HOTEL owners revamping and expanding their properties have been faced with doubling costs for basic materials such as steel and plasterboard.

It has prompted one Scottish hotel group to set up its own workshop as it fits out its next premises, in Glasgow, which will then act as a template for its future expansion plans.

Edinburgh-based House of Gods Hotel group is expected to open its first west coast hotel at the former Peckham’s in Glassford Street in the new year after navigating the worst of the coronavirus pandemic and readying for the wider cost of living squeeze.

While it prepares its Glasgow offering, it has also launched a new bar, Lilith’s, in the Scottish capital where it is welcoming more tourist traffic than in the last two years.

The business has a team of 20 working on construction from its West Lothian workshop and about 35 staff at the hotel in Edinburgh.

The Herald: The business was launched by Mike Baxter, pictured, and his brother Ross. The business was launched by Mike Baxter, pictured, and his brother Ross.

In the final part of our series, House of Gods founder Mike Baxter, told how he is getting round the challenges.

He said: “We will be open at the beginning of the new year. It has taken a little bit longer, and again, a lot of that is a result of the supply chain.

“However, we took a lot of this into our hands six months ago when we built our workshop in Bathgate.

“We do all our own manufacturing whether it be furniture to wall finishes, we are doing our own wallpaper and fabrics now, we have started casting things like our lamps.

“Because it is so bespoke we want the only place that you get to see it is at the House of Gods, so we have taken that on ourselves.

“What we have found is it is certainly a significant amount more work but it doesn’t necessarily make it an unaffordable option, it just means that we are getting a better product for our money that is within our control from the supply chain, with the exception of the obvious things like plasterboard, which now costs twice as much.

“All these raw materials you would have to buy whichever way you look at it, but we’ve invested in a CNC (machine) which is more efficient and we get more out of the hours that the guys spend in the workshop, more result out of it.”


SPECIAL SERIES - Part One: ‘Bleak’ summer ahead for Scottish tourism as 300 hotels on market

SPECIAL SERIES - Part Two: Family to sell hotel after 67 years 'with very heavy heart'


He said: “I think we are in a really good position to deal with these issues but it is not business as usual.

“Where we can make a significant difference to the overall product is when we design our own furniture and manufacture it. The FF and E element of the job is completely within our control.

“What we anticipate we are doing here is we are able to build a hotel at twice the speed because we are essentially building all the components of the hotel – this is down to the finished wall panels – in a workshop, they are cut on a CNC machine so when you put them together they are millimetre perfect.”

It is also an asset for future premises, he said.

“This is our first one doing it like this and it definitely helps, it is a repeatable product. We did a lot of the tough learning on the first one, but albeit from an aesthetic perspective there are lots of changes to what we are doing in Glasgow.”


READ MORE: House of Gods entrepreneur plans to open hotel in every city


He continued: “Glasgow is really exciting, there are so many parts of the House of Gods that we are elevating to the next level as we’ve learned and we’ve grown.

"The challenge is to remain accessible and affordable to your customer base especially in light of the fact that they are going to be feeling the pinch at home but still be able to pay our bills.”

Stephen Leckie, owner of Crieff Hydro group and chairman of the Scottish Tourism Alliance, said it is inevitable some cost will reach consumers.

He said: “The cost of doing business is going up. Costs have gone up much more than anybody anticipated.

"Many businesses like ours are having to pass that on.”