Comfort Inn 2014 Annual Report Download - page 21

Table of Contents
Our toll-free telephone reservation system primarily utilizes third party call center service providers. Reservation agents trained on the reservation
system can match each caller with a Choice-branded hotel meeting the caller’s needs. We also operate a call forwarding program through which our
franchisees can leverage our central reservation system capabilities by forwarding reservation calls received directly by the property to one of our reservation
centers. Typically, this reduces the hotel’s front desk staffing needs, improves customer service and results in a higher average daily rate than reservations
booked directly through the property.
We continue to implement our integrated reservation and distribution strategy to improve reservations delivery, reduce franchisee costs and improve
franchisee satisfaction by enhancing our website, choicehotels.com. We also design our marketing campaigns to drive reservation traffic directly to our
proprietary channels to minimize the impact that third party reservation sites may have on the pricing of our inventory. In addition, we have introduced
programs such as our Best Internet Rate Guarantee program which has greatly reduced the ability of the travel intermediaries to undercut the published rates
at our hotels. We do selectively distribute our inventory to key third party travel intermediaries that we have established agreements with to drive additional
business to our franchisees' hotels. These agreements typically offer our brands preferred placement on these third party sites at reduced transaction fees. We
also continue to educate our individual franchisees about the unfavorable impact to their business of contracting with sites with which we do not have
preferred agreements. We currently have agreements with many but not all major online third party booking sites.
Property Management Systems. Our proprietary property and yield management system, choiceADVANTAGE, is designed to help franchisees
maximize profitability and compete more effectively by managing their room inventory, rates and reservations. choiceADVANTAGE synchronizes each
hotel’s inventory with our central reservation system, giving our reservation sales agents last room sell capabilities at every hotel. Our property management
system also includes a revenue management feature that calculates and suggests optimum rates based on each hotel’s past performance and projected
occupancy. These tools are critical to business delivery and yield improvement as they facilitate a franchisees’ ability to effectively manage hotel operations,
determine appropriate rates, drive occupancy and participate in our marketing programs. As a cloud based solution, the choiceADVANTAGE system reduces
each hotel’s investment in on-site computer equipment typically resulting in a lower total cost of ownership for property management systems than
traditional on-site solutions.
Quality Assurance Programs. Consistent quality standards are critical to the success of a hotel franchise. We have established quality standards for all
of our franchised brands that cover housekeeping, maintenance, brand identification and minimum service offerings. We inspect properties for compliance
with our quality standards when application is made for admission to the franchise system. The compliance of existing franchisees with quality standards is
monitored through scheduled and unannounced quality assurance reviews conducted periodically at the property and through the use of guest surveys.
Properties that fail to maintain a minimum score are reinspected on a more frequent basis until deficiencies are cured, or until such properties are terminated.
To encourage compliance with quality standards, various brand-specific incentives and awards are used to reward franchisees that maintain consistent quality
standards. We identify franchisees whose properties operate below minimum quality standards and assist them to comply with brand specifications.
Franchisees who fail to improve on identified quality matters may be subject to consequences ranging from written warnings, the payment of quality re-
inspection and guest satisfaction fees, attendance at mandatory training programs and ultimately to the termination of the franchise agreement. Actual
consequences, if any, are determined in the Company’s discretion on a case-by-case basis and may take into account a variety of factors apart from a
franchisee’s level of compliance with our quality standards and brand specifications.
Training. We maintain a training department that conducts mandatory and voluntary training programs for all franchisees and general managers.
Regularly scheduled regional and national training meetings are also conducted for owners and general managers. We offer an interactive computer and
mobile-based training system to train hotel employees real-time as well as at their own pace. Additional training is conducted through a variety of methods,
including group instruction seminars and live on-line instructor-led programs.
Training is conducted by a variety of methods, including group instruction seminars and on-line programs. We have also developed an interactive
computer-based training system that will train franchisees and general managers at their own pace.
Opening Services. We maintain an opening services department that ensures incoming hotels meet or exceed brand standards and are properly
displayed in our various reservation distribution systems to ensure that each incoming hotel opens successfully. We also maintain a design and construction
department to assist franchisees in refurbishing, renovating, or constructing their properties prior to or after joining the system. Department personnel assist
franchisees in meeting our brand specifications by providing technical expertise and cost-savings suggestions.
21