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| Steady Course…New Direction |
| You may fear the ‘old boat’ has sunk; but timeshare veteran Jay Finley thinks there’s life in her, yet! |
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by Sharon B. Drechsler, RRP
owner/operator
Drechsler Communications
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It’s been a stormy cycle and the crew has hung on through a cyclonic economic crisis. And while the gales may not be entirely over, we believe we have seen the worst. For many single-site developers and independent, sold-out timeshare resorts, it’s left us as breathless as a surfer panting on the beach after a wipe-out. Last year caught many in the resort business short: short on reserves, tight on operating and repair funds and long on escalating debt.
In many cases, it caught a few developers of resort projects off-guard and homeowner associations (HOAs) alarmed as they saw an escalation of unpaid maintenance fees and a devaluation of their resort’s price-points. Many owners were feeling the pinch of unemployment, while others were in a state of panic, and walking away from their responsibilities. Naturally, when owners stopped paying their annual assessments, a resort would be forced to cut back on services and defer maintenance. The result would inevitably be a decline in guest satisfaction and lowering ratings by the exchange company.
We asked Jay Finley what he thought resorts can do to stop this downward spiral. Finley has been in the timeshare business for 35 years and has established an excellent reputation for his ability to build sales and marketing teams and to provide leadership in directing the growth and operations of resorts. We knew Jay in 1992, when he was senior vice president of the timeshare resort development company, RBC Enterprises, Inc. He was in charge of their Midwest division and headquartered in Branson, Missouri. RBC had him launch the very successful Grandvista Resorts timeshare company. His sales team put this company into the top ten in sales volume in the U.S. before the company was sold to Westgate.
He had some great advice that would be of benefit to any resort, whether they were merely experiencing some minor setbacks or in more serious trouble:
Study the problem. Finley and his partner, Chuck Frey, own and operate a consulting company, Compass Resort Group. (Frey held a number of senior management positions at Sunterra Resorts, having started with the organization at its inception as Signature Resorts in 1990.) Naturally, both Jay and Chuck urge resorts to utilize a consultant. But that’s because they’ve each learned how useful this can be from their own experiences in the past.
“Sometimes a developer or someone on the Board of an HOA may be very well qualified to operate and direct the activities of the resort,” says Finley. “But drawing on the expertise and bird’s-eye view of a qualified ‘outsider’ can reap fabulous benefits. You get a fresh new perspective. Very often, your consultant will be able to tap into resources and contacts of which you were unaware. Your consultant should be able to give you a business plan to help work out the various issues both in the short- and long-term and give you some solid cash flow projections for the future.”
Finley points out that every resort’s situation is unique. Your consultant should be willing to spend the time and focus necessary to learn about your unique issues, rather than trying to apply a cookie-cutter solution.
Focus on sales and marketing. Finley says that particularly in the case of sold-out properties, he finds that resorts are often overwhelmed by the challenges of handling the day-to-day operations, tackling maintenance issues and managing their H.R.
“The resorts we work with are often pleasantly surprised at the opportunities for marketing that lie right under their noses,” Jay says. “Plus, it helps to be able to pool your resort’s available inventory with that of other resorts in other regions. Obviously, being able to offer flexibility gives greater allure to your resort’s offering. We’ve managed to tie together a diverse portfolio of resorts, for example. A prospective new customer can attend a sales presentation in Branson and learn they have the ability to take a vacation in the Palm Springs, California area. They may or may not ever exercise that option, but we all like to feel we have that freedom of mobility.”
Refurbish and renew: “Another vital part of getting a resort’s finances into the black is to spruce the place up,” Finley enjoins. “HOAs and developers must find ways to obtain funds to perform the immediate repairs and fixes, of course. But in every case in which Chuck and I are involved, we’ve seen resorts experience a burst of fresh, new life after even a few simple improvements have been made. And for these, often we’ve been able to help them uncover some additional sources of financing. We’ve even put in some of Compass Resort Group’s money to cover items such as repairing a swimming pool deck or buying new linens.”
In every instance, a resort project exists because people need and want vacations. Finley says, “Remembering the fact that you are providing a healthful, necessary benefit to your owners can help your team to focus in a more positive way. An essential ingredient in the improvement of your resort’s appearance and the overall impression of your guest is their attitude. This may seem obvious, but we’ve found that very often a resort’s workers – everyone from housekeepers to front desk representatives – will benefit from additional training and motivational input. This can make an enormous difference in the quality of a guest’s vacation experience. It is up to you, as senior management, to ensure that your staff is as enthused about the success of your resort as you are.”
Set your course. Another obvious step in improving your resort is to set goals and objectives. “You’ve got to have a direction that is specific for each and every department,” adds Finley. “You cannot just say, ‘Okay, today we’re going to work harder and be better.’ As obvious as this might seem, we’ve found resort developers and HOAs often are so overwhelmed by the enormity of the tasks in front of them, they fail to sort out the details. Again, that’s where a consultant can help them set the course and get the resort pointed in a new direction.”
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