Beach clubs: a shore thing

While visi­tors can ac­cess Le­banon’s seashore free of charge via its coast­line, the beach get­away con­cept has been some­what al­tered by the in­tro­duc­tion and de­vel­op­ment of pri­vate clubs, where ad­di­tional facilities, such as pools and res­tau­rants, are made a

Hospitality News Middle East - - IN THIS ISSUE -

An evolv­ing busi­ness

The first beach club to open in the Mid­dle East was the Saint-ge­orges Yacht & Mo­tor Club, which was launched in April 1936 in Minet El Hosn - Beirut by in­dus­try pi­o­neer, Michel Nader.

A few beach clubs fol­lowed in the 1960s, such as Saint Si­mon and Riviera. Fast for­ward to the early 2000s, and sig­nif­i­cantly, beach clubs started to spring up out­side of the cap­i­tal, to the south and north of Beirut. Key play­ers in­cluded Bam­boo Bay in Jiyeh, Oceana in Rmeileh and Ed­de­sands in By­b­los, which re­mains the big­gest beach club in Le­banon to­day. With com­pe­ti­tion heat­ing up over the years, new beach clubs looked for in­no­va­tive ways of at­tract­ing clien­tele, adopt­ing clever strate­gies that in­cluded of­fer­ing unique con­cepts and dif­fer­en­ti­at­ing their ser­vices and facilities. As nov­el­ties and new temp­ta­tions be­came the norm, fol­low­ers were less likely to stay loyal to one outlet. Di­ver­si­fi­ca­tion and grow­ing num­bers of new venues spring­ing up along the Le­banese coast also weighed on beach club mem­ber­ships, which have dipped in pop­u­lar­ity since the turn of the mil­len­nium, due to a de­sire among cu­ri­ous cus­tomers to try out new out­lets with­out com­mit­ting to one par­tic­u­lar place. Against this back­drop, beach cub own­ers face a tough bat­tle to main­tain in­flows of visi­tors and rev­enues at an op­ti­mal level.

Choos­ing wisely

De­vel­op­ing a beach club con­cept re­quires se­ri­ous stud­ies and fi­nan­cial re­sources. Keep­ing in mind that the beach is the num­ber one des­ti­na­tion for out­ings dur­ing the sunny sea­son, club own­ers need to cre­ate their con­cept metic­u­lously, based on the niche clien­tele they want to tar­get. With ap­petites and life­styles chang­ing, new beach clubs in Le­banon are shift­ing their fo­cus from so­cial classes and age groups to tastes and spend­ing be­hav­iors. One ma­jor trend cur­rently in ev­i­dence is the draw of nat­u­ral fea­tures and sur­round­ings. Ô-glacée, an open-air, hip beach lounge in Ba­troun, wel­comes its guests with an ice-cold, nat­u­ral pool, while of­fer­ing sim­ple and af­ford­able ser­vices and prod­ucts. Aside from these at­trac­tions, beach clubs in the area are also con­sid­ered ide­ally lo­cated for water sports. Other con­cepts re­main fo­cused on lux­u­ri­ous ser­vices, tar­get­ing a niche clien­tele that wants to be pam­pered.

Beach re­sorts in Le­banon: a chal­lenge

Ben­e­fit­ing from warm weather that ex­tends from mid-april to late Septem­ber, Le­banon is a draw for lo­cals, tourists and ex­pa­tri­ates in sum­mer, many of whom flock to its richly var­ied coast that fea­tures both rocky and sandy shores, span­ning south to north. In re­cent years, the coun­try has en­joyed longer sum­mers, lead­ing to pro­longed sea­sons for beach-re­lated busi­nesses. Lazy B, lo­cated in Jiyeh, opened its doors on April 1, 2018, sig­nif­i­cantly ear­lier than tra­di­tional open­ing dates, in a bid to at­tract cus­tomers keen to kick-start their sum­mer sooner rather than later. How­ever, the Le­banese still tend to re­strict beach-go­ing to be­tween June and early Septem­ber,

Beach clubs also find their prof­itabil­ity af­fected by a lack of sup­port from the pub­lic sec­tor

de­spite warm spring-times and amaz­ing In­dian sum­mers that can stretch from Septem­ber to end-oc­to­ber.

These lim­ited win­dows are among the chal­lenges that beach club own­ers face in their strug­gle to gen­er­ate prof­its. Own­ers tra­di­tion­ally counted on cus­tomers spend­ing money on food and drinks, since F&B tended to gen­er­ate more rev­enue than en­trance fees. How­ever, over the years, con­sump­tion be­hav­iors have changed, with pop­u­lar up­selling items now a dis­tant mem­ory. Al­co­hol is a prime ex­am­ple; while it used to be a key rev­enue stream for the F&B seg­ment, many cus­tomers have re­duced their qual­i­ta­tive al­co­hol con­sump­tion at the beach, lead­ing to a cut­back in profit mar­gins. Other fac­tors af­fect­ing both pric­ing and prof­itabil­ity in­clude high rents and re­lated taxes.

Tough on the pocket

Peo­ple seek out the beach to re­lax and en­joy the warmth of the sun. But what hap­pens when kick­ing back by the sea is be­yond bud­get? Costly en­trance fees and F&B checks are two ma­jor is­sues at beach clubs in Le­banon, es­pe­cially for fam­i­lies. Visi­tors will se­lect a beach club based on a num­ber of fac­tors, in­clud­ing ac­cess to the sea and use of ba­sic beach facilities, such as pools, which they ex­pect, along­side es­ti­mated spend­ing on food and drinks. How­ever, some own­ers seem to for­get that the higher the price, the lower the con­sump­tion, lead­ing to re­duced vis­i­tor in­flow per sea­son, even if other fac­tors come into play, such as the pop­u­lar­ity of a venue with chil­dren.

More sup­port needed

In ad­di­tion to fac­ing high taxes, beach clubs also find their prof­itabil­ity af­fected by a lack of sup­port from the pub­lic sec­tor: • Per­mits Ob­tain­ing con­struc­tion and op­er­a­tional per­mits is a ma­jor strug­gle for own­ers, which leaves them hav­ing to nav­i­gate com­pli­cated pro­ce­dures with var­i­ous pub­lic in­sti­tu­tions prior to gain­ing ap­provals.

• Sub­si­dized Loans Sub­si­dized loans have al­ways been a chal­lenge to se­cure and have also tra­di­tion­ally only been made avail­able for new builds. Such loans were granted at rates of around 0 per­cent at the end of the 1990s, but rose to 3 per­cent in the early 2000s, be­fore reach­ing 4.5 per­cent this year. How­ever, own­ers of beach clubs al­ready up and run­ning, but seek­ing fi­nan­cial sup­port for re­fur­bish­ment, are of­ten forced to ex­plore al­ter­na­tive and ex­pen­sive sources of fund­ing or sell part of their prop­erty.

• More ex­penses A lack of re­duced or sub­si­dized elec­tric­ity pric­ing and mu­nic­i­pal­ity taxes present fur­ther chal­lenges. More­over, in­suf­fi­cient sewage lines for the seashore can lead to ad­di­tional treat­ment plant costs.

• Cat­e­go­riza­tion Un­like ho­tels, beach clubs in Le­banon do not fol­low 2, 3, 4 or 5- star clas­si­fi­ca­tion ratings, mak­ing it dif­fi­cult for the pub­lic to gauge their stan­dards and the ser­vices they of­fer.

Against the odds

De­spite the mar­ket dif­fi­cul­ties, some beach clubs, such as Kalani in Halat, La Siesta in Khaldeh and Man­daloun Beach in Dbayeh, are still stand­ing tall, cham­pi­oning Le­banon’s ef­forts to re­gain its po­si­tion of re­gional touris­tic sum­mer hub.

Own­ers tra­di­tion­ally counted on cus­tomers spend­ing money on food and drinks, since F&B tended to gen­er­ate more rev­enue than en­trance fees

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