Advantage Hotels to focus on what franchisees need
Advantage Hotels to focus on what franchisees need
26 JUNE 2019 9:30 AM

Patrick Mullinix, who just launched Advantage Hotels, said his new company’s vision is all about making sure his franchisees get all the support they need.

AUSTIN, Texas—Every brand launch is exciting, said Patrick Mullinix, but this one is different.

Over the years, Mullinix has been a part of different company and brand launches. He worked for Cendant Corporation when it relaunched AmeriHost Inn. He worked for Vantage Hospitality during the launches of both Americas Best Value Inn and Signature Inn.

The launch of Advantage Hotels and the acquisition of the Vista Inn and Select Inn brands is different, he said, because it’s his.

“This is more special than all of them combined for me,” Mullinix said. “This is me personally putting together my organization, my team, my structure, and it’s not acting as a corporation. This will probably be the most memorable moment of my lifetime.”

Taking on the role of president and CEO of his own company will provide him with new opportunities, he said. He can address all of the things he’s seen in the industry that’s he’s wanted to fix that others have shied away from.

The formation
After RLH Corporation acquired Vantage Hospitality in 2016, Mullinix said he took some time off. He traveled around the country, looking at different hotel brands and meeting with key executives of brands he thought “were begging to be grown” with the right leadership, structure and formation.

During his travels, he came across a small company based in Nashville: Advantis Hospitality Alliance. Vaguely familiar with the company’s brands, he said he reached out to the company’s leadership about a possible acquisition, but the interest wasn’t reciprocated.

“I liked the (brands’) names very much,” he said. “I had seen they had the right ingredients for what I was looking for.”

As it turned out, Mullinix knew one of the major shareholders of Advantis, Dhansukh (Dan) Patel, a former chairman of the Asian American Hotel Owners Association. The two met along with another shareholder and former AAHOA Chairman Ramesh Surati, and worked out the deal, which closed 14 May. As a result of their collaboration, Mullinix asked them to join his new company’s board of advisers to help grow it. Former AAHOA Chairman Mukesh Mowji joined the advisory board as well. Steve Belmonte, former president and CEO of the Ramada hotel chain and current CEO of Vimana Franchise Systems, is a senior adviser and on the executive board of directors.

New vision
Mullinix chose the name Advantage because he felt his company’s philosophy with the brands, its plans for the future and its understanding of what is happening in the limited-service segment would give his company an advantage over the competition.

“We know what’s being done right and what’s missing, what franchise owners are not getting that they need,” he said. “We began the process of really building all of our structures and service and executive teams and programs around meeting all of the needs of franchise owners today.”

A team member said the company is creating a new vision, which has become a slogan for the company, he said, adding it was an “a-ha moment.” The new vision is understanding and embracing the technology piece that has reformulated the industry, he said. The industry will never change and go back to what it was before ecommerce and tech innovations, he said.

“Our view today is to try to simplify the use of (technology) in a complex world in relation to distribution channels,” he said. “We will simplify it so it’s easy to use, easy to understand and easy to find efficiencies.”

One of Advantage’s goals was to reduce technology costs for owners, Mullinix said. Franchisees in the limited-service space are reluctant to fully embrace new technology because they are concerned about runaway costs, he said. His company partnered with a tech vendor to create customized platforms for his franchisee owners by removing some elements the owners didn’t need. The new platforms offer owners cost-efficient yet advanced distribution solutions, he said.

Large-scale legacy brand companies do everything at a national scale with the expectation a trickle-down effect will benefit local properties, he said. Having a company of Advantage’s scale allows more property-specific attention for things such as marketing, tracking performance and reservations, he said. There will be quarterly reviews with property owners to show them the results of the company’s marketing campaigns and how they affected performance, he said.

“My vision for Advantage Hotels is to offer a fresh approach to franchising based on trust, communication and relationships,” he said, adding that this is such a core part of the company that it’s been put into a pledge for each staff member to sign. “This is what we stand for. These are our core values and what we believe to be the most important in our culture and who we are.”

The brands
Advantage was lucky to acquire the Select Inn and Vista Inn brands, Mullinix said. Select Inn started in 1990 in Minnesota and grew to about 25 to 30 upper-economy hotels throughout the Midwest and was targeted at business travelers, he said.

“What I love about Select Inn is the purity of it being a solid upper-economy premium brand,” he said. “We’re going to make sure we follow that track.”

The brand will be an alternative to Red Roof properties, he said.

The company updated Vista Inn’s logo, but it kept the name and the colors the same, he said. Focus groups showed the name resonates clearly with the mid-tier to full-service area. He said he expects it will be on par with Best Western Plus, Quality Inn and Comfort Inn.

Advantage isn’t looking for large-scale growth as that would be unsustainable, he said. Instead, it will focus on quality and qualified owner/operators. The company’s growth model calls for somewhere between 40 to 45 new hotels a year, he said.

This approach should help build the foundations of relationships the company will have with hotel owners, which is important to creating the trust necessary between franchisor and franchisee.

“We think that is our comfort level,” he said. “That gets us to our goals of reaching critical mass in a reasonable amount of time.”

The brands have a presence in the Southeast and lower Midwest, Mullinix said. The company will grow them in those regions as well as across the Southwest.

“As opportunities come up in the next five years, we will allow ourselves to branch out a bit farther,” he said.

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