RANDOLPH, N.J. � FEB. 23, 2005 � With the business climate warming up after a long cold spell, industry observers predict that that more hotel operators will either re-flag their properties or, in the case of independents, sign on with a franchisor, in order to avail themselves of the competitive advantages franchising brings to the table.  
 
That�s good news for the franchise chains�and, ideally, for the franchisee�but for some, especially the novice hotel owner, a word of caution is in order: Unless you totally understand the legalities of a franchise agreement, or the flexibility and options that are inherent in the negotiations leading to the signing of a contract, then it is a clear signal to seek help in the contract negotiation process.
 
One of the keys to franchising success is to hammer out a solid, equitable franchise contract. It�s equally important to be able to negotiate a fair termination agreement, should the need arise. Here�s a case in point:
 
Naresh �Harry� Patel, manager of Sky Hospitality LLC, a small company in Clearwater, Fla., that owns and operates three hotels, wanted to terminate a franchise agreement on his hotel in Clearwater.

�We had two years to go on the agreement, and as far as I could tell we were within our rights to terminate,� Patel said. �But these franchising documents are so complex that you pretty much have to hire an attorney to interpret them and then take your case to court for resolution�and that�s a long, expensive road to travel.�
 
Patel was about to head down that very road until he heard about Hospitality Solutions LLC, a Randolph-based firm founded by longtime lodging executive Steve Belmonte, that specializes in franchisee/franchisor negotiations services and more.

�I had friends in the hotel business who had hired Steve to help in disputes like mine,� Patel said. �They told me Steve has in-depth knowledge of franchise agreements and that his fees were far less than it would cost us to hire an attorney. I called him right away, and the next thing I knew Steve was working with us to get the dispute resolved.�

It didn�t take long for Belmonte and his Hospitality Solutions associate, Wayne Miller, to negotiate a solution to the dispute between the franchisor and Patel�s Sky Hospitality.
 
�Steve and Wayne solved the problem within approximately 30 days by sitting down with brand management, and in a professional, businesslike way, coming to an agreement that satisfied all the parties involved,� Patel said. �Their thorough knowledge of the in-and-outs of the franchise agreement was critical to getting this done. If I had done this myself, it would have cost me about $200,000 in franchise-termination fees, and probably another $50,000 if I�d have retained a lawyer and taken the dispute to court. The fee Steve charged me was a flat $3,900 � a special price that he offers to all AAHOA (Asian American Hotel Owners Assn.) members.�
 
For hoteliers, by hoteliers

Belmonte, founder and President of Randolph-based Hospitality Solutions LLC and the former President and C.E.O. of Ramada Franchise Systems, says Hospitality Solutions provides new franchise agreement negotiations, franchise termination and liquidated damage claim negotiations, mediation, expert witness, litigation support, motivational speaking, market studies, feasibility studies, on-site analysis and ownership and development assistance to the hospitality industry.

�Basically, the franchise negotiation services we�re offering never existed before we came along�no one specialized in hammering out solid, equitable agreements either at the front end or the back end,� Belmonte said. �Up until now, you had to do it yourself or hire a lawyer for this kind of negotiation, and the chance that the typical lawyer really knows the ins and outs of hotel franchising agreements is pretty slim. Franchisees need someone who knows the industry and these agreements inside and out.�

In other words, Hospitality Solutions offers a quick, low-cost alternative to litigation in resolving franchise-agreement disputes.

�We can wrap up the typical project in as little as two weeks, and in�it usually takes attorneys that long just to get you on their calendar,� Belmonte said. �Cost-wise, there�s no comparison. Our typical franchise termination project is done for a flat fee of $3,900 and comes with a no-risk guarantee�it usually costs five times to pay an attorney to do this kind of negotiating.�

Belmonte says that franchise-negotiation services are particularly needed in times like the present, when the economy is coming back from the doldrums�and staying competitive sometimes means changing brands in a repositioning strategy.

�Many franchisees are experiencing the kinds of problems Harry Patel was going through with his Ramada Inn,� Belmonte says. �But our franchise-negotiation expertise isn�t limited to Cendant brands � we have done negotiations with every major franchisor in America, and what we bring to the negotiation process can result in a win-win situation all the way around. The franchisee is happy because he�s gotten out of an agreement he wants to be out of, or has been assured that the one we�ve negotiated is fair and solid, and the franchisor is happy because the dispute has been taken care of quickly and equitably.�

�Up until Steve founded Hospitality Solutions LLC a few years ago, there weren�t any negotiation firms for small companies like mine to turn to,� Patel said. �Now that franchisors know that someone in the industry will fight for the small hotel businessman, the franchisors are more open than they ever were to sit down and negotiate.

�Any hotelier who runs into a franchise dispute should get help settling it through negotiation instead of litigation,� Patel added. �Negotiation saves on costs and on time, and when it�s done right, everyone leaves the table happy.�
.

 
.

Steve Belmonte
President/CEO
Hospitality Solutions LLC
Tel: (973) 598-0839
[email protected]
www.stevenbelmonte.com