global franchise newsletter sign up graphic

Stay in the know and receive the latest international franchising news, insight and investment opportunities

close catfish

Hotels: A Franchising Mainstay For Capital-Rich Investors

Hotels: A Franchising Mainstay For Capital-Rich Investors

While certainly not approachable to every kind of entrepreneur, hotel franchising can be a great way to diversify a property portfolio.

While hotels have been around for centuries, the franchise industry only took hold of this hospitality-driven sector in the last three or so decades. Back in the 1980s, for example, the big hotel names would take on significant debt to purchase or develop their own branded locations.

A look at the industry today, however, reveals that roughly 80 per cent of hotels in the U.S. are franchised operations as opposed to independent entities; with the likes of Hilton, Marriott, and Choice Hotels now opting for more ‘asset lite’ models that see them take on a supportive consultancy role for their franchisees.

But why are hotel franchise networks continuing to expand, even amidst a pandemic that almost seems custom-built to target their revenue streams? And why would independent locations decide to partner with a national or international brand?

“A lot of the hotel franchises have been established for a number of years and not only have a robust network of trained professionals that will help the hotel operator to hire and train the right people, but they also have a lot of resources that an independent property will not have,” says Geraldine Guichardo, global head of research, hotels and hospitality group, at JLL, a provider of numerous real estate services.

“Particularly during COVID-19, having that backing really helps. During the pandemic, a lot of these brands launched sanitation programs where they partnered with major cleaning brands. The combination of those two entities really helped to build consumer confidence in staying in a hotel. An independent property would have to go and do all of that on their own.”

Help needed for hospitality

Before we go any further, it would be remiss to not cover the unavoidable impact that the ongoing pandemic has had on the hospitality and services industry – especially when it comes to hotels.

According to a report by McKinsey & Company, a specialist on travel, logistics, and infrastructure, U.S. hotel revenue per available room will be down by 20 per cent by 2023. This is due to factors such as exceptionally low occupancy rates, and in May 2020, it was recorded that occupancy was less than 15 per cent in luxury U.S. hotels and around 40 per cent for economy locations.

If you take care of your people, train them, and pay them well, that will reflect on the service that they give to the consumer”

Because of the volatile nature of the industry, hotel franchisors are becoming increasingly selective about who they take on as franchisees. The numerous responsibilities associated with running a 24-hour, 365-day operation make hotel franchising much more formidable than opening a new gym or cafe, and as such, only a certain kind of entrepreneur fits the bill.

“Not everyone can say they want to run a hotel and get a franchise from Marriott or Hilton,” explains Guichardo. “They require you to provide a resume with previous hotel experience. That includes experience in running the kind of hotel in the category that you want to develop; for example, if you want to run a JW Marriott, you need to have experience running a luxury product.”

Despite the asset lite developments that many big brands have taken in recent years, this cautious approach by the biggest brands is reflected in their franchising figures. HVS, a consulting firm for the hospitality industry, found that hotel brands are less willing to franchise their luxury properties (at only 8.6 per cent across Accor, Hilton, and Marriott), and instead trust franchisees with midscale (62.6 per cent) and economy (47 per cent) locations.

“To be able to operate something that never shuts down and is consistently adhering to brand standards takes a lot of effort and experience and work,” says Guichardo. “I think it’s quite a bit more difficult to break into the hotel franchise world compared to opening a restaurant or gym, and franchise agreements in this industry can last 10 to 15 years; it’s a long time to live up to expectations and pay fees for anybody unprepared.”

Global Franchise Meets.

An inspirational new web video series where we meet the business leaders and influencers in International Franchising.

you may be interested in

franchise directory

  • TaxAssist Accountants

    Business & Professional Services, Financial Services, <100K, Featured

  • Cafe2U

    Food & Catering, Coffee, Take-away, <100K, Featured

  • 800 Pizza

    Food & Catering, Fastfood, Pizza, Take-away, Featured

view more
Connect with Linkedin Logo
Global White Logo Click Here
Close button


Any of the information we collect from you may be used in one of the following ways: To personalize your experience (your information helps us to better respond to your individual needs) To improve our website (we continually strive to improve our website offerings based on the information and feedback we receive from you) To improve customer service (your information helps us to more effectively respond to your customer service requests and support needs) To process transactions your information, whether public or private, will not be sold, exchanged, transferred, or given to any other company for any reason whatsoever, without your consent, other than for the express purpose of delivering the purchased product or service requested. To administer a contest, promotion, survey or other site feature To send periodic emails The email address you provide for order processing, will only be used to send you information and updates pertaining to your order. Note: If at any time you would like to unsubscribe from receiving future emails, we include detailed unsubscribe instructions at the bottom of each email.


We implement a variety of security measures to maintain the safety of your personal information when you place an order or enter, submit, or access your personal information We offer the use of a secure server. All supplied sensitive/credit information is transmitted via Secure Socket Layer (SSL) technology and then encrypted into our Payment gateway providers database only to be accessible by those authorized with special access rights to such systems, and are required to keep the information confidential. After a transaction, your private information (credit cards, social security numbers, financials, etc.) will not be stored on our servers.


Yes (Cookies are small files that a site or its service provider transfers to your computers hard drive through your Web browser (if you allow) that enables the sites or service providers systems to recognize your browser and capture and remember certain information. We use cookies to help us remember and process the items in your shopping cart, understand and save your preferences for future visits, keep track of advertisements and compile aggregate data about site traffic and site interaction so that we can offer better site experiences and tools in the future. We may contract with third-party service providers to assist us in better understanding our site visitors. These service providers are not permitted to use the information collected on our behalf except to help us conduct and improve our business.


We do not sell, trade, or otherwise transfer to outside parties your personally identifiable information. This does not include trusted third parties who assist us in operating our website, conducting our business, or servicing you, so long as those parties agree to keep this information confidential. We may also release your information when we believe release is appropriate to comply with the law, enforce our site policies, or protect ours or others rights, property, or safety. However, non-personally identifiable visitor information may be provided to other parties for marketing, advertising, or other uses.


Occasionally, at our discretion, we may include or offer third party products or services on our website. These third party sites have separate and independent privacy policies. We therefore have no responsibility or liability for the content and activities of these linked sites. Nonetheless, we seek to protect the integrity of our site and welcome any feedback about these sites.


We are in compliance with the requirements of COPPA (Childrens Online Privacy Protection Act), we do not collect any information from anyone under 13 years of age. Our website, products and services are all directed to people who are at least 13 years old or older.


This online privacy policy applies only to information collected through our website and not to information collected offline.


Please also visit our Terms and Conditions section establishing the use, disclaimers, and limitations of liability governing the use of our website at


By using our site, you consent to our online privacy policy.


If we decide to change our privacy policy, we will post those changes on this page


If there are any questions regarding this privacy policy you may contact us using the information below. All correspondence relating to the Website should be sent to: Global Franchise 21/23 Phoenix Court Hawkins Road Colchester Essex CO2 8JY Email: