HB On The Scene: Country Hearth Inn Looks To Grow Chain, Brand Awareness

ATLANTA— Does size matter in a hotel chain? That was the question posed Monday to attendees here at the 2003 Country Hearth Inn Conference by Douglas Collins, chairman/president/CEO of parent Buckhead America Corp., who sees the largely regional chain ready to advance and expand beyond suburban, secondary and tertiary markets in current core states, with long-term goals envisioning CHI product in urban settings in key markets. “We’re poised to go forward. We have a solid base of high-quality properties that we can build upon,” Collins told HOTEL BUSINESS®. “I think our chain has a bright future and we’re right on the cusp of it; we’re ready for the rebound.” Toward that, HOTEL BUSINESS® learned the limited-service brand will make a foray into Florida via HI Development of Tampa, which has committed to a master development agreement with CHI to bring 20 properties to the Sunshine State “ASAP.” The brand previously had a presence in Orlando; however, the property was sold and torn down to make way for the city’s convention center. Since officially launching as a franchise brand in 1996, Country Hearth Inns— centered around a bed and breakfast concept that imbues a residential feel— has grown more than tenfold from a five-property base out of Ohio to 52 properties at presstime. Some 100 representatives of those properties— franchisees, owners, general managers, along with perspective franchisees, vendors and business partners are in attendance at the conference, themed: “One Brand, One Vision, One Team.” Collins noted chain-size importance could be interpreted from different perspectives. “Many smaller chains run higher occupancy rates than larger chains,” he said. Collins added there are 10 properties under development with signed agreements and two are under construction in Alabama and North Carolina by existing CHI developers “We would all benefit by adding more high-quality locations to our chain. I’m very gratified at the number of franchisees that own more than one Country Hearth Inn or have referred prospective franchisees to our chain. Our best source of new properties will always be our existing franchisees,” he said. The company itself already owns three CHIs; however, Collins expects that paradigm to shift: “In the future we’ll probably be a pure franchisor.” Toward that, CHI has hired Roman Aluisy as director/franchise development, to help the push in that direction. During the morning session, Collins also presented a “Lifetime Achievement” award to Victor Baker, the first CHI franchisee who opened his 73-room property in 1987 in Jackson, MI. Senior VP/Regional Marketing, Richard “Rick” Welch said the success of building the brand “has to come from making the franchisees be ambassadors of that brand.” Welch delivered an overview of industry performance and noted how product has been compacted by the trickle down of discounting, offering a tangible example to attendees. “There’s going to be pressure on room rates; room rates are going to continue to stay low. The higher-level chains are competing in our rate range. A perfect example is where we are here today, paying $79 in a Crowne Plaza [for a conference-rate room]. One mile down the street is a Holiday Inn Express; the rack rate for a double room is $79.” He added there would continue to be downward pressure on ADR, stating: “Never before has there ever been comparison shopping in the 30 years I’ve been in the hotel business as there is today.” Welch said CHI would implement a regional plan whereby the company would research and complete a sales marketing plan on a site-specific basis for the properties. The chain’s guest loyalty program— The Country Club— also is getting a push. “We see it as a very important part of local marketing; we can increase our business, hotels can market to the guests other promotional opportunities. It gives [the franchisee]an opportunity to band to a program that we’ll be advertising nationally,” Welsh told attendees.