The franchise fee starts at $25,000. And the startup costs range from $169,270 to $3,572,460.
10. Days Inn
Days Inn is another popular Wyndham brand. The Days Inn hotel franchise focuses on clean, comfortable accommodations. There are nearly 1,700 properties around the world. And the rising sun logo is one of the most recognizable in the hotel industry. The company has more than 40 years of experience franchising. So they provide new franchisees with plenty of training and resources to get up and running successfully.
The fee for a new Days Inn hotel franchise is $36,000. And the total initial investment ranges from $292,634 to $8,281,441.
11. Econo Lodge
Econo Lodge is part of the Choice Hotels International brand. It has more than 890 hotel franchise locations open or under development around the world, with most of those located in the United States. This makes it one of the most prominent economy lodging options in the country, with plenty of room for growth internationally. The hotel franchise chain has been in operation for more than 30 years and franchising for more than 20. The company has an extensive tech and reservations platform to make operations easy on new franchise operators, along with personalized training and support.
The fee for new franchises is $25,000. And the total initial investment ranges from $126,150 to $767,599.
12. La Quinta
La Quinta is a hotel franchise chain owned and operated by Wyndham Resorts. It’s part of the midscale hotels sector. So it offers a few more amenities than some economy hotels on the list. The franchise business offers both new construction options and conversions of existing hotels and resorts. With more than 50 years in business, the hotel chain has more than 900 hotels across the United States, Canada, and Latin America. It’s popular with both business and leisure travelers.
The franchise fee for La Quinta resorts is about $55,000. And the initial investment for new hotel franchise locations ranges from $452,400 to $11,052,800.
How Do You Choose Hotel Franchise Opportunities?
As an aspiring business owner, start by reading how a franchise works and the pros and cons of franchising. Research individual hotel franchises in more depth using the hotel brand links above. Get a feel for each hotel chain and what it offers.
Once you’ve narrowed it down to a few choices, next request and receive a hotel franchise disclosure document (FDD) for each. Read over the FDD carefully, as it could be hundreds of pages long. You will find details a prospective franchise owner needs.
If the hospitality company invites you to franchise discovery day and you attend it, you’re very close to becoming a new franchisee in hotel ownership. When you reach the contract stage, seek help from an attorney to protect your rights in the hotel franchise agreement.
What Factors Should You Consider for a Hotel Franchise?
Consider the following special features which are specifically relevant to motel or hotel franchises:
Strong Financials – Look for a hotel group with great financials. Hotels are capital intensive. Franchisees will need to invest more money compared with many other types of franchises to achieve success. Think about your investment in real estate, furniture, linens, fixtures, more. Protect that investment and maximize profits by aligning with a strong “partner”.
Quality of Stay – People are more sensitive to their experiences with a hotel than many other types of franchises. Be sure to stay in the hotels you are considering. Book a room and not just for a single night — stay a few days in each hotel. Eat in the restaurant. Use facilities like the business center. Experience the management practices first hand. Ask yourself: would you love to stay in that hotel? Would you choose it versus a competitor chain?
Cleanliness – Choose a brand that emphasizes sanitization. Clean guest rooms will be of top importance to guests for the foreseeable future. Does cleanliness figure into the franchisor’s national marketing? Does the hotel’s style feature furnishings and floor coverings that are easy to clean? If you are renovating an existing older property, can it be made pristine at a reasonable cost?
Support and Technology – Find franchisors that offer excellent support to franchisees and add value with technology. For example, evaluate the quality of the national reservations phone line and booking system. A strong loyalty and newsletter program can give the hotel a memorable personality and drive new business.
Site Location Support – How good is the franchisor at helping choose locations? How much site selection assistance can you expect? Is site location one of the hotel’s strengths? Access to airports, interstates or nearby destinations can make or break a property. Safety and security of the area are also important, especially for women travelers.
|Factors to Consider for a Hotel Franchise||Description/Considerations|
|Strong Financials||- Assess the financial stability and performance of the hotel group. Ensure they have the necessary capital for support. - Consider the capital-intensive nature of the hotel industry and the investment required by franchisees. - Evaluate the protection of your investment and the potential for profit alignment with the franchisor.|
|Quality of Stay||- Personally experience the hotels under consideration by staying for an extended period. - Assess the guest experience by dining at the restaurant, using facilities, and observing management practices. - Ask yourself if you would prefer staying at the franchise hotel over competitors in the area.|
|Cleanliness||- Choose a brand that emphasizes cleanliness and sanitization, especially in light of current guest expectations. - Examine if the franchisor's marketing highlights cleanliness as a selling point. - Consider the ease of maintaining cleanliness in terms of furnishings and floor coverings. - Evaluate the cost and feasibility of renovating an older property to meet cleanliness standards.|
|Support and Technology||- Evaluate the level of support provided by the franchisor to franchisees, including technology support. - Assess the quality of the national reservations phone line and booking system. - Consider loyalty programs and newsletter initiatives that can enhance the hotel's identity and attract new business.|
|Site Location Support||- Determine how effective the franchisor is at assisting with site selection for your hotel. - Assess the level of site location support available to franchisees. - Consider factors such as proximity to airports, interstates, and popular destinations, which can significantly impact the success of the property. - Evaluate the safety and security of the chosen area, especially for the safety of travelers, including women.|
How Has Covid-19 Affected Hotel Franchises?
The COVID-19 pandemic of 2020 hit the hospitality industry hard as people curtailed travel and conferences. However, downturns are great times to snap up bargains and take advantage of trends.
Aspiring hotel owners should carefully assess the future. Try to gauge when conditions are turning around and point toward an upswing. A return to normal presents opportunities to jump on pent-up demand by travel lovers, business travelers and conference goers. In light of the pandemic and resulting economic conditions, it’s more important than ever to make wise choices:
- Identify the best-performing business model. Economy and extended-stay hotels seemed to have weathered the impact better, according to a mid-2020 survey by JLL. Urban hotels are struggling the most, according to a report by the American Hotel and Lodging Association. 2
- Evaluate financial support. Find franchisors willing to offer discounts or go the extra mile to address temporary financial pressures. Were they willing to allow franchisees to temporarily relax brand standards such as cutting back on amenities or switching to carryout food versus sit-down restaurants? What other aid did the franchising team give?
- Anticipate trends. Recovery depends on the willingness of guests to travel, and why they travel, says Daniel Fenton, Director of Global Tourism and Destination Development Services, Hotels & Hospitality Group, JLL. “The first round of leisure travelers will be inclined to drive rather than fly. After that, individual business travel will start to grow, followed by group business travel. It will take longer for group leisure travel.” 3
Bottom line: the opportunity for a franchise can be found even during the most difficult of times, if you are smart.
1 JLL, Why More Hotels are Owned by Franchisees
More in: Franchise Opportunities