Filter by topic:

Become a MasterBUILT insider

October 31, 2022
  • Investment & Partnership
  • Owner & Investor Experience

The Advantages of Outsourcing Hotel Management to Your Franchise Partner

There is a common misconception that if you’re outsourcing work you could be doing internally, you’re simply taking money out of your own pocket.

The truth is, in any business, you need to play to your strengths. This is particularly relevant in the hotel industry, where expertise and efficiency are among your greatest assets.

Many hotel brands offer hotel management as part of their turnkey solution. Outsourcing hotel management to your franchise partner has numerous built-in advantages that can not only make your job easier – but also make your property more profitable.

Advantage #1: Experience and Expertise in Key Roles

When we’re talking about outsourcing hotel management, we’re referring to the key behind-the-scenes services that have a direct impact on your ability to fill rooms and maximize RevPAR.

This includes positions such as the Director of Operations, Sales Director, Revenue Manager and Marketing Manager. By outsourcing this expertise to professional hoteliers, you’re investing in knowledge.

Your management partner understands the ebbs and flows of seasonal markets. They are skilled at setting and adjusting rates, guided by key performance metrics. They have well-defined strategies for attracting business and leisure travellers. And, they can leverage the in-depth knowledge of the competition to help you find your sweet spot.

Plus, they draw on the experience they’ve gained operating numerous properties on behalf of franchisees just like you. It’s not their first rodeo, which ultimately allows their team to be faster, more efficient, and more effective in achieving desired results.

Advantage #2: Filling key roles with qualified people

These senior positions can be difficult to fill in most Canadian markets (especially outside of large cities or destinations). They require experience, education, training and an in-depth understanding of the hotel and hospitality industry. Unfortunately, qualified candidates don’t just grow on trees!

Hotel management companies are typically based in major metropolitan areas, where there is a larger pool of qualified candidates to draw from. Let your franchise partner focus on finding the best and brightest.

Advantage #3: Brand Familiarity

No one knows the intricacies, nuances, obligations, and inside-outs of your brand like your franchise partner. When the brand’s proven practices and tried-and-true formulas are followed, the property tends to run like a well-oiled machine. In this way, they support your general manager by helping to ensure brand standards are followed and opportunities aren’t missed.

If your franchise partner also offers asset management services, this extends to timely maintenance that can help extend the life of your property and save you from expensive repairs down the road. Following the brand’s renovation recommendations and schedule ensures your hotel is always current, contemporary, and compelling to customers.

Advantage #4: HR Efficiencies

By outsourcing hotel management, you are reducing your human resources requirements. You only need to manage the housekeeping, front desk, maintenance, and general manager on site. Your management team looks after the rest. This can save you significant costs around hiring, relocation, training and dismissals.

As a bonus, you don’t have to carry these management-level salaries, as they are included in your monthly management fee. This helps increase profit margins while giving you a leg-up on the hotel across the street that’s paying these salaries!

Advantage #5: Relationships & Buying Power

As your hotel management company, your franchise partner often brings the strength of their relationships to your property. They can often leverage their buying power across several hotels to save you money on a variety of services and supplies central to your operations.

Taking the work and worry off your plate

Hotel management requires commitment and dedication. Often owners are unable to dedicate the time and hands-on attention required. Many times, there is a desire to take a more hands-off role by franchises owners.

Whatever your motivation, outsourcing to a professional who knows your brand and understands your objectives will help you sleep as calmly and peacefully as your guests – knowing your property is in good hands.

Considering a hotel for your development property

questions for hotel investor