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Michael Ayling, driving the expansion of the Laguna brand outside Thailand

'Leaner' Laguna Phuket Looks Beyond Thailand Troubles

Monday, August 16, 2010
ALTHOUGH Laguna Phuket continues to grow, the big change is that staff numbers at Phuket's biggest private employer have declined by 15 to 20 percent since last year. This is a sign of the major employment reform sweeping through progressive resorts.

In a wide-ranging interview with Phuketwan that also touched on national travel alerts and Thailand's political unrest, Laguna Phuket Managing Director Michael Ayling said that natural attrition had been allowed to take its course.

Instead of having more than 3000 permanent staff members, Laguna Phuket now runs ''leaner,'' with a Recruitment Sources Centre that enables all seven resorts in the lagoon sanctuary complex at Bang Tao beach to draw on a pool of casual employees as required.

Times are actually better for Phuket tourism this year than last year, when political upheaval in the red invasion of the Asean conference planned for Pattaya sent tourists scurrying to other destinations.

Back then, Laguna Phuket was forced to cut working hours and urged staff to take unpaid leave - something that hasn't happened in the wake of this year's political crisis.

Mr Ayling said today that the new workforce structure left Laguna Phuket ''better placed to deal with external influences.'' He added that this year was ''not looking a bad year.'' In any case, given the sacrifices that the Laguna Phuket staff had made last year, unpaid leave schemes would be a last resort, he said.

''External influences'' probably includes national travel alerts, which with one or two important exceptions encompassed warnings for all of Thailand in April and May - including the parts that were always going to remain safe. As a result, tourism in Phuket especially suffered needlessly.

Mr Ayling said that he ''totally agreed'' with the open letters to ambassadors written by William E. Heinecke, the chairman and CEO of the Minor Corporation, calling for greater awareness of the unnecessary damage done by travel warnings.

''Not enough thought is being given by the respective governments,'' Mr Ayling said. ''It's really not fair on the tourism industry in Thailand and Phuket especially.''

Last week's announcement of the pending sale of the Dusit Thani Laguna Phuket Hotel for 2.6 billion baht (US$81.3 million) to Dusit Thani Ltd was ''a win-win'' because of the long relationship Laguna Phuket already maintained through the Dusit-branded resort - the first at Laguna Phuket, opening in 1987.

''The opportunity to divest came along, and given what has been happening, we saw a window of opportunity to invest overseas and become less reliant on Thailand and Phuket.''

That message was put even more strongly late last week in Singapore by Banyan Tree executive chairman Ho Kwon Ping, one of the two brothers who in the early 1980s first realised the potential of Phuket as a tourism destination and developed Laguna Phuket from a tin mine wasteland.

While Banyan Tree and and Laguna Resorts and Hotels remain separate operations, they are linked via share cross-holdings.

What Ho Kwon Ping had to say might alarm some people because, having seen many coups and much unrest in Thailand since 1987, here's what he is being reported as saying about Thailand today: ''The frequent political events in Thailand have prompted us to accelerate our plans to re-balance our asset portfolio in order to reduce our exposure to some countries and increase in others, particularly China.

''We have more than 60 percent of our total assets in Thailand, and in the past, we thought that we would not actively divest; (so) we would just reduce that mix by growing elsewhere. As a result of what has been happening, we decided to accelerate this whole process, not just by growing elsewhere, but also by actively reducing that concentration in Thailand. We would hope to get it to be below 50 percent for sure over the next few years.''

For Michael Ayling, the sale of the Dusit means ''situation normal for me.'' However, the cash to be gained from the Dusit sale is certain to be spent outside Thailand, when the right new project comes along. A new Laguna-style development in Vietnam is already fully-funded

A good first quarter enabled Laguna Phuket to weather the damage caused by the Bangkok upheaval. Mr Ayling said that the occupancy rate was running at 50-60 percent rather than 70-80 percent, but that the fourth quarter outlook was strong.

After the sale of the Dusit is completed, Laguna Hotels and Resorts will continue to share 50 percent ownership of Laguna Beach Resort and hold 100 percent of Sheraton Grande Laguna, Outrigger Laguna Phuket, Best Western Allamanda, Laguna Holiday Club, Banyan Tree Phuket and Banyan Tree Bangkok.
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Comments

Comments have been disabled for this article.

gravatar

Kick out staff is a sign of "progressive" resorts, right?

Congratulations that Mr Heineke found a new advocate of his - .. in the US and Europe highly criticised model of ... - "casual employment".

PhuketWan - the newspaper owned by an an American who wants to make network on Phuket - and his Thai wife.

Posted by Martin on August 17, 2010 05:48

Editor Comment:

Hello Martin, is this some kind of guessing game? You make a statement then we supply the answer, True or False?

''Kick out staff is a sign of "progressive" resorts, right?''

False. Laguna Phuket is not ''kicking out'' staff. It is reducing its staff by natural attrition.

''Congratulations that Mr Heineke found a new advocate of his - .. in the US and Europe highly criticised model of ... - "casual employment". False

''PhuketWan - the newspaper owned by an an American who wants to make network on Phuket - and his Thai wife.'' False. False. False.

gravatar

martin, i work in laguna phuket. i've worked here for the past three years. trust me, none of the staff - thai or foreign - are being kicked out.

you sound like yet another example of a bitter old expat man. if you can't play nice on the playground, then don't play at all.

Posted by anonymous on August 17, 2010 13:41

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Martin: Every resort on the island is reducing staff because of protracted hard times -- simply by not replacing some when they resign voluntarily. No one is laying off staff. Furthermore, casual labor is used all over the world.

Posted by mango on August 18, 2010 16:23


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