Best Hotel Franchises: Top 7 Hotel Franchise Companies in Australia for 2024

As we look ahead to 2024, the top hotel franchise companies in Australia are set to play a crucial role in shaping the hospitality industry. These companies offer a range of services and brand names that cater to diverse traveller needs. With the recovery from the pandemic, many franchises are expanding their reach and enhancing their support for franchisees. This growth is fueled by strong demand for quality accommodations and innovative business models, including options like timeshare arrangements. In this blog, we will explore the leading hotel franchises that are making a significant impact in Australia’s hotel market this year.

What are the Best Hotel Franchises in Australia for 2024?

In 2024, the hotel franchise market in Australia is expanding, offering many choices for investors and entrepreneurs. Let’s take a look at the best hotel franchises available, highlighting their unique features and benefits. Whether you are looking for luxury options or budget-friendly stays, understanding these franchises can help you make informed decisions in the thriving hospitality industry.

Quest Apartment Hotels

Quest Apartment Hotels began in 1988 when Paul Constantinou opened the first location in Fitzroy, a suburb of Melbourne. This initial property was a modest 55-key establishment that catered to business travellers in search of more spacious and comfortable accommodations. Over the years, Quest has expanded significantly, now boasting over 160 properties across Australia, New Zealand, Fiji, and the UK.

The growth of Quest Apartment Hotels continued as it became part of Ascott Limited, a Singapore-based company. This partnership allowed Quest to leverage Ascott’s extensive resources and expertise in the hospitality sector. Today, Quest is recognised as Australasia’s leading apartment hotel provider. The brand’s commitment to customer service and local ownership has been crucial in maintaining high standards and adapting to changing market demands.

Opening a Quest Apartment Hotels franchise involves several steps. Prospective franchisees must first meet specific criteria set by the company. The initial franchise fee typically ranges from AUD 50,000 to AUD 60,000. Additionally, total costs for opening a franchise can vary widely depending on location and property size but usually range between AUD 1 million and AUD 3 million. This investment covers property acquisition or leasing, renovations, and initial operating expenses.

For those interested in pursuing this opportunity further, detailed information about opening a Quest Apartment Hotels franchise can be found on their official website. 

Choice Hotels

Choice Hotels began in 1939 when seven motel owners in Florida formed a cooperative called Quality Courts United. This group aimed to refer guests to each other’s establishments and set service standards. Over the years, the cooperative expanded, becoming the first hotel chain in the United States. In 1972, it changed its name to Quality Inns International, reflecting its growing presence in the hospitality industry. The company continued to innovate, introducing many industry firsts, such as guaranteed reservations and 24-hour toll-free booking services.

In the following decades, Choice Hotels expanded its brand portfolio by introducing new chains like Comfort Inn and Quality Royale. By the 1990s, it was recognised as a leader in the economy hotel market, capturing a significant share of the industry. The company became publicly traded in 1996 and continued to grow through strategic acquisitions and partnerships. Notably, in 2003, Choice Hotels acquired Flag International Ltd., which allowed it to expand its footprint in Australia and New Zealand, rebranding it as Choice Hotels Australasia.

Today, Choice Hotels is successful due to its strong brand recognition and diverse offerings that cater to various market segments. The franchise model allows for flexibility and local ownership while benefiting from a global network. Opening a Choice Hotels franchise in Australia provides several advantages, including access to a well-established brand with a loyal customer base, comprehensive training programs, and ongoing support from corporate teams. This support helps franchisees navigate the competitive hospitality landscape effectively.

To open a Choice Hotels International franchise, potential franchisees must pay an initial franchise fee that typically ranges from $25,000 to $60,000. Additionally, total costs can vary based on location and property size but generally range from $1 million to $5 million for development. This investment covers construction or renovation costs, furniture and fixtures, and other operational expenses necessary to establish the hotel. 

For those interested in pursuing this opportunity, more information can be found on the official Choice Hotels franchise website.

AccorHotels

AccorHotels began in 1967 when Paul Dubrule and Gérard Pélisson founded the company under the name Société d’investissement et d’exploitation hôteliers (SIEH). The first hotel, Novotel Lille, opened in France. Over the years, Accor expanded rapidly by launching various brands, including Ibis in 1974 and acquiring others like Sofitel and Mercure in the 1980s. By 1983, the company rebranded itself as Accor, marking a significant milestone in its growth and development as a major player in the hospitality industry.

Throughout the 1990s and 2000s, Accor continued to grow by acquiring more hotel chains and entering new markets. The company expanded into Asia and the United States, acquiring Motel 6 and Red Roof Inn. Today, AccorHotels operates over 4,200 hotels across five continents, offering a range of accommodations from luxury to budget-friendly options. The brand is known for its commitment to quality service and innovation in the hospitality sector.

AccorHotels is successful today due to its strong brand recognition, diverse portfolio of hotel brands, and a focus on customer satisfaction. Opening an AccorHotels franchise in Australia offers several benefits, including access to a well-established brand with a loyal customer base. Franchisees can leverage Accor’s marketing strategies and operational support to ensure success. Additionally, the growing tourism industry in Australia presents a lucrative opportunity for new hotel franchises.

To open an AccorHotels franchise, potential franchisees must be prepared for certain costs. The franchise fee typically ranges from AUD 50,000 to AUD 70,000. Total costs can vary widely based on location and property size but generally range from AUD 1 million to AUD 5 million. This includes construction or renovation costs, equipment purchases, and initial inventory. Franchisees also benefit from ongoing support from AccorHotels in areas such as training and marketing.

For more detailed information on how to open an AccorHotels franchise, including specific requirements and support offered by the company, you can visit the official AccorHotels franchise page.

InterContinental Hotels Group (IHG)

InterContinental Hotels Group (IHG) has a rich history that dates back to 1946 when it was founded as InterContinental Hotels. The first hotel opened in Belém do Pará, Brazil. Over the years, IHG expanded its portfolio by acquiring several hotel brands, including Holiday Inn in 1988 and Crowne Plaza in 1990. In 2003, IHG became a publicly traded company and rebranded itself as InterContinental Hotels Group. Today, IHG operates more than 6,000 hotels across various brands in over 100 countries, making it one of the largest hotel companies in the world.

IHG’s success can be attributed to its strong brand recognition and commitment to customer satisfaction. The company focuses on providing high-quality service and a range of amenities to enhance guest experiences. Additionally, IHG has developed a robust loyalty program called IHG One Rewards, which allows guests to earn points for stays and redeem them for free nights and other rewards. This program encourages repeat business and fosters customer loyalty. In Australia, opening an IHG franchise offers numerous benefits, including access to a well-established brand, marketing support, and a proven operational model that can lead to profitability.

To open an IHG Hotels franchise in Australia, potential franchisees need to understand the initial investment required. The franchise fee typically ranges from AUD 50,000 to AUD 75,000, depending on the brand and location. Additionally, total costs for setting up an IHG franchise can vary widely but generally range from AUD 1 million to AUD 5 million. This includes expenses for construction, equipment, and initial inventory. Franchisees also benefit from ongoing support from IHG in areas such as training and marketing.

The application process for becoming an IHG franchisee involves several steps. First, interested parties must submit an application and provide details about their business experience and financial background. After an initial review, candidates may be invited for interviews with IHG representatives. If approved, franchisees will enter into a franchise agreement that outlines the terms of the partnership. 

For more detailed information on opening an InterContinental Hotels Group franchise, you can visit their official franchise page.

Marriott International 

Marriott International, founded in 1927 by John Willard Marriott and his wife Alice, began as a small root beer stand in Washington, D.C. The company quickly expanded into the restaurant business and opened its first hotel, the Twin Bridges Motor Hotel, in 1957. Over the years, Marriott grew rapidly, becoming a significant player in the hospitality industry. In 1993, Marriott Corporation split into two entities: Marriott International, which focuses on hotel management and franchising, and Host Marriott Corporation, which owns properties. Today, Marriott International operates over 8,700 properties across 131 countries and territories, making it the largest hotel chain in the world by available rooms.

The success of Marriott International today can be attributed to its diverse portfolio of brands, strong management practices, and commitment to customer service. The company offers a wide range of accommodations from luxury hotels to budget-friendly options. This variety allows Marriott to cater to different market segments and customer preferences. In Australia, opening a Marriott franchise can be particularly beneficial due to the country’s growing tourism industry and demand for quality lodging options. Franchisees can leverage Marriott’s established brand reputation and extensive marketing resources to attract guests.

To open a Marriott International franchise in Australia, potential franchisees should be aware of the initial investment required. The total initial investment ranges from approximately $74 million to $117 million AUD. This investment covers various costs such as the franchise application fee, pre-opening training, property management systems, and construction costs. Franchisees are also responsible for ongoing fees that include a percentage of gross room sales and food and beverage sales.

The initial franchise fee is around $120,000 AUD. Franchisees must also prepare for additional costs related to marketing and operational supplies. It is crucial for franchisees to complete specific training programs mandated by Marriott to ensure quality service at their hotels. 

For more detailed information on how to open a Marriott International franchise, including the complete breakdown of costs and requirements, you can visit the official Marriott International franchise page.

Hilton Hotels & Resorts

Hilton Hotels & Resorts began its journey in 1919 when Conrad Hilton purchased the Mobley Hotel in Cisco, Texas. This marked the start of a remarkable expansion in the hospitality industry. In 1925, Hilton opened the first hotel to officially bear the Hilton name in Dallas, Texas. Over the years, Conrad Hilton acquired several hotels and pioneered innovative features like air conditioning and televisions in guest rooms, setting new standards for comfort and luxury. By 1946, Hilton Hotels Corporation was incorporated and became the first hotel company to be publicly traded on the New York Stock Exchange, further establishing its presence in the industry.

The brand continued to grow internationally, with significant milestones including the opening of the Caribe Hilton in Puerto Rico in 1949, which was also the first hotel under Hilton International. Throughout the 1950s and 1960s, Hilton expanded into Europe, Asia, and beyond, introducing concepts such as airport hotels and women-only floors. Today, Hilton Hotels & Resorts is recognised as a leading global brand with properties in over 90 countries, offering full-service accommodations that cater to both leisure and business travellers.

Hilton Hotels & Resorts is successful today due to its strong brand recognition, commitment to quality service, and continuous innovation. The company emphasises customer satisfaction and has implemented various loyalty programs that attract repeat guests. Opening a Hilton franchise in Australia offers numerous benefits, including access to a well-established brand that enjoys high consumer trust. Franchisees can leverage Hilton’s marketing expertise and operational support to thrive in a competitive market. Additionally, Australia’s growing tourism sector presents significant opportunities for hotel growth and profitability.

To open a Hilton Hotels & Resorts franchise, potential franchisees need to meet certain financial requirements. The initial franchise fee typically ranges from $75,000 to $100,000. However, total costs can vary widely depending on location and property size, often ranging from $1 million to $10 million or more. This investment includes construction costs, furniture and fixtures, and other operational expenses necessary to establish a new hotel under the Hilton brand. 

Franchisees will also benefit from ongoing support from Hilton’s corporate team, which includes training programs for staff and access to proprietary systems for reservations and management. This comprehensive support system helps ensure that franchisees can maintain the high standards associated with the Hilton name while running their operations efficiently.

Wyndham Hotels & Resorts

Wyndham Hotels & Resorts has a rich history that dates back to 1981 when it was founded in Dallas, Texas, by Trammell Crow. The brand was created as part of a strategy to expand the hospitality market. In 1990, Hospitality Franchise Systems (HFS) was established to acquire hotel franchises, and by 1995, it had acquired several well-known brands like Days Inn and Howard Johnson. The company underwent significant changes in ownership, being acquired by Patriot American Hospitality in 1998, which later became Wyndham International.

In 2005, Wyndham International was sold to the Blackstone Group for $1.4 billion. This transaction led to further expansion and rebranding efforts. In 2018, Wyndham Hotels & Resorts was spun off as a separate entity from Wyndham Worldwide, solidifying its position as the largest hotel franchisor in the world. Today, Wyndham operates over 9,200 hotels across more than 95 countries under various brands including Super 8, Ramada, and Days Inn. 

Wyndham Hotels & Resorts is successful today due to its strong brand recognition and extensive global reach. It focuses on providing affordable lodging options for travellers while maintaining quality service. Opening a Wyndham franchise in Australia offers several benefits, such as access to a well-established brand with a loyal customer base. Franchisees can leverage Wyndham’s marketing resources and operational support to ensure success in a competitive market.

To open a Wyndham Hotels & Resorts franchise, potential franchisees need to understand the financial requirements involved. The initial franchise fee typically ranges from $35,000 to $75,000 depending on the brand and location. Additionally, total costs for opening a Wyndham franchise can vary widely but generally range from $2 million to $5 million. This includes costs for construction, equipment, and other startup expenses. 

For those interested in pursuing this opportunity, it is essential to conduct thorough research and prepare for the application process. Detailed financial planning and understanding of local market conditions are crucial steps. More information about opening a Wyndham Hotels & Resorts franchise can be found on their official website.

Which Hotel Franchise Companies Are Most Profitable in 2024?

Profit margins in the hospitality industry can vary significantly based on a multitude of factors, including location, brand strength, and management efficiency. Many hotel franchises, particularly those under well-known hotel chains like Marriott International and Hyatt, tend to enjoy higher profit margins due to their established customer bases and operational efficiencies. Understanding these margins is essential for any investor considering entering the hotel business, as it provides insight into potential revenue streams and the overall profitability of specific hotel franchise opportunities.

How to Assess Potential Profitability

Assessing the potential profitability of a hotel franchise involves analysing several key indicators. Investors should review the franchise’s historical performance data, including occupancy rates, average daily rates (ADR), and revenue per available room (RevPAR). Additionally, engaging with current franchisees can provide valuable insights into operational challenges and successes

What Makes a Hotel Franchise Successful?

Successful hotel franchises share several key attributes that contribute to their standing in the hospitality industry. Brand recognition is paramount; leading hotel brands have established a reputation for quality service and customer satisfaction. Additionally, innovation in service delivery, such as the integration of technology for seamless guest experiences, has become increasingly important. Furthermore, a diverse portfolio of hotel properties allows these brands to cater to a broad audience, from business travellers to vacationing families, enhancing their overall market reach.

Effective hotel management is critical to the success of any franchise. A skilled hotel manager can optimise operations, enhance guest experiences, and maintain high occupancy rates. This is particularly important for franchisees who must adhere to the standards set by the franchisor while also managing their individual properties. Continuous training and development of hotel staff play a significant role in ensuring that service quality remains consistent, which is essential for building repeat business and fostering brand loyalty.

Marketing strategies tailored to the hotel franchise model can greatly influence a hotel’s success. Leading hotel brands invest heavily in digital marketing, utilising online platforms to reach potential guests. Social media campaigns, targeted advertisements, and loyalty programs are common strategies employed to drive bookings. Additionally, partnerships with local tourism boards and businesses can enhance visibility and attract a diverse clientele. A well-executed marketing strategy not only increases brand awareness but also drives revenue growth for the franchisee.

How to Choose the Right Hotel Franchise Opportunity?

Choosing the right hotel franchise opportunity requires thorough evaluation of various investment options available in the market. Potential franchisees should consider their personal financial situation, investment goals, and risk tolerance. Researching the performance of different hotel brands, the support offered by the franchisor, and the competitive landscape in specific regions can provide valuable insights. Investors should also explore various franchise opportunities across different hotel segments, from luxury resorts to budget motels, to find the best fit for their investment strategy.

Franchisor support is a critical element when selecting a hotel franchise. Prospective franchisees should closely examine the training programs offered by the franchisor, as well as ongoing support in areas such as marketing and operations. A strong support system can significantly improve the likelihood of success for a hotel franchise, providing them with the tools and resources necessary to thrive in a competitive market. Additionally, understanding the franchisor’s commitment to their franchisees can help build a strong, collaborative partnership.

When evaluating hotel franchise opportunities, it is essential to consider the long-term growth potential of the franchise. This involves analysing market trends, consumer behaviour, and the franchisor’s expansion plans. Franchises that demonstrate adaptability to changing market conditions and effectively cater to evolving consumer preferences are more likely to succeed in the long run. Moreover, franchises with a diverse portfolio can mitigate risks associated with economic downturns by appealing to a broader audience across different market segments.

Challenges and Risks in Hotel Franchise Business

The hotel industry presents unique challenges and risks for hotel owners, particularly those considering entering the franchise industry. One major concern is maintaining brand standards. Franchise agreements often require hotel owners to adhere strictly to the franchisor’s guidelines, which can include specific requirements for design, amenities, and services. This can lead to significant costs for updates or renovations, especially if the franchisor decides to change brand standards or undergo rebranding efforts. For high-end and upscale hotels, these requirements can be even more stringent, impacting the overall profitability of the hotel franchises.

Another challenge is the competitive landscape within the hotel industry. With numerous mid-range and top hotel brands vying for customer attention, franchisees must invest heavily in sales and marketing to differentiate themselves from competitors. However, increased advertising expenses do not always guarantee higher occupancy rates. The pressure to maintain a profitable hotel franchise can lead to financial strain if customer expectations are not met or if the franchisee fails to attract enough guests. Additionally, fierce competition may force hotel owners to offer discounts or promotions that further erode profit margins.

Territory encroachment is another risk that hotel owners face when entering a franchise agreement. This occurs when multiple franchisees operate in close proximity, potentially cannibalising each other’s business. If you’re considering a franchise opportunity, understanding territorial protections within your contract is crucial. Without proper safeguards, a new franchisee could open nearby and significantly impact your hotel’s performance. This situation can lead to disputes between franchisees and franchisors over market allocations.

Finally, legal and financial exposure is a significant concern in the franchise industry. Hotel owners often need to guarantee their franchise agreements personally, which means they could be held liable if their hotel does not meet its contractual obligations. This risk is compounded by the complexities of navigating regulations that govern franchising relationships, particularly as these rules can vary greatly from one region to another. Understanding these factors is essential for anyone looking to operate a successful hotel franchise in today’s global hospitality market.

The Future of Hotel Franchising in Australia

The hotel franchising landscape in Australia is evolving rapidly, especially in the wake of the pandemic. Major brands like Travelodge, Embassy Suites, and La Quinta are expanding their presence, driven by a renewed interest in travel and hospitality. In 2022 and 2023, many hotel companies focused on franchise conversions to adapt to changing market demands. The Asia Pacific region is seeing a surge in hotel openings, with brands aiming to capitalise on the growing tourism sector. This trend is reflected in the increasing number of hotels listed under various brand names, as companies seek to enhance their visibility and market share.

Franchising offers hotel owners a unique opportunity to maintain control over their properties while benefiting from the established reputation of larger brands. For instance, Hyatt Hotels and Westin are leveraging this model to expand their footprint in Australia. The flexibility of franchising allows owners to operate under well-known brands without the heavy costs associated with building new hotels from scratch. As a result, many owners are opting for franchises as a strategic move to navigate the challenges posed by rising construction costs and interest rates.

Looking ahead, the future of hotel franchising in Australia appears promising. The industry is expected to grow significantly as more operators recognise the advantages of this model. With ongoing developments from major players and a focus on enhancing guest experiences, the hotel sector is poised for recovery and growth. The anticipated changes in franchising laws may also provide additional support for franchisees, fostering a more robust environment for hotel operations in 2024 and beyond.

Conclusion

In 2024, the top hotel franchise companies in Australia are set to play a crucial role in the hospitality industry. Brands like Accor, IHG, and Wyndham are leading the market with their diverse offerings and strong support for franchisees. These companies have adapted well post-pandemic, focusing on growth and expansion while ensuring quality service. With their established brand names and commitment to innovation, they provide excellent opportunities for hotel owners looking to enter or grow in the franchise market. The future looks bright as these top companies continue to shape the landscape of hotel franchising in Australia.