Summary

Determined efforts to eliminate years of substantial losses and restore the Don Group to profitability finally paid off. The new Optima Line was a part of the process.

Introduction

The South African, JSE-listed, Don Group, with 13 suite hotels in Cape Town, Johannesburg, Sandton and Pretoria, is implementing plans that will cement Don's standing as the leading suite hotel chain in the country.

The concept of suite hotels among business and leisure travelers is not as well known in South Africa as it is in most parts of the industrial world, where this class of accommodation is a popular alternative to conventional hotels.

New Controlling Shareholder & CEO

March 2002

The Don Group under its new controlling shareholder and chief executive officer hotelier Thabiso Tlelai, is working steadily to make South African travelers 'suite hotel aware'. The thrust of Don's drive to create suite hotel awareness is based on the superb positions of its hotels (close to business nodes, shopping centers and entertainment complexes), the luxury of its fully equipped serviced studio, one-, two- and three-bedroomed suites; and its competitive rates.

The suite hotel's motif is 'Freedom to stay your way'. Guests have the complete freedom to use as the hotels as a second home.

Part of the changes that had to be done in the hotels was to replace the old computer system with one that will answer the needs of the hotels and will offer new and centralized capabilities to allow the management run the group efficiently and economically.

The main needs from a computer system was:

- Easy to learn and operate.

- Deal with the complexity of different VAT depending on length of stay.

- Strong database mainly for guest profile and history (many returning guests).

- Integrated members club utility with external reporting (to SAA).

- Ability to import and handle their over 3000 travel agents and customers.

On the next stage the requirement was to centralize information and computer resources in order to improve significant selling processes and the control over these processes.

The Training Course 

August 2002

The Don Group second target was to save money as much as possible. They have decided to establish their own team of IT that will install, train and support the system.

The team arrived to Silverbyte office early August 2002 accompanied by representatives of Silverbyte’s South African Distributor for a two weeks course. The course was done in two parallel classes, technical and operational.

The technical course included database structure and maintenance, tools, Installation and update of the Optima line software, environment of Client/Server, Microsoft Terminal server (RDP) and Citrix Metaframe (ICA) and Optima interfaces to peripheral equipment and other software

The operational course included supervisor training on the various Optima line applications, system structure, database structure, tools to access the database and introduction to interfaces.

All the six participants completed the course successfully and were ready to implement the Optima Line in the Don Suites.

The Implementation 

August - October 2002

The implementation team did not waist any time. As soon as they got back home they started the preparation for the first installation.

At the first week of September the first hotel was ready for changeover. Mr. David Frankel, one of Optima top experts, came down to Pretoria to support and escort the local implementation team in their first mission. Eventually he did not have much to do. Within a week the hotel was running Optima PMS as if nothing new happened.

Within less then two months the entire group was running the Optima line, using all the features they have anticipated for so long. The managers were satisfied and have expressed their appreciation in letters to Silverbyte.

Don Group moves into profit for first time since change in control in 2000

December 2002

Determined efforts to eliminate years of substantial losses and restore the Don Group to profitability finally paid off. The chain declared a profit attributable to ordinary shareholders of R1,2 million against a prior year loss of R79,9-million.

Chairman and CEO Thabiso Tlelai, who is also the controlling shareholder, said: "We said at the time control of the company changed hands in 2000 that
we intended to move into profit within two-three years. We have now delivered. Conclusion of the re-financing and re-structuring program carried out during the financial year means we can now move forward to make Don a real force in the South African and continental hospitality industry."

Tlelai said guest exit questionnaires pointed to many instances of service going beyond clients’ expectations.

"With a clean balance sheet now a reality and with a strong board, we now have a business based on well-grounded management and operational policies conducive to growth in profitability”.

2008 - 2010 looking at World Cup

The Don Group, which owns the Don Suite Hotel chain, intended to capitalise on SA’s stabilised economic growth, 2010 World Cup opportunities and the burgeoning tourism industry to boost its performance. On 2008 Tlelai said the value inherent in the group’s property portfolio augured well for the expansion of the brand. “Management believes all metropolitan areas of SA and the continent of Africa present fertile ground for investment in hotels.”
Tlelai said that removing a few “historical impediments”,among them a tax liability of R2m, which is now fully paid off, left the road open for improving financial performance and continued profit growth. For the year to end-June the group shook off a loss of R5,3m (due to the deferred tax of R2m) and posted a 74% increase in net attributable profit to R5,1m.
 It was the third year in a row the company’s operating profit increased, growing from R3,9m in 2005 to last year’s R15,3m. Revenue rose 27% to R62,6m due to “modest” increases in the group’s rates, and increasing demand for accommodation. (Read the full article on Don web site)

Silverbyte is proud to be a part of this success story.