Why Hotels Fail

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Hotels Fail For Many Reasons

Hotels do not fail on their own. The owner of a property is not only responsible for failures but also the franchise itself. Have you noticed that your area of protection does not always protect you? This is evident when your franchisor places one of their “sister brands” in close proximity to your property cutting into your market share. Below are a few more reasons hotels Fail:

      Underestimating the difficulty of establishing a new hotel business

      Hotel Owners who do not read the fine print relating to ALL the fees they have to pay each month - Then Shock sinks in.

      Paying all the high franchise fees that do not give a good return on your investment

      Being forced by your franchisor to use preferred vendor products and services that you can get at a lower cost elsewhere

      Ownership has No practical hotel experience

      The hotel doesn't have “that thing" that makes it special - No uniqueness

      Limited knowledge of sales & marketing

      Unprepared for off-season

      They underestimate their competition

      Community disconnect - No manager presence

      Lack of accountability and urgency

      Absentee owners, with passive onsite managers & staff

      Unmotivated employees, asleep at the wheel

      Ownership negating all the profits and not reinvesting in renovations when needed

      Pushed out of  the market of best to second-best by a new or renovated hotel

      Menus that are not comparable to others nearby

      Employee theft - of cash or inventory

      Dye the carpet and raise the rates mentality

      Consistently comping rooms rather than addressing service issues

      Owner and franchise have different goals

      Ownership stuck in a 15- 20 year franchise agreement - with a 5 year exit plan

      Dated rooms and common areas

      Safety and health issues ignored    

      Free Continental Breakfast - fit for a wedding reception

      Franchise PIPs based on sheep mentality of "monkey see - monkey must copy"

 

Enjoy Independence - On Your Own Terms