Making motel partnerships successful

Since my last article on this topic nearly three years ago I have been witness to some very good motel operations that have been run under a partnership arrangement.

Each has had a different method of operation and each has had its own trials and tribulations. In the greater majority they have worked well for the purpose of the owners and allowed each owner various benefits that they may not have been able to enjoy as a single operator. A partnership operation in any business is not everyone’s cup of tea. Many do not want to work with others and many simply cannot work with others for different reasons. The partnership method of operation in motels has increased in popularity over the last few years. Demand within a market drives growth for this type of operation and those demanding it will in the end make it happen.

Demand has largely come from new moteliers to the industry. Two couples who know each other and are comfortable with each other from a trust or friendship point of view are in the main those demanding this type of operation. That is not to say experienced moteliers are not interested, as some have seen an opportunity to expand into different geographical locations without having to be in two or more places at once. In any business it is easy to spread yourself too thin. The
converse also applies where one side of the partnership is new to the industry and can benefit from the experience of a seasoned motelier.

Some believe that the motel industry is ideally suited to a joint management arrangement between two couples. Many operators of motels can fall into the trap of burning themselves out rapidly by trying to do everything. In a business such as a motel, burnout can occur rapidly unless more workable methods of operation are initiated to avoid this situation. The fact that you are there and “Johnny on the spot”, is often the instigation of this. It seems easier to do a job yourself rather than be bothered organising or paying someone else to do it. Ultimately this takes time away from the operator’s golf or other preferences for relaxation (or frustration in the case of golf).

An alternative to putting on extra staff to alleviate everyday time constraints and pressures is the partnership arrangement. An example is each couple work a month on and month off or longer depending on what suits both couples. This leads us to the main concern some have of entering a partnership and that is how well both couples can get on together and make joint decisions that both will be happy with, and will be in the best interests of their business.

Trust and communication will make or break a partnership in any business, not just motels. Also not working together on site at the same time would seem like common sense. It would be assumed that if two couples know and trust each other then they are probably going to be like-minded people, and this would be a big key to the success of the partnership, similar values, beliefs and work ethics.

There are many benefits to those with a partnership arrangement. Some of these include:

• Alleviating possible early burnout – owners working longer hours without getting away for a break can be avoided with for example a month on month off type operation

• The residence provides accommodation for both couples as they move in and out for their shift

• Only working half of the year – more time to travel and enjoy life with flexibility

• Doubling the level of finance that is available allows the purchase of a larger motel business and higher standard of property to be acquired

• Experience – having another party or couple to enjoy the experience with, spread the risk and to share the highs and lows

On the other side of the coin, one must consider where these types of arrangements could go wrong, thereby helping make an informed decision before diving in boots and all.

• The more people involved increases the risk for arguments which is a potential problem in any business

• Different methods/standards of operation – one couple finish their month on and then leave the business in a poor state, finance or cleanliness wise

• Working too closely together – partners working together at the property can create friction

Having a structured partnership agreement in place to prepare for any future issues you may not see coming can be a good place to start.

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