Making Phuket a net-winner

Referencing a recent Financial Times article regarding ‘What tennis can teach investors about risk and return’ (Howard Marks 12 September 2023 see: https://rb.gy/ofycz), and being an intermediate amateur tennis player of sorts myself, always trying to look at Phuket and its development through fresh eyes to keep things fresh, it occurred to me that it is possible, with some degree of collective will, to make Phuket a better place against the tide of negative factors that often hinder the process.

The nub of the article is that you can bear risk with control, but if you ‘avoid’ risk you’ll simply have zero return. Seems like a very simple analysis, right? However, in tennis, if you try for your best shots all the time you’re highly likely to fail and if you try to be too safe you’ll also likely fail against many opponents. Howard Marks points out investing is the same and I think what we choose to apply energy and effort into Phuket is also similar. We must take some controlled risk.

Fortunately, I don’t think I’m alone in my line of thinking. There are many community groups in Phuket trying to lift development, improve individual and collective good through initiatives, information sharing and action.

One recent event that I found impressive, even after parking at a car lot far away from the venue and trudging through the rain (for which I am well versed following recent Phuket hikes), was the Phuket Hotels for Islands Sustaining Tourism (PHIST) 2023 event organised by the Phuket Hotels Association.

All Phuketians – part and full time, and even some people in Bangkok – are aware of how important hotels in Phang Nga, Phuket and Koh Samui are to attracting foreign-derived revenue into the domestic economy. This event is inspirational in its topics, progressive (without too much liberal ideological assumption coercion and with a healthy dose of rationality) and peppered by people who know what they’re talking about and have accomplishments to prove it, e.g. successful hotel and mixed use developers, hoteliers and ecological innovative businesses from suppliers to service delivery firms.

One particularly fascinating discussion involved the Worldwide Wildlife Fund on how social enterprise and non-profit organisations can work, including with Government, on initiatives to create ‘sustainable’ projects – with hotels. Development through community liaison and operations, taking into account nature and community nuances, are pivotal to a project’s successful sustainable implementation.From this, we could ensure in our own businesses and activities in Phuket that we think outside of our comfort zone or routine operations and imagine how we could form better partnerships with organisations to improve sustainable practices. The net financial gain on this is that a sustainable company should achieve higher value ratings for investment or takeover but the wider gain is for stakeholders in the Phuket community and the environment of Phuket.

Another discussion was hosted by Bill Bensley, a man with a super interesting life trajectory who has clearly put his creative heart and soul into his projects and his art and design. Interviewed by another larger than life hotel character, Bill Barnett of C9 Hotelworks, Bill Bensley discussed his work at the Shanti Mani Wild ‘resort’ which comprises tents in a Cambodian national park with unrivalled access to experiences only available when situated in the heart of a preserved environment. This type of project requires a lot of investment and doesn’t immediately facilitate the application of traditional ‘6-star premium rates’ that ‘luxury’ makes. Instead, focus is on alignment with the desire for experiences and interaction in lodgings between the design, nature and services expected when paying for accommodation such as wellness and high quality food and beverage.

Every small step is a step of evolution but we should try to remark upon steps when they make a significant change, while scaleability can accelerate successful impact. The risk for business operators in Phuket to change their business models to be more sustainable is that the net gain might not necessarily be immediate or financial. However, applying the clichéd ‘long term view’ theory, the gain over time will be everyone’s gain because of the risks we might take now to adjust and be more ‘sustainable’.

Will our customers cover the cost of non-plastic straws? Bear the consequence of less resilient but more sustainable materials? How will they feel if we only keep their records digitally (noting that there are trash problems in the digital world also)? We can address these issues if we take a step back and strategise our businesses around sustainable goals. “How on earth can a law firm be ‘sustainable’ ?” I’ve often wondered in the past. Well, I’ll keep trying to find out and from the PHIST event and other noble activities on the island, I’m confident others are already way ahead of me and more will follow suit.

As I try to split step for 20 percent of the rallies that a fit tennis pro can manage in my tennis match later tonight, I’ll reflect on the ‘net gains’ of risk-taking and try to win the point as early as possible before my knees betray me. We can all perhaps take a bit of risk and try to achieve some more sustainable practices and outcomes for a net gain in our Phuket businesses.

By Desmond Hughes, Senior Partner of Hughes Krupica
Hughes Krupica is a law firm which specialises in Real Estate; Construction; Hospitality; Corporate; Commercial; Tech; Dispute Resolution; and Litigation, operating from Phuket, servicing clients in relation to their business activities in Thailand and in other regions of Asia.