When Dick Huisman describes himself as a corporate “one-man band,” he’s not kidding.

When you call Huisman’s dot-com company, Freestay Hotels Inc., the CEO himself answers the phone. Huisman has no receptionist.

In fact, the former CEO of Greyhound Lines of Canada doesn’t have a single employee at his virtual company, which partners with hotels to provide customers with free accommodation in exchange for a guaranteed minimum charge for dining in the main hotel restaurant. The business is essentially operated via the company websites, www.freestayhotels.com and www.freestaygetaways.com.

Conscious of cash-burn rates that have put most dot-coms out of business, Huisman doesn’t even have his own office, sharing digs with one of his affiliated companies, Pandell Technology Corp., at the old Currie Barracks.

David Lazarowych photo, Business Edge
Dick Huisman hopes hotel guests have an appetite for his Freestay program

What the seasoned hotel and transportation executive does have, however, is a vision. 1. Who was your role model during a boyhood in The Netherlands?

“My family was in business and my dad (Jan) ran his own business. I learned a lot from him. I wanted to do something different, so I went to hotel school in Switzerland (International School for Hotel & Tourism Administration). After I did military service, I told my dad I wanted to go into the hotel business. He said: ‘If that’s what you want to do, I’d like you to work in a hotel for a year just to see if you like it.’ He said that if I did like it, he would put me through school in Switzerland, which was an expensive proposition. He wanted to make damned sure that I was ready to do it.”

2. What was your first job in the hotel business before you went to Switzerland?

“I was a waiter in a hotel in Holland. When my dad first visited me at the hotel, I dumped a pot with green peas on his lap. It wasn’t a very good start between him and myself.”

3. What did you learn during your years with major hotel chains Hilton, Marriott and CP Hotels?

“The hotel business is all about people, so you have to focus on the customer. It really boils down to service levels, but at the end of the road, you have to make sure that the price point that you go into the marketplace with is reflective of those service levels and that everything you do filters down to the bottom line.”

4. When you were CEO of Greyhound Lines, the company started an airline, Greyhound Air. What happened to the airline?

“Laidlaw stepped forward and made an offer to buy Greyhound, and the board of directors could not decline. Laidlaw didn’t want anything to do with the airline, which was just starting to become successful, and they asked us to shut it down. If we’d have been able to continue operating the airline, WestJet probably never would have operated across the country as it does. But that’s water under the bridge.”

5. What’s your view of Air Canada’s current financial crisis?

“I think that Air Canada is in search of what it wants to be, and I don’t think they’ve found it. I’m not sure that whatever they come forward with will work. Unless they really become a low-cost carrier, they will continue to run into expenses that will one day, one way or the other, bite them in the ass.”

6. What motivated you to return to the hotel business by launching Freestay Hotels?

“It made sense to me. If a hotel has a business plan that has $100 as an average room rate with a 70-per-cent average occupancy rate annually, then there is spare capacity of 30 per cent. If the occupancy rate is low, the hotel restaurants are 99-per-cent empty. I’ve always been intrigued thinking about what can be done to deal with that spare capacity and how to create a new market segment. Essentially, we help the hotels get rid of excess capacity without an effort on their part, and they have the sole exclusive opportunity to say yes or no. The business is really incremental and the profits are incremental.”

7. Is the slowdown in the hotel business in recent years beneficial to your business?

“It helps in slower periods because when occupancy goes down, the chances that the hotel will say yes to a request from a Freestay customer are bigger than when occupancy is high. Our program also finds more positive responses from hotels when there are more days of low occupancy.”

8. How many hotels are connected to the Freestay program?

“We now have 40 Canadian hotels and we are expanding to the States as we speak. We have every single brand of hotel you can think of, except the deluxe brands such as Fairmont Hotels and Four Seasons Hotels.”

9. How does Freestay generate revenue?

“It’s totally Internet-based. We promote the program through the Internet, and we take $29 for the privilege of people to request a room for two or three nights from any of our participating hotels and be granted the room.”

10. Is the company profitable?

“Oh, no, not yet, but we’re getting there. We don’t burn a lot of money. The expenses have been in designing the website and making sure that the processes are working. Most of our activity is based on getting more hotels to join us and getting more people to come to the website. It’s something that will grow over time, because if 40 hoteliers say it’s worthwhile to do, I’m sure that out of the thousands of hoteliers in North America, there will be many more to look at this. The question is how fast we can get to the hoteliers and tell them about us. Every day, we see increased numbers of consumers coming to our website.”

11. How has the response been?

“To date, we probably have had about 400 transactions confirmed by hotels. The fact that 400 people have made a reservation request and had it accepted by hotels times $29 is peanuts, but it really is starting to develop. And this is not a process where we are spending millions of dollars to get launched.”

12. Who owns the company?

“I own about 45 per cent and the rest is owned by friends and our partners. Every one of the companies that is contracted to support and help us (Pandell Technology, Zero Gravity, Advanced Information Marketing and Procall Marketing) are shareholders.”

13. Do you know of any other companies operating in this space?

“There’s a model like this in Europe, although their model is totally manual. That business is done by printed catalogue and after seven years it has 1,600 hotels in Europe. We have a ways to go in North America, but doing it through the network, I think we have a reasonable chance to make this very successful. If we can get through this year with about 100 to 150 hotels, that would give me a solid base for Canada and we could then roll into the U.S. with some confidence.”

14. What’s your most difficult challenge in marketing this concept to the hotel industry?

“It’s getting them to understand that this is incremental (revenue), that this is spare capacity (being sold), that there are no costs associated with this for them and there are really no contracts or obligations. When a request from a customer comes to the hotel, they either say yes or no. Their worst-case scenario is that they will have exposure and people will have looked at their hotel. Once the industry understands this, this will be a perpetual opportunity. Once they understand the concept, the success rate for hoteliers participating is about 65 per cent to 70 per cent.”

15. Do you plan to take this company public?

“Eventually, yes. That’s why the shareholders are there. We’ll have to wait and see when the time is right.”

16. What’s this job like for you compared to jobs you’ve held with major corporations?

“This is a lot of fun. I get to deal with a lot of young people and it keeps me in the industry. Most importantly, it gets me out of bed early in the morning. And if I want to play golf, I can do that, too.”

17. How would you describe your leadership style?

“It’s very much participative, but on the other hand, I have a very strong opinion. I challenge people to challenge me and, once there’s an argument, I don’t care where it comes from, as long as what it is, is the right thing to do. I have absolutely no pride of ownership or authorship or whatever.”

18. Who’s the business leader or entrepreneur you most admire?

“I learned a lot from John Teets (former CEO of Dial Corp., owner of Greyhound). He ran a lot of companies under the same umbrella and he taught me a lot about delegation, keeping control on capital expenditure and knowing where your money is made.”

19. What’s your proudest achievement?

“It was turning Greyhound Lines of Canada around from an operational company to a consumer-driven company with innovations like having trailers behind buses and launching Greyhound Air, which would have been a successful product line had we not had to fight what I believe were unreasonable restrictions imposed by the government (on foreign ownership).”

20. Do you think about retirement and eventually hiring someone to run Freestay Hotels?

“I enjoy what I’m doing, and if I need help in order to do it, then, yeah, we’ll cross that bridge as it happens. Right now, it’s a one-man band with a lot of people helping. If this is successful, I don’t have to retire because this would just be a lot of fun to continue to do.”