The Quest for success

In Marketing 101 teachers tell students about the importance of the product itself as a cornerstone for the success of a company.

It’s a lesson that Quest Serviced Apartments chairman Paul Constantinou has definitely taken to heart.

“Quest came about more from an understanding of the corporate traveller market and just seeing the frustration from a lot of corporates having to spend more than the typical one or two nights in hotels and motels,” he explained.

“It was more about developing a product for the needs of these extended stay corporate travellers and understanding where they needed to be and the sort of locations they wanted across Australia and New Zealand. It was working out how to provide a product to meet their needs in the locations they wanted to be in.”

 The company was also clever enough to learn from its mistakes, he said.

“One of the mistakes we did make was that we thought our business model could flip over to the leisure market,” Constantinou recalled. “At the beginning we said we were going to focus on corporate travel in corporate destinations. If there were fundamentals taking place in parts of towns because of business then that is why we went there.

“We decided to do one thing up in far north Queensland in Port Douglas which was a disaster. We thought the decision makers for leisure travel were the same as for corporate. We thought that people visit for work and they would visit for a holiday. But nine times out of 10 that person travelling didn’t make the decision. It will be chosen entirely on destination instead of a property.

“It took us a number of years but then we sold that property out. If you focus on the customer that you want to do business with, that is sometimes a decision that will stop you doing business with customers you really don’t want.”

With the focus clearly set on specific markets and demographics, Quest has been growing at a rate of eight to 10 properties each year.

“We opened our first property in 1988 and since then the group has grown to about 130 properties across Australia and New Zealand,” he said.

“This year we have had six openings – these were products we established several years ago which are just now being finished.

“There are certainly some restraints to growth particularly in these current economic times where getting money for property is very difficult. These things hold back third-party developers and ourselves in growing.”

And while some might be ducking for cover in the face of the current economic adversity, Constantinou said he has seen off similar threats before.

“Being around over 20 years now we have seen a number of cycles - we saw the stock market crash of the late 1980s, the high interest rates of the 1990s, we have gone through pilot strikes, bird flu and SARS,” he said. “There is always going to be some sort of cyclical event which is going to provide some sort of a cloud over the climate, so it is about how you penetrate the market.

I think having been through these situations, you are able to see the market a lot clearer. I think the biggest issue that we have always had is the continual growth. Sometimes money won’t be an issue, but the cost of money will be the real issue.”

And one of the most important business lessons was to stay true to your company’s values and vision, he added.

“We look at our critical success factors as being making sure we have the right franchisee and ensuring we induct that franchisee in the right way,” Constantinou explained. “It is making sure we have chosen the right location and the right site within that location. And it is about making sure the guest experience is one that we look at and evolve. We want to make sure guests are getting what they want not only today but also tomorrow. It is this continual research and understanding your customers that we just have to do.

“Some think that if they are the newest and best in town then everyone will want to stay. But they probably won’t because it is all about the relationships you build with your customers as opposed to the piece of marble you stick in the foyer.

All businesses are essentially customer centric, so everything you do must revolve itself around the customer and each of the other stakeholders as well. When the customer stays with us and spends a few thousand dollars on accommodation, he takes nothing home but that experience. It is all about how he has enjoyed his stay and how he interacted with our people.”

And the other lesson? Avoid inertia and seek action, Constantinou advised.

“What we saw is that you build a momentum in business where you grow from one to two and so on and you are really pushing it hard,” he explained.

“[Then] you get to a level where the market is taking you. We are probably measured now by the opportunities we don’t take more than the ones that we do. I think that is when you find that your engines are really rolling.

“The important thing is to stay true to those critical success factors and make sure you are staying on the right line. Take risks. I think at the end of the day that is what business is about. Risks are out there, you just have to take them – so long as you make sure they are calculated risks.

“Sometimes I find entrepreneurs tend to sit back and wait for someone to give them a tick of approval. The reality is that the other person is not in your mind and he doesn’t know what you are thinking – just get out there and do it.”