I Channel Profile Operator

45

LODGING OperatorChannel Profile

TOTALTRAFFIC

-0.1% 2%

Source: NPD Crest YE Sept. 2017 vs Prior YearSource: Technomic

Source: Technomic 2017

39.6BILLIONexcluding alcohol

TOTAL CHANNEL

SALES

48.7BILLION

with alcohol

TOTAL CHANNEL

SALES

Total Lodging Traffic

GPO/Management Company Affiliation

Key Channel Players

Source: Technomic

Avg. Purchases per Location:

$227,867

GPO

FoodBuy

AvendraMember

AvendraMember

3YR CAGR

Top 3 Management Co.


LUXURY

UPSCALE

MIDSCALE

ECONOMY

TOTAL

SHAREOF TOTAL

CHANGESINCE 2015

CORP. 3RD PARTY INDEPENDENT TOTALMANAGED COMPANY

# HOTELS

229

1,483

2,035

2,467

6,214

11%

9.2%

# HOTELS

46

1,732

8,547

1,247

11,572

21%

8.8%

# HOTELS

83

1,172

16,308

19,940

37,503

68%

2.1%

# HOTELS

358

4,387

26,890

23,654

55,289

100%

4.2%

# ROOMS

84,549

605,883

331,229

280,249

1,301,910

25%

4.3%

# ROOMS

10,479

454,339

978,843

109,810

1,553,471

30%

9.2%

# ROOMS

13,532

155,796

1,104,133

1,073,836

2,347,297

45%

1.0%

# ROOMS

108,560

1,216,018

2,414,205

1,463,895

5,202,678

100%

4.1%

MANAGEMENT COMPANY AFFILIATION

Back To Main Traffic Chart

46


Key Focus Areas - Share of Purchases/Sales

• Less than 1% of total properties include casinos. On average, however, these properties tend to be larger than average and make up nearly 5% of total rooms in the lodging segment.

• Upscale properties, while only representing about 8% of total properties and 23% of rooms, accounted for 54% of total revenue.

• Economy properties, on the other hand, while representing a large share of properties represent a very small share of food and beverage revenue.

TOTALREVENUE

($M)

11,797

1,007

467

20,006

4,443

405

3,396

3,376

293

3,303

182

26

48,731

PERCENTOF TOTAL

24%

2%

1%

41%

9%

1%

7%

7%

1%

7%

<1%

<1%

100%

SHARE OF TOTAL - LUXURY

18%

<1%

<1%

55%

11%

2%

6%

2%

1%

4%

1%

<1%

100%

SHARE OFTOTAL - UPSCALE

23%

1%

1%

47%

9%

1%

10%

4%

1%

3%

1%

<1%

100%

SHARE OFTOTAL -

MIDSCALE

30%

5%

1%

27%

9%

<1%

2%

11%

<1%

14%

<1%

<1%

100%

SHARE OFTOTAL -

ECONOMY

9%

6%

11%

12%

10%

<1%

4%

40%

<1%

8%

<1%

<1%

100%

TOTAL REVENUE LODGING FOOD SALESBY SEGMENT

FULL SERVICE RESTAURANT

LIMITED SERVICE RESTAURANT

LOBBY KIOSK SALES

BANQUETS & CATERING

BARS & LOUNGES

POOL BARS

ROOM SERVICE

BREAKFAST AREA

MINI-BARS

LOBBY STORE FOOD SALES

PREFERRED GUEST DINING

DEDICATED EMPLOYEE FEEDING

TOTAL

TOTALREVENUE

($M)

3.8%

2.5%

8.5%

6.1%

4.8%

4.1%

3.0%

9.6%

0.8%

10.4%

7.9%

2.1%

5.5%

PERCENTOF TOTAL

5.7%

4.3%

8.5%

5.4%

5.8%

4.4%

2.3%

6.5%

2.2%

6.1%

8.6%

2.2%

5.3%

SHARE OF TOTAL - LUXURY

5.1%

4.9%

9.8%

6.0%

4.9%

5.1%

3.4%

11.1%

0.5%

9.0%

7.8%

2.0%

5.7%

SHARE OFTOTAL - UPSCALE

2.1%

2.2%

7.2%

6.8%

4.6%

0.9%

1.1%

8.9%

0.2%

11.6%

2.8%

N/A

5.2%

SHARE OFTOTAL -

MIDSCALE

0.0%

-2.0%

7.8%

7.4%

0.0%

N/A

0.0%

9.2%

N/A

10.2%

N/A

N/A

5.5%

LODGING FOOD SALES CAGRBY SEGMENT - 2011 TO 2017

FULL SERVICE RESTAURANT

LIMITED SERVICE RESTAURANT

LOBBY KIOSK SALES

BANQUETS & CATERING

BARS & LOUNGES

POOL BARS

ROOM SERVICE

BREAKFAST AREA

MINI-BARS

LOBBY STORE FOOD SALES

PREFERRED GUEST DINING

DEDICATED EMPLOYEE FEEDING

TOTAL


Full-Service Restaurants (FSRs) - Any sit-down restaurant with a wait staff providing service to patrons

Limited-Service Restaurants (LSRs) - Includes social caterers, midscale, casual-dining and fine-dining restaurants

Banquet & Catering - Professional or personal catered events

Lobby Cart/ Kiosk - A stand-alone non-permanent cart or kiosk located in the lobby. Most typically used to sell coffee and assorted bakery items

Pantry/ Lobby Shop - Food and beverage sold in a dedicated retail area within the lobby. Includes food sold in gifts shops as well as dedicated food pantries

Pool Bars - Locations near pools where the primary emphasis are alcohol beverage sales

Room Service - In-room service provided by the hotel's own kitchen. Does not include delivered food from third parties

Breakfast Area - Dedicated breakfast areas, both complimentary and paid

Minibars - Any food offered to guests in the room, excluding room service

Preferred Guest Dining - Food and beverage offered within lounges or areas restricted to preferred guests

Dedicated Employee Feeding - Food and beverage feeding areas restricted only to hotel employees

Key Outlet Definitions

Luxury$5,621MM

Upscale$26,520MM

Economy

$48,731MM

12%

54%

Midscale

32%

2%Luxury

358 Upscale4,387

Midscale26,890

Economy23,654

55,289

1%8%

48%

43%Total # of Lodging

Properties

Luxury108,560

Upscale1,216,018

Midscale2,414,205

Economy1,463,895

5,202,678

2%

23%

47%

28%

Total # of Lodging Rooms

$15,418MM

$1,172MM

Total Lodging Industry 2016 F&B Revenues


47


Key insights regarding food trends, operations, etc.

Food and beverage is viewed as a differentiator in a crowded marketplace (vs. amenities, service, and rooms as portrayed by hotel operators). More true the higher the brand or “tier” of the hotel.

Growth in “non-traditional” service areas outside of B&C (e.g., Lobby Kiosk.)

Hotel management is increasingly moving toward franchise or 3rd party control. These operators still have to follow brand standards but are not directly run by the corporate brand.

Menus include more casual offerings, small plates, and snacks-sized meals.

99% of Operators surveyed offered breakfast to guests; it is being used to differentiate from the competition (92% want theirs to be better than others).

“Feel Good” is a driver with operators- NAE, All Natural, Cage Free, etc.

TrendsNew Thinking for Hotel Restaurants - Sharper Concepts. Guests versus locals, local/regional, bar-focused, breakfast still there but de-emphasized. - Regional menus

The Transformation of Hotel Lobbies - New multi-purpose spaces aimed at serving guests for all meal occasions. - Lobbies in all segments are becoming high- energy multi-purpose great rooms. - Zoned spaces host a variety of seating and refreshment options. - Bars and markets are prominent. Multiple areas with large menus. - Room Service / In-Room dining will become a rarity in midscale and upscale segments. Luxury hotels, casinos and resorts will still offer room service. - Select and limited service hotels will follow full-service in lobby upgrades.

Evolving Banquets & Catering - Hotels delivering menu specialization and unique experiences. - Select-service hotels get into catering. - More competition from independent restaurants and all other types of venues, i.e. universities, museums, stadiums, etc. - Customers seek unique experiences – not standard ballrooms. Serving Food in non- traditional areas can be a challenge. - Millennials demand better food. Special diets must be accommodated. - Traditional plated menus and meal service is declining in favor of action stations.

Breakfast 24%Opportunity: Breakfast Buffets (starting to offer Build Your Own options) and Cooked to Order, Lobby/Pantry Grab N’ GoSolution: Breakfast Sausage (FC and RTC), FC and RTC Bacon, A&E Sausage, Sausage Skillet, Breakfast Sandwiches

Industry Insights

Dessert/Snacks 9%Opportunity: Lobby/Pantry Grab N’ GoSolution: Breakfast and APF Lunch Sandwiches, Hillshire Snacking Plates, Golden Island Jerky, Bosco Sticks

Breads/Sweet Rolls 12%Opportunity: Sweet BakerySolution: Muffins, Pastries, Danish (Demi & Elite), Croissants, Donuts, Cinnamon Rolls

Sides/Apps 27%Opportunity: Small Plates and Banquet, Bar and Full Service Restaurant Menus.Solution: Red Label Chicken (Tenders/Tenderloins, Boneless Wings), Bone-In Wings, A&E Sausage, Center Cut Thighs, Ingredient Chicken, Sliced Steak (philly)

Entrée 23%Opportunity: Banquet, Bar and Full Service Restaurant menus. Solution: Red Label Chicken, RL All Natural, LS Ingredient Chicken, VA UC Filets, A&E Sausage, Sliced Steak Breakaway (philly), Authentically crafted ingredient meats, Ham

Tyson Solutions

Sandwich/Burger 6%Opportunity: Banquet, Bar and Full Service Restaurant menus Solution: Red Label Chicken, LS Ingredient Chicken, VA UC Filets, A&E Sausage, Sandwiches, APF Sandwiches, Franks/Hot Dogs, FC Burgers

Top Menu Items

Source: Technomic MenuMonitor 2016

6%

23%

27%9%

12%

24%

Sides/ Apps

Entrées

Sandwich/Burger

Breakfast

Desserts/Snacks

Bread/Sweet

Rolls


48


Weekend

Weekday

PCYA Traffic 6%, 3YR CAGR 7%

PCYA Traffic -5%, 3YR CAGR -4%

Other Operator Channel Considerations

All Consumer Segments are targets for Lodging. Click on the arrow to learn more about the consumer segments.

TARGET CONSUMER

57%43%

46% 21% 27% 6%

Overall Performance Snapshot

Source: NPD Crest 2017

DAYPART

WEEKPART

PCYA Traffic -3%3YR CAGR -1%

PCYA Traffic 4%3YR CAGR -2%

PCYA Traffic -3%3YR CAGR 2%

PCYA Traffic 14%3YR CAGR 3%

MORNING MEAL PM SNACKSLUNCH SUPPER

Operational Considerations • Many decisions on menu and products for Midscale properties

are made at the Corporate Brand level, while at Upscale properties decisions are normally made at the property level. Field sales teams should concentrate on Upscale properties.

Luxury - Affiliation with a major luxury hotel brand (e.g., Four Seasons, Ritz Carlton, etc.) Also includes any 5 star Mobil or 5-Diamond AAA property.

Upscale/First Class - Affiliation with one of the upscale brands (e.g., Marriott, Hilton, Sheraton, etc.) Also includes any 4 star Mobil or 4-Diamond AAA property.

Midscale - Affiliation with a mid-market brand (e.g., Best Western, Holiday Inn, Hampton Inn, Courtyard by Marriott, etc.) Also includes a 2 Diamond/Star or 3 Diamond/Star by AAA or Mobil.

Economy - Affiliation with an economy market brand (i.e. Days Inn, Holiday Inn Express, Comfort Inns, Super 8, Motel 6, etc.). Also includes a 1 star Mobil or 1 Diamond AAA property, or rated as a 2 Diamond AAA property with no F&B. Also includes any property that specifically positions itself as “budget” or “low price”.

More information on classifications of Lodging Establishments



Documents

I Channel Profile Operator