In succeeding an entrepreneurial legend, Adam Stewart assumed control of a world-famous $1 billion resort chain and now oversees 22 properties and 8,000 employees — at the ripe old age of 27.

Page 2 of 2
« Back

continued

Renovation and expansion continue almost everywhere in the Stewarts’ resort constellation. The company has six large-scale construction projects underway or in the planning stages, including a $180 million expansion of its Beaches property in Turks and Caicos, and a $12 million project at the Montego Bay Sandals that will enlarge rooms and create a riverine pool that snakes along the room blocks, offering guests balconies that open onto the water. At most hotels, Stewart says, rooms are renovated every 10 to 12 years. At Sandals, “We do ours every two and a half to three years.” He estimates that Sandals has spent $200 million on rehab alone since 2005. The company acts as its own contractor, with its own full-time staff of architects, engineers and interior designers. “I always make the joke that we’re really a construction company that operates hotels,” he says. The company puts no limits on capital spending. “We sort of look at a blank piece of paper and say, ‘What would the ultimate be?’ ” he says. Then they execute it.

For an expansion of the Sandals resort on the island of St. Lucia, for example, the company is taking a cue from Las Vegas and creating a Venetian village with room blocks connected by gondolas on canals and an acre of infinity pool. “We let our imaginations run wild, and then we cost it out,” Stewart says. “We scale back here and there, where we have to, but we spend a lot.”

Much of what the company earns is reinvested in the form of upgrades to the physical plant and guest services (state-of-the-art water-ski boats, say, or bigger wine lists). “We pay the bills, we pay our staff and then everything goes right back into the organization,” Stewart says.

Such a business model is made possible by the fact that Sandals Resorts is 100 percent family-owned. It has no outside investors and no board of directors — “a huge advantage,” Stewart says. “We don’t have to report to anybody. We can make a decision this morning and have it implemented by this evening. It makes us nimble.”

One of Stewart’s primary goals has been to remove red tape wherever he can find it. He says he has two audiences in mind when he makes a decision: the customer and the staff. Reviewing the company’s structure division by division, he says, “I take it from the employees’ standpoint: How easy do we make it for them to get their job done?” To that end, he and his brother Bobby, 43, a computer expert in charge of Sandals’s information technology (and its director of SRI), helped design and implement a system that surveys guests via the Internet and collates their ratings of the resort and its services. They then distribute the results to employees, who can see their own scores and make on-the-job corrections as needed. “We use it on the property before every staff shift starts,” Stewart says.

The Stewarts as a unit are nothing if not detail-obsessed. Adam discusses a recent deal with Beringer Vineyards, in the Napa Valley, to pour bottles of wine that cost $18 retail, rather than the $4 bottles offered by some all-inclusive competitors. He mentions Sandals’s recently acquired $50,000 MasterCraft water-ski boats, the 300-thread-count linens on its beds and the two lighting specialists the company employs to make sure the mood is just right at each of the bars, restaurants and rooms in the chain. “We kind of go overboard on the details,” he says. That seems to be a family trait. When Butch Stewart began his career, he was a hustling salesman who understood in which details the devil could be found. As an air-conditioner man, he made himself available whenever a customer wished. He installed units on Christmas Eve (a husband’s gift for his wife). He made house calls at 2 o’clock in the morning if that’s when the machines broke down. “His entire work ethic was based on customer service — on saying yes,” Jaime Stewart says.

Whether by nature or nurture, the patriarch’s work ethic seems hard-wired into the entire Stewart clan, and by extension the company as a whole. A large portion of Sandals’s senior management has worked for the firm since its founding. There’s Eleanor Miller, director of projects, who has been with Butch since his air-conditioning days. And Brian and David Roper, both managing directors, who started with Stewart in 1981 as cooks and bartenders. And Daddy Stone and Red Jute, head waiter and restaurant manager, respectively, at the Montego Bay Sandals, who also came aboard that first year. “These people are extended family members,” Adam says. “You work all day with them, and then you go to their houses for dinner.”

Any family business has unique complexities and challenges, of course. But the Stewarts believe they’ve got those problems solved. “Because of the culture that’s existed here, with the organization being a part of us, we’ve never had a problem,” Adam says. “As a matter of fact, I wish it would never change. As companies get larger, sometimes it’s harder to have the family right there at the top, but I really don’t see this changing for us.”

Page 2 of 2
« Back

Next article » Chairman’s Row

Previous article « The Cat Came Back