AAHOA Needs To Back Off Brand Execs During Annual Event
Tuesday June 12th, 2012 - 11:46AM
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Last month, I had the privilege of going down to Atlanta and attending the annual Asian American Hotel Owner’s Association (AAHOA) conference, an event which included everything from a lively trade show to a question and answer session with former U.S. President George W. Bush.
There are few greater success stories in the lodging industry than AAHOA, which in some 20 years has grown its membership to 11,000 strong and car- ries more clout than many hotel executives care to admit. And no group has been more vigilant about standing up for the rights of franchisees against the big brands.
However, in my opinion, the group often takes it too far and there’s no better example than the Industry Issues panel during the conference. The panel, which was moderated by franchise attorney Robert Zarco, featured a number of brand executives,including Choice’s Steve Joyce, Wyndham’s Eric Danziger, Hilton’s Bill Fortier, Marri- ott’s Liam Brown, Bob Morse of IHG and David Kong of Best Western.
But these execs represented little more than lambs on their way to the slaughter. As if the line of questioning wasn’t enough as Zarco flatly asked the group “what they could do for franchisees who run out of funds for improvements” and why they
need to impose such “unnecessary” upgrades, the tone of the session was flat-out hostile. Zarco seemed determined to whip the membership into a frenzy with each question, which resulted in cheers during the questions and booing and catcalling during many of the responses.
From my perspective, this is not how you gain credibility as an organization. If this was a one-time thing, I might give AAHOA a pass, but the same thing occurred at last year’s event in Chicago. I’m not here to hold a pity party for the brands, all of these execs have faced tough questions before and they’ve handled themselves capably. But what does this do to the relationship between franchisees and franchisors, the industry’s two most important groups? There was a time when the franchisors seemed to turn a blind eye to the franchisees but, by all accounts, that is no longer the case. More often than not, we hear that franchisors have been lenient on brand standards and are trying to work with owners. Not to mention, as several executives stated during the panel, it’s often other owners who are compliant that urge the brands the loudest to come down on those not in compliance. After all, the value of the brand, and their re- spective assets, ultimately depends on it.
As a group, AAHOA has made consid- erable progress with gaining a louder voice on Capitol Hill and affecting real change, but the group has higher aspirations. With that in mind, any political leaders who witnessed the “ambush” on the brand executives might not be inclined to take this group as seriously.
Franchisees may not be satisfied with the returns they’re getting on their investment these days, but that’s not necessarily the fault of the brands. The fact of the matter is it’s a tough time for any business to thrive.
I’m not saying the brands are beyond reproach. But let’s be honest: Any meaningful dialogue with the brands isn’t likely to take place in a public forum. AAHOA's leadership needs to find a way to make the brands accountable but do it more constructively and, ultimately, that could help take the association and entire lodging industry to another level.
The most recent NYU Conference, earlier this month proved, once and for all, that the lodging industry has finally turned the corner and happy days are, indeed, here again. While the economists and pundits all provided plenty of anecdotal evidence to bear that out in terms of supply and demand ratios, RevPAR projections, asset values and all the other metrics, that’s not what has me convinced.