A recent Case Study of a current client;
A UK Hotel Group
The hotel group is a rapidly growing enterprise and consists of luxury hotels and onsite bars and restaurants across the UK
The cost review to date includes Energy, Telecoms, Waste Management and Food & Beverage Procurement.
Average Annual Saving
Energy 26.4%, Telecoms 43.8%, Waste Management 31.6%, Food & Beverage Procurement 15.4%
Total Annual Saving
Energy £149,600, Telecoms £10,400, Waste Management £TBC and Food & Beverage Procurement £40,000
A UK Hotel Group
The group is a rapidly growing enterprise and consists of luxury hotels and onsite bars and restaurants. Their sites include city locations in Chester, Glasgow, Edinburgh, Liverpool and Manchester as well as 3 country resorts, throughout the UK.
Their focus is on luxurious, stylish, modern and oversized unique rooms with distinctive design and state of the art technology. They have a "sophisticated but unassuming and consistently fabulous" approach to food and drink, all pulled together by a team of highly trained staff. Service is a core principle of their hotels as is the individuality and a nod to locality for each site.
Whilst discussing what the directors wanted to achieve, we established the aim of the review was to ensure key operational costs were as efficient as possible, without compromising quality (predominantly on the food and beverage side); the reason was to financially support a process of expansion and re-development of a new hotel to the group.
Having conducted our review the majority of our reports confirmed a well-run and well maintained business and many of their costs were market aligned. We were however able to secure a significant cost saving on the waste management, food and beverage procurement, the business energy (both electricity & gas) and telecoms which realised a further improvement.
In total we were able to realise a combined annual cost saving of 29% of the group's expenditure on waste management, food and beverage procurement, business energy (both electricity & gas), as well as their insurance. Happy with this result the company have been able to start the redevelopment and refurbishment at one of the new hotels in the group.
There was very little involvement the business needed in the project, allowing them to fully focus on the development of the business. This was particularly important to the client as they had reached a stage in their expansion where valuable internal resources were not available to concentrate effectively on the purchasing of essential services anymore.
The hotel group were experiencing poor service and high costs to their waste management which have now been turned around to produce a 31% saving and increased service and more appropriate collections.
The group's food and beverage procurement was a very large undertaking and continues to be re-tendered as certain contracts come to an end. As an example, the group consumes over 15 tonnes of coffee per annum. This has been re-tendered and bought in a bespoke package of blended coffee, new machines and improved training as well as saving over £40k per annum. Our partners also developed a bespoke supply contract that delivers national pricing with regional focus around locally sourced products that give each hotel its individuality without losing commercial value. Savings in excess of 15% have already been achieved with significant administration cost reductions alongside.
This administrative burden had left them at risk to uncompetitive contracts, especially as their energy usage was greater than 11.5kWhs and they didn't have the knowledge or expertise to price up or manage their Half Hourly requirements.
Similarly, their telecoms growth, usage and requirements were not joined up across the group and had never been reviewed. For telecoms they were also on uncompetitive, out of contract tariffs. None of their fixed lines or mobile requirements had been purchased centrally and so there were a number of inefficiencies highlighted.
"Initially, they looked to understand what we wanted to achieve. This was so refreshing and unassuming. It was even more uplifting they told us that we simply didn't need to change some suppliers as we had good deals in place! But when they reported back what we could save in just a few areas, we were very impressed and went with all the recommendations. Everything they did was completed with the minimum of fuss, fantastic communication and clarity. We are extremely glad that we now work in partnership with Procuright for our procurement and buying." EK the Group Financial Controller.