When contemplating a change in flags, Kelly Horwood (owner of the Magnuson Hotel Clearwater Central) needed to find a way to increase revenue. As a Travelodge, revenue numbers appeared to flatten out and, with a 12% commission on gross room revenue and annual PIPs, it was becoming almost impossible to operate in the “black”.
“We have been holding our own in occupancy and are consistently $10 below market rates, we will never close this gap with Travelodge as customers expect Travelodge to be one of the lowest priced options in their markets.” – Kelly Horwood, owner of Magnuson Hotel Clearwater Central Kelly learned of Magnuson of a local owner and signed up to switch brands shortly afterwards. In the first full year with Magnuson, the Magnuson Hotel Clearwater Central was able to increase its revenue numbers by 30% over the last full year with Wyndham’s Travelodge segment. With a 5% commission on gross room revenue, the hotel was able to realize an increase in profits of almost $450K over its previous flag in its first year. The hotel operated with a profit in the first year as a Magnuson, a feat that took 5 years to obtain as a Travelodge.
The growth did not stop there, the hotel was able to grow an additional 5% the next year. The hotel saved almost $240K over Travelodge when comparing cost structures through the first 2 years after the switch.
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