LINQ0103

CALIFORNIA Lodging The Voice of the Independent Lodging Operator

Lodging SPRING SPRING 2003 2003

Passing the Gavel Also in this issue: Weathering War in the Lodging Industry Doing Business in a Down Market A Call for Nominations

CALIFORNIA Lodging VOLUME 57, NUMBER 1 P.O. Box 15918 Sacramento, CA 95852-0918 (916) 447-6565 (800) 637-4664 Fax: (916) 447-6563 E-mail: info@clia.org www.clia.org

OFFICERS Chair of the Board Jill Macdonald Quality Inn Eureka Vice Chair Sima Patel Holiday Inn Express Oakland Airport Oakland Secretary Terry Westrope Sterling Hotels San Luis Obispo Chief Financial Officer Don Turner Golden Bear Motel Berkeley Immediate Past Chair J.P. Patel Best Western Colony Inn Atascadero

EXECUTIVE STAFF President/CEO Rick Lawrance Director – Administration & Finance Joseph Davis Director – Membership Services Beverly Hook Information Technology Administrator Joe Lish Administrative Assistant Rachel Nelson California Lodging (ISSN 1094-1495) is published biannually by the California Lodging Industry Association (CLIA), 1011 Tenth Street, Sacramento, CA 95814 (916) 447-6565 or (800) 637-4664 (in California only) and Naylor Publications, Inc. Subscriptions $20 annually (included in CLIA member dues). Periodicals postage paid at Sacramento, CA 95813.

Nothing contained in this publication shall be deemed to constitute in any fashion whatsoever an endorsement by the California Lodging Industry Association (CLIA) of any information in this publication, and CLIA disclaims any and all liability with respect to any use of, or reliance on, such information. No information in this publication shall be construed in any manner whatsoever as a recommendation of any standard, or as a recommendation of any kind to be adopted by, or binding on any person or entity. Nor shall any information contained in this publication be deemed to constitute in any fashion whatsoever an endorsement by CLIA of any product or service advertised herein. The material set forth in this publication is provided on an informational basis only. CLIA is not engaged in the practice of any profession, including, but not limited to, law and accounting, and nothing in this publication should be relied on in lieu of appropriate, competent professional advice.

POSTMASTER: Send address changes to: California Lodging, P.O. Box 15918, Sacramento, CA 95852.

Inside this Issue CHAIR’S REPORT

CLIA: Providing a Wealth of Knowledge to its Members . . . . . . . . . .4

HEADQUARTERS REPORT

AAA Ratings – Are Diamonds Still Our Best Friend? . . . . . . . . . . . . .5

Features WEATHERING WAR IN THE LODGING INDUSTRY

How to Weather the Storm of Economic Uncertainty . . . . . . . . . . . .7

DOING BUSINESS IN A DOWN MARKET

What You Can Do in Your Own Backyard . . . . . . . . . . . . . . . . . . . . .9 First-Impression Customer Service . . . . . . . . . . . . . . . . . . . . . . . . .10 Inexpensive Marketing Ideas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11 Guest Loyalty and Repeat Business . . . . . . . . . . . . . . . . . . . . . . . . .12

A CALL FOR NOMINATIONS!

Recognize a Peer for His/Her Dedication to Excellence . . . . . . . . .14

Departments LEGISLATIVE UPDATE

Budget Proposal Targets Tourism . . . . . . . . . . . . . . . . . . . . . . . . . . .15

CLIA Updates INNKEEPING LAW Become an Active Partner with Your Workers’ Comp Carrier and Control Your Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16

CLIA UPDATE

All the Latest News About the Lodging Industry . . . . . . . . . . . . . . .19

Index to Advertisers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22 Cover photo: 2002 CLIA Board Chair J.P. Patel, Best Western Colony Inn – Atascadero, passing the gavel to 2003 CLIA Board Chair Jill Macdonald, Quality Inn – Eureka

California Lodging Disclaimer The material set forth in this publication is provided on an informational basis only for the exclusive use of members of the California Lodging Industry Association (CLIA). CLIA is not engaged in the practice of any profession, including but not limited to law and accounting, and nothing in this publication should be relied upon in lieu of appropriate, competent, professional advice. No information contained in this publication shall be construed in any manner whatsoever as a recommendation, and CLIA disclaims any and all liability with respect to any use of, or reliance on, such information.

Information provided herein is accurate and applicable to the best of CLIA’s knowledge at the date of publication. However, changes in state law are always occurring and CLIA members are encouraged to monitor all information provided by CLIA on an ongoing basis. Please direct any additional questions or concerns to the CLIA staff at: (916) 447-6565 or Helpline (800) 637-4664.

Published for: The California Lodging Industry Association P.O. Box 15918 Sacramento, CA 95852-0918 Tel.: (916) 447-6565 or (800) 637-4664 Fax: (916) 447-6563 E-mail: info@clia.org Website: www.clia.org Published by: Naylor Publications, Inc. 9806 Old Winery Place, Suite 6 Sacramento, CA 95827 Tel.: (800) 873-4800 or (916) 363-1913 Fax: (916) 363-1934 or (800) 215-9404 Website: www.naylor.com

©2003 Naylor Publications, Inc. All rights reserved. The contents of this publication may not be reproduced by any means, in whole or in part, without the prior written consent of the publisher.

Publisher: Gail E. Kelly Editor: Jeanie J. Clapp Advertising Manager: Kurtis Colbert Research: Steve Hoidalen Publication Director: Steven Seeber Advertising Representatives: Joel Berk, Michael Ivers, Shirley Lustan, Stephen Peters, Diane Ricks, Daryl Short Layout & Design: Catharine Snell Advertising Art: Elaine Connell PUBLISHED APRIL 2003/LIN-Q0103SP/8586

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CHAIR’S REPORT CLIA BOARD OF DIRECTORS

OFFICERS

By Jill Macdonald Chair of the Board

CLIA: Providing a Wealth of Knowledge to its Members Greetings! am delighted to serve as CLIA’s 2003 Board Chair. I am president of Macdonald Motor Inns and, along with my family, operate the Quality Inn Eureka located on California’s beautiful Redwood Coast. I am proud to proclaim myself a third-generation hotelier and CLIA member!

Often I am asked why I volunteer to make the six-hour trip to Sacramento multiple times a year to attend CLIA meetings. To me, the answer is simple – knowledge! Conducting commerce “behind the Redwood curtain” poses its unique challenges, and being a member of an effective trade organization is imperative. CLIA is that organization.

Our constituents make CLIA unique. We are the voice of the independent lodging operator in California – the backbone of the state’s economy – small business. We are the little guys that don’t have human resource directors, safety compliance officers, and full-time legal departments. My point is that independent lodging operators must wear many hats. CLIA is dedicated to providing the specifically tailored information and services that we all need. Our legislative research keeps our members up-to-date on critical legislation that impacts small business. We successfully co-op our lobbying efforts for greater impact by partnering with the California Restaurant Association, the California Travel Industry Association and other like-minded groups. Last year CLIA successfully sponsored lodging legislation, and currently we are working on a bill that would streamline the laws regarding transient occupancy tax. Recently, we’ve moved our offices to downtown Sacramento, one block from the State Capitol, to be a stronger and more visible voice for the tourism industry. Issues such as ADA and Proposition 65 are “hot topics” that CLIA has become the state’s resident expert on, guiding our members to prudent information, and resolution. Our member HelpLine, fax bulletins, and the new LOBBY newsletter are effective vehicles for on-time information.

With California’s current budget woes, and the threat of war and terrorism looming, the state of our industry is tentative. In times like this, I find comfort knowing that I have CLIA to turn to for the knowledge I need to stay on the upside of some down times.

I am constantly amazed at the efficient and professional job that our staff at CLIA provides. Our team truly believes in the CLIA cause – making California’s tourism industry more profitable and prevalent in our great state. Please use CLIA’s knowledge to your advantage – we’re here for you.

I

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Chair of the Board Jill Macdonald Quality Inn Eureka Vice Chair Sima Patel Holiday Inn Express Oakland Airport Oakland Secretary Terry Westrope Sterling Hotel Corporation San Luis Obispo Chief Financial Officer Don Turner Golden Bear Motel Berkeley Immediate Past Chair J. P. Patel Best Western Colony Inn Atascadero President/CEO Rick Lawrance Sacramento

Directors Joe Dedio Holiday Inn Costa Mesa Costa Mesa Laurenne Douglas Pacific Plaza Hotels Alameda Doug Forzani Merritt House Inn Monterey Bev Holthouse Ridgemark Golf & Country Club Resort Hollister Peter Kwong Best Western Dragon Gate Inn Los Angeles Christopher Layton Christopher’s Inn Calistoga John Manderfeld Marin Management Sausalito Howard Mathews Howard Mathews Lodging Broker Discovery Bay William O’Connell Best Western Stovall’s Inn Anaheim Dilip Patel Holiday Inn Express Hotel & Suites Mountain View Mahendra Patel Menlo Park Inn Menlo Park Ramesh Patel Sonora Days Inn Sonora John Reinacher Historic Santa Maria Inn Santa Maria Dean Ruffing Best Western Bayside Inn San Diego

HEADQUARTERS REPORT CLIA COMMITTEE CHAIRS ASSOCIATE MEMBER COMMITTEE Ed Bear AutoClerk (925) 284-1005 BED & BREAKFAST STEERING COMMITTEE Doug Forzani Merritt House Inn Monterey (831) 646-9686

By Rick Lawrance President/CEO

AAA Ratings – Are Diamonds Still

CONFERENCE COMMITTEE Mahendra Patel Menlo Park Inn Menlo Park (650) 326-7530

Our Best Friend?

EDUCATION & SCHOLARSHIP COMMITTEE Bev Holthouse Ridgemark Golf & Country Club Hollister (813) 637-8157 INTERNET/AUTOMATION COMMITTEE John Manderfeld Marin Management, Inc. Sausalito (415) 331-1061 GOVERNMENTAL AFFAIRS COMMITTEE Bob Griffin Sterling Hotel Corporation San Luis Obispo (805) 546-9388 MEMBER BENEFITS COMMITTEE Chris Middleton American Hotels Inc. Palo Alto (650) 321-4106 MEMBERSHIP DEVELOPMENT COMMITTEE Howard Mathews Howard Mathews Lodging Broker Discovery Bay (925) 634-1873 NOMINATING COMMITTEE J. P. Patel Best Western Colony Inn Atascadero (805) 466-4449 COMMUNICATIONS COMMITTEE John Reinacher Historic Santa Maria Inn Santa Maria (805) 928-7777

F

or many years, the lodging industry has placed a high priority and high value on AAA inspections and ratings. These ratings – of one to five diamonds – have long been an important indicator to the American traveling public of the cleanliness, quality, available amenities, and service level offered by each rated property. Annual AAA TourBooks have long been referred to as the travel “bible” for AAA’s estimated 46 million members. CLIA has embraced these important TourBooks, working with AAA to develop special and cost-saving advertising opportunities for our members.

More recently, however, some CLIA members have told us of their concerns regarding the fairness and consistency of the inspection standards and property inspection process, and the resulting ratings. Clearly a loss – or gain – of one diamond can substantially affect a property’s business model and ability to attract guests. As a result of these member expressions of concern, our board of directors created an ad hoc committee to gather facts and information, and to chart a course of action to address member concerns. This “course of action” was not intended to be confrontational; CLIA is committed to working cooperatively with our AAA colleagues in San Francisco, Costa Mesa, and at AAA Headquarters in Heathrow, Florida.

We have sought greater understanding of the standard setting process. We noted that while 88 percent of all AAA-rated properties are either two or three diamonds, the committee setting the standards was largely comprised of representatives of four- and five-diamond facilities. CLIA has committed to sending two member representatives to actively participate in future AAA lodging requirements and diamond rating guidelines revisions. AAA has welcomed that commitment. We have also urged AAA to further postpone new guideline revisions until the economy, and domestic travel, substantially improve. And we have sought a grace period of four to six years for completion of major capital improvements, when required by guideline revisions.

Clearly, AAA Ratings and AAA TourBooks are valuable and respected marketing tools, and AAA is an equally valued and respected travel industry partner.

During the current challenges confronting the lodging industry, this partnership warrants greater cooperation and understanding. CLIA will continue to pursue that aim and steadfastly represent the interests of our members.

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Spring 2003

Weathering War in the

Lodging Industry

By John Manderfeld

I

n 2003, work hard to keep the loyalty of the customer you have and work hard to get some more.

Here is why:

Revenue Outlook The Iraq war, a probability at the time of this writing and perhaps a certainty when these words appear in print, is this year’s major uncertainty for the travel industry. In California, the war will have a bigger impact on travel than in most other states, partly because we benefit from so many visits by international travelers, who are likely to stay away during a war as they did during the first Gulf War. Experts are predicting a short war will cause a sixmonth slump for the travel industry, just as in the first Gulf War. Increased airport inconvenience, higher gasoline prices and travelers’ security worries will eliminate a significant portion of non-essential travel.

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From an article titled, “Industry Will Battle for Profits in the Event of War with Iraq,”1 here are two ominous quotations from the experts: “The unanticipated consequences of war in Iraq … shift hotel revenue forecasts noticeably downward.” Jack Corgel, Ph.D., HRG managing director “Our analysis shows RevPAR growth in this segment (chain-affiliated, full-service) will be significantly reduced in the case of a ‘short war’ scenario while it will turn negative in the case of a ‘long war’ scenario.” Petras Sivitanides, Ph.D., vice president of research, TRW.

Identify and implement the top 20 actions you can take to drive more guests to your hotel.

Another menacing factor for the travel industry is the possibility of one or more failures of major U.S. airlines. Such failures would most affect the California lodging markets relying on fly-in visitors. With reduced airline schedules and higher fuel prices, airfares will increase, which will cause reduced commercial and leisure travel.

Without war, many experts are forecasting flat occupancies in 2003 with slight declines in average room rates. Some areas of California, such as San Diego County, will continue to thrive, however.

We know from looking at the past 18 months that those hotels having the strongest brands will be least affected by economic decline. The “strong” brands are those with the most powerful frequent-guest programs.

Next in line to retain the most business are those hotels that invested in

renovations, maintenance, sales activities and marketing during the good years and are continuing that investment today. An edge also goes to those hotels in communities with convention and visitor bureaus that are feverishly active, well-financed, flexible and creative.

Operating Expenses You can expect operating and overhead expenses to continue to increase during the next 12 to 18 months. The most significant expense increases will be for water, sewer, electricity and in all categories of insurance. For franchisees, add expense increases from changing brand standards and new brand training programs.

Hotel Development No doubt, there are fewer opportunities for hotel development than there have been during the past several years. Some locations, however, are still suitable for new hotel developments. These locations are in growing communities, small markets underserved by below-average lodging facilities, and locations near expanding companies, colleges, prisons, medical facilities and government offices.

hotel asset management since 1986), “It’s just not the way it used to be, and it never will be again, so implementing new practices is critical to success.” 2 So, what are those “new practices” critical to your success?

First, audit your guest service programs and facility conditions to assure they are at a level to keep the customers you have and effectively compete for new customers. Second, start the proven best practices for sales and marketing to build business.

Identify and implement the top 20 actions you can take to drive more guests to your hotel. There will still be a lot of hotel customers, but you need to give them reasons – stronger reasons than before – to pick your hotel.

1

Hotel Business, November 7-20, 2002, page 1.

2

“New Business Practices Essential to Lodging

Companies Success,” Real Estate Forum, January 2003.

The Internet Once considered a source for new business, it is becoming increasingly apparent that consumers’ greater use of Internet booking channels (Priceline.com, Hotels.com, and dozens of others) is contributing to hotel rooms often being sold as a commodity to those seeking the lowest prices. How to minimize the decline of RevPAR from the Internet is a challenge to every hotel owner and operator. The response to this challenge is too complex to discuss in this article, but we know, in 2003, every smart operator will have written procedures for managing rates and available guest room inventory for each Internet booking channel.

What To Do According to Rick Swig, RSBA Associates (a firm specializing in California

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John Manderfeld, president and founder of Marin Management, Inc., in Sausalito, California, is a more than 30-year veteran of the lodging industry and a Certified Hotel Administrator (CHLA) as recognized by the Educational Institute of the American Hotel and Lodging Association. His career includes 11 years in food-and-beverage operations and sales with Westin Hotels and Resorts and the position of vice president for two major development and management companies – Metro Hotels, Inc. and Mariner Corporation, both of Dallas, Texas. Mr. Manderfeld may be reached at Marin Management, Inc. in Sausalito: (415) 331-1061.

Doing Business in a

Down Market You Can What D o

t-I Firs

yard in Yo ur Own Back

mpression C usto mer Service nsive Ma Inexpe rke tin gI deas

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ss sine u B at Loyalty and Repe

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e would like to offer this reprinted article from the Winter 2002 issue of California Lodging in companion with Mr. Manderfeld’s article on “Weathering War in the Lodging Industry.”

This article was written by four lodging and tourism veterans who were asked, post 9-11, to offer their own ideas and suggestions on new and “tried-and-true” marketing and promotional ideas for the lodging industry to assist other owner/operators in securing new business as well as retaining the loyalty of existing guests for return business. The ideas and suggestions are as valid today as they were then. Here’s what they had to say: California

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What You Can Do in Your Own Backyard

By Dean Ruffing Since the California economy – and the general state of business – has taken a tremendous nosedive since the tragic events of September 11, hotels and lodging properties have had to refocus on their source of business. The hospitality experts have opined that the leisure markets will rebound much more quickly than the corporate and meeting markets. Within the leisure market, the “drive” market is experiencing the fastest recovery growth rate. The San Francisco, Los Angeles and San Diego Convention and Visitors Bureaus are all targeting markets within 500 miles of their respective destinations. Therefore, the lodging industry can even target markets closer to home without spending additional marketing dollars.

The following are a few ideas that you might employ at your property to generate or augment your in-state business: 1. Churches and temples all play host to weddings, bar mitzvahs and special events. Since these organizations are nonprofit, give them the opportunity to earn additional income by referring room business to your property. Offer a commissionable rate to these different organizations. Perhaps you can also have the reception at your property.

2. Create “value-added” packages and advertise in the smaller feeder markets. These ads can simply be a listing in the classified section of different publications.

3. Target all special events coming to a local community. Focus on sporting events, social club activities and cultural events. Offer rebates on room nights so these organizations can generate additional income.

4. Work with feeder market hotels to create a “discount or value added coupon” book. These coupons can be presented to guests at check-in. The “value added” coupon book has special offers in the local community, and special hotel packages in completely different, non-competitive destinations.

Take advantage of each other’s leisure customers.

5. Properties that are AAA appointed/approved can offer special packages or discounts in these monthly publications. There is no cost for these specials: • Northern California – Going Places publication • Southern California – Member Savers publication One or all of these programs may be successful for you. However, in order to ensure success, there must be commitment. These programs must be reviewed quarterly, if not monthly, to assure that details are taken care of and the program

is being properly promoted and serviced.

First-Impression Customer Service

By John Manderfeld Many of us in the lodging industry are wondering what to do next. The economic downturn is deeper and longerlasting than predicted just a few months ago. Of course, smart hotel owners and operators throughout California are refocusing on sales and marketing while searching for ways to reduce expenses without reducing the quality of each

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guest visit. But there is more to be done to protect your hotel investment.

Guest service is now more important than ever.

What should you now be doing differently in guest service? You can improve guest service to gain market share. It is unlikely that any change in service will immediately return your hotel’s financial performance to the record years of 1999 and 2000. By setting and implementing improved service standards, however, you can increase your hotel’s share of business within your competitive set.

Great service builds repeat business and builds referrals of new business.

Great service builds great relationships between your hotel and each of your customers – and that grows your most valuable asset, customer loyalty.

I suggest you commit to using this economic downturn to gain an edge on your competitors so that, when the economy gets back on track, your hotel will be in the lead to enjoy the benefits of that economic recovery. Your goal should be to move up one or two positions in revenue per available room (RevPAR) during this economic downturn.

Here are some tips – three challenges – to reposition your hotel’s service standards to gain market share. I call these three challenges “20-10-1”: First, challenge your staff and yourself to find at least 20 service standards that can be done just slightly better at little or no cost. For example, improve the greeting as each guest arrives in your lobby, wash your guests’ car windows, set higher standards for employees’ grooming and attire, call and thank every travel agent personally. I bet you and your staff could think of a hundred more low-cost ideas to impress your guests just a little more than you do now. Review every service standard in your guest services and housekeeping manuals to find at least 20 that can be done a little better. Your customers will notice.

Challenge two: Spend a night at a key competitor and challenge yourself to find 10 things that your competitor does better than they’re done at your hotel. Perhaps you will discover your competitor has better pillows, better

wake-up calls, a better welcome letter, a restaurant reservation service, or something that is missing from your breakfast. Make the commitment to do each of these 10 things better than before – and better than the competition.

The third challenge: Pick at least one hotel feature or service for which you are willing to make a capital investment.

Ask your customers and employees what is missing from your hotel that would make a difference, such as fitness equipment, transportation services, whirlpool spa, larger beds, down comforters, or DVD players. Find that one affordable feature that will make a difference. When your customers see you are making improvements while others are reducing services, you will be the winner.

Finally, recognize that higher service standards and new features require a detailed implementation plan, and the key to that plan is thorough training. As Mark Twain said, “Training is everything. The peach was once a bitter almond; a cauliflower is nothing but cabbage with a college education.”

Inexpensive Marketing Ideas

By Rick Lawrance Many members have asked CLIA, “Do you have any great ideas for marketing and promoting our property in this down economy?” So I called longtime industry colleague and public relations guru Cynthia Fontayne, president of the Fontayne Group, for some proven techniques that she and her clients have employed or considered. Here are a few that she shared, which may work for you: • Hold Cab Driver Appreciation Day – free hot coffee and doughnuts for any cabbie who pulls up. Give them their snack and a flyer about the hotel so they can recommend you to their fares who arrive in town without a reservation. Let the local paper and TV stations know in advance. Do it once a month, varying the day and time, so you get all the shifts.

• Firefighter or Police Officer Appreciation Day – they get plenty of food at the firehouse or police station, of course, but invite them to stop by anytime, show their badge and get a

cup of coffee, etc. Alternatively, set up a schedule to bring a basket of homemade chocolate chip cookies to every station house in your area.

Alert the media.

• Donate a weekend stay with some extras to your local PBS TV station, local NPR radio station and/or other high-profile, worthy nonprofits.

These get you free “air time.”

• If there is a college or university nearby, talk to its alumni council to offer special rates for class reunions, parents’ days and gradua-

tions. Make sure your property is included as a resource in the information the council sends to parents and students. Also, look at prep schools and other institutions that draw visiting parents and graduates.

Create a special rate and package.

• Look into any institutions that offer continuing education courses or seasonal workshops and see how your property might fit with the housing needs of their adult students. Create a special rate and package.

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• If you have a newsletter, be sure to add some journalists to the distribution list.

• Rent a mailing list that fits your clientele profile and do a postcard mailing to your community with a “tell a friend” message, asking them to recommend your property to visiting friends and family.

• Create a special “family reunion” rate/package – use your group rate but put in some value-added items such as complimentary disposable cameras and a photo album so they

can record the visit. Send a postcard, again, to the local community.

• Look for human interest stories inhouse – an employee with an awardwinning hobby or talent, one who has been with the hotel for 25 years, etc. Great for local feature reporters.

• Set up a lending library of “good reads” – real hefty hardback books (you can get even recent ones in practically new condition at the Salvation Army and Goodwill for a dollar or two apiece). The extra newsworthy angle: Guests can take

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a book with them if they have not finished it before departure if they promise to then donate it to their local library when they get home.

Order some bookmarks with your hotel logo, some promo copy, reservation number and Web address on them and place them in every book.

Copy shops can run this off for you very inexpensively. You could also paste a bookplate in the cover of each book with your hotel name, number and web address.

• Send a form letter to radio stations in your drive markets – usually two to three hours – offering room packages as prizes for on-air contests. Make sure you approve the copy describing your property. You can make the package by co-oping with a local restaurant, attraction, or seasonal event.

Not all of these “promos” may fit your property, but take the basic idea and redesign it to your special needs, market or location.

Lodging

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Spring 2003

By John Reinacher When I was initially contacted by California Lodging magazine to write this article on how to make sure your guests return again and again and again, I said to myself, “piece of cake.” After all, I’m a seasoned veteran in the hotel and marketing arena.

However, I soon realized that most of our members are small to mediumsized hotels and inns with very limited budgets.

The corporate national marketing strategies used by the Hiltons, Hyatts and Radissons of the world are not available to many of our members.

The free airline mileage program – such as “stay one night and get 500 miles” – and the national branding programs definitely create loyalty.

National corporate-rate programs, free weekends at resorts, national advertisement programs; they all work, but these great programs are not available to most of our independent lodging owners and operators.

Unfortunately or fortunately, most CLIA members need to offer a more personalized and targeted approach!

So, here are my suggestions to address and build guest loyalty and repeat business: • First and foremost, offer a clean, well-maintained and comfortable hotel, motel, or inn. Create personality and character in order to offer a distinctive and unique property.

• Always take full advantage of your strengths. Whether it be location, historical significance, or recreational attributes – always reinforce these strengths via flyers, brochures, or verbal communications to your valued guests both within the hotel and at the local chambers, bureaus and civic organizations.

• Always recognize your guests by name.

• Get to know your valued guests.

Make a special effort to learn more about your customers. Walk the property – meet and greet!

• Drop a short note thanking the guest for returning. Include a token gift.

• Create a reward program for the individuals responsible for booking your repeat guest. A “corporate secretary

• •

•

•

•

program” works great! Offer gift certificates for lunch, dinner, etc. Whatever the program is, it must be consistent, timely and honored.

Upon check-out, offer a discount certificate to return during off-season.

Recognize your best guest of the day by reserving the “VIP Suite” or “Guest of the Day” suite. Depending on the program, the manager should escort the guest to the suite, offer complimentary dinner, wine, chocolates, etc. In other words, “wine and dining!” The guests selected will not soon forget the special recognition they received.

When you and your staff interact with the guests, always dedicate 100 percent of your attention to the guest you are attending.

Consider using your guest history for direct-mail purposes. A simple postcard from the owners or GM is quite effective.

Offer your own version of a 100 percent guest satisfaction program with a clear, definitive set of parameters appropriate for your property.

California

Lodging

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Spring 2003

Probably the most important point I’m trying to make is to practice good, old-fashioned hospitality and always make the guest feel that “We’re glad you are here.” Attitude is everything.

Instill this attitude in every member of your staff.

This article is a reprint of an article appearing in the Winter 2002 issue of California Lodging. The authors included: Dean Ruffing is the director of sales and marketing for Lodging Today in the San Diego area and can be reached at: (858) 486-1744. Mr. Ruffing is a current member of the CLIA Board of Directors.

John Manderfeld, president and founder of Marin Management, Inc., in Sausalito, California. can be reached at: (415) 331-1061. Mr. Manderfeld is a current member of the CLIA Board of Directors.

Rick Lawrance, CLIA President/CEO, may be reached at the CLIA offices in Sacramento: (916) 447-6565.

John Reinacher, general manager of the Historic Santa Maria Inn, a beautiful 199-room hotel on the Central Coast, can be reached at: (805) 928-7777. Mr. Reinacher is a current member of the CLIA Board of Directors.

A Call for Nominations!

CLIA’s 2003 Excellence Awards Will Be Presented in September …

“There are countless ways to achieve greatness, but any road to achieving one’s maximum potential must be built on a bedrock of respect for the individual, a commitment to excellence, and a rejection of mediocrity.” – Buck Rodgers In 1999, CLIA established the Excellence in Lodging Awards program to recognize outstanding accomplishments in the areas of lodging

management, operations, and hospitality and services within the lodging industry of California. The awards will be presented to this year’s honorees at the annual CLIA Gala Awards Dinner to be held, September 7, 2003, at the Doubletree Hotel in Ontario during the 2003 Western Lodging Show. The Western Lodging Show is scheduled for September 7-8, 2003, at the Ontario Convention Center in Ontario, California.

Recognition of outstanding excellence within the lodging industry has become a CLIA tradition as we “honor our own” with these very special awards presented each fall. Please give some consideration to these awards and nominate someone you feel should be recognized for their exemplary performance and dedication to excellence in the industry.

Nomination materials for the Excellence in Lodging Awards were sent to all members in April. The deadline to submit nominations for CLIA’s Excellence in Lodging Awards is July 15, 2003.

There are two categories for nominations: Outstanding Lodging Owner or Operator Recognizes outstanding achievement in one of the following categories: community services, construction and refurbishment, employee relations and staff development, sales and marketing, or visitor and guest services.

Outstanding Lodging Employee Recognizes an outstanding lodging property staff person for his or her dedication to serving the guests of the lodging property.

Take an active role in acknowledging excellence within your industry. Nominate one of your peers for his or her true dedication to being one of the best!

California

Lodging

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Spring 2003

LEGISLATIVE Update

By Ralph Simoni and Mike Belote California Advocates, Inc.

W

hen Governor Davis released his proposed budget for state fiscal year 2003-2004, the news was not good for tourism. Faced with the responsibility of bridging a nearly $35 billion budget gap, the governor proposed a series of sweeping and painful cuts; unfortunately tourism was not exempted. The budget document proposes the complete elimination of all funding for the Division of Tourism within the Technology, Trade and Commerce Agency, for general fund savings of $7.5 million annually. Surprisingly, the Division of Tourism was one of the few general fund programs eliminated entirely in the governor’s budget proposal.

A short comment on the structure of California’s tourism effort is in order. Responsibility for tourism promotion is vested both in the state Division of Tourism, and the state’s Travel and Tourism Commission, made up primarily of private industry representatives. The state general fund contributes $7.5 million to the division, while the commission is funded entirely by the self-assessment on tourism-related businesses.

The governor’s budget indicates that “the Tourism Commission will continue to provide opportunities for coordination of marketing of the state as a vacation and entertainment destination.” By de-funding the Division of Tourism, however, the proposed budget effectively eliminates all state support to tourism promotion, since basically businesses are funding the commission through the

self-assessment mechanism. Even with the budget deficit, it would be extraordinary for a state as dependent on tourism as California to dedicate no public resources to marketing and promotion, especially in light of evidence that dollars spent promoting California are returned many times over by tourists visiting our state.

The release of the governor’s proposed budget is only the first round in a

Budget Proposal Targets Tourism lengthy budget season. The Legislature will spend at least the next six months fashioning its own budget bill, and this year especially, it is expected that the governor’s proposal will change markedly. CLIA will be active with our travel and tourism partners in urging the governor and Legislature to maintain these very moderate expenditures in support of an industry so vital to the state economy.

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Member FDIC

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Take an Active Role!

Become an Active Partner with Your Workers’ Comp Carrier and Control Your Costs

W

ith the increase in California’s workers’ compensation benefits rising significantly as of January 1, 2003, properties will not only need to budget for this skyrocketing business expense but also plan strategies to lower business costs to accommodate constantly increasing insurance rates. Workers’ comp costs are scheduled to rise at the beginning of each of the next three calendar years making it increasingly important to control all business costs.

This article will discuss some of the steps you can take to control your rising business costs by assuming an active role in the management of workers’ compensation claims.

Becoming an active partner in the management of your workers’ compensation claims can greatly impact your bottom line.

Comply with the Law 1. Workers’ compensation insurance is mandatory and failure to comply with the law can result in significant additional financial costs to your property.

2. Maintain your insurance coverage at all times.

3. File reports on time, particularly any report dealing with serious injury or death of an employee.

4. Display the 2003 edition of the workers’ compensation poster in all workplaces.

5. Give copies of the 2003 workers’ compensation pamphlet to all new employees.

Consider your Insurance Rates 1. Call CLIA to request a quote for CLIA’s State Compensation Insurance group workers’ comp program offering premium savings off standard SCIF rates along with the possibility of dividends at the end of each policy year.

2. If you have placed your comp insurance with State Compensation Insurance Fund and you are a CLIA member, but are not currently in the CLIA/SCIF workers’ comp group, call the CLIA HelpLine to request a conversion form.

Prevention of Illness and Injury 1. Reduce your costs by maintaining a safe working environment.

2. Schedule regular inspections of the workplace and work equipment and hold managers accountable for safe working conditions and practices.

3. Train managers to recognize health and safety hazards, including ergonomic risks. Members utilizing CLIA’s State Compensation Insurance Fund group workers’ compensation insurance program may access the company’s vast Internet library of safety training subject matter.

4. On an employee’s first day of work, orient him/her to the workplace California

Lodging

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Spring 2003

risks he or she may encounter on the job. Take this opportunity to enforce your property’s commitment to a safe work environment by explaining safety practices.

5. On an employee’s first day, explain emergency procedures regarding instructions in case of fire, earthquake or other serious emergency and what to do if an employee sustains an injury. Schedule reinforcement training, on a regular basis, with existing employees to remind them of emergency procedures.

6. Interview injured employees and others who witnessed the accident in an effort to investigate accidents and injuries to determine the causative factors. Examine the scene and equipment involved in the incident. If the injury presents ergonomic issues, seek advice from a consultant in workplace design.

Injured Employees 1. Assure that prompt, courteous, convenient and qualified medical attention is provided for an injured worker. This can make a critical difference in maintaining medical control of the case and in controlling your workers’ compensation costs.

2. Reassure the injured worker that you will do everything possible to see to it that benefits and treatment will be provided and that the job will be waiting for his/her return to work.

Employees who feel valued both as individuals and as team members return to work faster and are less likely to become involved in litigated workers’ compensation cases.

3. Follow up with your injured employee to make sure he or she is receiving temporary disability payments on time and for the correct amount.

4. Follow up with your injured employee and your insurer’s case manager to be sure the necessary medical treatment is being provided and that referrals to specialized medical or rehabilitation services are made if they are required.

5. Communicate with your company physician to assure his/her familiarity with your property’s modified duty/return-to-work program.

6. Your medical provider needs to understand the difference between first-aid cases and those that must be reported to your workers’ compensation insurance carrier. Appropriate classification of first-aid cases with direct billing of first-aid treatment to the employer will have a direct impact on your future premiums.

Indicate on the “Authorization for Medical Treatment” form that your property pays directly for all first-aid cases.

• Employees who feel valued both as individuals and as team members return to work faster and are less likely to become involved in litigated workers’ compensation cases.

• Appropriate classification of first aid cases with direct billing of first aid treatment to the employer will have a direct impact on your future premiums.

• If you believe a claim is fraudulent or your injured employee is not cooperating with treatment and recovery efforts, advise your insurer and insist on closer supervision of the case.

• New laws permit negotiated rehabilitation settlements under certain limited conditions for those workers who are unable to return to their employment.

Maintain Contact with Your Insurer

Research Credit:

1. Ensure that appointments with appropriate medical providers are being made promptly and are being kept by the employee.

2. Stay in close contact with your insurance carrier to make sure that cases are being properly managed and moved toward closure. Review job duties and medical findings to determine whether an employee might be returned to modified duty.

3. Schedule a periodic review of all open cases to make sure they are being moved toward final resolution.

Encourage prompt closure of cases when an employee’s condition is “permanent and stationary” to avoid lengthy periods of temporary disability payments.

Create and Manage a Return-to-Work Program 1. Employees who return to work quickly have a more successful recovery and save on workers’ compensation costs. Offering reasonable work opportunities at the employee’s regular rate of pay avoids temporary disability payments and can result in substantial savings of insurance premiums.

2. Advise the case physician of the essential duties of the employee’s regular job so that recommendations can be made if temporary modifications are needed.

3. Describe other available work opportunities to encourage medical support for a return to work. Offer the opportunity to do something useful, whether it is a modification of the employee’s regular job or some other task that is within the employee’s immediate physical capability.

4. An employee who refuses a reasonable work assignment can be denied temporary disability payments.

As is true with most aspects of managing your property, success comes with active involvement!

Take an active role, become a partner with your workers’ compensation insurer to help control your costs.

California

Lodging

California Chamber of Commerce – Alert – January 31, 2003 (Paul Schecter, Employment Law Counsel, California Chamber of Commerce) State Compensation Insurance Fund – Bea Caldevilla/Sacramento, CA Please Note the Following: 1. Under California law, it is unlawful for an insurer to promise the future payment of dividends under an unexpired workers’ compensation insurance policy or to misrepresent the conditions for dividend payment. Dividends are payable only pursuant to the conditions determined by the board of directors or other governing board of the company following policy expiration. It is a misdemeanor for any insurer officer or agent thereof, or any insurance broker or solicitor, to promise the payment of future workers’ compensation dividends. Past dividend performance is no guarantee of an insurer’s future dividend performance.

2. Universal Lodging Industry Services (ULIS) is a wholly owned subsidiary of the California Lodging Industry Association (CLIA). Any group dividend or bonus earned by the group program for the policy year 2003 shall be distributed at the discretion of the ULIS board of directors. The board of directors retains the right to forfeit or reduce dividends and bonus payments for management and administrative fees.

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Spring 2003

SWITCHING YOUR COMPANY TO STATE FUND MAY NOT CHANGE YOUR WHOLE LIFE. JUST A FEW HOURS OF IT HERE AND THERE. Our 85 years of experience with workers’ compensation can make your hours better. We’ll handle your claims quickly. And give you safety programs so you don’t have to spend time setting them up yourself. Join the State Fund/California Lodging Industry Association today. Eligible members may receive a group discount on their workers’ compensation insurance premiums.. Whatever we can do to get you on to more important things. Call your broker or Kent Woodward of State Fund group programs at 916-263-7380.

www.scif.com

California

Lodging

18

Get More. Worr y Less. ®

Spring 2003

UPDATE CLIA/PKF Announce New Monthly TRENDS Program

Our Sympathies to the Macdonald Family We are saddened to report that Linda H. Macdonald passed away recently. Mrs. Macdonald, the mother of current CLIA Board Chair, Jill Macdonald, was the wife of past CLIA Board Chair, Jack Macdonald (1991-1992).

CLIA extends its deepest sympathies.

CLIA Excellence in Lodging Awards Nominations In keeping with the California Lodging Industry Association’s desire to “honor its own,” the 2003 Excellence in Lodging Awards nomination materials were mailed to members in April. CLIA’s Excellence in Lodging Awards are presented annually to recognize the best in lodging management, operations, and hospitality services in the state of California. We encourage all members to submit nominations in recognition of outstanding achievement in the lodging industry. The deadline for nominations is July 15, 2003.

2003 Employee Poster Sets Still Available from CLIA CLIA’s 2003 laminated poster set includes all of the state and federally mandated guidelines for employees, including: minimum wage, EEO, Cal/OSHA, Workers’ Comp, and others. The posters are 25" by 37", sized to mount behind a door, and are available in both English and Spanish. When ordering, please specify English and/or Spanish and the quantity of each that you require. The poster sets are available only to CLIA members and are priced at $35 per set including postage and handling and must be prepaid. Call CLIA to order yours.

What’s New on clia.org Be sure to check the latest features and articles recently added to the CLIA website, www.clia.org: • California Tourism’s Contribution to the Economy • Update on Minimum Wage and Employment Law Q&A • MediaWrites Endorsed Provider Information • Past issues of CLIA newsletter LOBBY • 2003 Federal Per Diem Rates (Members-Only section)

California

Lodging

CLIA has formed an alliance with PKF Consulting (PKF/C), a major international consulting company which tracks lodging industry statistics. CLIA is inviting members to participate in a new cooperative program that will become part of TRENDS IN THE HOTEL INDUSTRY, a monthly publication produced by PKF/C, that tracks average daily rate and occupancy for hotels throughout California and the U.S. Our new joint venture program will generate and provide more specific information for California’s smaller and mid-size lodging properties. This venture between CLIA and PKF/C will also provide “targeting trends reporting” for participating CLIA members.

Both the Los Angeles and San Francisco offices of PKF/C have been providing consultation services to all facets of the hospitality industry for over 30 years. PKF/C is an international firm of management consultants, industry specialists, and appraisers who provide a full range of services to the hospitality, real estate, and tourism industries.

CLIA member participation in TRENDS will be free and will require only the completion of an enrollment form.

Every month, PKF/C will fax or e-mail a questionnaire requesting number of rooms available, number of rooms sold, and total monthly room revenue. Members will be asked to fill out these forms and return them to PKF/C so that they can provide an accurate report as quickly as possible.

All information submitted will be kept strictly confidential and will only be presented in aggregate form.

For participation in the program, CLIA members will receive a complimentary copy of PKF’s publication TRENDS IN THE HOTEL INDUSTRY every month.

TRENDS is an excellent tool that may be used for budgeting, benchmarking, and understanding the local hotel market.

Information and enrollment forms for this program were recently sent to all CLIA members. CLIA urges all members to consider participation in this program, as the reports generated will be of greater benefit to everyone if there is a high level of member participation.

Please contact PKF Consulting with any questions: James Mbugua PKF Consulting 865 Figueroa Street, Suite #104 Los Angeles, CA 90017 Phone: (213) 680-0900/Fax: (213) 623-8240 E-mail: james.mbugua@pkfc.com

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Spring 2003

• Past exhibitors list from the 2002 Western Lodging Show Our website is updated weekly so please revisit often for the most recent updates and additions.

sionals, this is a great opportunity to market your property.

Listing forms and information will be mailed to all CLIA members. Orders will be accepted until mid-August 2003.

2003 Western Lodging Show & CLIA Gala Awards Dinner

California Tourism Web Site Activity

CLIA’s annual Western Lodging Show has been scheduled for September 7-8, 2003, at the Ontario Convention Center in Ontario, California. The annual Gala Awards Dinner will be held the evening of September 7th at the Doubletree Hotel located at the Ontario Convention Center.

The 2004 California Official State Visitor’s Guide CLIA has negotiated another great opportunity for your property to advertise in California’s State Visitor’s Guide and receive a listing on www.visitcalifornia.com. CLIA has negotiated a discount for members. CLIA members will receive a $420 ad for only $150, a significant discount off the open rate. With more than 550,000 copies distributed yearly to prospective visitors and travel profes-

From January - November 2002, California Tourism’s Web site, www.visitcalifornia.com, has averaged 199,824 visitor sessions, 88,597 unique visitors, and 5,218,902 hits per month. Users to the site average a total of eight minutes and 14 seconds per visitor session. For more information about California Tourism’s Web site, please contact Megan Wright, Web Site Manager, at (916) 322-3586 or mwright@commerce.ca.gov.

Free Travel Research New data is posted regularly under the “Research & Statistics” tab within the Travel Industry section of www.visitcalifornia.com. Bookmark the site and visit often for the latest in California travel statistics!

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Spring 2003

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Index TO ADVERTISERS

ADVERTISING/MARKETING/ TRAVEL GUIDES MediaWrites . . . . . . . . . . . . . . . . . . . . . .22 Traveler Discount Guide . . . . . . . . . . . . .Inside Front Cover

Morris & Garritano’s Hospitality Staff have extensive experience in designing and implementing insurance programs for restaurants, hotels, resorts, motels and bed & breakfast inns.

ATTORNEYS Nixon Peabody, LLP . . . . . . . . . . . . . . . .21

Our expertise includes:

CALL ACCOUNTING SYSTEMS Mirage Hotel Computer Systems . . . . . . . .6

BANKING SERVICES Bank Of The West . . . . . . . . . . . . . . . . . .15

* Access to major insurance markets and national specialty programs * Tailored Workers’ Compensation Claims management * Loss Control services designed for the Hospitality Industry * Employee Benefit services * Reputation in the Industry for integrity * Staff personnel who have managed hotels and resorts

CLEANING AND SANITATION PRODUCTS & SYSTEMS Ecolab . . . . . . . . . . . . . . . . . . . . . . . . . .15

Our staff speaks your language and understands the unique needs of the Hospitality Industry.

1122 Laurel Lane, San Luis Obispo, CA For more information please contact John Hottinger 800-350-0247

INTERNET LODGING DIRECTORY 1st Travelers Choice . . . . . . . . . . . . . . . .18 LAMPS & SHADES Catalina Lamp & Shade . . . . . . . . . . . . .22 LAUNDRY EQUIPMENT/SALES, SERVICE, SUPPLIES & TRAINING Super Laundry . . . . . . . . . . . . . . . . . . . .11 LODGING BROKERS Howard Mathews & Associates . . . . . . . .10

CONSTRUCTION Huff Construction Co. . . . . . . . . . . . . . . .14

MAINTENANCE/HOUSEKEEPING Oreck Commercial Sales . . . . . . . . . . . . .21

COMPUTERS/SOFTWARE AutoClerk . . . . . . . . . . . . . . . . . . . . . . . .18

PAINTING Ross Painting . . . . . . . . . . . . . . . . . . . . .17

CREDIT CARD PROCESSING Paymentech . . . . . . . . . .Inside Back Cover

PEST CONTROL Western Exterminator Company . . . . . . . .6

FOOD & BEVERAGE SYSTEMS Mirage Hotel Computer Systems . . . . . . . .6

PROPERTY MANAGEMENT SYSTEMS Mirage Hotel Computer Systems . . . . . . . .6

FRANCHISES Sholodge, Incorporated . . . . . . .Outside Back Cover

SOLID SURFACES Calply . . . . . . . . . . . . . . . . . . . . . . . . . . .21

Quotations on any hardbacks, knife pleats or mushroom pleats. Prompt service, long or short run capability.

Brass rings on request.

9917 Gidley, El Monte, CA 91731 Phone: 800-447-7611 Fax: 626-448-4791

Lodging

INSURANCE Morris & Garritano Insurance . . . . . . . . .22 State Compensation Insurance Fund . . . .18

COMMERCIAL LAUNDRY SYSTEMS PWS The Laundry Company . . . . . . . . . .12

FURNITURE Premier Furniture . . . . . .Inside Front Cover

California

HOTEL & LODGING MANAGEMENT Bon Management Group . . . . . . . . . . . . .20 Sterling Hotels Corp. . . . . . . . . . . . . . . . .20

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Spring 2003

TELECOMMUNICATIONS Call Management Products . . . . . . . . . . .21 USP Communications . . . . . . . . . . . . . . .13

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©2003 1361

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