Franchisee Clubs Clash, CHOC Chair Resigns
NAPLES, Fla. — Choice Hotel Owners Council chairman Todd Winkler stepped down on Friday, April 2, after urging his advisory council to resist accepting delegates from an independent franchisee association, the Asian American Hotel Owners Association.
AAHOA is an independent association of some 10,000 hotel owners, whose members largely have ancestors, surnamed Patel, who come from Gujarat, India. It does not report to Choice Hotels or any other franchisor. In contrast, CHOC is an advisory council, a franchise advisory board of over a hundred delegates that advises Choice Hotels on the needs of the chain's franchisees. Choice Hotels requires roughly 6,000 franchisees to pay CHOC membership dues, which are roughly $600 per year, to support the advisory board.
But now there is trouble brewing.
In a March 23 meeting of Choice owners, the franchisee advisory council chair said that AAHOA was trying to change CHOC. Their influence was not appreciated. Winkler spoke candidly to franchisees in the filled room about the upcoming fall election, where even more delegates from the independent hotel association look likely to win seats for the privilege of advising their franchisor on franchisee needs. CHOC delegates also disseminate information from franchisor Choice Hotels to franchisees.
Winkler believes that CHOC leaders should only be elected from the top 80 percent of the most experienced and knowledgeable hoteliers, and drop the bottom 20 percent of hotels who drop the hotel owners in the bottom 20 percent of performance scores from running for office. There is also an accusation that AAHOA members have tampered with the council's elections to boost its representation. CHOC proposes changing its bylaws before the next election so that franchisee candidates will have to own properties for a longer period in order to run. That would swing election results towards old CHOC members and away from the newcomers who largely are coming from AAHOA.
In a video taken at the summit, Winkler is seen arguing, "It [having AAHOA members lead Choice hotel owners] is just like sending your child to school, to college. Do you want to send them to the best college? Do you want them to be taught by the best professors? Or do you want them to be taught by the worst?"
One attendee stood up and disagreed. "I don't care who is on this board or about percentages. I want the people on this board to be the smartest people and the most qualified."
Bina Patel, one of over a hundred elected representatives chosen in an election to advise Choice Hotels International on franchisee concerns, rose at the summit meeting to support Winkler's worries about AAHOA members being foreigners storming the gates of CHOC. She is also a member of AAHOA. "We [members of CHOC] put a lot of time and energy into this [franchise advisory board]. What this [allowing AAHOA members into the council] has done is set us back," the new CHOC delegate declared. To make it clear to all, she expounded on what the problem was: "Choice won't share confidential information because of AAHOA."
Some hotel franchisees wondered how delegates could be identified as representing the Asian American Hotel Owner's Association, other than by skin color. One attendee wrote to Choice's CEO Steve Joyce: "the public humiliation by a representative of CHOC and really your company, and blatant discrimination really makes us Asian American licensees feel threatened and helpless." The licensee went on to write, "I strongly urge you to reconsider the appointment of Mr. Winkler as chairman of CHOC and as a voice of Choice Hotels International."
Winkler stepped down as chair on Friday, April 2. His photo and profile on the CHOC website were replaced Friday, April 9 by Cris Vasquez's, the new chairman.
Tamie Matthews, chief operating officer of the Choice Hotel Owners Association, said about Winkler's abrupt resignation, "He has always put first and foremost his commitment to act in the best interest of the owners, and we believe it was that commitment that drove his decision. Under his leadership, membership increased and the leadership on both a national and regional level became more engaged, diverse and effective. Today we are a much more collaborative and inclusive organization as a result of his leadership."
C.K. Patel, vice-chairman of the Asian American Hotel Owners Association, says, "The Asian American Hotel Owners Association is doing what it is supposed to do, that is, to educate and encourage its members to participate in franchise advisory boards. AAHOA members own some 60 percent of Choice Hotel properties, so our members are fully within their rights and obligations to want to participate in the council. We encourage that level of involvement."
So why the clash between an elected council that advises Choice and independent AAHOA?
Hotel consultant Stan Turkel thinks this is essentially a battle between the old guard and the new. AAHOA franchisees are growing, and encouraging voting. They are a more independent voice that signifies change.
Clearly the AAHOA members, who have started to become active in CHOC, were reaching for more independence," says the hotel consultant. Turkel, author of Great American Hoteliers, expresses what a number of hotel owners have been privately saying to Blue MauMau, that Winkler and the elected advisory board have become rubber stamps for Choice Hotels. "CHOC is not independent. It must kowtow to Choice Hotel's CEO Steve Joyce, or any other future CEO or president of the company," says Turkel.
Turkel says, "Winkler clearly got the message from Steve Joyce: if AAHOA starts pushing CHOC in that direction, we are going to start cutting off support of CHOC."
Not so, chimes in Anne Madison, vice president of communications at Choice Hotels International (NYSE: CHH). "It concerns all of us at Choice a great deal that remarks made at a recent meeting, without Choice representatives in attendance, are being reported, misrepresenting Choice's views and the facts. We take great pride in the relationships that we have built with leaders and organizations within the industry, including our franchise associations and their independently elected franchisee leadership, and groups such as AAHOA and its board. We will continue to cultivate these positive relationships and to call upon various organizations and industry leaders to ensure that we are providing the best possible support to our owners and operators, as well as continually raising the brand and performance standards of hotels in the Choice system."
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