Red Roof Outsources Tech Stack to HotelKey to Help Combat Labor Shortage

25.08.2023 - 14:45 / skift.com / Justin Dawes

When George Limbert began as president of Red Roof, he met with franchise operators of the hotel brand to better understand what was going well — and what was not. 

He became interim president of the Ohio-based company in late 2020 and took the role fully in August 2021. During that time, of course, the industry was struggling. 

The Red Roof portfolio includes 682 hotels across four brands. More than 100 of those are operated by two franchises affiliated with the corporate Red Roof company. The rest are operated by independent franchise owners. 

One of the top issues was the lack of hospitality workers in the current labor shortage. Franchises needed to reduce their dependence on workers, and technology is a big piece to solving that puzzle. 

“Innovating to help with the labor shortage is an imperative for us from a brand level,” Limbert said. 

That’s why Red Roof on Friday night announced that it is partnering with Texas-based HotelKey as the official property management system for the company. 

All Red Roof franchise owners are required to use the official corporate tech system, which historically had been developed, hosted and supported in-house. It had been clear that Red Roof was limited in what it could invest, which is why it needed to outsource, said Ted Hutchins, chief information officer for Red Roof. 

The platform’s simple interface will be a big help for owner-operators with worker training, he said.

“As you can imagine, they have a huge amount of turnover in this labor market. One of the biggest problems is if you have an old creaky interface, it takes too long to train,” Hutchins said. 

The HotelKey platform will streamline a number of Red Roof operations, including property management, guest management, central reservation, point of sale, connectivity to third-party booking platforms, and a loyalty program. Owner-operators will also have access to tech, like housekeeping and preventative maintenance apps and electronic signatures, that Red Roof had not been able to invest in prior because of lack of resources. 

Franchise owners pay a fee to the Red Roof corporation for the tech it provides. That fee had been used to run the in-house software system, and now it will be used to operate the HotelKey system instead. 

“We came from an internal system, where we put $1 in and get maybe 10, 20 cents of innovation out of it,” Hutchins said. “The community model lets me put $1 in and get two, three, four dollars back.” 

It’s unclear at this point how well the tech will lead to more guest sales. 

“It’s hard for us to forecast that … but there’s indications that better connectivity with some [online travel agencies] and less complexity in booking leads to better conversion,” Hutchins said.

HotelKey