Over the course of just a decade one Hanoi hotelier went from taking over a struggling hotel to creating what is now a major boutique hotel chain.
On a flight back to Hanoi in April this year, Mr. Do Van Dan struck up a conversation with some passengers seated nearby. To his surprise, they had all booked rooms at hotels owned by the Elegance Hospitality Group (EHG). “I felt honored and happy,” he remembered. The passengers, of course, didn’t know that the man they were chatting to was the Founder and CEO of EHG. Mr. Dan and EHG now have seven hotels and employ 600 people.
As a youngster, Mr. Dan dreamed of being an architect and creating beautiful works of art that would bear his own personal characteristics. While at university he picked up a part-time job at a hotel near Hanoi’s Old Quarter, to fund his studies. He then slowly became inspired to pursue a career in the tourism industry. “It was an accident but the right choice,” he told VET in explaining how his dream of being an architect turned into a career in business. “There have been many difficulties but I always want to challenge myself.”
Blessing in disguise
Born into a working class family on the outskirts of Hanoi, Mr. Dan’s dreams of architectural glory actually faded away because he couldn’t afford his studies. Students of architecture have to spend a lot of money on the tools of the trade and he realized his part-time job at the hotel couldn’t cover five years of study at the Architecture University. He therefore decided to apply for entry into the Hanoi National University of Education.
But every cloud has a silver lining. The part-time hotel job presented the young student with a chance he didn’t expect. Mr. Dan began as a receptionist but it was a small hotel with a small staff so he learned about security, maintenance, and other jobs. “With each position I picked up skills in hospitality,” he said.
A “golden opportunity” came his way a few years later, in 2006, when he heard that the loss-making State-owned Van Xuan Hotel was calling for investors. Seeing the possibilities, he decided to invest his savings of VND50 million ($2,250), which is equal to VND200 million ($9,000) today. The hotel employed just eight people.
In addition to capital he was also lack of relationships, which can be a common problem for entrepreneurs in the hospitality industry in their early days. Due to these shortcomings he could only maintain the hotel’s operations instead of investing further. “Despite the difficulties, I never gave up,” he said. “I gradually overcame the difficulties to run the hotel well, with occupancy of 80-90 per cent, and the financial and relationships issues also became easier,” he said.
Mr. Dan put all of his enthusiasm into developing the Van Xuan Hotel and giving it a new face, starting with the name, which he changed to Hanoi Elegance Hotel. In 2006 he opened the first Hanoi Elegance Hotel, in Hang Bac Street. Elegance, he said, represents Elaborateness, Luxury, Experience, Generosity, Amiability, Navigation, Courtesy, and Enthusiasm.
The first and most important thing when he began with hotels was identifying the needs of guests then providing the satisfactory services. With the hospitality skills he gained from his part-time beginnings, he received a lot of customer feedback after chatting with them and understanding what they wanted, and gradually made the necessary changes. For example, at that time there was an increasing demand for internet access but few hotels had computers for their guests. So he set up a desktop computer in every room that customers could use for free.
After investing in and operating the first hotel in the Elegance chain for six months he then invested in a second. From his experience he could see the potential that resided in Vietnam’s tourism sector thanks to the rapid growth in tourism numbers. He soon had a third and now has seven. In 2010, foreseeing the global packaging tourism trends Mr. Dan put his first investment into restaurants and spas. The trademarks Gourmet Corner Restaurant, La Siesta Spa and Red Bean restaurant were respectively created and have soon become most wanted among traveler community. “After taking the plunge into hospitality I was increasingly confident that we were on the right track,” he said.
Its services are what give Mr. Dan and EHG the greatest amount of confidence and differentiate the group from others. Modest in every other respect, he never once doubted that Elegance could provide better services than others. The most remarkable difference between EHG and global hotel chains, he said, is that guests receive the same value, both tangible and intangible, when staying at either an EHG hotel or at a global chain but pay much less at the former. Limiting administration costs, which can weigh down global hotel chains, while maintaining efficient business operations and ensuring maximum value for guests allows EHG’s room rates to be lower.
Mr. Dan is convinced that long-term cohesion among staff is the most powerful factor in sustainably developing a hotel. One achievement he is particularly proud of is EHG’s people. Many employees have been with the group for over ten years, starting out as interns or, in a nod to his own past, part-time students. They have grown together with EHG’s development and now hold key positions.
“People” is the key to success and the most valuable asset of any business. Mr. Dan has built a personnel system based on three criteria: Talent, Attitude and Manner. EHG always welcomes candidates with passion, enthusiasm and responsibility. “Our personnel strategy is to develop people, both in expertise and in attitude, to contribute to EHG’s growth and the quality of Vietnam’s tourism industry, which is the face of Vietnam,” he said.
Looking to the future
Many businesses are concerned about how to optimize profitability as much as possible. Construction companies, for example, see buildings as simply a way to earn profit. Mr. Dan, however, sees building as a passion and views EHG as his son. “Nobody would sell their son,” he said. “My desire is to build, operate and make our brand grow stronger each day,” he said.
Over the next five to ten years EHG is to grow into a luxury boutique hotel chain in Vietnam and Asia. Initially it will focus on Ho Chi Minh City, as it remains a fertile and rapidly growing market. In addition to Ho Chi Minh City, Hanoi and Hoi An are the two places EHG will conduct further investment. EHG’s goal is to become among the largest high-end hotel chains with a world-class international brand.
Mr. Dan has placed his trust in the strong development of Vietnam’s tourism industry. When he started out in the hotel business he didn’t have the time or opportunity to travel abroad. He learned through newspapers, books, and forums. Then and now, Vietnam’s media regularly talks about the disadvantages for and weaknesses of Vietnam’s tourism sector. Like many others, Mr. Dan believed that Vietnam’s tourism sector in general and the hotel industry in particular was much worse than in other countries.
But now, having traveled overseas, he recognizes that Vietnam’s hotel industry is considerably better than in many other countries, not only in Southeast Asia but globally. From this, he aims to take EHG to the world. “My wish is that in every country in the world there will be at least one EHG hotel,” he said. “This would put Vietnam’s tourism industry onto the global tourism map and affirm the country’s world-class tourism services.”
When his busy business schedule permits, Mr. Dan often spends time with his family. His wife, he said, gives balance to his life and has always stood by him. “I’m very lucky to have met and married a woman who has always supported my every decision,” he said. “And she reminds me when I become too focused on my work.”
Ten years on, the simple ten-room hotel with eight staff in 2006 has been transformed into one of Vietnam’s leading boutique hotel chains. Mr. Dan always keeps in mind that perseverance, passion and kindness are the most important factors in the hotel industry. “Perseverance to pursue goals, passion to convey the joy and enthusiasm to guests and employees, and kindness to serve guests carefully,” he explained.
(Source: Vietnam Economic Times – Face Value)