How skiing break became slippery slope to making my first million

DATE: Feb, 2   COMMENTS: 0   AUTHOR: Allan Azarola

Andrew Dunn started his company for the best possible reasons: pure selfishness and a touch of sibling rivalry. The veteran of the travel business had been having a wonderful time skiing in Verbier, where his sister was working as a chalet host, and time came to return to reality. In his case the reality of being a student who could barely afford to visit the pub let alone hit the glittering slopes of a top ski resort.

The answer, he decided, was to start his own travel company, Ski Scott Dunn, in 1986. Today it is called Scott Dunn, though there never was a Scott. “It just sounded better to have another name on the letterhead.”

Launching a business required money, so a visit to his grandmother was called for. The result was a loan of £5,000 and her advice that “people always pay for what they want”. What he wanted was a company that allowed him the lifestyle he craved, plenty of skiing and minimal administration.

“To make a success of a company in any sector you must love it,” he says. “I didn’t even think about getting into any other kind of business. For me it had to be the travel business. I had the £5,000 plus £40 a week from the enterprise allowance scheme and that was it, I had to make it work.”

The super-rich winter playground of Verbier was a step too far so he lowered his sights and instead rented two chalets in the more affordable French ski resort of Chambery. In the first season Scott Dunn arranged holidays for 200 people and made a loss of £7,000. The following year it turned over about £60,000 and made a small profit. “We weren’t making much money but it was very exciting,” Mr Dunn says. “I took on six or seven staff, we set up an office and produced our first brochure.”

The company did well but, like many others, took a hit during the 1992 recession, when oil prices went through the roof, causing air fares to rocket. “We went through something of a crisis at that time,” he admits.

The solution for Mr Dunn, now 53 and the founding president, was to bring investors on board, offering 1 per cent shares in Scott Dunn for £5,000. He then added more resorts. “It wasn’t that long until I made my first million, that was very exciting,” he says.

People brought up on skiing holidays staying in staffed chalets in some of Europe’s top mountain resorts are the same people who can be persuaded that they would like to travel somewhere in summer as well.

Expansion of Scott Dunn’s operations continued, with forays into Africa and later a number of European resorts, providing holidays aimed at its core well-heeled customer base. “I wanted Scott Dunn to be the most aspirational travel company out there,” Mr Dunn says.

Scott Dunn began with ski holidays but the company now sells tours to Alaska

With offices in London and Chichester and branches in San Diego and Singapore, the company now offers destinations across all seven continents, from Lapland to Antarctica, California to Kenya.

Skiing remains a staple for the group but there are also beaches, safaris, spas, ranches, honeymoons and family holidays. Alaska and luxury yacht charter holidays in Croatia and Greece have recently been added to the portfolio.

His advice to budding entrepreneurs is that they must love what they do and have the confidence to carry their ideas through. “Don’t hesitate for too long. Set yourself goals and don’t allow yourself to be sidetracked,” he says, urging them to celebrate each milestone.

“For me the real milestones were starting the company in the first place, then finding an office and producing our first brochure, plus of course making that first million, I still get excited when I think about that.”

Scott Dunn now turns over about £100 million annually and employs 193 people in the UK and 130 overseas. When he sold some of his shares in the company a while ago he became a millionaire many times over, though he is shy about discussing the figures. “I haven’t even told my daughters how much I got so I had better not say.”

Carving out a niche
Would Andrew Dunn recommend starting a travel company if he were setting out today? “Not necessarily. The margins can be small, it’s getting harder to make money.”

When he founded Scott Dunn the travel industry was dominated by mass-market companies trying to be all things to all holidaymakers and the niche his business filled was an opportunity waiting to be grabbed.

At the same time, holiday sales were largely through a handful of high street travel agency chains and there was little in the way of bespoke holidays. “There wasn’t the kind of regulation we have to deal with now; the business was more open to enthusiastic amateurs.

“No, if I was starting out today I would be taking a close look at the property business. It’s all a bit flat at the moment but [that] won’t last. I would be looking at opportunities in the student accommodation sector. There’s a constant demand and the returns are excellent.”

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