FRANCHISING IN HOSPITALITY - A KEY POINT FOR STRATEGIC DEVELOPMENT

This research paper aims to show the key differences between management and franchise as business models that are applied in the operations of hotels with international hotel brands. The intention is to identify key success factors to facilitate aligning decisions with the appropriate business model that should be applied, so as to simplify the process. The paper's findings are based on available empirical studies published in scientific journals and magazines. The implementation of the franchise business model in the past 10 years became more important for the stronger development of brands. Also, it is a key factor for flexibility in operations and more cost efficient for the investors. Franchising became a highly valued business model not only for the investors who realized that the franchise model optimizes the costs but also because it maximizes benefits of being part of the global brand in the commercial context and keeps control of operations under local management. This research paper will contribute to the general understanding of what the purpose of franchising is as a business model that is applied in hospitality today, how and in which circumstances it should be considered prior to a direct brand management model.