their spending, and it’s suddenly becoming a bit socially unacceptable to be seen spending large amounts of money on lavish nights out.
So what do you do? Your cash flow is shot and you run the risk of not meeting next months lease payment, but you don’t want to give up your spot as the best champagne bar in town.
Well, it’s a no-brainer. If being the best champagne bar with a reputation for decadence and opulence isn’t making you money, then you stop it and you stop it fast. A friend of mine preaches to “Fail, and fail fast”. That way you can quickly move on to something that works.
I recently read that Starwood Hotels & Resorts Worldwide Inc., the U.S. owner of luxury brands including St. Regis and W Hotels, will let some of its properties reduce their level of service — and number of stars — until the industry begins to recover. Hilton Hotels Corp. and InterContinental Hotels Group Plc have already cut the ratings for some locations.
They have realised that stars don’t make money. Empty five star rooms make less money than full three and four star rooms. If organisations this large can restructure and make such sweeping changes in light of the current economy, you have no excuse.
Take stock of your situation, evaluate your short term viability and take the appropriate steps to ensure your survival. It won’t be easy and you might end up with a different business than you started with, but if you want to survive badly enough, you’ll embrace it and take action. Today.