THE PEOPLE ISSUE journey they ’ re on when they are staying in our hotels ,” Cruse says .
They can also pay what they think is the right price . SCP offers Fair Trade Pricing , with guests deciding the rate at checkout based on their experience . There are guidelines — a market-based price is suggested when guests book , which sets an expectation . And very few guests — less than 1 % — have actually taken advantage of the flexibility , Cruse says . When they do pay less , it gives the hotels an opportunity to ask how they can improve .
GEARING UP FOR GROWTH As the brand expands into new locations , Cruse says secondary and tertiary locations with some technology or emerging business presence will be likely targets . The rapidly swelling ranks of digital nomads generated by COVID-19 will also determine sites . What are those travelers seeking ? Cruse says coworking facilities , a focus on fitness and a vibe tied to the local community all hit the right notes ; great natural resources , a good comfort index and vibrant local arts might seal the deal for someone to spend weeks or months rather than days at an SCP property .
A strategic investment announced at the end of 2020 will provide up to US $ 210 million to finance SCP ’ s growth . That investment will fuel up to US $ 500 million in acquisitions in the near term , and the goal is to add 25 more properties over the next 12 to 18 months . In conjunction with the investment , SCP formed SCP Hospitality , an integrated brand , management company and owner .
Cruse says brands have grown inefficient and often create a conflict of interest for owners . “ We like the idea of owning all three pieces of the puzzle ,” he says . “ It gives us more efficiency and we can make wide changes easily .” In the current economy , he argues , adaptability is essential .
Despite the negative pressure COVID-19 has placed on hotels , pandemic-generated creative destruction is likely to create an opening for SCP with existing owners . “ Everyone is reexamining their strategies , which gives us an opportunity to get in front of people ,” he says . “ We can provide helpful capital , reposition their brands and create a positive outcome for owners who are facing challenging situations with lenders and staff , and [ who are ] without a clear answer to how they ’ re going to survive ,” Cruse says .
Direct real estate acquisition , partnership or management are all on the table , but franchising is not . “ We ’ re not in a position to franchise only because culture is such an important part of our business ,” Cruse notes . He is also wary of expanding too quickly and losing sight of the culture — a misstep other disruptive concepts have made . For SCP , “ being maniacally focused on culture is a huge piece ,” he says . Reinforcing that philosophy , 45 minutes of the company ’ s Monday morning meetings focus on a single page in SCP ’ s “ culture book ,” which defines the brand .
“ We will continue to be maniacal about our culture ,” he adds . “ It might mean slower growth , but in the end it ’ s the tortoise and the hare .”
Cruse , formerly chief executive officer at Sunstone Hotel Investors and a veteran of Host Marriott , says SCP has forced him to think about the business differently . “ For the first part of our careers , we were deal guys : How do you get money out of that guy ’ s pocket into mine ?” he observes . Now , profit is not the be all . “ The brand exists to make the world around us a better place ,” Cruse says . “ We are creating a virtuous cycle in support of the business .”
That ’ s not to say profits don ’ t matter — they do . Cruse says Soul Community Planet is the culmination of his career in hospitality and because of that , he feels great pressure to ensure it succeeds . “ We ’ ve already achieved more than we could have foreseen ,” he says , “ and we will continue to grow in the right way , not forgetting our culture .”
WE WILL CONTINUE TO BE MANIACAL ABOUT OUR CULTURE .
KEN CRUSE
46 hotelsmag . com March / April 2021