on . Also , consider the capital cost associated with the affiliation . Brand standards benefit the brand consistency but may over-capitalize assets for certain markets . Just as importantly , consider resources no longer needed if an affiliation is in place . Often the hotel leaves resources in place and ends up competing with the affiliation which is a total waste . In my experience , generally the higher end the hotel , the more revenue is generated by the asset than any affiliations . Always start with “ I don ’ t need an affiliation ” before considering any affiliation .
Generating EBITDA is just as important if not more important than financing the EBITDA . I have seen many investors spend a great deal of time on financing a project and far less time on driving the earnings to support the investment thesis . Capital is critical in hotel investment and so is the return of capital and its financial returns . In addition to an investment plan , a hotel investment needs :
• Marketing Plan - who are the targeted customer segments and how to communicate with them
• Sales Plan – how to work with critical intermediaries in selling to the end-users
• Distribution Plan – how will the hotel offerings be visible to the target audiences
• Operations Plan – how many resources are necessary to execute the service strategy and brand building / compliance .
All the plans have to be in alignment or risk inefficiencies and ineffectiveness . Brand affiliation is an important part of these plans but only one part .
A sidebar on the luxury segment . A luxury hotel has an advantage in building its own individual brand over the other segments . Luxury hotels are often the site of well-publicized business , political and social events . Celebrities are often seen at luxury hotels . Luxury hotels are often used as background in movies and TV programs . Their architecture and designs are often recognized by publications . This is a huge advantage and often low-cost publicity .
Should a hotel be “ branded or unbranded ”? The answer is similar to responding to the question “ should I manage my own investment or hire a money manager ?”, it depends .
About the author I have had a wonderful 30 + year career in the global hospitality industry in North America , Hawaii , and Asia Pacific driving unit and company growth with some of the most prominent brands in the world . I have been engaged in revitalizing business units and creating new organizations to generate greater enterprise value through organizational alignment , development and execution of revenue and unit growth strategies , restructure resources , and improve operating efficiency . I have taken part in the development of many landmark hotel projects . I have guided companies through crisis and survived to see better markets . I have achieved many successes as well as learned many difficult lessons through failures . I have enjoyed the business relationships I have developed with many hotel owners , business partners , and colleagues . I am equally proud to have contributed to the careers of the people I have led .
I am especially excited about the opportunity to lead The Leading Hotels of the World . The unique ownership structure , global scale , and truly world class properties attracted me to this . What I am most energized is to create the right future business model for this 85-year old institution . This is also a great opportunity for me to work closer with European businesses .
Specialties : Hospitality Industry Business Strategies , Operations , Organizational Development , Development , Brand Marketing , Sales and Distribution , Financial Management , Investments , Management Contracts , Joint Ventures , and Asset Management in North America and Asia Pacific .
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