Investing in the hotel business is one sure way of getting good returns on your investment over a long period of time, as long as the hotel is still open and functional. If you decide to buy the franchise of a hotel in the UK, you won’t struggle to grow the business. When it comes to hotels and hotel franchises, there’s one thing worth considering: most hotels (more than 70 percent), carry a brand attached to their name.
Interestingly, the hotel cum hospitality industry in the United Kingdom is doing pretty great and there are different types of hotels in the UK. Statistics show that both international and domestic tourism contributes to this market, which is worth an astounding £20.7bn.
The hotel occupancy rate has seen some highs too with numbers reaching nearly 80 percent. Another report shows that there are currently almost 13,000 hotel businesses contributing over 373,400 jobs to our society, not to mention that the UK hotel industry generated a total revenue of £20 billion in 2019.
While the outcome of Brexit has created a certain level of uncertainty over the future of the industry, many British holidaymakers are choosing to stay in the UK rather than venturing overseas. The hotel and hospitality industry in the United Kingdom is experiencing an upward trajectory and this presents an exciting opportunity for entrepreneurs looking to capitalize on this lucrative industry.
So, if you are interested in starting a hotel business in the United Kingdom, here are some hotel franchises that you should consider buying.
8 Best Hotel Franchise Opportunities in UK and Their Cost
Best Western is one of the world’s most well-known hotel chains, operating in over 4,200 locations with a variety of names under its belt. Each site is independently, privately owned. Best Western hotel can boldly boast of having a whopping 3.8 million loyalty members.
- An initial investment of £420,000
Curio by Hilton
Curio by Hilton was founded in 2014, and the hotel has been one of the brands in the Hilton Hotel portfolio for five years. Hilton has opened over 35 hotels in this time, all of which have a distinctive interior design strategy and atmosphere.
Curio hotels present “distinct character and a personality you can’t duplicate”, but above all, they are “authentic, independent and remarkable”. Hilton Hotels & Resorts is undeniably one of the most recognized hotel brands in the world. Being a leader in innovative products, amenities, and services, Hilton remains synonymous with ‘hotel’ all over the world.
Hilton Hotels & Resorts continues to be a stylish, sophisticated, and forward-thinking global front-runner in the industry. The brand prides itself on making travel a whole lot easier, with its elegant design, advanced restaurant concepts, and dedication to the global hospitality community. So, let’s find out if it is possible to become part of this internationally recognized brand.
Initial investment: £2,960,000 to £76,820,500
Franchise fees – £60,000
Esplendor by Wyndham
Esplendor is a boutique hotel brand in the Wyndham hotels portfolio. It is a notable hotel chain in South America and aims to give each guest an unforgettable stay by putting comfort and style first. As a franchise, Wyndham owns 20 different brands that offer consumers slightly different experiences. In total, the business operates over 9,000 hotels which have almost 800,000 rooms and stretch across 80 countries.
- On Request
Hotel Indigo by IHG
IHG (InterContinental Hotels Group) is an international franchise that operates 16 hotel brands. Franchisees make up the majority of the business, as 4,615 hotels out of 5,518 are operated under franchise agreements. The IHG name spans almost 100 countries and delivers 163 million nights of the board every year.
When IHG introduced its brand, Hotel Indigo, it gave its customers a chain of hotels that listen to the local community and fit in well. They all have plush bedding, hard surface flooring and spa-inspired bathrooms. There are 103 Hotel Indigo branches, offering 12,828 rooms in total.
Total Investment – £13,142,000 to £29,388,000
Franchise fee – £60,000
Travelodge is the second largest budget hotel chain in the industry after Premier Inn. The brand has a large clientele, as it has become synonymous with affordable accommodation in the UK. With more than 500 branches, Travelodge has a strong presence in all major towns and cities.
Travelodges can be built to fit a range of designs. They have previously been incorporated into Grade II-listed buildings, office conversions, purpose-built hotels, acquisitions of existing hotels and as part of co-partnerships with leading retailers, supermarkets and pub companies.
- Liquid capital – £190,000.
Holiday Inn & Holiday Inn Express
Holiday Inn is the third biggest hotel chain in the UK – and its offshoot brand, Holiday Inn Express, are operated under franchise agreements. They are part of the InterContinental Hotels Group (IHG), which manages 16 different hotel brands.
IHG has not officially published the investment needed to open a Holiday Inn or Holiday Inn Express, but Speculators have produced suggested costs. It is thought that franchise fees could amount to £40,000, while the initial investment might be between £6.1 million and £19.3 million.
Choice Hotels is one of the largest hotel franchises in the world. The hotel franchise boasts of having more than 6,400 hotels spread across over 40 countries. Choice Hotels has a loyalty program that includes over 16.5 million members. They also offer reservations through an online booking system and third-party websites focusing on travel. National advertising campaigns also make this a sound investment.
It is on record that in 2013, Choice Hotels added an additional nine branded properties to its UK portfolio, thanks to its relationship with Akkeron Hotels Group Limited. Akkeron is a well-known hotel operator in the UK. This partnership has resulted in a 25 percent increase in the Choice Hotel’s UK portfolio, which includes an extra 611 rooms.
- Initial franchise fee – £7,000 to £46,000
- Net worth – £580,000
- Liquid capital – £193,000
Hemera Holidays offers an array of luxury lodges, holiday homes, and cabins for holiday lettings. Founded in 2014, the UK holiday brand has grown rapidly in the last four years and is consequently on the hunt for savvy entrepreneurs all over the UK.
UK holidays are becoming more on-trend and hot tub lodges and they are in huge demand. Therefore, many landlords are progressing into the holiday market – one of the most rapidly growing markets in the UK. Hemera Holidays lets you take advantage of this, and all you need is the drive, knowledge of the local area and the ability to locate and work with holiday let owners.
- The total investment is £4,995 and you can expect to make around £75,000 in revenue after two years.