A premier supplier to the hotel industry
Growing throughout the COVID pandemic and beyond, LOC International has bright prospects
Leading the competition year after year, LOC International is an industry-leading designer, manufacturer, and distributor of electronics and equipment to the hotel industry. Founded in 1988, and headquartered in Montreal, with offices in Toronto, and distribution centers/warehouses in Montreal and Calgary, the company is the largest Canadian supplier to its 10,000-plus client list of hotel owners and operators across North America, the Caribbean, and Europe.
Its wide range of products includes in-room electronics, such as phones, alarm clocks, and charging stations; in-room appliances, such as minibars and refrigerators; security and access solutions, such as keycards, electronic door locks, and electronic safes; hospitality TVs and smart displays; and hotel lobby equipment, such as digital signage and interactive kiosks.
Company prospers during COVID
It’s an obvious fact that the COVID-19 pandemic had a huge impact on the travel and hospitality industries. Business as usual for hotels, for example, virtually disappeared overnight and the normal cycles of renovating and upgrading, the key to LOC International’s revenue stream, were disrupted. “Most of the major chains gave all of their owners and operators a bit of a break during COVID and right after,” explains Vincent Beaudet, LOC International’s CEO. “They didn’t push what we call in our industry a PIP (Property Improvement Plan), which is upgrading their fixtures, furniture, and equipment to be up to the brands’ standards.”
One might reasonably assume, then, that the COVID years were a bleak time for the company. And yet, even when PIPs were in abeyance, LOC International actually grew throughout the pandemic. In fact, over the last three years, the firm was ranked as one of Canada’s top-growing companies by the Globe and Mail. As Beaudet notes, that somewhat counter-intuitive dynamic was due largely to an unforeseen industry shakeup when travelers were staying home. “COVID was a difficult time for the industry, but we grew a lot because it was also a time when some of the older groups went out of the hospitality sector and sold their properties to some new type of investment or management group,” he recounts.
“You would take a property during COVID, almost strip it, re-brand it, and put it back on the market right after COVID. So, for us, these were much bigger projects. That was the reason why we kept growing. We had fewer customers, but the customers that we worked with did much larger projects within their properties.”
The industry bounces back
Today, with an industry-wide hotel occupancy rate across the U.S. and Canada that may be higher than its 2019 pre-COVID numbers, LOC International is preparing for even more growth. “In 2024, we are going full throttle into the U.S. market,” Beaudet reports.
“We’re already selling in the U.S., but our USA brand is going to become a business itself. We’re going to have an LOC International base in the U.S., hiring Americans, and selling to Americans. And if you look at Canada right now, the GTA (Greater Toronto Area) is expanding; that’s the biggest market. And the greater Vancouver area is going to boom; BC and Vancouver are short about 10,000 hotel rooms. And BC and Quebec are very similar in terms of having some big tourist cities.”
“So, the owners and operators are working full throttle on their growth plans and I see more and more projects. We’re getting a lot of requests because people want to put their investments for 2024 on their books. So, it’s going to be a big year for remodeling in the hotel industry.”
Meeting the challenges with new technology
Beaudet notes that going forward, one of the biggest challenges for the hotel sector will be keeping up with guests’ ever-increasing demands for enhanced connectivity. “A lot of hotels were built to have, maybe one electronic per guest,” he says.
“Today, the typical guest will walk in with four to six different ones – a watch, a computer, a phone, ear plugs. If you have a family, everybody has their tablet and their phone. If you are an older property, you just didn’t build it that way. So, we have to find ways to get that extra connectivity, for example, through some small electronics on the nightstand. The typical radio/clocks that people were using for a wakeup call are now being used as a connectivity device – a USB port, USB-C, wireless charging, etc.”
Another necessary equipment upgrade concerns the ubiquitous hotel room TV set. “At some point, you had a property that had a 32-inch TV and then, all of a sudden, people were complaining that the TV was too small. So, across the street, they’re moving to 55 inches. That becomes the standard because it’s what the guests want.”
“Now, the TV has also become a way of communicating with the guests; pushing information through the televisions and getting rid of paper. It’s also a way for the guests to watch what they want when they want it. Instead of using the regular hotel channels that every hotel has, people want to be able to log into their accounts — watch their Netflix, Amazon Prime, Disney – whatever content that they subscribe to. That’s the big shift that we’re seeing.”
Other product innovations include mobile key software that will allow guests to receive a room key on their phones. “While you’re on your way to the hotel, you’re going to receive a confirmation that your room is ready and, if you request, you’re going to receive a digital key. So, once you get to the property, all you have to do is unlock the door with your phone in a secure way, without having to go through the front desk. That will also become a tool in order to communicate with the property. So, you can request anything you want with the app.”
“You can also, as a property manager, do some upselling,” Beaudet continues.
“If some of your most expensive rooms were not booked by 3 PM the same day, most likely, they won’t be booked. So you can offer the current guest the opportunity to upgrade for a lesser amount. While you’re confirming that they’re staying in Room 304, and they’re going to get their mobile key, you can also send them a message: ‘You booked a one-bedroom suite; we can offer you the premium one-bedroom suite for tonight for an additional $40. That’s the extra revenue that the property can get.”
“Also, the whole mobile application will be able to help ease that period of check-in where everybody gets to the property at the same time. It’s hard for the property to manage that. So, I see that evolving a lot, especially with the younger generation who will be very comfortable using it. I think it’s going to be big.”
“One of the things you have to do as a property to be ready for that is you have to make sure that when you install an RFID (Radio Frequency Identification) door lock, you include the Bluetooth chip inside to be able to have that communication in the future,” Beaudet adds.
“On the door lock side security is also a concern. Traditionally, a lot of the manufacturers were using the same type of encryption. Now, because of potential privacy, they’re changing to an extra level of security because being able to hack into a hotel door lock is a big problem. In a 500-room property, some kind of master key that can unlock any door would be a disaster.”
“Some customers have existing door locks and we tell them they should upgrade the software for more security. Most of the time there’s a cost to that, but we need to make sure they understand the value and what could happen if they don’t do it.”
Sales and education go hand-in-hand
Educating its customer base is a big part of LOC International’s business. Its account managers, working within set territories across Canada, maintain a portfolio of numerous products, some of which are quite complicated, according to Beaudet.
“For example, these smart locks are a trade in themselves,” he suggests. “All of the technology on the television side could be complex, as well. So, we have specialists within each of our product categories.
“let’s say we have a rep in Vancouver, and a property is looking to upgrade its smart door locks. We have a specialist within our team who is going to tag along with our local rep to go into detail on that product line. That’s how we work; each of the main product lines has somebody within our team that has ten to fifteen-plus years of experience within the hospitality space with that particular product line,” he elaborates
LOC International’s employee specialists all train with the company’s many suppliers and manufacturers. “We are very blessed to have these direct relationships,” says Beaudet.
“For example, on the door lock side or the TV side, we work directly with the person that is in charge of the hospitality market within these different manufacturers, and our sales reps have direct access to them. They’ll be able to go on a sales call with them and they’ll be able to take training on the new product line. As soon as a supplier or manufacturer comes out with something new, they want to make sure that we have the tools in order to sell these products. Then, every year, we take three days around December for our yearly sales kickoff. We have all of our people come together and the different suppliers or manufacturers will come to us and give us product knowledge on what’s new, what’s dedicated to our market, etc.”
Another way in which LOC International stays abreast of what’s new and needed is by working closely with many different hotel associations. The company is a member of the Hotel Association of Canada, the Ontario Restaurant Hotel & Motel Association, the British Columbia Hotel Association, the Alberta Hotel and Lodging Association, the Association hôtellerie du Québec, the Association hôtelière de la région de Québec, the Tourism Industry Association of New Brunswick, and the Hospitality Newfoundland and Labrador Association.
“We get a lot of data from those associations,” Beaudet notes. “They will also tell us what their members are looking for, or if they’re having a shortage on this or that.”
35 years of innovation
LOC International’s reputation as an innovator is well-known and much appreciated. “People don’t carry money anymore,” Beaudet relates, “so the tipping is going down for the cleaning staff. We purchased a company that has QR code software, and we can leave a QR code in the room or print it on the hotel key cards. Now, it’s very simple: people can leave a tip using their credit card and get a receipt. If they’re a business traveler, they can expense it. As soon as we implemented this into a property, the tips went up by 40%. We charge a small management fee that comes directly out of the tip.”
“That percentage is so small compared to the increase in tipping. It’s a free solution for the hotel, and it’s a great way to show staff that you care about them. Also, we’re now giving the customer the option to pay for that small management fee. We tell them, ‘If you’re leaving $10, the staff will receive $9.10. Do you want to pay for that $.90 yourself to make sure that the staff is getting the full $10? And 80% of the travelers are saying “Yes.”’
A future innovation concerns the coming wave of AI (Artificial Intelligence). “AI will be something interesting because it’s gathering a lot of information, and eventually, it’s going to be able to cater to a guest’s needs,” Beaudet proffers. “As you travel with the same brand, they’ll know a lot about you. So, they’ll be able to be a couple of steps ahead, and give you a nice, personalized experience.”
Throughout the past 35 years, LOC International has mastered the art of service excellence. As it continues to grow and expand, its goal remains the same: to satisfy its clients with innovative products that cater to the ever-evolving needs of hoteliers and their guests. “And we’re making sure we’re ready for 2024,” Beaudet says in conclusion.
“It’s going to be a great year.”
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AT A GLANCE
WHAT: A supplier of equipment and electronics to the hotel industry
WHERE: Headquartered in Montreal, Canada