Uniqueness is the selling point of a soft-branded property, but it also can create challenges when it comes to budget.
When the first-ever soft brand was introduced, it changed the landscape of the hotel business. Hoteliers were no longer forced to choose between going it entirely alone as an independent property or following strict brand standards. What developed was a category that provides hoteliers an opportunity for increased amenity flexibility and design creativity.
Soft branding has become a successful alliance between the major franchising companies, who now get increased product distribution with autonomy-minded hoteliers who still obtain many big-brand benefits without those rigorous rules.
Overall, most hotel developers enjoy the financial opportunities afforded by soft brands. However keeping within the budget while maximizing style requires paying close attention to the design and construction process.
Here are some tips to make these projects successful:
Soft-branded hotels provide plenty of opportunity for a developer to leave a personal mark on a hotel. Reinvention of an existing property such as an older, exterior-corridor hotel or an asset that might not fall within the typical style room layout can be viable options. We are presently updating a hotel damaged during a hurricane. This could be the perfect opportunity for the ownership to create something distinct within the free parameters of a soft brand, rather than the more “plug-and-play” nature of a traditional flag.
However, with soft brand parameters being a bit more open-minded, budgets can be more susceptible to being challenged. The custom nature of the project provides the ability to be more creative, but this added creativity can also impact budget guidelines. It is important to create a budget and have all of the stakeholders buy into it. This can mean a longer design process than a prototypical off-the-shelf design package.
Know your market
Be sure to inherently understand the customer mix for that market. Creating an amazing looking soft-branded hotel is wonderful, but if it’s too upscale for clientele, you’re simply spending money with no ROI.
Engage a purchasing partner in concert with the design team. They are an important part in controlling FF&E costs. Including them as part of the design process and leveraging their ability to reach out to manufacturers for rough order-of-magnitude pricing during this period provides great value.
A procurement team will help value engineer products by providing cost-effective alternatives. Examples might include less expensive woods or fabrics or the use of other material such as aluminum that maintains the look and feel of the product while lowering the overall price.
This extra effort on the front end minimizes the reselection process at order time, an extra effort which requires significant time to be spent by all of the team members and can ultimately delay a project start.
Soft-branded hotel design means adding amenities that the more independent-minded guest craves. Consider using LVT flooring rather than carpeting. It’s more contemporary in style and takes less time to maintain and clean than carpeting. Select a larger, oversized TV that becomes a distinct selling point for the room and finish it off with custom fabrics if the budget allows. In aggregate, these elements help push ADR ahead of your competitive set.
Add a contingency
Earmark contingency. If buying goods from China, you will need to compensate for recently introduced tariffs that may or may not be in effect. The added tariff can add 15% to 25% of the FF&E cost.
Implement the unexpected
Use an unconventional element such as creative room signage. Rather than a typical room number, consider painting large numbers on the door, or use a lighting element to display the room number. This creates a very cost-effective but strong design element. Also, settle on a signature design element for public spaces highlighting the hotel’s unique identity. This creates a psychological shortcut for guests to know what the hotel is all about, while creating an emotional connection with them.
In all, soft brands provide hotel developers and owners with opportunity to create something distinct that’s reflective not only of the property’s location, but one that represents them as individuals.
Stephen Siegel is principal of H-CPM (Hospitality CPM) and a proven professional in the areas of design, engineering, contractor negotiation and project management for new construction and renovation projects. He earned both a Bachelor’s and Master’s Degree in Construction Management from the University of Florida.
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