BIRMINGHAM, AL—Vimana Franchise Systems, LLC, is hopping on the “new year, new me” bandwagon by introducing new support services to its franchisees and launching a new product for independent hoteliers who want to reap the benefits of a soft brand.
“By far, it’s the biggest thing we’ve ever done with the brand,” explained Steve Belmonte, the company’s CEO, speaking about the franchise company’s enhancements to its support infrastructure. “We took a look at all the different brands out there—at memberships, franchises, etc.,—and we really, really worked very hard to put a model together that we think probably represents the most value in hotel franchising.”
To make this happen, Belmonte and his two partners—Neal Jackson and Cory Jackson Jr.—reinvested a “significant amount of money,” the CEO told Hotel Business. The financial terms of the investment were not publicly disclosed.
Vimana provides the following new support services: a central reservation system (called Constellation CRS), a revenue management program and a loyalty club program, which won’t include a separate fee or a charge, Belmonte noted.
Also included in Vimana’s fee are a cloud-based PMS; OTA agreements; a worldwide sales department; a purchasing network; a dedicated account manager; free Vimana University online training (powered by HMBookstore); a custom-built vanity website; consumer marketing and metasite listings; and a technology consultant.
“Our consumer marketing is not only marketing the brand as a whole, but we’re marketing each and every property separately,” said Amanda Belmonte, VP of Franchise Services.
New partnerships formed in 2016 to help drive technology and consultative services are available to franchisees in 2017, including IBC (InnDependent Boutique Collection), which will offer members direct access to channel management and booking technology via the IBC Marketplace; Room Results, which powers the franchise company’s new revenue management program; Infomedia, the company behind Vimana’s new website; and Source1 Purchasing, a national purchasing services organization.
“What is helping to make Vimana so great in 2017 is our many new partners who are driving the technology and providing consultative services to our members,” she said.
Vimana also made additional hires. The company brought on Tim Pigsley, former VP of marketing at Ramada, to serve as the Vimana technology advisor. The company also added Stephanie Pohubka as franchise lead generator. She will focus her efforts on adding properties to Vimana’s brands. Furthermore, Vimana hired an outside firm to lead marketing efforts on a national and property level.
Upgrades to Vimana’s franchise model don’t come without an additional cost to the franchisee, although the company isn’t too concerned about the 1% fee increase (which raises the combined marketing and loyalty fee charged to franchisees from 3% to 4%).
“Nobody has a problem with paying the extra one point,” Steve Belmonte explained, adding Vimana’s new package “represents extraordinary value for its franchisees.”
Vimana also cut a very advantageous agreement with Expedia, according to Belmonte, who explained the franchise company’s deal with the publicly traded OTA actually saves some of Vimana’s properties “much more than they’re paying us in franchise fees.”
Said the CEO, “We’re keeping the fees very, very low because we launched this company on a firm foundation that we were going to be one of the more affordable and franchise-friendly companies, and we continue to do that with our fee structure, with our contracts and deal terms. If they need rolling windows, we’re happy to accommodate them. We don’t have the same rulebook for Burlington, IA, that we do in Manhattan, which, unfortunately, some of the brands do.”
Vimana’s new independent collection, simply coined Independent Collection by Vimana, attempts to provide independent hotels with extra layers of support while also ensuring familiarity to travelers “who feel some affiliation membership gives them a comfort level,” said Steve Belmonte.
“The franchise industry is changing dramatically,” he continued. “Soft brands seem to be gaining momentum and are desired by hotel owners more for a multitude of reasons.”
Independent properties looking to keep their independent name and feel can do so under the company’s new product. Vimana will provide these properties with the same support infrastructure being offered to Centerstone and Key West properties.
Vimana doesn’t want cookie-cutter hotels in this product’s property portfolio. “We want the properties in the independent collection to have that boutique flair, to have that independence,” Steve Belmonte stressed. “We want them each to be a different experience.” What the company does hone in on for each of its properties is quality, he added.
As of print time, none of Vimana’s current franchisees have expressed interest in going independent under the new brand; however, to be fair, the franchise company hasn’t promoted much of the new product yet to its existing hotel owners. If, after Independent Collections by Vimana is fully marketed, there are licensees hoping to make the switch to the new brand, Vimana’s response, said the CEO, will be straightforward: “We don’t care.”
“We just assume give the customer what the customer wants,” he noted. “As long as we can integrate them and fill their beds—that’s all we care about. We just want to drive business to the property.”
The growth of Vimana’s independent portfolio is expected to be a significant one, said the CEO, who noted, “There’s a lot of long-term life to the company’s new brand. It just seems more and more properties are looking at that option, and the technology today really provides them that option; it’s a viable option, whereas 10 years ago—not so much.”
While the company cannot disclose the number of prospective properties projected to fall under its new product in the next year, it’s currently working hand-in-hand with an entity, which may allow [them]to integrate a multitude of independents in one sweep, the executive disclosed.
Even with the launch of its new product, Vimana believes its future is with Centerstone. “We think that Centerstone will ultimately be the fastest growing aspect of all the brands in our company,” Steve Belmonte said. In fact, the company is forecasting the majority of its independent properties (nearly 99% of them) will be of Centerstone quality.
“We have gone through great lengths to keep the Centerstone brand very clean,” he said. “We don’t have a bad Centerstone.” Part of the reason why Belmonte believes Centerstone properties have done very well is Vimana rejects more applications for the brand’s properties than it approves. “I firmly believe to start integrating substandard properties at this juncture of our lifespan would be the kiss of death,” he said.
Sometimes the hotel’s owner doesn’t have the product or the financial wherewithal to upgrade, said Steve Belmonte. There’s an alternative for properties falling under those conditions: Key West, the company’s economy brand, which has “grown very nicely to 26 hotels,” he said.
Vimana expects to announce six new Centerstone properties within the next four months and five Key West properties in the next six months. The properties will open in seven different states across the country: Colorado, Wyoming, Pennsylvania, Oklahoma, Florida, Georgia and Indiana.
“It’s really a completely different company,” Steve Belmonte noted. “We just have so much to look forward to in 2017.”