Franchisees want to be in business for themselves but not by themselves. Ownership of a franchise can bring considerable benefits – franchisees can brand their hotel with one of our well-known and popular brands, while the franchise contract provides a powerful set of tools to drive new business.
Other services available to franchisees include training programmes, a consultation and advice service and optional marketing programmes.
This following is a diagram of the Franchise Revenue Business Model
IHG franchise revenue has three levers to drive future growth. Some of the factors that influence these levers are under our direct control, like rooms' growth, and others are influenced by market forces, such as the performance of our brands relative to competitors' brands.
The franchise contract is generally a standard contract, with some variation across the world. A sample contract would have a royalty fee of 5% of rooms' revenue. However this also varies across brands and countries.
Last updated 8 May 2013