Radisson Hotels & Resorts today announced a landmark “New Deal” for its franchise business, featuring a franchisee-friendly agreement with flexible new benefits, a simplified and streamlined new fee structure, and for those paying full fees, the opportunity to leave the system without penalty.
The “New Deal” is franchising is a key component of a broad-reaching new vision and strategy for Radisson Hotels & Resorts which was announced here this week at the company`s Annual Business Conference.
“The new business environment and consolidating hotel industry has changed the playing field with the franchising community, and led us to re-examine all aspects of the way we do business,” said Jay S. Witzel, president and chief operating officer of Radisson Hotels & Resorts. “Franchising has been at the heart of Radisson`s rapid growth for more than a decade,” he added. “As we developed our new business model and key operating strategies, we evaluated our franchise program and saw there is a genuine need in the marketplace for a new type of agreement that better serves the needs of today`s hotel owners and operators.”
Witzel explained that Radisson has developed a new Uniform Franchise Offering Circular (UFOC) for the brand in the United States that features a streamlined, simplified fee structure and added flexibility.
Radisson`s New Deal at full fees offers franchisees the opportunity to control their own destiny with the flexibility to leave the system at any time without penalty. According to Witzel, this is ideal for those franchisees or financial institutions that invest in a hotel asset, enhance a hotel`s value and then want to harvest that value in a shorter time-frame. Current franchisees will also be invited to convert their agreement into one with simpler, streamlined fees and easier administration. Industry and franchising experts have commented favorably on the new Radisson concept.
“At a time when many of the hotel industry`s leading players are cutting back their franchise development efforts, Radisson is focusing harder on its franchise relationship,” said Stephen Rushmore, president and founder of HVS International. “Radisson has essentially provided a satisfaction guarantee for all its franchisees.”
“Radisson`s new agreement is cutting-edge and helps level the playing field for a win-win,” said Brian Schnell, co-chair of the franchise practice group at Gray Plant Mooty and vice-chair of the International Franchise Association`s Supplier Forum Advisory Board, which he will chair next year. “The UFOC offers an easy to understand fee structure, and a `free-out` option with no strings attached for those who want to be able to quickly convert their real estate asset.”
The new agreement provides a platform for key components of the new vision for Radisson Hotels & Resorts which states that Radisson will be a global company distinguished by:
* Great Places in Great Places (having the right hotels in the right markets, balancing its portfolio of high quality franchise operations with more owned and managed hotels)
* A recognized and trusted brand
* Valuable relationships with guests it serves
* Superior financial returns for owners and investors
Other key changes benefiting Radisson hotel owners include a new regional “cluster marketing” process for North America that will enable the brand to quickly implement national marketing initiatives at a regional level to help drive more revenue to the property-level. Radisson will utilize the new regional structure, to invite all Radisson hotels in the United States, Mexico and the Caribbean to meet twice a year with their Regional Vice Presidents of Operations. These sessions will focus on building operational excellence and include a discussion of significant operating issues, education, training, and information and idea exchange.
Radisson is also in the process of establishing a board of advisors that will address key business issues, and best practices in the areas of sales and marketing, operations and technology, and include outside industry and business experts.
We are confident that our new UFOC and franchise agreement are on target with the needs of today`s business environment and will change the franchise business model for our industry,” said Witzel. “We are fully committed to franchising that makes good business sense for participants and we are seeking high quality franchise owners who share our values and vision to create a consistent guest experience, building long-term guest loyalty and attracting new customers to the brand.”