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INTRODUCTION TO HILTON RESTAURANT
The Hilton Hotels brand remains one of the company's flagship brands and one of the largest hotel brands in the world. The company places marketing emphasis on both business travel and leisure travel with locations in major city centers, near airports, convention centers, and a number of vacation resorts and leisure-oriented hotels in popular vacation destinations around the world. The company's Hilton Honours guest loyalty program is one of the largest of its kind and has numerous partnerships with airlines and car rental companies. Some Hilton Hotels feature an Executive Level lounge for Honours Gold and Diamond members and those willing to pay for Executive Rooms. The lounge is normally located on the highest floor of the hotel building. In addition to Hilton Hotels, the Hilton Honours membership can also be used at all other Hilton Worldwide brands. The U.S. branch of Hilton hotels was reunited with the international properties after more than 40 years in February 2006, when United States-based Hilton Hotels Corporation purchased the hotels division of United Kingdom-based Hilton Group plc, which had acquired Hilton's International operations in 1987 (the companies had been separated originally in 1964). Hilton Hotels & Resorts (formerly known as Hilton Hotels) is an international chain of full
service hotels and resorts, it is the flagship brand of Hilton Worldwide. The original company was founded by Conrad Hilton and is now owned by Hilton Worldwide. Hilton hotels are either owned by, managed by, or franchised to
independent operators by Hilton Worldwide. Hilton Hotels became the first coast-to-coast hotel chain of the United States in 1943. As of 2010, there are now over 530 Hilton branded hotels across the world in 78 countries across six continents.
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HISTORY OF HILTON RESTAURANTS
Founded in 1919 by Conrad Hilton. Hilton bought his first hotel, the Mobley Hotel, in 1919 in Cisco, Texas. The first hotel to bear the Hilton name was the Dallas Hilton, a high-rise that opened in Dallas, Texas in 1925. In 1949, at the Caribe Hilton Hotel's Beachcomber Bar in San Juan, Puerto Rico, Ramon "Monchito" Marrero created the Pia Colada. In 1954, Hilton hotels bought the Statler Hotel chain, making it the largest hospitality company in the world.
The Conrad Hilton Hotel in Chicago figured prominently in the 1968 Democratic Convention riots that occurred across the street in Grant Park. The hotel's doors were locked for the first time in its history. The hotel still suffered minor damage as a result of the violence outside as the street level windows gave way under the weight of hundreds of protesters on the street during the ensuing riot.
John Lennon and Yoko Ono held their first Bed-In for Peace between March 25 and March 31, 1969 at the Amsterdam Hilton in Room 902. This room became a popular tourist destination. On April 3, 1973, Martin Cooper made the world's first handheld cellular phone call in public when he called Joel S. Engel at the New York Hilton with a 2 pound Motorola DynaTAC phone.
The Beirut Hilton finished construction and was supposed to open on April 14, 1975. However, the Lebanese Civil War erupted exactly one day before the Grand Opening date on April 13. The hotel was never opened and was severely damaged during the war. The building was demolished in the late 1990s. In the 2000s, work on a completely separate Hilton Beirut Hotel was begun nearby, but it was never completed.
The Hilton Nicosia in Nicosia, Cyprus, was the scene of the assassination of Youssef Sebai, an Egyptian newspaper editor and friend of Egyptian President Anwar El Sadat, on February 19, 1978. The assassination and the hijacking of a Cyprus Airways DC-8 at Larnaca Airport led to theEgyptian raid on Larnaca International Airport by Egyptian forces. The intervention by the Egyptians led to the deterioration of relations between Cyprus and Egypt.
The Amsterdam Hilton hotel has had two more notable incidents. On June 27, 1991, Dutch drug kingpin Klaas Bruinsma, once a major drug dealer of Europe, was
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assassinated in front of the building. On July 11, 2001, Dutch artist Herman Brood committed suicide by jumping from the roof.
In 2009, the company relocated its global headquarters from Beverly Hills, California to Tysons Corner, Virginia.
In 2009 Hilton opened Canada's tallest hotel at 58 stories in Niagara Falls, Ontario In late 2010, Hilton Worldwide announced a name change of the Hilton Hotels brand to Hilton Hotels & Resorts along with a new logo design as part of a rebranding effort for the flagship brand.
On February 11, 2012, multi-Grammy Award winning singer Whitney Houston drowned in the bathtub of room 434 at the Beverly Hills Hilton.
In July 2012, tightrope walker Jay Cochrane walked from the Skylon Tower to the top of the Hilton in Niagara Falls, Ontario
In March 2013, Hilton announced that it would be entering Myanmar for the first time with the construction a 300-room hotel in Yangon.
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OVERVIEW OF HILTON
Type Traded as Industry Founded Founder(s) Headquarters
Public NYSE: HLT Hospitality, Hotels Cisco, Texas (1919) Conrad Hilton 7930 Jones Branch Drive, Tysons Corner, Virginia, United States (McLean mailing address)
Number of locations
3,897
Area served Key people
Worldwide Christopher J. Nassetta, President and CEO
Revenue Employees
$9.735 billion USD (2013) 152,000 employees and 162,000 franchise employees (Dec 2013)
Parent Website
Blackstone Group Hilton Worldwide
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HILTON BRANDS
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HILTONS BUSINESS MODELS
Leased Hotels
B
Owned Hotels
A
Business Model
Managed Hotels
Franchised Hotels
F
E
Timeshare Ownership
Joint Ventures for International Operations
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HILTONS FRANCHISE MODELS
Many of Hilton's properties are franchised to independent operators and companies. This business practice has proven successful in rapidly expanding the various Hilton brands to markets all over the United States. Franchisees must follow strict brand standards in order to maintain a licensing agreement with Hilton Worldwide. The Hampton Inn brand is virtually 100% franchised with the minor exception of a few properties that are corporate managed for various reasons. All franchised hotels are regularly inspected by a Quality Assurance Team to enforce brand standards and consistency. The practice of franchising is popular within the Hospitality industry among most major hotel chains, especially among smaller brands with a fair number of locations which are not feasible to be corporately owned and managed by the company. Competitor companies such as Marriott International and Starwood follow a similar business model that focuses on franchising as a rapid expansion method. Most of Hilton's flagship properties, airport properties, and largest resorts, however, are corporately managed.
REASONS FOR FRANCHISING
The hotel market is booming and gaining more attention from franchise investors. Lodging industry is projecting strong growth in the future. Great opportunities for this type of business exist in the U.S and worldwide; the lodging industry is constantly expanding. Little or no capital investment required. To expand globally and gain brand recognition
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FRANCHISE DEVELOPMENT PROCESS
There are 2 steps for franchise of Hilton restaurants. Those are as follows:-
21-step Franchise Development Process
Approval Process: Steps 1-9
Design & Construction : Steps 10-21
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STEP: 1:- APPROVAL PROCESS Franchisee contact HHC developer and will receive UFOC (Uniform Franchise Offering Circular). Decision for the site of the hotel. Completion of FLA (Franchise License Application). Payment of Initial fee. Project summary submitted. Approval letter from Franchise Administration. Get Hilton Standard Manual and set up a pre-design meeting with the architect. STEP: 2:- DESIGN & CONSTRUCTIONS PROCESS Franchisee send preliminary plans and specifications to the Hilton project manager for review and comments. After final approval construction of the hotel began. Franchisee sent monthly updates/repots The project manager may visit the site up to three times during construction for inspections. Decide the opening date. Obtain a Certificate of Occupancy from local Building Department. Pre-opening checklist. Installment of the required property management system and training for using the computer equipment Final consent by QA team. The Hotel Open!!!
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FRANCHISE UNITS
YEAR U.S. CANADIAN INTERNATIONAL COMPANY OWNED 2013 2012 2011 2010 182 187 191 194 11 11 11 11 36 35 35 33 322 324 315 299
START-UP COSTS, ONGOING FEES AND FINANCING
Total Investment: $55,997,500 - $97,115,875 Franchise Fee: $85,000 Ongoing Royalty Fee: 5% Term of Franchise Agreement: 22 years, renewable
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FRANCHISE FEES
Franchise Application Fee When you submit your franchise application for a Hilton Garden Inn franchise, you pay us an initial fee based on the number of guest rooms in your prospective hotel. The initial fee is currently $75,000, plus $450 for each additional guest room or suite over 150 guest rooms or suites. Monthly Royalty Fee 5.5% of monthly gross rooms revenue. Monthly Program Fee 4.3% of monthly gross rooms revenue. Technology Hilton Worldwide Technology Solutions empowers our owners with a competitive advantage a single-solution technology platform delivering a range of services within a multi-brand hotel company. Like Hilton Worldwides many technological firsts, our revolutionary OnQ framework connects team members to every guest touch-point and database across the portfolio, allowing the hotels to obtain and share information at all levels of the organization. This has led to benefits including significant cross-sell revenue and record growth in our customer loyalty program. Hilton World wides technology platform integrates components in such a way as to reduce workload redundancies, and to manage your property and the inventory it sells with 24/7 access around the globe, while providing the necessary business intelligence to enable smart, profitable decisions. And with implementation complete in more than 3,850 global properties, Hilton World wides integrated solutions open new fertile markets of customers for your Hilton Worldwide properties. Pricing of the OnQ framework varies from brand to brand and is based on the size of the hotel and the location of the property. In general, Hilton Technology Solutions prides itself on maximizing revenue generation opportunities and driving operational efficiencies
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throughout each property, while ensuring the best price and performance quality for your technology investments. Hilton Worldwide has won numerous external awards for the value its technology provides to the enterprise. Most recently, the companys IT division received the 2012 Visionary Award from Hospitality Technology magazine. On Q Powering hospitality around the globe. Other Fees For Frequent Traveller/Guest Reward program, training, ongoing computer system maintenance and related fees, and all other fees, please refer to the March 30, 2012 Franchise Disclosure Documents for Hilton Garden Inns Franchise LLC.
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HHCS PRINCIPLES OF FRANCHISING
HHC believed that a franchise relationship should be a long-term commitment made to benefit both parties. The purpose of the HHC Principles of Franchising is to provide a clear definition of the expectations of the franchisor and franchisee to help us both build an even greater foundation for a solid, long-term relationship. Both HHC and its franchisees shared a mutual interest in maintaining the product and service quality at a competitive edge. HHC also charted out growth and development programs for its franchisees through principles of development, multiple brand considerations, and market awareness and fairness. The principles of development focused on fair play, teamwork, mutual respect and open communication. HHC also gave its franchisees multiple brand considerations as it had a wide range of hotel brands and brand extensions, each with a unique and differentiated product and service profile, and at distinct price points.
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WHAT FRANCHISEES EXPECT FROM HHC
HHC should protect the value of its brands. HHC was committed to deliver outstanding service to its franchisees and to help them maximize the value of the system. HHC should maintain the superiority of its brands by continuously monitoring and conducting research on trends and standards within each brands competitive set. Develop and manage programs and processes to maintain HHCs product and service quality at a competitive edge. HHC to monitor quality and performance, and develop leading-edge programs and products. Uphold brand value, product and service quality standards, and HHCs culture of complete guest satisfaction. Total commitment to building customer loyalty. Ensure that the employee team members were well-trained and focused on delivering HHCs commitment to product and service quality. HHC invited its franchisees to communicate openly and regularly to provide input to improve its brands and relationships. Take a proactive role in building new HHC brands in its (franchisees) markets.
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HILTON SUPPORT TO FRANCHISEE
Spent more than $700 mil in a year Worldwide marketing and sales Promoting the brand in top media National and regional advertising Public relations National programs, such as Hilton vacation package, getaway packages Total technology solution OnQ system, a technology platform that linked all its brands and hotels to enhance customer service and loyalty. Maximize the operational efficiencies. easy escape
Hilton reservations worldwide In 1999, $30 million central reservation system (CRS) called HILSTAR. Toll-free 1-800-Hiltons in the US and Canada.
Cross-Selling Hilton horizon system, linked the reservation availability and facilitated referrals to other nearby hotels within the Hilton gamily of hotels.
Hilton HHonors Frequent guest reward program. As of 2004, 13 mil loyal HHonors members.
Hilton is a name that is synonymous with first class hospitality. Franchising with Hilton is a satisfying and rewarding experience.
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Hilton gives committed service and support.
HILTON RANKING ON FORTUNE 500
Rank Company 500 rank Revenue ($ millions)
1 2 3
Marriot International Harrahs Entertainment Hilton Hotels
203 254 296
12,160.0 9,780.7 8,162.0; 572.0(profit)
4 5 6 7 8 9
MGM Mirage Starwood Hotels & Resorts Wyndham Worldwide Boyd Gaming Penn National Gaming Las Vegas Sands
315 381 546 768 797 801
7,588.0 5,979.0 3,842.0 2,397.5 2,244.5 2,236.9
Source: Fortune Magazine, April 30th, 2007 issue
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