By Agnes E. Nantaba
Jeanne Byamugisha is the Executive Director of Uganda Hotel Owners Association (UHOA). She spoke to Agnes E. Nantaba about classification of Ugandan hotels and the prospects of the industry.
What are the key trends in Uganda’s hotel industry today?
The rate of growth of the industry keeps increasing. There is vast improvement in facilities and quality of service in Kampala hotels which has prompted upcountry hotels to up their game. Now that Uganda Tourism Board (UTB) has started grading and classifying hotels, the quality of the sector will improve further and boost pricing. This in the end will increase the tourism potential of the country.
Some hotels award themselves 5 or 4 stars but the service delivery is deficient. How does the association ensure adherence to standards?
We have three 5-star hotels in Uganda; Serena, Sheraton and Munyonyo Commonwealth Resort which means no other hotel can classify itself as such. The four stars are many. It is illegal for any hotel to advertise itself as a star rated hotel unless it has been graded and classified with a certificate to that effect. Grading sets the standards and pricing. There is no way a 1-star hotel can advertise as a 5-star and charge five star prices. That is illegal and that calls are prosecution. Grading of hotels is done by UTB at no cost to ensure it is a free and fair system.
What is the criterion for grading and how genuine is it?
It is an East African based criteria based on international standards. The East African Business Council formulated the criterion that is applicable to all the East African countries. All East African countries are graded by qualified regional assessors to ensure uniform standards.
There are sixteen key elements according to the criterion. Key of them is location. The other element is human resource; there is a required level of qualification and training for each star. The size of the rooms also matters; they have to be four by four.
The sixteen grading elements are both accessible in soft and hard copies at the secretariat, UTB and ministry of Tourism as well as all registered hotels. UTB is bringing in consultants from the United Nations World Tourism Organisation to explain to the hoteliers on the importance of classification and translating the criteria into local languages to ease communication.
According to UTB, out of the 78 hotels that were assessed, 29 passed the test for classification using standard East African criteria. What implications does it have on the industry?
There are about 400 registered hotels although we speculate that the number of hotels is twice that figure. It is a wakeup call for the industry as many hotels have been advertising as higher stars than what was actually on ground. UTB started with a pilot project covering 78 hotels in Kampala but the results were shocking to many hoteliers as some reluctantly accepted the lower grades they were awarded.
And now with the grading criterion, more hoteliers are upgrading to qualify for the stars they want. And now as we roll out to other regions, we are doing pre-classification to help other hotels upgrade and do self-examination so that at the time of grading, the gaps are bridged.
We have sent the hotels a checklist for self-assessment.
The quality of service is becoming a top industry concern, what strategies has the association put in place to inject expertise into the workforce?
As an association, we carry out periodic training on capacity building programmes for hoteliers in the different regions. UTB has also considered bringing in consultants from the UN to determine the human resource and facilities needs for the country’s hotel industry in the different regions.
In addition to that, it was during my tenure at the UN when we carried out a skills audit of the hotel sector in Uganda. The study unveiled the resource needs in the sector as research was conducted with the hoteliers and the academia in the field of tourism.
The study indicates that some hoteliers would opt for diploma holders rather than their counterparts with a degree qualification since the latter are exposed to more training. Therefore majority of the staff in the industry are diploma holders with more experience. This is true because the industry is more of hands on training.
Our suggestion remains that degree holders should be exposed to a two month internship programme at the end of every academic year. This will bring them up to speed with the current needs of the industry.
According to W. Hospitality, a global company providing advisory services for hotel, tourism and leisure industries, Kenya and Uganda are among the top 10 preferred African countries for hotel development. What is attracting entrepreneurs?
Political stability is the most critical element. Ugandans in particular have the best spoken English in the region but most importantly Uganda is still virgin territory especially outside the Central Business District of Kampala. The game parks, forest reserves, rivers, springs and other unique flora and fauna are among the undiscovered areas.
Investors are currently looking for a new region to discover and attract more people because tourism is largely about adventure. This makes the country a very conducive environment for investment.
There is an outcry from hoteliers about taxation of the hospitality industry. What do you think of this?
We can largely blame ourselves for that because we have been quiet for a long time even when we are hurt by such unfavorable taxes. Hoteliers are the biggest contributors in the Tourism Industry contributing about 5% of the total GDP. In times of low business, tour operators can decide to park their vehicles or divert to other means of survival but hoteliers continue incurring operational costs and overheads even in times of low or no business.
We should have made an alarm about the discomfort much earlier walking in the footsteps of our counterparts in Kenya and Tanzania who strongly opposed VAT until it was scrapped. This is however the time when we have decided to fight as a region. You cannot milk a cow without feeding it and so by imposing VAT, we have made domestic tourism very expensive. How can a country where majority of its population live on less than a dollar per day charge $300 per night in accommodation.
How has the heavy taxation (local service tax, corporate tax, VAT, etc) of the hotels affected the hospitality sector, especially upcountry establishments?
Upcountry hotels are still grappling with the issue of VAT and yet occupancy has fallen to 20% up from about 50% in 2014. It should be noted that much of the hotel money is made from sale of rooms or accommodation rather than conferences because the facilities are standard. By attacking the component from which hotels earn through heavy taxation, it is doing a disservice to one of the country’s highest exchange earners. This has affected investment in hotels upcountry yet the value chain from hotels is large in terms of employment. We should not be myopic to only look at VAT while avoiding other ripple effects.
The hospitality industry is gradually getting more and more competitive. What is your competitive advantage as hoteliers?
We have some of the best hotels in Uganda and with the current classification; the industry has moved a step higher. We are still endowed with attractions that give us a competitive advantage over our counterparts in the region. It’s just that we are still lacking in terms of marketing but this has also been taken up aggressively by UTB.
Upon taking over as UHOA Executive Director in March this year, you pledged to seek close collaboration with the Ministry of Tourism, the Uganda Tourism Board (UTB), tourism sector associations, and other stakeholders relevant to the hotel sector in Uganda. How far have you gone in executing your plans?
It has been successfully executed within just three months. I have met with the Executive Director of Uganda Wild Life Authority (UWA), Chairlady of tour operators in Uganda, and now in close contact with UTB which is the organisation that is mandated with marketing the country; the advantage to such collaborations and meetings is that the biggest stakeholders in tourism are the hotels.
As an industry we have realized that coming together and speaking as one has made much headway in growing the sector. UTB for instance is fully funding training for upcountry hoteliers on grading and classification which had not happened before in the industry.
What are the key elements in your management philosophy as a manager?
Knowledge is a key element because it builds competency in the industry. The hotel industry is one that is driven on the approach of ‘knowledge is power’ since it involves many stakeholders. The vast experience of over eight years in the industry has enabled me to analyse the industry. Being passionate is not something learnt from school, it is in-built.
I have had mentors with vast experience in the industry such as Hajji BMK who was then the chairman of UHOA at the time I was Executive secretary and the current Chairlady Susan Muhwezi. I got an opportunity to work with the UN to carry out studies on the hotel sector in Uganda. The two years offered me immense experience that has enabled me start with bridging the gaps.
Where do you see the hotel industry in Uganda in the next few years?
The future is very bright for hoteliers. This is so true because before establishing a hotel in Uganda, investors have the criteria to guide them on which star they want to put up. We are moving to discover new frontiers in Uganda.
It is an assurance that in the next five years, all the hotels will be graded to market the industry confidently with evidence. We are continuing with spot on checks to ensure sustainability and adherence to standards. Now with the coming of the Pope and his delegation, there is a lot expected from Uganda in terms of hotel facilities and service delivery.