HB ON THE SCENE: Knights Inn Streamlines Franchise Process

ORLANDO–Knights Inn used its owners and general managers conference here today to introduce its new simplified franchise agreement. The streamlined format is intended to appeal to a broader base of potential franchisees, particularly those new to the lodging industry, who may be put off by the traditionally lengthy document. “A typical agreement can be quite intimidating to someone new to the process,” said brand senior vp Rajiv Bhatia. The new four-page agreement replaces a 35-page version. “All the essentials are there. We feel the new version will be welcomed by potential owners. Not only is it a time-saver, but therell be cost savings as well since itll take an attorney less time to review.” Streamlined too is Knights Inns new custom-designed property management system. Known as Knight Lite, it is approximately 50% less expensive to implement than traditional PMSs and, consequently, can help improve franchisees return on investment. With 240 properties in the U.S. and Canada, Knights Inn, an economy brand that is part of the Wyndham Hotel Group, opened 31 hotels in 2006, according to Bhatia. Most were conversions from other flags, including five that were conversions from other Wyndham brands. Though its been expanding in other regions, most of the brands distribution is on the West Coast, including properties newly opened in San Diego, Los Angeles, and San Francisco. In fact, 40% of its pipeline is on the West Coast. Bhatia told the franchisees and general managers assembled at the Disney Coronado Springs Hotel & Resort here that the new streamlined franchise agreement was intended to expand the development pipeline further. The brands recent RevPAR growth has been encouraging as well–up 7% in 2006, compared to 2005. Like its sister brands, Howard Johnson and Travelodge, Knights Inn is rolling out new brand standards. A three-item complimentary continental breakfast is now mandatory and there are new requirements for staff uniforms. “In many cases, franchisees are already meeting–or surpassing–the brand standard,” Bhatia said, “so the impact of the change isnt that significant.” Roughly 70% of franchisees are already in compliance with the new breakfast standard, for example. Knights Inn is not making complimentary high speed Internet access a brand standard yet, but Bhatia cautioned franchisees that it was just a matter of time until it too becomes a requirement. “In terms of what the competition is offering, you dont want to be left behind. For travelers today, high speed access is a necessity, not a luxury,” he said. He estimated that 50% of franchisees already offer it, whether in a wired or wireless solution, on a complimentary basis.