How to Become a Franchisee of InterContinental Hotels Group

One of the growing economies today is tourism which makes hotels and resorts a very good investment for entrepreneurs. With this fact, people can enjoy considerable amounts of financial benefits by becoming a franchisee of InterContinental Hotels Group.

For those interested IHG franchisees, they can choose from different hotel brands including Crowne Plaza, Hotel Indigo, Holiday Inn Express, Staybridge Suites, Candlewood Suites, and InterContinental Hotels and Resorts which is the most popular trademark of the corporation.

Just like any franchising business, IHG requires franchising fees which will depend on the hotel’s brand. Meanwhile, the company said that a standard contract usually requires 5 percent royalty fee of the gross revenue of the hotel (but still, it comes with some variation depending on the location).

According to IHG, the corporation will be the one to maintain the business instead of the franchisee and it will provide its own senior executives to manage the hotels such as the general manager and financial controller. Meanwhile, franchisees will own the building of the hotel and can hire middle- to low-level hotel staff.

In management standard contract, franchisees are required to pay two separate fees: base and incentive fees. Base fee would typically cost 1 to 3 percent of the annual revenue of the franchised hotel and this will go to management and maintenance of the business. On the other hand, incentive fee is a share of profit that would cost 5 to 10 percent of the gross revenue of the hotel. Meanwhile, these fees may vary depending on the country and location.

Other services available to franchisees are training and marketing programs and consultation services. Meanwhile, it can also be helpful if franchisees will join to IAHI, an association of hotel owners around the world, since other hotel owners can provide them helpful tips on how to manage their businesses.


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