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CLEVELAND, Ohio - Roger Bloss, CEO, president and founder of Vantage Hospitality Group, discusses the need for franchisors to have their franchisees elect members of their advisory councils, and says that franchisees should regularly grade the performance of their franchise chain.
Bloss answers a question from Blue MauMau about the problems of a traditional franchise advisory council, which has members appointed by the franchisor to represent franchisees in advising on brand initiatives. Most franchise systems provide this type of advisory council. The CEO also discusses the importance of creating preferred vendor programs that are not major profit centers for franchisors at the expense of franchisees.
It becomes apparent when speaking with the founder of the Vantage Hospitality Group, which includes over 900 Americas Best Value Inn budget hotels and the Lexington Collection of high-end four-star hotels, that he heads one of the most innovative firms in franchising. The focus on giving hotel owners a fair shake has contributed to the company's rapid growth. During the 2009 recession in which its competitors have contracted in number of franchise units, according to the International Franchise Association, Vantage Hospitality has grown by over 12 percent, earning it a place on Inc. Magazine's 500/5000 list of the fastest growing private companies for four consecutive years.
Roger Bloss: Maintaining open relationships with our members is the cornerstone of Vantage’s philosophy — it’s a hotel company run by hotel owners. Input and involvement from members is not only encouraged, it is expected.
Both of Vantage’s brands are overseen by a member-led advisory board and advertising council, which meet several times throughout the year to discuss and approve expenditures and opportunities. Vantage is the only large hotel company that does not compensate its Board and Council members. These elected members are required to travel, at their own expense, to the annual December conference in Las Vegas and a Spring Board Conference in Coral Springs, FL. They also must be available for phone conferences and any other incidental travel that may occur during the year.
I don’t want these elected members to feel indebted to me or my staff because Vantage paid for their conference expenses. I want them to tell me what I need to know — not what I want to hear. And they can only do that by representing the members in their regions without any outside influence.
During the December conference, both brands present voting topics that are discussed openly within the respective membership and require a minimum 66 percent approval before passing. Administrators and staff are not allowed to vote and must abide by the membership’s final decision.
Even an increase in fees must be approved by a majority. This is a first in the industry and something no other hotel chain has ever attempted. Our members are first and foremost business owners. They know how much money they bring in and how much they can afford to spend. If I can’t trust them to do what’s right for their business and our brand, who can I trust?
Vantage is also the only hotel company to ask their hotel owners to complete a yearly “report card” on how well they believe Vantage is performing. Just like a student in school, if a member gives Vantage a poor rating, an action plan will be immediately implemented to make the necessary improvements, help the property reach its goals, and ensure a positive and open relationship between the member and corporate staff.
We are a results-driven company and if a member doesn’t think he or she is getting the proper results, I want to know about it. Hotels are multi-million dollar assets. Owners expect the profit from owning a hotel to put food on their families’ tables and send their children to college. Vantage has a direct responsibility to provide our members with the necessary resources to meet their financial goals.
Our Preferred Vendor program is not a profit center for Vantage, as it is for other hotel brands, yet it continues to grow and remain a win-win situation for the vendors and our members. We are not out to profit from every vendor and hotel owner with hidden fees and agendas. Our goal is not to have the highest profit margin in the hotel industry. Instead, we continue to reinvest in our people and technology so that we can bring our owners the most comprehensive resources to increase their ROI.
Vantage offers its members the most comprehensive resources in the industry. With 27 worldwide divisional offices, two reservations systems, and over 100 employees available to its members, Vantage has the highest ratio of corporate service team support to members in the industry.
In other words, Vantage has literally set the benchmark for excellent franchise relationships.