If you ask Hospitality Resource Group founder Robert Sanders the secret of his company”™s two decades of success, you”™ll get a variety of answers, ranging from the company”™s solid business plan to a focus on philanthropy to, frankly, pure luck.
But there”™s one characteristic that he credits above all else: a focus on forming strong, meaningful relationships.
Nearly all of Sanders”™ White Plains-based event planning and communication company”™s new business is the result of referrals, either from satisfied customers or thanks to relationships he”™s formed outside of the industry.
“We really focus on people,” Sanders said, as opposed to simply the large-scale fundraising events or conferences his company organizes.
The company is about more than just throwing a good party, Sanders is quick to point out. Through a trio of business segments, Hospitality Resource Group develops and manages customized training programs, executes events across the world and devises marketing solutions for a wide range of companies.
Though the company is celebrating its 20th anniversary this year, the road has not always been easy for Sanders and Hospitality Resource Group.
Sanders climbed his way up the ranks at hospitality company Marriott International Inc. during the 1980s and early 1990s, starting as a chef in South Carolina before becoming the director of catering at the New York Marriott Marquis in Times Square. At the Marquis, Sanders helped organize numerous high-profile events like the Excellence in Sports Performance Yearly Awards, commonly known as the ESPYs, and the
Daytime Emmy Awards.
But with that job came a long commute from his Mahopac home to Manhattan and even longer hours in the office ”” typically more than 100 per week, Sanders said. That left little time for Sanders to spend with his wife and two young children and prompted him in 1995 to take a position with the Tarrytown-based catering and event planning company, Abigail Kirsch.
There he learned the basics of entrepreneurship and began courting the idea of starting his own firm, Sanders said. “My kids were at the age where I could either do it now or forever hold my peace.”
To minimize the costs associated with starting a business, Sanders chose to launch his company in 1997 from his own Mahopac residence. He did a build-out in the family two-car garage. “I built a wall and put in carpeting, and I built an office, and I started,” he said. “Literally in my garage.”
One of the company”™s first major events, the American Red Cross”™s Touch of Red gala, proved a turning point for Sanders and his young company. The event”™s success and the positive response it received had a domino effect on the company”™s growth, with referral after referral leading to a string
of new business.
Today, HRG is composed of three separate but connected divisions: Event Solutions, the company”™s corporate and nonprofit event-planning sector; Allegis Communications, the public relations and marketing division; and Strategic Training Solutions, its training and
development business.
“Essentially, all three divisions run independent of each other,” he said, “but there”™s a lot of synergy there.”
Sanders said 60 percent of the company”™s clients are corporate and 40 percent are nonprofit. They include Aetna, the city of Yonkers, Covidien and White Plains Hospital, just to name a few.
The company also places a strong focus on Sanders”™s own roots in the hospitality sector. “Hospitality is a big piece of our world,” he said. “We do events all over the world, but we have a real passion
for local hospitality.”
In the two decades since launching his business, Sanders has had to navigate it through a number of obstacles and global events ”” not the least of which was the 2008 financial crisis.
“A lot of our clients that we deal with were cutting back their business because they had to,” Sanders said. “Financially, they couldn’t do it.”
The crash of the economy also made corporations much more conscious of how they spent their money, particularly with regard to large-scale events or parties.
“They started saying, ”˜Okay, do we really have to do this? Does it really make sense?”™” Sanders said. “So, from our perspective, we had to do a much better job of presenting the return on investment to them, saying, ”˜Okay, if you do the trade show, let”™s talk about your return on investment.”™ We really had to do a better
business case for that, which was a big
shift for us.”
Those experiences forced Sanders and his company to adapt to a new world order within the industry. Sanders used the example of a former client, Univision, with which Hospitality Resource Group had a large, longstanding contract. As a result of the financial crisis, Sanders contact person within Univision was laid off.
“What we realized is, we didn”™t have the next go-to person in the company,” he said, “and we ended up losing the account.”
Sanders said that same scenario of a critical layoff happened twice more with large clients during the economic downturn, though HRG was able to retain the other two. Now, he said, he no longer relies on just a single point of contact within
client companies.
“You can”™t just have one contact person,” he said. “You have to go three layers down. Even though you”™re not thinking they”™re going to lose their job, you just never know.”
Before the financial crisis, “We were used to meeting with the CEO, CFO, those higher-ups,” Sanders said. “Now, we”™re meeting with the level down, because they”™re delegating those tasks.”
The types of corporate events the company organizes and their locations also have shifted since the global financial crisis.
“We used to do a lot of Las Vegas events, and (after 2008), we had a lot of our clients say, ”˜Listen, we can”™t go to Las Vegas. We have to think about the perception of the board, the trustees, of the investors,”™” he recalled. “No matter what you”™re there to do in Las Vegas, the perception is that you”™re there to have fun. We started to look
at more conservative-type places to go where it was more business oriented.”
As the Great Recession has receded, companies have started to loosen their purse strings somewhat for event or conference spending, Sanders said. But the industry likely will never revert to what he called its “Wild Wild West” days before the financial crisis.
“Those days are gone forever and they”™re never coming back. Corporate organizations are now a lot more conservative, because they have to be, because they”™re being watched a lot more,” he said.
