Questions and Answers

Because hotels are often owned on an individual basis rather than by the chain, who pays for things like breakfasts, club lounge access, suite upgrades, parking, etc.? Does the chain somehow reimburse the hotel, or is the hotel just forced to eat it? If the hotel has to cover it by itself, then I can understand why it would try to be as skimpy as possible with things like continental breakfast, especially if the guest is making a one-night stay and isn’t likely to return often (thus not producing as much incremental revenue for the hotel). And if a hotel decides to award points for something like a service issue, does the hotel pay the chain some sort of a value for those points? This is something I haven’t really seen covered on the blog…

[URL=’http://onemileatatime.boardingarea.com/2016/05/11/starwood-merger-lawsuit/’]”For the most part the major hotel chains don’t actually own the individual hotels, but rather just have management contracts to operate them. They get a percentage of the hotel’s revenue, and in exchange for that they market and operate the property.”[/URL] – Lucky 5/11/16

That management contract would have sections that work out reimbursements for things like what you are mentioning. I wouldnt describe it as being forced to eat it but rather a cost of operating. They can choose not to be managed by a certain brand and go independent, but then they’d stand to lose business from customers who are loyal to a brand. That might be more costly than the cost for loyalty benefits.