John McCarthy is a Newmarket native who spent 17 years working in the hotel industry in Cork and Shannon. With the hotel industry experiencing overhaul after the 2008 Global Credit Crunch depreciated tourism, many enterprising managers in the hotel industry like John looked at switching to something different.
After John left his position in the Ambassador Hotel in late 2009, he set up Cafe Beva. The enterprise in Glanmire is 2 years old next month, employs 6 staff and has become a hugely popular meeting point for Glanmire people and those passing through.
Barry O'Brien, Strategy Student at UCD Michael Smurfit Graduate Business School sat down with John and asks him about the hotel industry, the business environment in Glanmire and strategies to attract customers in a recession.
What is your background?
I was born in Newmarket near Kanturk. I went to Scoil Mhuire in Kanturk. I started my career as a manager in Rochestown Park Hotel under Liam Lally. I was there for 3 years. Then moved to Oakwood Arms Hotel in Shannon and then I moved to the Ambassador Hotel for 12 years. I started as Deputy Manager and progressed to General Manager in 2005. I left there in late 2009 and set up Cafe Beva in 2010.
What is the sales pitch for Cafe Beva?
Local fresh food, cooked to order. The food is healthy. It is a place for everyone. There is room for people to relax both with and without kids and people on business. We have stayed away from deep fried food. We make all the food ourselves from scratch, all the deserts, homemade brown bread and homemade soup. We use very good local suppliers from Glanmire such as Sheehan's Butcher, Superpack Vegetables and Riverview Eggs around the corner. We are all about using fresh local suppliers.
How long did it take you from concept to opening the doors?
About four months, I met the landlord on site and we agreed a deal. It was open four months later. The first year we established ourselves quite well and now that we have managed to get costs down in year 2 we are seeing that trickle down to the customer and they come back because of this.
You spent most of your career managing the hotel industry, we know of all the closures in the industry, what happened?
In the boom, the rates hotels were getting for room rentals created good profit in the hotel industry. Today, those same rooms are going for 30-40% less. Additionally, 35% of hotel rooms in Ireland were built since 2005, further depreciating the profit. Most of the newer hotels had large bank loans and that is contributing to many of their problems. What you are seeing is the old hotels who were there for years are surviving, because they have less 'boom-accentuated' liabilities.
What is the business environment like in Glanmire?
It is a bit of an unusual town, in the respect that there is only one super market, most towns this size around the country would have three or four. It is not a typical shopping centre as you can see here. It is many small buildings in a business designated park. It has all the small shops someone needs. With respect to the recession, from my own perspective, things are not too bad. People are willing to pay €4 or €5 for a sandwich and to spend time here. It is not expensive. Many pubs do not open until late in the day, so we serve as a convenient meeting spot in Glanmire. Overall, Glanmire is a positive place to do business.
Is Government policy making hiring people in Ireland difficult or easy?
For me, the 10.5% Employer PRSI charge does not make sense. If I am lucky enough to be able to provide employment for somebody, surely government save money when one more person is non-reliant on the state. We are very lucky with the staff we have. They are all local so we are doing our bit but why not incentivise employers to hire?
What are your strategies for attracting customers in a recession?
I took a social media course and use Facebook and Twitter all the time. I interact with my customers through that. The main website is simple to navigate for information. We collaborate with other local businesses in Glanmire, for example we have an offer in conjunction with the local bookmakers for Cheltenham week. If customers show there betting slip here they get €1 off their bill. We are looking to extend the space out front with installing a canopy for customer to use in the middle of the year.
Was going in to business on your own always something you wanted to do?
It was always something in the back of my mind. When I left the Ambassador Hotel I saw an opportunity with this brand new building in Glanmire and just said lets go for it.
What advice do you prospective entrepreneurs in Cork?
Always stay positive. The glass is half full, not half empty. This breeds a 'can do attitude'.
How hard do you work?
I work six days a week. I work to 6 in the evening. I do accounts at night at home and plan for the next week. I do on average 60 hours a week.
Where will you be in 10 years time?
Hopefully on a golf course somewhere (laughs). Hopefully here! Still going strong and if the opportunity arose perhaps look into opening a second Cafe Beva and hiring more Cork people!
Readers can visit Cafe Beva on Facebook.