AAHOA’S advocacy in action
AAHOA Members and leaders are constantly at the forefront of legislative issues that impact the hospitality industry. “No one knows how policies impact your business more than you,” said Franchisee Advocacy Consulting Principal Keith Miller, “and no one can relate that to policymakers better than you.”
AAHOA sets itself apart from other associations when it comes to advocacy through its strong grassroots efforts by its strength in numbers. “The number of members and Congressional Districts AAHOA covers is huge,” Miller said. “The effort AAHOA leaders put into involving members in the advocacy process and always fighting for the business interests of hotel owners is unmatched.”
“There’s a saying in politics, ‘They can’t like you if they don’t know you,’” said AAHOA’s Vice President of Government Affairs Dean Heyl.
TWEETING FOR CHANGE
As social media permeates all industries, politics is no different. Many voters get live updates on social media and follow politicians to stay up to date on the latest news. In 2020, 98% of U.S. Senators posted through their official Twitter accounts. “Elected officials are becoming more reliant on social media to get a pulse on what’s important,” Heyl said. Accordingly, voicing your opinion on social media and reaching out to local senators can have a huge impact.
Political advocacy has evolved significantly during the past two decades. Voters are using social media to be solution-driven and advocate for what their beliefs are regardless of affiliation to a specific party. “You have to stay active in the political world with issues that impact your business,” Miller said. “But this does not mean being a Democrat or Republican, it needs to be issue-driven. “When it comes to fighting for your business, social media is a great tool to discuss issues that directly impact you.”
AAHOA IN ACTION
AAHOA leaders stand firm in their belief that business owners should have a voice and that AAHOA Members have a huge impact on the communities in which they live and work. “To use a sports analogy, AAHOA leaders skate to where the puck will be, not where it is,” Heyl said.
“There is no doubt in my mind the leadership of AAHOA is committed to working on the tough issues impacting member businesses,” Miller said. “Making change is difficult, but they’re up to the task.”
FRANCHISEES STAND UNITED
“AAHOA Members want to ensure their relationships with the franchisors are fair, equitable, and mutually beneficial,” AAHOA President & CEO Laura Lee Blake. “Sometimes, depending on the situation, things are definitely one-sided, and that’s where AAHOA comes in. Earlier this year, leaders refreshed their approach to designing, developing, and implementing mutually beneficial franchise systems.”
Franchising is a massive global industry, and the success of franchises lies in the ownership and customer. “The industry seems to forget the largest investors are the franchisees,” Miller said. “It pains me when I hear that franchisees’ children don’t want to continue the family business because they feel their parents work too hard for too little. Franchisees need to stand united to swing the pendulum back.” The question of how global hospitality chains should operate has been on the minds of hoteliers for decades. In a franchising market, the franchise must design, implement, and sustain strategies that will increase efficiency and fairness.
AAHOA’s 12 Points of Fair Franchising (AAHOA.com/12Points) reveal the foundational pillars that need to continually be worked on to achieve fairness and mutually beneficial relationships for franchisees and franchisors. It addresses topics that are important to hoteliers such as franchisee termination rights, asset protection, quality assurance, brand reputation, competitive pricing, disclosure of fees, and more. “The 12 Points do a great job in outlining the biggest issues,” Miller said.
“Another top issue is when franchisors sell guest loyalty points for a discount,” Blake said.
“The franchisors are making a large profit while the hoteliers are losing revenue.”
Franchise owners commit to working on a long-term relationship with the franchisor and expect the same loyalty and openness in return. There have been many instances where franchisors include “gotcha” clauses in agreements that leave the franchisee restricted with few options. Both parties should commit to maintaining a fair relationship that’s a win-win for everyone involved.
“The rebate issue is huge in the franchise industry,” Miller said. “Along with transparency of franchisee-funded programs, new fees are being charged that aren’t always disclosed,” he continued. “I could go on for hours about the high-priority issues, which is why we’re so busy. There’s so much work that needs to be done to protect the franchise model for the franchisees.”
Blake agreed, saying “One of the issues that has received a lot of attention is when a franchisor mandates specific vendors. If the vendors are required to pay high revenues or commissions to the franchisors to be one of their select few mandated or approved vendors, this will drive up the prices for products and services,” she explained.
AAHOA has been taking a leading position to advocate for effective communication and independent and fair dispute resolution. By expecting ethical practices from both parties, fairness and honesty are often selling points when entering a long-term partnership. AAHOA understands the needs of the franchisee and works closely to advocate for small business owners.
“During the pandemic, the industry struggled as a whole, and our hotelier members really felt the brunt of the lack of travel and tourism across the board,” Blake said. “With these significant financial difficulties, coupled with the unfair practices of some of the franchisors leading to single digit returns on their investments, the 12 Points are a necessary tool to address such practices.”
THE TOP ISSUES
“While promised group purchasing power, many vendors are chosen by the size of the rebate, not the lowest cost product to the end user. This limiting of suppliers and driving up costs is hardly the free market as we know it,” Miller explained.
“The top issue hoteliers are facing is a decreasing ROI with single-digit profit margins,” Blake said. “The decreasing returns appear to be directly related to numerous unfair practices that have continued and increased in recent years. This is a key reason for a resurgence of interest in fair franchising.”
BECOME AN ADVOCATE
One way to become an advocate for fair franchising and other policies that directly affect hoteliers is by building relationships with elected officials. “It is easy to sit around the table with fellow franchisees and complain about what needs to be done, but elected officials actually have a vote to do something,” Miller said. “It’s important to meet with them and have them know you and your business before you need them.”
“I’d encourage younger folks to introduce themselves to elected officials, volunteer on campaigns, and attend town halls, Heyl shared. “From there, when an issue arises, let your voices be heard. Send emails, letters, and attend meetings when AAHOA call to action alerts are sent.”
“At the end of the day, fairness matters most,” Blake said. “AAHOA helps provide the framework for members to meet elected officials and send out emails and alerts so all members are in-the-know. Work with your regional director and ambassadors, and be proactive in learning about local issues so we can act quickly.”
Here’s a quick look at just five areas where AAHOA is focusing its advocacy efforts.
BEST Inhospitable to Human Trafficking Training Sponsored by AAHOA has played an active role in keeping hotel owners and trafficking victims safe. In 2021, a law went into effect mandating that all Florida lodging establishments provide annual trafficking awareness for employees.
At the state level, AAHOA works directly with legislators to advocate for the joint-employer standard. AAHOA also supported the Save Local Business Opportunity Act, which restored independence for franchisees and small business owners.
AAHOA supports legislation that discourages litigious incentives and is committed to working toward achieving the true intent of the ADA’s rules and guidelines.
AAHOA is advocating for Section 1031 in the tax code to defer tax payments on property exchanges, thus allowing hotel owners to have more capital to invest in additional properties. This tax code leads to multiple benefits for hoteliers such as new employee hires, job protection, business growth, and opportunities for community investment.
TRAVEL AND TOURISM
AAHOA supports the reauthorization and preservation of Brand USA. A partnership that markets tourism and travel to the U.S. at no cost to taxpayers. And 84% of travel- and tourism-related companies are considered small businesses largely consisting of hotel owners.
“Together, we can work to make a difference for franchisees across the nation,” said AAHOA President & CEO Laura Lee Blake. “Perhaps not only in our industry but even beyond.”
AAHOA generated 500 emails within hours to defeat a short-term rental bill.
AAHOA Members and leaders from all over the country flew into Washington D.C. for AAHOA’s Fall National Advocacy Conference last month, meeting and building relationships with more than 100 offices and 40 members of Congress to push our policy priorities forward.
100+ members showed up en masse to support the LA land use ordinance.
Hit the highlights
- Franchisees should be free to buy brand-conforming goods from any vendor, not just those mandated by the franchisor.
- For any vendors mandated by a Franchisor, the Franchisees should receive competitive pricing.
- A Franchisor should not profit directly from the loyalty rewards program, or create and sell loyalty points at a discount to the detriment of the Franchisees.
- Franchisors should encourage and support the establishment of independent and democratic FACs or Franchisee Associations.
- Franchisors and Franchisees should agree in good faith to participate in an informal, in-person meeting between the authorized representatives of the parties to resolve a dispute.
- Franchisors should not delay or impose unreasonable fees for a property transfer.
- If a Franchisor sells a brand, the Franchisor should promptly give notice and pledge to work with the Franchisees and the new Franchisor to ensure a smooth transition.