6/11/2012 8:35 AM
As Chairman of the Owners Association, I get to work with a lot of talented people. And I don’t mean just my colleagues on the Board and all our Committee members. My journey as Chairman has taken me to so many places where we have IHG hotels. In every location, our members, from the Americas to Europe and Australasia, tell me a similar story of determination to be more profitable, to create opportunity for growth, to do more than just keep the doors open. We share so many similarities as owners and operators that the regional variations seem minor. This journey has really opened my eyes—and my mind—to the true global reach of our Association.
This reach was highlighted recently when we had the opportunity to feature a panel of global Committee participants at our recent Joint Committee Meetings at the Crowne Plaza in Phoenix, Arizona.
I’d like to thank those who participated in the panels (I’ve listed all their names below) and share some of their insights with you. You can also spend some time with a video we produced from the second session to give you an idea of the scope of the presentation. View the video here. But here’s my wrap up in four sound bites:
What can we do about rate? “It’s all about revenue management, day in and day out. Offering tools to the whole estate is helpful, but we must be on it all the time.” This statement came from Patrick de Peuter, Vice Chairman of the European Board and Chair of the European IT Sub-Committee, and highlights what many on the panel and at the meetings said. We have tools available to help us manage and to improve our revenue position, but we must dedicate the time to learning them and to using them daily. You can find helpful tips from Lara Hernandez, Vice President, Distribution & Relationship Marketing Americas, here.
“Commissions have skyrocketed over the years,” noted Nik Gupta, who serves on the Global Revenue Performance Committee and serves on the European Sales & Marketing Sub-Committee. “I remember 2002 cost of sale was around 12.2%, and by 2010 we are at 14%. We are failing to contain cost of sale.” And he was not alone in expressing concerns over cost. Jeff Krivoshen, Vice Chair of the Canada Committee, noted that minimum wage “was approaching $11 an hour in Canada with no concern for the economic downturn.” And Martin Quinn, who serves on the Global Crowne Plaza Committee and European Board, urged the Association “to put positive pressure on IHG to spend wisely.” I agree, and so as an Association, we are looking to find ways to work with IHG to lower costs where possible and to make more resources available without additional fees. This is a top priority for the Association’s officers.
“A tale of two countries.” Panelists from Canada, United Kingdom, and Mexico all agreed that recovery was not a country-wide phenomenon. In Mexico, Gerardo Garrido, vice chairman of the Mexico Committee, noted that the construction of auto plants in the central region should promote positive growth but security fears continue to impact resort areas. In the U.K., the Olympics will create rate strength in London, but then “there’s everywhere else,” noted John Wagner, who serves on the Global Staybridge Suites Committee and European Standards Sub-Committee. And in Canada, “the Western side is a lot different than central Canada, which has a lot of companies tied to manufacturing, which is still being affected by the U.S. downturn,” noted Jeff Krivoshen. We hear loudly and clearly that many of you are just hanging on, hoping for a quicker recovery, and we’re taking that message to our IHG partners.
And finally, I’ll share my favorite one: “Inspire us to do better. The only way to go is up.” I think that came from Nik Gupta, and I think what he says is important for me to remember. My role, as I see it, is to make sure that we focus on those areas that are going to make a difference and to get us aligned so we are effective in our discussions with our partners at IHG. Our Committees do an amazing job of working through the details on standards, programs and tools, and I have great confidence in their abilities to serve us all. My role, then, is to lead our Officers to work with IHG’s senior leaders to be the guiding force that moves us toward better asset value, more profitability, and lower costs. We do that by participating in the important discussions that we need to have, on topics that matter, like how do we best use system funds to promote growth for existing hotels, how do support new hotel development that honors existing relationships and truly measures impact, and how do we create standards for things that really matter to our guests and empower our general managers to create memorable guest experiences. I think I speak for all the Association’s leaders when I say that our role is to make sure that we make a difference and lead each of you to the best hotel ownership experience in the industry, one that is profitable, professional, and long-lived. Tell me, in your opinion, what is the one thing that you believe the Association should be taking the lead on?
Patrick De Peuter, Prem Hotels NV
Lilian Flores, Holiday Inn Queretaro Centro Historico
Nikhil Gupta, BDL Management Ltd
Walther Lauffer, Crowne Plaza Fredericton
Gerardo Garrido, Holiday Inn Trade Center
Jeff Krivoshen, P.R. Hotels Ltd.
Martin Quinn, Westmont Hospitality
Joost Serrarens, Westbridge Europe
John Wagner, Cycas Hospitality
1 comment(s) so far...
By Ken Edwards on
6/11/2012 11:52 AM
Re: Around the World in Phoenix
Tips from www.HMonline.com. Other areas which can help the Owner with rate:
1. Evaluate your hotel reservation taking process. If you are using the Brands reservation program- as the owner-test call it 5-6 times and evaluate if they are doing a good job. If they are not, look at two outside companies for additional training: Signature Worlwide and Contact Points.
2. If you are not using Revenue Management for Hire (RMH), call your IHG area manager and ask for a test trial for 3 months and see if it is a good program for you.
3. Tell IHG that Last Room Availability (LRA) at the Key Account level should be used to provide higher rates for your hotels.
4. At the property level is your GM and sales staff having a "weekly" sales meeting-reviewing release dates, group rates and length of the group blocks.
5. Does the Owner & the GM review your Accounts Receivables (A/R), every week-if the money sits in your bank account and not in the A/R you can have more money to operate your hotel.