Hospitality sector finds a new avenue to host its IT

Alistair Hargreaves has teamed up with Claritas Solutions, the Yorkshire-based IT services specialist, to launch Avenue 9.

He said the joint venture will “demystify” IT for hoteliers who on average have between 10-20 different technology suppliers per hotel.

“We take the IT out of hotels,” said Mr Hargreaves. “We will manage that process for them and gravitate them to a single platform.”

Avenue 9 is focusing its efforts on smaller hotel groups with 10 or less properties at a time of change in the sector.

Mr Hargreaves said: “Several of the larger chains are hugely leveraged and as a result they are ceding control to the banks who subsequently try to sell the group as a whole; if this isn’t possible they break it up and sell it as individual hotels.

“If the group is broken up, it is quite common for investors to buy a few of these properties and create a small group. This is where our expertise in hospitality IT provides a cost-effective solution to manage or host their solutions which removes operational requirements, allowing them time to get on with focusing on the guests.”

The sector is also facing economic challenges.

Mr Hargreaves said: “It’s a difficult market. London has its own micro-economy. Everywhere else is really struggling. A lot of business travellers are expected to travel there and back in a day if they are coming to Leeds because the transport links are so good.”

He added: “The industry is fighting back with a better offering. Everyone has realised that slashing prices is not going to help. You have to increase what you are offering.”

MWB Holdings plc, the owner of Malmaison and Hotel du Vin, has 27 hotels and a turnover of around £150m.

Mr Hargreaves worked at the company for four years. He spent three quarters of his time doing service reviews and dealing with supplier issues.

He said: “Service level agreements are still largely a nod. They are barely in place. They tend to be best endeavour rather than actual guarantee to serve. If the reservation system is not working, staff are working blind but they still have to deliver a service.”

Hotels traditionally stored IT equipment alongside the air-conditioning unit, linen store and tool box, he added. But advances in technology and cloud computing mean that IT services can be hosted remotely in secure data centres.

Mr Hargreaves is operations director of the new company. He is using his contacts in the industry to develop the business.

He started his career in hospitality as IT manager for Virgin Hotel Limited Edition, Sir Richard Branson’s luxury hotel group.

He has also worked for venture capitalist Benchmark Capital, London estate agent Hamptons and City law firm Lawrence Graham.

He was headhunted to join Malmaison and Hotel du Vin in 2009.

While at the group, he created a desktop system covering property management, central reservations, restaurant bookings, accounts and office software.

Mr Hargreaves said: “I have worked all over the world and still the problem persists that our sector places IT way down as a priority, when it fact it should be its leading light.

“IT is the way forward to get your house in order, to accurately forecast and ultimately build the way to making profit.”

The new company is forecasting turnover of more than £1m in its first year of trading and double-digit growth in years two and three.

Mr Hargreaves said: “We want to be the hospitality partner because we are interested in people and service. It’s not just about technology.

“Technology is just there to enhance business. It’s not there to put hurdles in the way.”

Kevin Edwards, sales director at Bramham-based Claritas Solutions, will be sales director at Avenue 9.

Claritas has supplied various IT solutions for hotel groups, including the delivery of a new data network for Malmaison and Hotel du Vin.

Glenn Scaife, Claritas managing director, said: “This an excellent addition to the group.”

bernard.ginns@ypn.co.uk