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Red Lion’s Ron Burgett Discusses Franchise Growth

Red Lion’s Ron Burgett Discusses Franchise Growth

For 20 years, Ron Burgett has been a hotel franchising and development guy. Now, at Red Lion Hotels, he’s on a mission to grow the company’s franchising program. The timing is good since Red Lion recently restructured its debt and invested $20 million back into the company. Burgett says the move has made it easier for Red Lion to look forward and not back.

LODGING: How did you get into the hotel business?

Burgett: When I was 26 and working for Cracker Barrel, I opened a store in Marion, Ill., across the street from Best Inn of America’s headquarters. At the time, it was a family-owned business with about 40 hotels and a lot of the guys used to have lunch at the restaurant every day, so I got to know them well. They eventually convinced me to come work for them, managing four Comfort Inns in Chicago. That’s how I got my start.

LODGING: What did you learn from working in restaurants that you still use today?

Burgett: I learned that you only have a few short moments to make a good impression with your guests. You may have more opportunities at a hotel than a restaurant, but you still need to make the most of them.

LODGING: How has your first year at Red Lion been?

Burgett: Great. I took on the mantle of what this company started a couple of years ago with better brand segmentation. We just put the pieces of the puzzle together to clearly market three brands: one limited-service, one full-service, and the Leo Collection, which is focused on unique, boutique, and historic properties. Leo launched in January in response to our owners asking for a way to compete with other brands in the upscale segment.

LODGING: What does having this limited-service product, Red Lion Inns and Suites, allow you to do?

Burgett: We always had limited-service hotels but we didn’t really market them well or clearly separate them for our customers. The product gives us an opportunity to capture some of the properties that are leaving brands like Hampton and the Holiday Inn Express. Many of the folks we talk to still have a really good product, but they just need a new brand.

LODGING: And what about the Leo Collection?

Burgett: The whole purpose of Leo is to focus on properties that are unique. It’s a soft brand of properties that are more historic in nature so they have their own identity and their own quirky, classic feel to them. So most of Leo’s growth will come from converting existing product. And then we provide the distribution system, website, and rewards program.

LODGING: In the past few years Red Lion has reduced the number of properties it owns and increased its franchises. Is that going to continue?

Burgett: Yeah, that’s something new for us. We moved from a 60-40 split between corporate-owned and franchise to a 50-50 split, which was a big goal since it means our franchising is really taking off. Still, we’re going to keep many core assets because we need to remain in the business. One of our value propositions is that we understand how to operate hotels and restaurants. But to grow the business, we’re investing our dollars into the franchise side of things.

LODGING: What kinds of markets have you found work best for the Red Lion brands?

Burgett: Airport locations, state capitals, and universities are all areas where we’ve been successful and our customers have told us that’s where they want to be. We’re also a West Coast-based company and we want to be able to service a property multiple times throughout the year, not just show up every now and then to say thanks for the check.

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