Good ethics is brilliant business

Date: 24 December 2023

In the luxury accommodation industry, cutting corners by underpaying staff isn't just a disservice; it’s wrong. If you're up there on your hotelier's throne, handing out bare minimum wages, you're setting yourself up for a world of trouble, and I don’t have a great deal of sympathy. 

No one can thrive on a minimum wage, and expecting your team to pour their soul into their work for peanuts is downright unrealistic. If you want to deliver top-tier service then you need to have top-tier wage policies.

There is a difference between the living wage and the minimum wage. It’s called the living wage for a reason, and it values not only the work that people do but how much they are prepared to invest in your business, not financially, but mentally and emotionally. 

If you’re thinking, “I can't afford to pay more”, well, perhaps you're not charging enough. It’s time to re-evaluate. Upping your game means upping your prices and ensuring that you’re providing a quality service. By doing so, you’re ensuring that you can afford to give your staff the pay they genuinely deserve. The value of a service should always be reflected in its price tag.

Margins are important, and you need to make a profit. A sustainable business is a profitable one. But the area to squeeze is not staff wages. Improve your offering and increase your prices. Don’t get greedy. I’ve built a multi-million dollar, award-winning lodge and I didn’t hold out for 35% profit margin over 30% at the expense of my staff. 

Your staff are the backbone of your establishment. Nobody’s going to be passionate about cleaning bathrooms if you treat them like they're beneath you and don’t pay a living wage. It’s essential to understand that respect and kindness aren’t just words; they're necessities in building a successful team. The way you treat your staff directly reflects the service quality they provide. Make them feel valued, and you'll have a team that's dedicated and enthusiastic.

When you hire someone, you're not just bringing in an employee. You're connecting with their hopes, dreams, and in many ways, their entire family. When staff feel secure, acknowledged, and well-compensated, there's a very high chance they'll go above and beyond in their roles. They'll be the ones making guests feel special, attending to those tiny details that elevate a guest's stay from good to extraordinary.

There is a choice every hotelier must make: Do you manage your team based on the majority who give it their all, or do you focus on the small percentage who might occasionally fall short? If you're continually zeroing in on the outliers, you're missing the bigger picture. And honestly, that's no way to run a business.

Last but not least, remember that loyalty is a two-way street. Good staff are hard to come by, and they stick around when they feel appreciated. Consistently hiring and training new people can be a drain on resources. When you invest in your team, they, in turn, invest in you and the business.

It’s easy to forget how much the onboarding process costs, let alone adding that to training and providing development opportunities to staff. Your time is valuable. Every minute you’re recruiting, training, and teaching, you’re not reaching out for new business or looking after customers. 

The approximate cost to recruit, onboard, train, and develop a new staff member over three months is up to $3,000. Paying that much more to your existing staff over the year will create a higher standard of service and engender far more loyalty than constant turnover, so it’s good business as well as being a good human. 

Like any other endeavour, the luxury accommodation sector thrives on relationships – with guests and, crucially, with staff. If you want excellence, start by looking after your team. Their dedication, passion, and hard work will shine through, directly benefiting your guests and the reputation of your establishment. In this industry, that’s where the real ROI is.