Hotel and Motel Management Companies Face Franchise Challenges

As the lodging industry starts to stabilize, hotel and motel management companies will face tougher performance measures if the properties they manage lose the franchise. Owners of older hotels and motels that have not kept their up property with a PIP (Property Improvement Plan) can expect less leniency and more aggressive contract terminations as a result. In turn, third party operators of these lodging properties will have to get creative if the hotel or motel loses its flag and goes independent. Several major brands, such as Comfort Inns, Crowne Plaza and Best Western are on the move to remove what they deem as “the low hanging fruit” from the franchise and member tree. According to these excerpts from this article, owners and hotel and motel management companies will have to meet both QA (quality assurance) and customer rating scores or else: “For Crowne Plaza, approximately 10% of hotels in the system are not expected to make the cut; Comfort Inn and Comfort Suites also will lose about 10% of their portfolio size; and for Best Western International, about 500 hotels were removed from the system before the company launched its descriptor program.” “We’ve been very candid with franchisees throughout the whole process,” said Christina Williamson, senior director of brand planning and management for the Comfort brand family.” “Ron Pohl, senior VP of brand management and member services for Best Western, said the quality of the hotel builds customer trust.” More info on the BW Descriptor Program for owners and their hotel property management company can be found here. Are you an owner or hotel owners representative facing similar requirements from your franchisor? If so, do your hotel and motel management companies recommend alternative plans such as going independent? Please post your comments below.