Product Improvement Plans (PIP)
When you consider a hotel acquisition, you evaluate retaining the hotel’s existing brand and may consider alternative brands. Whether you are the new owner seeking to keep the hotel affiliated with its current brand (a “change of ownership” process) or are applying for affiliation with a different brand, the hotel will be evaluated by the brand for compliance with brand standards. A PIP is a document prepared by a franchise or brand that details the upgrades and replacements required for a hotel to be accepted as, or continue as, an affiliate.
The PIP is a list of every little thing that must be upgraded, updated, renovated or replaced for the hotel to remain in the brand system. Minor or major renovations are common in PIPs depending on the brand and the current condition of the hotel. Changing brand also includes adopting new brand identifiers.
As owner, you typically will engage contractors to implement the plan.
Completing the PIP typically brings the hotel into compliance with brand standards.
According to HVS, an effective PIP should help owners gain market share, increase guest satisfaction, drive revenue performance, and enhance profitability.
Executing a PIP is as simple or complex as the individual PIP for your hotel. Once you have settled on the scope of work with brand, take the time to plan implementation. PIPs take budgeting, contracting, the team of experts and contractors. Timing matters - you will implement the PIP during the off-season, if practical.
