Building Value In Each Hotel

Given the highly competitive nature of the hotel franchising business, Choice continues to improve and diversify the products and services it makes available to franchisees. At the heart of that competition is the drive to stay on the leading edge of technology.

"Like virtually every other business at the end of this century, the hotel industry is changing rapidly with new technology," said Tom Mirgon, senior vice president of administration. "We have to bring greater value to our franchises by giving our franchisees the best technology options to keep their properties operating at maximum effectiveness."

To enable franchisees to better manage their hotels, Choice is implementing Profit Manager, a proprietary property management system designed to manage reservations, rates and inventory more efficiently and effectively.

Janna Morrison, vice president of property systems, acknowledged the challenge of the ambitious project to outfit every Clarion, Quality, Comfort, Sleep Inn and MainStay Suites hotel with Profit Manager by the end of 2000.

"In our first roll-out phase in 1997, we encountered some difficulties in larger properties with managing group business," she explained. "As a result, we designed a new release of the software, and we will continue to evolve the product to meet our franchisees' needs."

A comprehensive Windows-based system, Profit Manager includes InSync, a communications tool that allows instantaneous synchronization between the CHOICE 2001 central reservations system and each hotel. CHOICE 2001 gathers reservations from a variety of sources, including global distribution systems (GDS) run by airlines, the Internet and call centers to provide the ability to manage room inventory and rates. This real-time, two-way communication helps increase property revenue and decrease the likelihood of overbookings.

Profit Maximizer, another Profit Manager feature, helps the individual hotel predict future occupancy and demand for hotel rooms. Using past property data, each hotel can forecast future stay patterns and more effectively set rates to meet guest demand.

For the company's economy hotel brands, Econo Lodge and Rodeway Inn, the company has developed ChoiceLink for Windows to provide a gateway to reservations through CHOICE 2001, thus giving them access to the GDS and Internet.

When Choice needs a well-managed hotel with technologically savvy personnel to help test the latest version of its Profit Manager property management system software, one of the places it turns is the Comfort Inn hotel of Scottsdale, Ariz. Click here for more information.

Choice's Strategic Partnerships program is another way to build value for both guests and franchisees. Operating under a "4-Win" strategy, the program ensures that products and services endorsed by Choice benefit the guest, the franchisee, the vendor and Choice.

"The guest enjoys brand-name products and services that help build guest loyalty for the franchisee, who also benefits from competitively priced products," explained Daniel Rothfeld, vice president, partner services. "Vendor partners gain access to a critical mass of franchisees, which in turn generates residual income for the company."

The Quality brand's Serta bed program underscores the value of this initiative. Banking on the inherent quality of the Serta name, Quality brand hotels promote the restful sleep assured by the Serta beds featured in every room. Taking the program one step further, participating Quality brand hotels now can offer guests the opportunity to purchase Serta beds at a significant discount.

"The Serta bed promotion gives everyone an opportunity to win," said Pete Jordan, Quality brand management vice president. "Our guests not only can enjoy the Serta experience in our hotels, but now they can take it home. Franchisees can offer guests a 'quality' night's rest. And Serta, our preferred vendor, gains access to yet another sales channel."

Another value-added service for franchisees is the Internet Project Management system, or IPM, which consolidates the design, sourcing, purchasing, management and financing of renovation and refurbishment projects into a single turnkey, competitively priced package for franchisees. Through partner relationships with The Gettys Group, an interior design and procurement firm, and McClier Corporation, a leading architecture, engineering, construction and project management company, the level of service has been enhanced through access to these services over the Internet and a toll-free hotline.

As a successful underpinning to the franchisor-franchisee relationship, Choice continues to review and update its franchise agreement to stay competitive in the industry.

"We have worked hard to improve our basic agreement by rewriting it into plain English and reducing its length significantly," said Michael DeSantis, senior vice president, general counsel & secretary. "We just announced a reduction in the cap on liquidated damages paid upon termination, from 60 months to 36 months. This revision follows another recent cut-ting edge change to the agreement, which implemented five year mutual outs for franchisees in good standing, making Choice one of only a few hotel franchisors to provide this opportunity."