Holly Felder Etlin Comments On Her Philosophies For Restructuring A Destination Club

By: Destination Club News
Date: September 30, 2010

The role outsiders play often reshapes an industry. Computer company Apple revolutionized the portable music player industry with the creation of the iPod. The case could be made that Marvin Miller is the most important person in the history of baseball without ever throwing a pitch or swinging a bat. The destination club industry's Apple and Marvin Miller is Holly Felder Etlin, the Chief Restructuring Officer at Tanner & Haley during their bankruptcy and a major player in the club's eventual acquisition by Ultimate Resort. We spoke with Etlin yesterday to learn her philosophies for restructuring a destination club.

"The key with the restructuring of a destination club is the members. They are far and away the most important creditor contingency," said Etlin. "They ultimately need to be supportive of whatever happens because they are also the primary source of revenue. They should be involved at every stage of the process."

While the "member first" structure at Tanner & Haley was one of their leading problems, it was one of Etlin's major strengths. "There are two things that I believe are needed when working with members while restructuring a destination club," Etlin continued. "First, you have to have open, honest, and frequent communication. We conducted all hands conference calls open to everyone. Our first call lasted over four hours and we had over one hundred members line up to ask questions. Second is what I like to call 'tough love.' One of the ways destination clubs got off the rails is that they stopped enforcing the rules and philosophies the model is built on. Special deals are given and those things never remain a secret. Soon everyone wants to be special and the economic principles that the club is built on are gone."

The Tanner & Haley bankruptcy took place over four years ago, but the concepts used by Etlin seem even more valid today as the Ultimate Escapes bankruptcy has dominated headlines for a number of weeks. Long time Ultimate Escapes executive Jim Tousignant has been terminated by the company and Chief Restructuring Officer Sheon Karol, a former colleague of Etlin's, is now responsible for the day to day operation of the club. He will have a great deal of work in front of him as membership loyalty has eroded over the past month. Adopting some of Etlin's principles would be a wise option.

We asked Etlin for her thoughts on the future of the destination club industry and will feature her remarks next week. Check back soon to hear her outlook for the sector as well as more news on the continuing Ultimate Escapes bankruptcy filing.