Impact Studies, Stretching Segments, Short-Stay Rentals, Smoke-free Marriotts,
Franchising in China, Save the Belleview Biltmore Hotel
|By Stanley Turkel, MHS, ISHC, August 2006
1. In June 2006, I wrote that “The study of impact by a new hotel franchise on an existing franchise is an art not a science. The conclusions of impact studies are, therefore, subjective.”
Now, Steve Rushmore, president and founder of HVS International has confirmed my thesis that impact studies “are at best educated guesses. It’s like trying to guess what the Dow Jones Industrial Average will be a year from now.” Rushmore says “… the solution isn’t to try quantifying impact, but rather to head off the problem before it occurs.”
Rushmore proposes the following solutions:
2. Professor Larry Selden (Columbia Business School) and Professor Ian C. MacMillan (Wharton) wrote in the April 2006 Harvard Business Review about the growth gap between insular research and core customer requirements. They suggest a three-step process for closing the gap by understanding what the customer wants and then using the understanding to drive innovation. Here’s my take on how the hotel industry can benefit:
Step One in the process is identifying and developing a better understanding of the core customer. How many more guests could you attract if your hotel featured the following amenities:
For example, for senior citizens, provide specially-trained staff members who understand the needs and wants of the older traveler provide services that appeal to them. The staff must be taught how to communicate with persons with poor hearing or weak eyesight or both. Many mature travelers prefer locations on the low floors near an elevator. Safety and security are concerns, so smoke detectors and floor-located fire exit signs in corridors can be a strong selling point. More than other travelers, older guests prefer designated public areas where they can talk and socialize. Such rooms should generally be separated from the noisy cocktail lounges. (See my “Nobody Asked Me, But… No. 13 Turning Gray Into Gold” www.HotelOnline.com, July 18, 2006).
Step Three is to “stretch” segments, that is find customers beyond the core who can be served with your expertise.
For examples, for the VFR (Visiting Friends & Relatives) market, D. K. Shifflet & Associates has identified a 60 million room-night opportunity. Even in these busy times, only 65% of our guestrooms are occupied. On an average day, therefore, 1.5 million rooms are vacant. If we could capture just 5% of that potential business, it would add millions of dollars of revenue. Many of these leisure travelers want to stay in a hotel for freedom, privacy and comfort but their hosts are the key resistance factor to moving guests to hotels. Therefore, hosts need to get over “the guilt of not inviting them” and “the need to save them some money.” The challenge is to activate a strong industry advertising program (probably humorous) with guilt-reducing messages.
5. Most of us know that Kemmons Wilson started Holiday Inns in 1952 when, on a family vacation, he couldn’t find decent accommodations on the road. Within sixteen years, there were 1000 Holiday Inns built in conjunction with the construction and expansion of the United States interstate highway network under President Dwight Eishenhower.
As I wrote last month, in the next 10 years, China will become the largest in-bound travel destination in the world. It is estimated that there will be 180 million trips in China. Where will all these tourists stay?
If Andrew Cosslett, CEO of the Intercontinental Hotel Group has his way, most of them will be staying at Holiday Inns who built their first hotel in Beijing in 1984. Coslett says that most people in China think that Holiday Inn is a Chinese name, not one that started in the United States.
Since the Chinese are registering 4000 cars a day, building 85000 kilometers of freeway and 47 airports, the need for new hotels is extraordinary.
And since only 10 percent of the “away from home” market in China is branded there is a once-in-a-lifetime opportunity for the major U.S. hotel brands and their franchisees. Is it time to suggest that the Chinese governmental authorities create a model franchise agreement that avoids the one-sidedness of most U.S. franchise contracts? On January 1, 2006, the Vietnamese government passed a new commercial law which for the first time provided a general framework for franchising by defining franchising and requiring registration by prospective franchisors. (see Philip F. Zeidman’s article in Franchise Times August 2006)
6. Save the Belleview Biltmore Hotel: “The White Queen of the Gulf”. The owners of this historic landmark hotel in Bellaire, Florida have applied for a permit to raze all the buildings on this resort property and are planning to demolish seven buildings totaling 440,000 square feet including the removal of resort pools and tennis courts.
The hotel was built in 1897 by Henry Bradley Plant, the prominent railroad, steamboat, express mail and hotel developer (the FedEx/UPS man of his time). The Belleview Hotel at Bellaire opened with 145 rooms, Georgia-pine construction, swiss-style design, golf course and race track. The Belleview became a retreat for the wealthy whose private railroad cars were often parked at the railroad siding built to the south of the hotel. Guests at the Belleview enjoyed the amenities of regal rustic living; yachting and sailing on Clearwater Bay; horseback riding, golfing, tennis, skeet shooting and bicycling.
In 1920, the hotel was acquired by John McEntee Bowman, international sportsman and owner of the Biltmore chain of hotels (Los Angeles, New York, Atlanta, Delaware, Santa Barbara, Havana, Providence).
Since the hotel is listed on the National Register
of Historic Places it would be a tragedy if the owners (Di Bartolo
and Urdang) ignored the one-of-a-kind history and tore down this historic
Belleview Biltmore Hotel Golf, Beach & Spa Resort
25 Belleview Blvd.
Stanley Turkel operates his hotel consulting office as a sole practitioner specializing in franchising issues, asset management and litigation support services. Turkel’s clients are hotel owners and franchisees, investors and lending institutions. Turkel serves on the Board of Advisors and lectures at the NYU Tisch Center for Hospitality, Tourism and Sports Management. He is a member of the prestigious International Society of Hospitality Consultants. His provocative articles on various hotel subjects have been published in the Cornell Quarterly, Lodging Hospitality, Hotel Interactive, Hotel & Motel Management, Lodging, FIU Hospitality Review, AAHOA Lodging Business, Bottomline, New York Times, Wall Street Journal, Travel & Leisure, etc. If you need help with a franchising problem such as encroachment/impact, termination/liquidated damages or litigation support, don’t hesitate to call 917-628-8549 or email firstname.lastname@example.org.
Stanley Turkel, MHS, ISHC
|Also See:||The U.S. Population Age 65 and Over is Expected to Double in the Next 25 Years; What Does this Mean for the Hotel Industry? / Stanley Turkel / July 2006|
|Nobody Asked Me, But… No. 12; Portman, Women Homeowners, Minimum Wage, Tipping, Brooklyn Bridge, Chinese Tourism, Impact Studies / Stanley Turkel / July 2006|
|Do Hotel Franchisees Need Independent / Stanley Turkel / June 2006|
|Nobody Asked Me, But… No. 10 / Chinese Tourists, Gasoline Prices and Alternatives, GLBT Segment, Travel Agents, FAC's, Manhattan's Record Breaking Year, Impertinent Questions / Stanley Turkel / June 2006|
|Nobody Asked Me, But… No. 9 / Blang, Bathtubs, Best Green, Arbitration, Best Western, AAHOA, State Franchising Laws, VFR / Stanley Turkel / May 2006|
|Nobody Asked Me, But… No. 8; Bathtubs, Smokefree Hotels, Maps, Saving Water, Nevada Revenues, H.P. Rama, Ritz-Carlton, Statler Service Code, Mother’s Day / Stanley Turkel / April 2006|
|Nobody Asked Me, But….No. 7 / Stanley Turkel, MHS, ISHC / March 2006|
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