Franchise Deep Dive: Holiday Inn Hotels & Resorts Franchise Costs, Fees, Profit and Data

With experts saying worldwide travel is officially set to make a full post-pandemic recovery, this hotel franchise is one of the most trusted names in the hospitality biz.

By Luca Piacentini1851 Franchise Managing Editor

5:05AM • 06/30/23

LAST UPDATED: May 22, 2023

FRANCHISE WEBSITE: https://development.ihg.com/hotel-brands/holiday-inn

NUMBER OF LOCATIONS: 4,250

REPORTED COST TO GET IN: $8,848,215 to $20,017,848

REPORTED ROI (Item 19): N/A

Holiday Inn and Holiday Inn Express, part of IHG® Hotels and Resorts, are two of the most recognizable hotel brands in the world. Holiday Inn is a popular midscale, full-service hotel chain, while Holiday Inn Express is an offshoot brand of smaller, limited service hotels that cater to guests seeking value and efficiency. Both offer franchise opportunities for qualified candidates.

How Many Holiday Inn Hotels and Resorts Locations Are There?

Founded in 1952, the Holiday Inn company seeks to remedy the lack of affordable accommodations for families. After only a decade, Holiday Inn was one of the first franchise brands to ever reach the 1,000-unit mark.

Today, Holiday Inn is part of IHG® Hotels and Resorts, which is the world's largest hotel company, including some of the strongest and most recognized hotel franchise brands in the industry: InterContinental® Hotels & Resorts, Crowne Plaza®, Hotel Indigo®, Holiday Inn® Hotels and Resorts, Holiday Inn Express® and Staybridge Suites®. Holiday Inn was voted the most trusted brand in travel by U.S. consumers in a 2021 survey by Morning Consult.

In 2022, IHG signed 467 hotels and opened 269, which led to net system growth of over 4%. The Holiday Inn Brand Family delivered around a third of those hotel signings and half of the openings.

Holiday Inn has over 1,500 hotels open or in development worldwide, and Holiday Inn Express has around 3,600 hotels open or in the pipeline across the globe. Holiday Inn Hotels & Resorts came in at No. 156 on Entrepreneur’s “2023 Franchise 500 Rank,” down significantly from No. 31 the previous year.

What Is a Holiday Inn Hotels and Resorts Business Model?

Holiday Inn and Holiday Inn Express has four tiers:

Holiday Inn
Holiday Inn Express
Holiday Inn Club Vacations
Holiday Inn Resort

The Holiday Inn franchise investment model is driven by three levers — room growth, revenue per available room (RevPAR) and royalty fees. The franchise agreement is generally a standard contract, with some variation across the world. A sample contract would normally have a royalty fee of 5%–6% of rooms' revenue. However, this can vary by brand and country.

In addition to franchising, Holiday Inn offers a management program, where the company manages the hotel but ownership of the physical building remains with a third-party owner. Typically, the senior management like the general manager and the financial controller are IHG employees, who have oversight to build a successful team.

How Much Can Holiday Inn Hotels & Resorts Franchise Owners Make?

While financial performance representations for individual franchise owners are not publicly available, IHG said its revenue per available room was up 37% worldwide in 2022 and only 3.3% lower than pre-pandemic levels.

How Much Does It Cost to Open a Holiday Inn Hotels & Resorts?

The total investment necessary to begin operation of a typical 125-room Holiday Inn or Holiday Inn & Suites hotel, excluding land costs and other matters, ranges from $12,910,715 to $19,900,840 ($103,286 to $159,207 per guest room) or more, including between $159,125 and $221,575 or more that must be paid to the franchisor or an affiliate.

The total investment necessary to begin operation of a typical 93-room Holiday Inn Express or Holiday Inn Express & Suites hotel, excluding land costs and other matters, ranges from $8,848,215 to $12,912,230 ($95,142 to $138,841 per guest room) or more, including between $127,625 and $157,875 or more that must be paid to the franchisor or an affiliate.

The total investment necessary to begin operation of a typical 125-room Holiday Inn Resort hotel, excluding land costs and other matters, ranges from $12,980,115 to $20,017,848 ($103,841 to $160,143 per guest room) or more, including between $159,125 and $221,575 or more that must be paid to the franchisor or an affiliate.

What Is the Franchise Fee for Holiday Inn Hotels & Resorts?

The initial franchise fee ranges from $159,125 to $221,575.

Who’s On Holiday Inn Hotels & Resorts’ Leadership Team?

What Helpful Articles Can I Read to Learn More About Holiday Inn Hotels & Resorts?

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