Management: Checking into a troubled sector: Recession has created a market niche for one UK hotel company, writes Roger Trapp

WITH accountants and bankers now in competition with the likes of Forte, it is clear that Britain's hotel industry has suffered worse than most.

But one person's loss is another's gain, and an operation called Mazard Hotel Management has reported brisk business since being set up two years ago. A subsidiary of Blandy Brothers, the long-established family company that owns the venerable Reids Hotel in Madeira, it got into its present line of business by accident.

The original aim was to set up a British branch of the business, and two country house hotels - Bishopstrow House in Wiltshire and Charingworth Manor in the Cotswolds - were duly bought in the late 1980s.

'But the recession came along,' said Guy Macpherson, managing director. So it was decided that the company's structure and experience could be put to good use on other people's account. Realising that banks and accountants probably had many hotels on their books but little of the knowledge required to run them, it saw a gap in the market. A few trips to institutions later, it was running several hotels that were in receivership.

While most of its work is on behalf of receivers on a fixed-fee basis, the Mazard team has also started to work with hotel owners. Mr Macpherson sees this as an avenue for expansion.

Pointing out that the Mazard structure and expertise enables it to act quickly, often moving in on the same day as the receiver, he said: 'When we go in, one of the first things we are able to do is help with morale. Receivership is not good for morale or for business.'

This frequently involves establishing a rapport with the existing manager - as has been done successfully at the Bay Tree Hotel, a 16th-century inn in Burford, Oxfordshire. It may also involve trying to rebuild relationships with local suppliers who have been hit by the hotel's financial difficulties.

Acknowledging that similar services are on offer elsewhere, particularly from Resort, Mr Macpherson sees Mazard's strength as its ability to retain a hotel's individual character while subjecting it to the company's centralised accounting standards. The financial side of all nine hotels it is operating, plus its own two, is examined every month by the Mazard accounts team in London, so that any problems can be dealt with promptly or, preferably, ahead of time.

Good management could make a hotel, of the right kind and in the right location, profitable even in recession, Mr Macpherson said. 'The business is 90 per cent common sense and detail, plus experience.'

For example, Anugraha, in the plush locality of Egham, Surrey, was set up as a top-notch conference facility, only it did not have air-conditioning. Mazard persuaded the receiver to make the necessary small investment. Not only has this made the atmosphere more comfortable, it has saved on utilities bills, producing a marked improvement in the gross operating profit.

Another hotel had a splendid conference room on the top floor - but no lifts in the shafts. Again a relatively small investment has started to pay off.

Mazard also has a consultancy arm that advises on the viability of keeping an operation going. Its specialists will often recommend that the bank sell out before incurring further losses.

It is not all about finance, however. 'We put a lot of emphasis on performance,' said Mr Macpherson, adding that the British hotel industry could learn a lot from its counterparts abroad, particularly in the United States and the Far East.

'It's amazing how people respond if you listen to what their problems are,' he said. 'If you make their job easier, they start to respond.'

(Photograph omitted)