17 February 2014

Kenya: Perceptions of Insecurity Hurting Kenya's Economy


Moses Kanene, group chief executive officer of Monarch Group and Jambo Chester Hotels and Resorts, spoke to Star reporter NDUTA WAWERU about a wide range of issues including the business environment in Kenya.

What does Monarch Group do?

?It is a Kenyan investment holding company with interests in hospitality, property, entertainment and insurance. The Monarch Insurance company is one of the lead life insurance providers and the Angle Properties is a real estate company that manages a variety of properties including the Mall in Westlands. Tamasha is our entertainment business and it is focused on providing the best music from East Africa. It collects royalties on behalf of the artistes, and advertise and distribute their music and manages a variety of events.

Jambo Chester Hotel is the hospitality business and it includes the Jambo Chester Hotel in Nairobi, which offers apartments for long stays. It has now been renovated to offer even more spacious rooms with an executive feel to it. Our main clients are corporations, but also have a huge client base with governments such as Sudan and Somalia, and international organisations like the UN. Independent businesses and local travellers can also get something to their liking.

We have expanded Jambo Chester Hotels with four new units. The Jambo Impala Ecolodge is situated next to Lake Victoria and is about 15 minutes from the airport. It comes with 12 chalets, and is the only accommodation and eco-oriented lodge in the area. We fully own the hotel, but with an extended lease from KWS.

Do you have other businesses and what is the philosophy behind your hotels?

The whole philosophy behind the hotels is not about selling bed space but about conservancy. We make sure that the wildlife and the community benefit from these projects.

We also own the Jambo Chester in Mutara Ranch, a rhino conservancy. Located in Ol Pejeta conservancy, the hotel offers 15 extremely high end and exclusive tents. One of the things about this conservancy is that rhinos need a lot of space, therefore many ranches are coming together to bring down their fences to give the animals more space, to make it easier for conservation management and to secure more protective areas for Kenyans to enjoy their future.

The Lake Nakuru Ecolodge is a tented camp that offers 53 beds, and targets all big and personal travellers. Bordering Lake Nakuru on the south east, the construction of this hotel starts early in the first quarter of 2014. The theme is also conservation as we are opening up space to cater for the animals as Lake Nakuru National Park is already overstretched. KWS has also encouraged other ranchers to remove fences to create more space for conservation. The camps are made of bamboo and most of the materials are locally found since we are geared towards conservation, from the locations of the hotels to the choice of material and to our operations ethics.

At the corridor of the elephant migration on the Kenya-Tanzania border, we have the Kilimanjaro Jambo Chester. We have worked in partnership with Africa Wildlife Foundation and we are offering 30 bed spaces by the end of July or beginning of August. With Hitesh Mehta as the architect, the hotel will be right at the foot of Mount Kiliminjaro. We are also working on integrating landowners into the programme and make sure that the revenue gets back to the community in projects like education and healthcare.

In Meru National Park, we have the Gatu site, where we want to offer a luxury mobile operation, for those tourists that appreciate movement without having to worry about making plans. The tents are already in place, and waiting to see how the operation goes. It is easier to run on the lease but becomes quite difficult when it comes to logistics.

We also have two palatial houses in Watamu called Bahari Jahazi, which is suitable for both family and VIP groups. It comes with a nature trail for the residents to enjoy. We have also set our eyes on the Mara, and have just concluded carrying out the due diligence on the area for proper procurement.

Why opt for ecolodges?

It is part of our driving philosophy. We are not a mainstream hotel because we want to mix conservation with a human face, but with a hard-face for business and profitability. If tourism wants to make an impact, we should make sure that the revenue is retained in the conservation areas. I would like to encourage foundations to make philanthropic contribution for the same. ?We are also hoping to get the Ecotourism rating that ensures all our sites are eco-friendly, like the installation of the waste decomposition system in Mutara. Our aspiration is to be as green in every way possible.

What is your view of the business environment in Kenya?

It has improved remarkably. In the past, we had a bureaucratic system of licences and permits, but this has changed over the years and we can now access the permits at ease. However, we can do better and even have a single permit for businesses like in Rwanda. The government has also facilitated the environment to make business easier.

In terms of investment, Kenya is an emerging market and we are robust in terms of growing population and a rising middle class that can spend money, as well as a skills and brains base. The environment is now more conducive for business, thanks to the skills-based people who can provide quality products and services.

Money is also available for investment unlike in the past when the rate of borrowing was very high, but competition in the money market has seen the rate go down and the has made it easier for borrowers to negotiate.

The only challenge we have here is security, and perceptions of security because we have people who are afraid of booking because of terrorism fears, and that is a big headache to the business environment.

How is the hospitality business in Kenya shaping up?

We are not getting as many visitors as we would like yet we have so many attractions, great people and variety of skills. We are underperforming in terms of visitors because of the structural challenges, including airline, road and trains. We do not have good options in terms of bed nights and their quality. We can package them very well but we fail in delivery. The finesse in delivery of services makes the difference, and that is why ethics towards excellence is one of our key themes.

The other problem is that the Kenyan product seems like a cheaper product and people are now paying more money to go to Tanzanian parks than to Kenyan ones. In the beginning we started well in tourism, but we geared towards mass tourism instead of quality and this eventually compromised the sustainability of the quality we had in the beginning.

How is important is technology as your business strategy?

It is very important for our reservation and operations. We have installed a custom-made software for our services. The internet is very useful as we get a lot of business from online bookings. We have transactional management system that allows online banking, and makes it easier for us to better manage our operations. We have also embraced mobile banking with M-Pesa, and are working on our social media. ?Our best installation is the Resonance Planning system that allows system integration of our satellite lodges and the mother company in Nairobi. It makes it easier to plan around supplies and services, reporting and accountability and people management. ?All our lodges will have internet connection, as well as radio frequencies to help with conservation.

What should Kenyans expect from Jambo Chester Hotels?

We are offering pristine and exotic destinations, thus the deliberate selection of the destinations. We also offer exclusivity. Not a mass product but a boutique, bespoke, custom-made product. We do not want to be the alternative, but the choice.

We are looking to combine African hospitality with a conservation theme and to give back to the community.

What are the plans for the future?

We are already implementing them, with the expansion we offer. We want to make sure that all units will be operational by the end of the year and get them to be fully functional.

We are also looking for opportunities in the region and Africa for expansion of our businesses. We aim at expansion and consolidation as travel is a good thing and many people want to see the world.

We also plan to get into other business ventures as Monarch Group.

Any pieces of advice for young entrepreneurs?

Find a need in the market, take time to understand it and create a product that meets this need consistently. And always offer excellence.

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