Half a century of hospitality – Ruan Samarasinghe – Managing Director of Jetwing Hotels talks about the hospitality industry in Sri Lanka
We had the distinct pleasure of sitting down with the Managing Director of the Jetwing Hotels – Ruan Samarasinghe (Mr.) – a veteran in the hospitality industry, boasting near half a century of excellence. He has been at the frontline of all operations through his formative years and in the course of his career. Apart from his role at Jetwing Ruan served as the Immediate Past Chairman of the Pacific Asia Travel Association (PATA) Sri Lankan chapter.
The conversation revolved around the industry and as it stands today in terms of product and service quality, knowledge and expertise, education and training, growth, disruptors and the pros and cons of them. We also asked Ruan about how Jetwing as an organization and as a brand faces these challenges and how they look at contributing to the betterment of the industry.
How is Sri Lanka positioned in the global tourism market?
When considering Sri Lanka in the global market, after 2009 we are now in a level playing field with other destinations and we are very well positioned, catering to the low end, middle end and the high end because the country is so well diversified. There were so many taglines used to position Sri Lanka, “Wonder of Asia,” “Small Miracle,” and now it is “Small Island, Big Trips.” All these taglines positioned us well in the global market.
What are your suggestions?
We are very well diversified, in addition to the beaches, we have the hill country and we have wildlife parks, now we are into wellness tourism, Ayurveda and Spa. So we have a product that is very well diversified and we can cater to all segments of the market.
Where can we improve?
We need to improve our products, with the global players coming in, it will automatically improve. Our infrastructure needs to be improved, to get from point A to B, because now going to Kandy is a nightmare. So people who can pay a lot of money – high end clients will not want to spend five hours on the road to go 100-125km.
Hence infrastructure improvement is important and improving the products, refurbishing old properties and the new properties should be built in line with the international players.
How is our product and service compared to the competition?
Sri Lanka is known and famous for its hospitable people and the traditional hospitable service. That is inbuilt in the Sri Lankans and it is one of the main selling points – the smile of our people. So I think the international players, when they come, they will have to learn a lot from our culture and values. They will be coming here from Europe and Scandinavia, hence will not have the same culture to compete with the Sri Lankans. They maybe a bit less efficient in productivity but that service element and the smile will cover for that. I think people who are paying money now, apart from good service and good food, they want to be pampered, and to Sri Lankan people it comes naturally.
As a country who are our main competitors?
The main competition I think is Maldives, Seychelles, Mauritius and Vietnam and I think comparing with our growth, which we have been having 15-20% since 2009, I think we are very well positioned and we have nothing to worry. We can’t cater to the Thailand, Malaysian who gets over 20 million tourists because the country itself is a small island and we will not be able to sustain the industry. So I think this 10-15% growth until we reach 2.5 million tourists will be achievable the way we are going.
How are we fairing against them as an industry?
We are catering to the three segments, the budget, the middle and the high-end and I think we have all three categories covered. People are looking for dormitory accommodation and that’s covered and people are looking for 3-4 star hotels and that’s available and the 5 stars are also available, so we are ready to compete with the destinations in the region.
As a leader in the industry what challenges does Jetwing face?
The biggest challenge is to get approval, the private sector and the public sector is not working very well, that has to be improved because to get approval is a nightmare, it sometimes takes about 3 years to complete approvals for a certain project and it becomes very frustrating and for foreign investors to come and wait here for two three years is not going to help. Our biggest problem is that, and then of course with the interest rates going up doing business can be a bit difficult. Taxation has increased, VAT has gone up and income tax gone up. So all these constrains I see as a threat to the industry.
What is your view about the international chains coming into Sri Lanka?
It will help the country a lot, it will help us also. When I say it will help the country, they have huge loyalty members who follow them, we are looking at a 2-3-4 million members. So the country will open out to all these new travelers. Since the country is not marketed properly at the moment, it’s something that is lacking, we find that there is not enough marketing done by the Tourism Promotion Bureau to market the country, so these international brands coming in will fill that gap. And also it will be a benchmark for the local players to reach their standard to compete with them.
What are the negatives?
Negative factor is the staff, because if they also can start training their staff, bring in the expats who are working for them to Colombo rather than headhunting, rather than picking up the staff that we have trained for years; I think that’s the only negative part I see. For example we have a training program (Jetwing Youth Development Project – JEEP) which we have been doing for the last 12 years. We have trained over 1,200 individuals just out of school. All this staff naturally would want to go to an international chain, they coming in also is good but they must also focus on more training aspect to train youngsters the village and even from Colombo and them employee them, so we feel that’s probably the only thing that will affect us.
What is the perspective of Sri Lankan’s about the hospitality industry?
From a guest perspective the per-capita income also has increased, now we have the millennials who are travelling, so we have a lot of Sri Lankan business in hotels compared to the past increased, in the past there was no credit card, there was no facilities for those who want to travel. Only the middle aged and the elderly people and their families travel, but today there are lot of young executives in the private sector, they are all out because there are credit card discounts and other incentives for them to travel. So the Sri Lankan business I must say has improved and increased a lot to our hotels and I think it’s the same right around.
Is the general public hesitant to take up a career in the industry?
The Sri Lankans looking at the hotel industry, I think now with the new hotels opening up and with over 2 million tourists and the type of restaurants, I think lots of Sri Lankan students and school leavers are now interested in joining the industry and also there are some huge initiatives taken by the Sri Lanka Hotel Association to go into the schools and give them awareness of the industry and the basic orientation of what a hotel looks like and the pros and cons of working for it, their carrier paths and their future. We have three lady GM (General Managers) which is pretty rare in the industry. Three of our ladies who started as housekeepers and receptionists today ended up as General Managers. One person has over 39-40 years’ experience, the other one 30 year the other one about 28 years. There is a carrier path in the industry provided that they are committed and they put their heart and soul into the industry, because its job that does not give you a Saturday Sunday off, Poya-day off so you must be prepared, sometimes it might affect your family, because you may not be able to be with your family when they need you on special occasions. So these things have to be sacrificed but I think on the long run it is worth it.
We have only one hotel school that is recognized in the country, there are mushroom and satellite hotel schools which are not recognized, there are diplomas given that are not recognized and they hardly teach anything there, it’s basically a waste of money going into these places. The only decent hotel school in the country is the Sri Lanka Hotel School. This school either has to increase capacity, as they only have about 3,000 students a year, which I think is not enough. They need to expand more, they need to have more courses especially in craft level where people can be sent off to do some practices in the industry. They have also started some satellite schools, they have started in Anuradhapura, there is one in the South so hopefully those are expanded and they get the proper lecturers to teach, then I think to a certain extent we can overcome this. Then of course each of these big chains it is easy for them to have their individual training programs with training managers, these bigger hotels can afford to have a training section under their operation and keep training these youngsters.
For example in Jaffna, we were told by our competitors that we will never be able to find staff here because the staff don’t stay and they are not interested in the industry. We took the challenge and took 100 from the area, school leavers both girls and boys did six months of English and brought them into our other hotels and gave them cross exposure on what a hotel is and got them to work in different parts of the country, form Yala to Negombo to Galle to Sigiriya and today we have about 50% of them employed and they are some of the best staff we have in our entire group. Because they are so courteous and well-mannered that the feedback we get from the Sri Lankan’s, because 90% business we get in Jaffna are from Sri Lankans – Embassies and the NGO’s that are here, so the feedback is “you have some excellent staff here, because they look after us so well.” So I think if there is will there is a way and each of these bigger chains must set an example and have their own training programs.
For example in Jaffna the girls and boys who come to work came in scooters and the scooters were parked in the parking area and the guests sometimes had to park their vehicles out. So it’s a matter of awareness and proper training and guiding them and of course showing them what their future is going to be in the industry.
Who should Sri Lanka focus on as target markets?
For any country to benefit they must aim at the high end and the only way we can attract the high-end is by doing a marketing promotion campaign in the traditional markets like Europe which has been our market for the last 40-50 years and of course the emerging markets now which have over taken the European traditional markets – China, India and the Middle East. So we have to have PR agents and we have to start to run campaigns and that’s the only way we can attract the high-end. I think Sri Lanka is a destination that can cater to the high-end because there are now new areas, there are areas that are over visited, if you look at the coast there are too many villas hotels one next to the other so sometimes there is over visitation there.
So we as a company, Jetwing has gone into new areas. For example Wellawaya, nobody knew where Wellawaya was, they knew Ella. So here we are building a concept of Agro Tourism. We have 50 acres paddy where we are working with the farmers and showing the guests how paddy farming is done and how it is cleaned up and used for consumption. That type of concept has to come in, that will attract the high-end customer.
We are a country which has all the potential and everything is available for that. People who come will leave behind reviews so we have to improve our digital marketing and print marketing. We will have to have PR agents’ setup in these areas to talk about the country. That’s what Maldives is doing, that’s what everyone is doing, unfortunately we still haven’t done it and I don’t know when they will do it, sooner the better otherwise we will be attracting busloads of cheap-end tourists which will not help the country.
How has the upcoming villas impacted the industry? How does it impact Jetwing?
Majority of the villas at the moment is owned and operated and managed by foreigners. If you look at the areas from Talpe to Ahangama to Mirissa to Weligama, that whole stretch, maybe 60-70% of the villas are owned by foreigners and run by them and I think they do it very successfully because of their network. Whether 100% of money comes to Sri Lanka and remains in Sri Lanka is another question. You can sell, collect the money out and pay the guy who is looking after the villa. This also has to be regularized because in which we call the informal sector which is not regulated, they don’t come into this tax barrier and as a result they have an advantage over the rest of the smaller properties which has to pay taxes. I don’t think this is going to effect the hotel industry but it’s definitely affecting the villas. If a Sri Lankan does a villa he will find it more difficult than a foreign person running a villa because the foreigner will have his own network and that way they manage to get huge prices and they do it successfully. So I don’t think it’s going to effect the bigger hotels because the villas are no competition to hotels because a villa is for somebody who is looking for a family, special occasion; 15-20 people who will rent one place, that is the villa concept. A hotel is different, a hotel will have a buffet, spa treatment etc.
As a country what should be the plan for the next five to ten years?
We need to improve our infrastructure and it is being improved, the Kandy highway is coming up, other circular roads coming up and the accessibility is improving. They are connecting the Katunayake Express Way with the Port City so you will be able to come to Colombo in about 20 minutes to the Port City. So I think we are on the right track. But things like marketing need more emphasis in both the traditional and emerging markets.
The other thing that we need to have is a one stop shop to facilitate approvals for the private sector which we have some issues. There must be somebody who can come and step in and sort it out. Because now there are so many agencies for approval and it takes years to get it done and it became very frustrating. We opened three properties this last year but it took two years to get approval and another three years to build so it’s a matter of five years of planning to complete a hotel. Something must be done if we are to compete internationally, they have to look at that angle. One is to market the country and the other one to have an authority to facilitate the public sector.