Hotel in administration, what now for suppliers ?

I am a supplier to hotel’s so this article is largely based on the hospitality sector, but most of the points can be applied to any business.

Before I get into the ‘action plan’ for dealing with hotels or companies that have gone into administration, you need to know a little about the administration process.

Many people panic when they are doing business with a company and they hear that it has gone into administration, administration is very different to bankruptcy.  Bankruptcy is when a company has no possible way of survival and everything is lost.  Administration is a process of survival.

A company can be placed into administration by one of more companies that it owe’s money to.  Typically in the hotel business, the two main culprits who place hotels into administration are banks (who are owed a large amount of money in a mortgage or overdraft) and the Inland Revenue who are maybe owed a large amount of cash in VAT or PAYE payments.  A company may also place itself into administration if it thinks things have gone to far.

The company responsible for placing a company into administration, then appoints an Administrator.

The administer is a company specialist in this sort of thing, they act on behalf of the company owners, the people the company owes money to and the general running of the day to day business.

With hotels it is usually normal practice for the administrator to appoint a ‘hotel management company’ to do the day to day stuff which lets them concentrate on the future of the business.  The original owner of the business’s involvement mainly depends on the how the administrator feels about how they have ran the business up to the point it went into administration.  It is common enough for the administrators to pay the owner a salary to stay involved in the interim, in some cases the owner will not be allowed on the premises for any reason.

The company will not stay in administration for-ever but the time can vary from one month to 3 years (or more) dependent on the debt levels, current turnover and future plans.

There are a number of potential outcomes to administration.

1.  Complete bankruptcy, the company has no future and is wound down.

2.  Break up, in the case of a hotel, the property and land might be sold in chunks to developers.  The fixtures and fittings sold at auction etc, this is common if the month to month business is simply un-viable moving forward.  In hotel chains, it is common for the individual hotels to be sold off or the group to be split into smaller groups.

3.  The company is sold to another company, this is generally the quickest way out of administrator where another company see’s a bargain and grabs the hotel for a cut down price.

4. The hotel can work it’s way out of administration and return to the original owners, this is also not un-common and a situation were the administrators gets the company running correctly again, cutting all dead weight, re-structuring the debt and sailing on.

5. Management buy-out.  Not as common in today’s market but in times when credit is more freely available, management who were not previously owners can club together with the help of investors and banks to buy back the company.

So what do you do, if you supply a company that goes into administration.

The ‘Action Plan’

1. Firstly, you need to get to know your industry.  Thankfully, I am well connected in the hotel industry so I hear about these things (in most case’s) before they go public, this means conversations can take place ahead of the news.  Have you ever tried calling a business the day bad news is broken?  It’s not a good idea.

2. You need to know the law and your rights as a supplier.  You have a contract with BIG HOTEL LTD and on 21st May 2011, BIG HOTEL LTD goes into Administration,  You are owed every single penny up until 21st May, thats not to say you will get paid that money but you are owed it.

3. You need to cut the credit to BIG HOTEL LTD, if you continue to supply credit to this company there is a good chance you won’t get paid because that company on paper does not trade anymore

4. Speak to the management, the administrators, your contacts, the doorman, the bank, the neighbours dogs, whoever you like.  The point of this conversation is three fold, firstly that you are happy to continue to supply them, secondly to agree new terms (ie, reduced credit, a DD mandate, payment up front, whatever you are comfortable with) and thirdly to GET THE NEW COMPANY DETAILS.

The new company details will generally be BIG HOTEL (IN ADMINISTRATION) LTD with the same company registration number and all of your documents, invoices and agreements need to reflect this.

5. Set up a new agreement but be careful who sign’s it, it can be signed by the following people

a) BIG HOTEL (IN ADMINISTRATION) LTD, co-signed by the administrators

b) The administrators themselves

c) The new management company, appointed by the administrators.

6.  You need to treat the debt owed to you by BIG HOTEL (IN ADMINISTRATION) LTD and BIG HOTEL LTD as two separate things, if you are like me, you will probably be well down the pecking order for getting paid but you might agree to settle the balance for less.  The Government and the Banks will always get their money first, thats just the way it is.

7.  Chill out, follow the process and be happy.  It is in everyone’s best interest for the company to survive, do your part to make it happen!

Russell

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Are you going to stand up against this? #notinmyname

More madness over the weekend, hundred’s of people had their travel plans distrubted because of a bomb left under a bridge in Newry on Friday, it took me close to 5 hours to get home from my office in Dublin.  I don’t see how cutting off the main road between Belfast and Dublin can somehow work towards a United Ireland, surely if you wanted a united Ireland you would be encouraging cross border travel!

This morning hundreds of more people were delayed getting to work because of a hoax bomb on the M1.  It won’t stop me living here, it won’t stop me doing business across the island, it won’t stop me raising my family in this wonderful country.

They must not win, we cannot allow them to win!

If you are stuck in traffic or your journey is delayed because of these people, don’t let it get you down, take some time to enjoy the scenery surrounding you, take some time to talk to the person stuck in the car next to you.  Don’t let it get you down, don’t let it anger you because if you do, they win.

We need to stand united against these people, we need a United Ireland, that is an Ireland that is United in standing up against these people.

Watch this video Ruth has put together to learn more about how you can make your stand!

Send your photo to : notinmynamevid@gmail.com , about now is good!


You asked for a United Ireland….. you got one ! #notinmyname

Growing up in Northern Ireland, you had to learn some things that you might not in other parts of the UK and Ireland, what to do during a bomb scare, how to ‘make a smooth transition’ through security check points, always know clearly if you were asked were you were going and were you came from, don’t go to this or that part of town, always be were you say you are going to be and never, ever tell anyone that Jimmy from down the road is in the RUC.

This was simply because, the RUC was predominately made up of members from the protestant community and republican terrorists killed RUC members.  It’s not that Roman Catholics were not allowed to join the RUC but rather certain groups would have seen it as ‘being a traitor’

With the Good Friday agreement however things changed somewhat, The RUC disbanded, a new Police force, the PSNI came into force and crucially Sinn Fein actively encouraged Roman Catholics and Nationalists alike to join up……… And they did……… And it was good. We got a new police diverse police force and the newly formed power sharing government of Northern Ireland got the power to run it. It was ok to be a member of the police and it was ok to talk about it.

That was until Stephen Carroll and Ronan Kerr were brutally murdered for being members of the PSNI by so called republican terrorists.  These killings are similar to the killings of police officers that took place in the past, what’s different is that these officers were catholic. Ronan Kerr was one of the last new recruits to come through the 50:50 selection process. A clear message from those behind these shameless attacks that it is not ok for Catholics to join the police anymore.

Because of our so called peace, police officers have talked openly about there jobs and now they are again targets, they have no security, nothing at all, there job is known to their friends, neighbours and their friends friends. They must feel like sitting ducks in what is supposed to be a country in peace.

And for what?  A United Ireland? Let’s think about that for a second, a United Ireland…………….. it’s here, it’s alive and well, we might still have a border but something amazing has happened this week in the wake of Ronan’s death, every politician in the land, be they Irish or British, Catholic or Protestant has stood shoulder to shoulder to condemn this killing, Sinn Fien has openly told these people to stop, the Irish Taioseach attended the funeral.  An Garda Siochana have sent sympathies to the Kerr family.  Young Catholics and Protestants in Derry worked together to clean and remove graffi from Derrys wall’s relating to Ronan’s murder.

Gerald Seymour said in his book Harry’s Game that ‘one man’s terrorist is another man’s freedom fighter’ and if that is true then let’s stop giving these people a title they are proud off, lets call them what they are murderers, nothing more.

This is a new Ireland, one were we get along, one were we are not looking over our shoulders, one were our children can play with anyone and not worry about their religious.  Power sharing works, we have the best of both we can be British and Irish.  Lets not go back……


Can I get a freaking coffee please?

Last night myself and some buddies had the pleasure of attending the Irish Blog Awards in the Europa Hotel, Belfast (great night, enough about that though).

Once the event and eating were over, we decided to head to a pub, then it became apparent that all 4 of us were driving, so no point in heading to a pub on a Saturday night . Let’s get a coffee I thought! The words ‘Great idea’ resounded and we headed to the hip and happening ‘Lisburn Road’ for a coffee because after all, it was only 10.30pm.

First stop, Starbucks by the uni. Shut

Next stop, Arizona (made famous as a place to hang out in the evening and drink coffee), they were open but it was for take out only……… Despite the people sitting down behind us.

On to Morelli”s then. Again, they were open and seemed at first to want us to sit down and enjoy their establishment but then as it turned out, we were only allowed to sit down whilst we waited for our take out coffee. Thanks!

Everywhere else was shut…………… So we went to McDonalds, had some coffee, chatted then went home. Mission complete.

Now you can slag McDonalds all you want but they seem to know how to run a business better than the artisan places we give so much kudos too, incidentally, OpenCoffeeLisburn is only held at McDonalds because it is the only place in Lisburn open at 7am.

Why is McDonalds the only place open? Belfast is supposed to be a bustling European city not a ghost town at 11pm…… Unless you want alcohol that is.

Belfast : City of the future, if you are of retirement age that is.


Save the forests, sell the forests

Last year, David Cameron’s coalition Government announced controversial plans to sell the nations forests and free up some cash for our failing country.  It was wrong.  It was wrong because there was no immediate plans as to who would buy them or what would be done with them.

Today, David Cameron’s Government U-turned this plan. Environment Secretary Caroline Spelman told MPs the Government had “got this one wrong”, as she announced the current consultation was being halted.

Speaking on this, Labour’s leader Ed Miliband MP said

Virtually every person in the country could see selling off our forests was a foolish and short-sighted policy but they went ahead regardless. Now they are panicked into a retreat hours after Mr Cameron said they would carry on with their consultation.

Ed Miliband is also wrong.

Selling off the nations forests can only be a good thing……… if done right.

Let look at the facts for a second,

Government owned forests, both public and private are a burden on the public purse and what do they actually provide us?  A nice place to take our kids and dogs when the sun is shinning and a habitat for wildlife to flourish.

OK, so the later of my point is worth keeping them for but who says for the later to happen, they have to be state owned?  When people talk about selling off the forests, they automatically think of hungry fat cats swopping in and building concrete jungles but it doesn’t have to be that way.

With the correct model, more forests could be open to the public, enjoyed by all and be …….. er profitable?  Sure, lets think about it, even in public forests, most of the woodland is actually shut to the public due to our fancy pants health and safety laws, it just would not be safe for the average punter to be rambling about it.

Let’s get a forest and use all of it for the good of society.  What am I talking about here? well how a forest that contains

1.  Land for public’s and rambling (ok we have that already, i’ll move on)

2. Houses that are eco-friendly and built from the timber actually grown in the forest, that would be a nice place to live

3. Eco-office’s, again built from the timber in the forest and powered from power generated from woodchippings from the forest, what a great place to live

4. Let farmers use the land to….. er farm

5. What about a school in a forest?  I’d love to send my Daughters there, what a great place to learn

6. A hotel ! built again eco-friendly.  What a super place to holiday

6. An adventure centre, Scout den, watersports centre, farm shops, cafe’s on the river, research centres, theaters you name it.

I’m talking about a sustainible, profitible venture that doesn’t cost the Governement (utimately us) a penny.  It can be done, with the right guidlines and objectives in place it should be done.

A forest for all…….. lets do it!


CEOPs latest drama ‘exposed’ focuses on sexting

The Child Exploitation and Online Protection (CEOP) Centre, make good short films, really short films.  Well researched and executed hard hitting short films to educate kids and parents on taboo subjects.  Their website is pretty cool too.

Their latest drama ‘Exposed’ is aimed at 14-18 year olds and is focused on ‘sexting’ and the forwarding of ‘naughty’ pictures and video’s and the related consequences of the youth for both.  Below is the promotional drama for the actual video, I can’t show you the actual video yet as it’s only available for teachers and youth workers and I hope CEOP release the drama shortly on YouTube and Facebook as this needs to be easily shared online between teens, not just played in the classroom.

When you get the chance, watch it.  Get parents to watch it and get young people to watch it.

Updated : The movie is now online : watch it 

Read the rest of this entry »


The Hotel Technology Briefing 2011, Dublin

Following on from the Belfast briefing, we decided to run the event again only a bit bigger and this time in Dublin.

The event is specifically for hoteliers and is a informal place to learn from the speakers and other hoteliers just what is going on with technology that effects their business, without being ‘sold’ to.

Next stop………. London (or Cork)

Isn’t our designer just fantastic ?