Why Thousands of Hotel Franchisees Are Fleeing

By Patrick Mullinix

When conversing with large numbers of hotel owners weekly and reading the social media forums, I hear the same rhetoric: Franchisees are tired, dissatisfied with the lack of service and response, and have had enough of their current affiliation.

The writing has been on the wall for a few years. Now, dissatisfied franchise owners are waking up to the truth of how much or little their brands contribute to the success of their businesses compared to the high cost in which they pay to them monthly.

The dissatisfaction trend is evident by hotel franchise companies losing franchisees. One hotel franchise company reported a loss of more than 250 of its properties in 2019, even before the COVID-19 pandemic hit the travel sector in February.

Once the pandemic hit, it shut down the reservation system for every brand in the U.S. It unveiled a realization that brands don’t provide much support. Now, as hotel owners scramble to recover and find the lost revenue and profitability, they are choosing to separate and part ways with their current franchise brands in efforts to save their businesses as they fight for survival.

It’s time to go back to the future. We need to return to the golden age long since passed, where being part of a brand gave owners a sense of genuine pride and belonging within a corporate family; where owners could be successful by receiving the help and assistance provided from people who cared about their business’ success.

As I speak with many owners, one theme remains constant: Franchisees are fleeing their brands as partnerships and relationships are dimensioning and top-line revenue and stock price has become the focal point for the franchisor. They are tired of guest loyalty programs that benefit only the franchisor’s net bottom line. They are angry at the franchisor’s need to make a profit from every third party they do business with. They are “mad as hell and not taking it anymore.”

I believe during the long recovery of the travel industry, we are going to see hundreds, if not possibly thousands, of hotel owners making a change in their brand to regain their lost business income. They will be making the change not only because of their dissatisfaction but, more importantly, their need for financial survival.

Patrick Mullinix is president/CEO of Advantage Hotels, which franchises the Select Inn and Vista brands, as well as offers the VistaRez Independent Collection, a suite of services for any non-affiliated property.

This is a contributed piece to Hotel Business, authored by an industry professional. The thoughts expressed are the perspective of the bylined individual.