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The Madonna Inn in San Luis Obispo Philosophy:
Reinvest or Fall Behind
By Ermina Karim, The Tribune, San Luis Obispo, Calif.McClatchy-Tribune Business News

Dec. 27, 2006 - The Madonna Inn in San Luis Obispo served as the playground -- and learning center -- of Connie Pearce's childhood.

The fourth child of Alex and Phyllis Madonna, the eponymous creators of the iconic resort, Pearce was rolling pennies from the wishing well by 5 years old, working in the back office at 16 and waitressing and hostessing through college. She graduated to purchasing by the age of 22 before taking over general management of the hotel in 1993 at age 28.

"My dad let me get a well-rounded education by having me work everywhere and learning everything. I didn't know it at the time, of course," Pearce explained. "When you get that kind of experience, you know what you are best at and when you need to bring in your experts and trust them."

Pearce recently spoke with The Tribune about the changes planned at the hotel, her ideas for attracting tourists to the Central Coast and the challenges in balancing her own vision with her parents' legacy.

What changes do you have under way for the Madonna Inn?

The most notable change will be the long-awaited pool and spa facility, referred to as the Madonna Springs and Spa. Completion is projected for summer 2007. We continue to make the Alex Madonna Expo Center a place to have events of all types and sizes; however, we know we could be more efficient with our staff if we had a kitchen as part of the facility to serve the Expo. We are currently in the permit process to get this done. In the meantime, we're doing improvements to the inside of the building to make it more pleasing and versatile for all types of events. We have a 5,000-square-foot storage building being built at the main restaurant to help us be more organized and efficient in our daily operations throughout the inn.

We continue to upgrade the rooms through new amenities, furnishings, floor and wall coverings and advanced technology. For instance, we now have keyless entries, flat-screen TVs, pay-per-view movies, wired and wireless Internet connections, and new phone systems. We're also considering new toilet systems that have built-in bidets and heated seats, and Japanese-type soaking tubs in a few of the high-end suites.

How have rising costs for construction, furnishings and fixtures affected your business reinvestment?

I have to think of it as exactly that -- a reinvestment. With that reinvestment, I am looking for a good return on the money we're spending over the next few years through increased business of new and repeat customers. I can't say that it hasn't been daunting at times when looking at the cost and wondering about the return, but in today's times, you have to keep up your property and continue to improve your services or you'll be left behind as a business that has died on the vine.

How do you plan to stay competitive and keep the rooms fresh?

We've currently been taking five to 10 rooms at a time to go through and update. I'm a researcher at heart, so it's been a journey to go through my mom and dad's files (Alex died in 2004; Phyllis now owns the business). One of my best and most difficult replacements to date is the signature pink rose carpet, found in our lobby and throughout the Steak House. I found myself making my first trip back to North Carolina, where I was able to have a custom carpet re-created. Thank goodness, I had the specs from my dad, right down to the number of colors used in the wool to weave the design. That carpet is now placed and looks a perfect match to the old.

What are the primary challenges you face in operating the resort?

Staffing, especially at this time of year. I have an incredible group of people who work together to take care of so many people during the holidays, yet I still find we run short. And as our business grows to include the Expo, it's increasingly difficult to find enough help. Like other industries on the Central Coast and especially in the city of San Luis Obispo, the lack of affordable housing makes it even more challenging for those who want to work in the area.

Are you concerned about the number of new hotel rooms planned throughout the county over the next two years as the number of visitors is not expected to increase markedly?

I am concerned about the supply and demand of hotel rooms, but I don't believe we will be impacted as much as some of the other hotels who have little to differentiate themselves from the rest. We are doing what we can to stay one of a kind.

What do you think the Central Coast can do to attract more tourists?

I think promoting through outdoor events is a must. Attracting national sporting events is great publicity and shows people all over the country how great our area is for all kinds of outdoor activities. Making San Luis a mecca for the beauty it holds for all of us locals can make it the true jewel for others to search out and come for a visit.

How do you balance your parents' legacy with your own vision?

I'm very proud of what they have done. And in my effort to do my job, I'm doing my best to preserve what they have built and to protect the image and reputation they have created. I feel my vision has been blending with that of my parents over the past several years. (My) visions included taking credit cards, implementing computer technology, sponsoring outdoor activities, developing the current massage center and the push for the pool and spa project in full swing now. My vision also included the completion of the Expo Center so it could be utilized as the convention center so needed by the entire Central Coast. Not that these visions were instantly accepted and granted. They came with plenty of debate. The change of chairs in the coffee shop, for instance, was always a hot debate or definite "no" with my dad. Thankfully my mom felt differently and said it was time to make the change to a more comfortable chair for our guests to enjoy.

Do you find yourself being compared to your parents?

Probably the most difficult thing to hear is when people say "Alex wouldn't have done that if Alex were here." If they ever knew that the whole reason I am here is because of them. This was their home. This is my life. I feel so blessed to have been able to work with both of them, not that it was always easy. My dad wasn't the kind of person that just rolled over for you. You had to debate. You had to prove your point and you better follow through. You earned his respect and trust. I guess I am similar.

Did you ever think you would do something other than work at the inn?

No, I never thought of doing anything else. I remember having arguments with my dad and I would be so angry and my husband would tell me to just quit. But I didn't want to quit. This is my home.

About the Madonna Inn

Address: 100 Madonna Road,

San Luis Obispo

Employees: 154

Visitors: Close to 1 million in 2005

2005 annual revenues: More than $10 million

2005 annual profit: Not disclosed

Web site: www.madonnainn.com

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Copyright (c) 2006, The Tribune, San Luis Obispo, Calif.

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