Hotelier of the Week: Jacques Dubois (Mar 15)

Jacques Dubois, senior vp and chief operating officer of Park Inn,  reveals how the brand is leading the Rezidor Group's expansion into the midmarket

The Rezidor Group is best known for its five star Radisson Blu brand. But the recession is forcing changes on business travel so the Group, averse to dropping its high-end rates, is keen now to lure the cost conscious travellers with its mid-market Park Inn brand.

In no other region is this more obvious than Europe and the UK.

"We have 21 open properties in the UK with a further 12 under construction right now," Jacques Dubois, Rezidor's senior vp and chief operating of Park Inn, said. "We have just spent £45m on a refurbishment programme, plus Heathrow where we've also been spending a significant amount of money."

Park Inn Dublin

Having taken Park Inn's reins after 14 years with Rezidor, it is not hard to appreciate the dual Canadian/US national's logic. In more recent times, Mr Dubois has witnessed competing brands, such as Novotel and Jurys Inn, fare well while the high-end hotel industry suffered from a global downturn in travel. He can add to this his experience with Holiday Inn, a midmarket stalwart, and the Carlson group before he moved across the Atlantic to Rezidor as part of an operational agreement.

But the picture was not always so rosy for the midmarket, occupying an uncertain position between successful low-budget chains such as Premier Inn and high-end hotels with much to tempt the corporate executive. Only a few years ago, Mr Dubois was in the audience at the World Budget & Economy Hotels Congress when the demise of the midmarket was predicted by leading industry figures. This was long before the true effects of the recent economic troubles had hit home.

 

"People have said the midmarket is dead. Even the city analysts said the market was going to be polarised to the economy and budget segment and the high end.

"But I think this economy is going to change that. Certainly budget and economy hotels have a place. Whatever the conditions are for the economy, they are certainly a very viable option for a significant portion of travellers."

The midmarket, he argued, offers savings for business travellers and meeting planners on the hunt for the high value option: a full range of services such as suites and meeting space, but minus the ‘frills'. Added to this is its association with Rezidor which reassures Mr Dubois, as much as it does his guests, of Park Inn's strength as a low price but high-quality hotel.

While properties converted to Radisson hotels  require what Mr Dubois refers to as a ‘product improvement plan' involving greater investment, Park Inns have with fewer requirements and can still meet high standards for less money.

Park Inn Berlin

"Typically we'll do less and still achieve the visual impact and the experiential impact that we want to accomplish with the brand," he said.

But how exactly is Park Inn different from its more esteemed Rezidor cousins? "Very obviously by its positioning," said Mr Dubois, before detailing a raft of differences he refers to as the "Essentials," including staff uniforms, the art on the walls and the bed linen.

He admits the Park Inn Russell hotel is an atypical example but looking around the property, it is still obvious where the differences lie, or rather where value for money for the guest is realised. Pricing reflects the midmarket positioning even though many Park Inns still offer the conference facilities and fitness suites absent from low-budget rivals.

At Russell Square, for example, a business friendly room midweek with breakfast , high speed internet access and use of the fitness centre included, starts from £159 per night.

Rooms at the Park Inn Heathrow, a property which holds much promise for the brand, start at £85 per night midweek, with all the same facilities plus a pool.

So what does the future hold for the Park Inn brand? Despite further expansion planned across every region, including Russia and Eastern Europe, its second largest growth market in terms of rooms added, the toughening trading environment is taking its toll.

"We expect the growth to continue but it'll be more opportunistic. I think we'll see more conversion than new build, especially with the issue of finding financing," he said.

An acquisition, Mr Dubois said, is easier to finance than a new build as risk is lower, a factor to which the entire financial world is becoming increasingly sensitive.

With hoteliers striving to maintain lucrative corporate accounts, it is easy to imagine a shift in power from a suppliers' to a buyers' market. But Mr Dubois remains defiant of this assumption, keen to emphasise balance and trust between parties.

"We're all trying to accommodate a whole cost structure that has evolved from the last downturn, if you look back.

"Nobody is coming to us and saying ‘you've got to cut your rates 15% or we're not going to stay with you' because if they do that they're going to have to make different

Park Inn Paris Charles De Gaulle

choices," he said.

But this should not be mistaken for tough talk. There is a limit, he said, to which Park Inn as a business can adjust pricing. Value will come through improved commitment between buyers and sellers.

"I'd be much more willing to accommodate pressure on pricing in exchange for a much more solid commitment, such as a buyer who says to me ‘I'm going to reduce my list of approved hotels in a market from eight to three, or to two'.

"They know we have business objectives, we know they have theirs; we have to find a middle ground. And we're not going to do that by resisting each other's points and positions. We have to find the common ground and work together," he said.

www.parkinn.com