Everyone Gets Paid. Before You Do.

Ashish Gupta, Divisional Director of Operations – Brightstar Hospitality

  Revenue tells you what a business collects. The queue behind it tells you what the owner keeps. Over the years, I have watched more than one investor fall headlong for a city centre hotel. It usually goes the same way. They study the room rate, sketch the numbers on the back of an envelope and arrive at a delightful conclusion: a bed that costs very little to make up, sold every single night afresh. Then someone opens the P&L. Business rates. Ground rent. Insurance. Taxes. Wages. Energy. Each line helps itself to a slice, with impeccable manners, the way the British do in a queue. By the time the eye reaches EBITDA, the room has gone very quiet. So has the investor. The envelope, it turns out, had been an optimist. This is not just a hotel problem. I have seen the same error made, with great confidence, in boardrooms a long way from hospitality: the belief that a large business must also be a valua...