Hilton
Click
here to link to Hilton’s detailed company profile
One of the most recognized names in the industry, Hilton Hotels & Resorts stands as the stylish, forward thinking global leader in hospitality. From inaugural balls and Hollywood award galas to business events and days to remember, Hilton is where the world makes history, closes the deal, toasts special occasions and gets away from it all. The flagship brand of Hilton Worldwide continues to build upon its legacy of innovation by developing products and services to meet the needs of tomorrow's savvy global travelers while more than 144,000 Team Members shape experiences in which every guest feels cared for, valued and respected. Today, the Hilton Hotels & Resorts portfolio includes more than 540 hotels in 78 countries and the brand remains synonymous with "hotel."
The Hilton Hotels & Resorts brand is part of Hilton Worldwide, the leading global hospitality company, spanning the lodging sector from luxurious full-service hotels and resorts to extended-stay suites and mid-priced hotels. For 93 years, Hilton Worldwide has been offering business and leisure travelers the finest in accommodations, service, amenities and value. The company is dedicated to continuing its tradition of providing exceptional guest experiences across its global brands. Its brands are comprised of more than 3,750 hotels and timeshare properties, with 615,000 rooms in 85 countries and include Waldorf Astoria Hotels & Resorts, Conrad Hotels & Resorts, Hilton Hotels & Resorts, DoubleTree by Hilton, Embassy Suites Hotels, Hilton Garden Inn, Hampton Hotels, Homewood Suites by Hilton, Home2 Suites by Hilton and Hilton Grand Vacations. The company also manages the world-class guest reward program Hilton HHonors®.
| |
Operating Units |
12/31/2008 |
12/31/2009 |
12/31/2010 |
|---|
| | Franchised |
196 |
203 |
202 |
| | % Change | -- |
3.6% |
-0.5% |
| | Company-Owned |
20 |
21 |
22 |
| | % Change | -- |
5.0% |
4.8% |
| | Total |
216 |
224 |
224 |
| | % Change | -- |
3.7% |
0.0% |
| | Franchised as % of Total |
90.7% |
90.6% |
90.2% |
Investment Required
The fee for a Hilton franchise (development services fee) is $85,000 for the first 275 guest rooms or suites plus $300 for each additional room or suite.
Hilton provides the following range of investments required to open your initial franchise. The range assumes that all items are paid for in cash. To the extent that you choose to finance any of these expense items, your front-end investment could be substantially reduced. The following figures refer to a new hotel with 300 rooms.
| |
Item | Established Low Range | Established High Range |
| | Development Services Fee | $92,500 | $92,500 |
| |
Product Improvement Plan |
$7,500 (per plan) |
$7,500 (per plan) |
| | Phase 1 Environmental Assessment | $0 | $10,000 |
| | Designer and Engineering Fees | $500,000 | $2,000,000 |
| | Construction and Leasehold Improvements | $40,000,000 | $65,000,000 |
| | Furniture, Fixtures and Equipment (includes telephone systems) | $8,000,000 | $12,000,000 |
| |
Inventory and Operating Equipment |
$1,500,000 |
$3,000,000 |
| |
Signs |
$50,000 |
$150,000 |
| |
Computer Software |
$58,000 |
$173,800 |
| |
HAS Stay Connected High Speed Internet |
$86,000 |
$110,200 |
| |
Required Pre-Opening Training |
$15,000 |
$30,000 |
| |
ADA Consultant Fee |
$2,500 |
$10,000 |
| |
Construction/Renovation Extension Fee |
$10,000 |
$10,000 |
| |
SPA Consultant Fee |
$75,000 |
$75,000 |
| |
Organizational Expense |
$50,000 |
$200,000 |
| |
Permits and Licenses |
$100,000 |
$500,000 |
| |
Miscellaneous Pre-Opening and Project Management Expenses |
$1,000,000 |
$3,000,000 |
| |
Contingencies |
$1,540,000 |
$2,800,000 |
| |
Additional Funds (3 Months) |
$400,000 |
$1,000,000 |
| |
Total Initial Investment |
$53,486,500 |
$90,169,000 |
Ongoing Expenses
Hilton franchisees pay monthly royalty fees equal to 5% of gross rooms revenues and 3% of gross food and beverage revenues, a monthly program fee equal to 4% of gross rooms revenues and monthly OnQ® (business software) fees equal to 0.75% of gross rooms revenues. Other fees payable by the franchisee include additional OnQ®-related fees and TPCP (Travel Planner Centralized Payment Program) fees.
What You Get—Training and Support
Hilton conducts a four-day initial training program in a major market which provides hotel general managers with the skills they need to run a Hilton Hotel, including Hilton service, standards, marketing and sales, training, human resources and Hilton technology. Staff is also trained on-site in OnQ®, Hilton’s proprietary computerized business system.
Hilton provides a superior level of support to franchisees prior to, during and after opening, including site review and design consulting, a friendly and dedicated corporate staff and a business model backed by management and franchising expertise. Franchisees enjoy a large customer base fueled by the Hilton Honors guest reward program and referrals from other Hilton Family hotels through cross-selling. Franchisees also benefit from marketing and sales support provided by Hilton, including national and regional efforts, public relations and ready access to promotional materials. OnQ®, the lodging industry’s first totally integrated information technology platform, helps franchisees manage inventory, efficiently run hotels and assists in profitable decision-making.
Territory
Hilton does not grant exclusive territories.
Note: The tables and information regarding the number of operating units, investment required, on-going expenses, training and territory grants were taken from the company’s 2011 FDD. The 2011 write-ups will be incorporated into the 2012 Edition of Bond’s Top 100 Franchises publication.
|
