What are the potential consequences for a Crowne Plaza franchisee if they fail to meet the standards and specifications outlined in Item 8, considering the potential for competition from other licensees, as mentioned in Item 12?
Crowne_Plaza Franchise · 2025 FDDAnswer from 2025 FDD Document
SERVICES**
Except as described below, you are not required to purchase or lease products or services from Holiday or its affiliates, or from suppliers approved by Holiday, or under Holiday's specifications.
Standards and Specifications:
You must build, design, furnish, equip, decorate and supply the hotel subject to Holiday's approval of your plans. You must equip and operate the Hotel with products which meet the Standards and specifications, including those described in the License and the Standards for the applicable Crowne Plaza Hotel brand. All modernization, renovation and upgrading of your Hotel must also meet the Standards and specifications. Holiday issues specifications by brand of product and in many instances by brand "or equivalent", by physical characteristics and by other methods, depending on the product or service involved. Holiday can make changes to the Standards. These changes will become binding on you as if originally set forth in the Standards. Any change Holiday makes must be approved by Holiday's designated internal franchise committee or subcommittee, after seeking the advice and counsel of the appropriate committee of the IHG Owners Association. Holiday will provide you with an explanation of any change, in writing, at least 30 days before it goes into effect.
Holiday estimates that the Standards and specifications will apply to 90% to 95% of your purchases and leases. If you purchase or lease any equipment or supplies not previously approved by Holiday, Holiday may require you or the manufacturer to submit a written request for its approval. Holiday reserves the right to require removal of any non-approved product installed at the Hotel. While Holiday has no obligation to respond within a certain time frame, it expects to do so within 45 to 60 days from receipt of your request. Holiday may require certain information, tests, certifications and inspections, at no expense to Holiday, as a condition of approval.
All Crowne Plaza brand group hotels must install in all guestrooms the approved bedding components that comply with the Crowne Plaza Bedding Collection. To ensure brand-wide consistency of the sleep experience, you must purchase mattresses and pillows through the approved suppliers. You must purchase the brand-mandated components (for example duvets and sheets) through the IHG approved distributors.
Under the Crowne Plaza Bulk Bath Amenity Program, all Crowne Plaza brand group hotels must install in all guestrooms the approved bath components that comply with the Guest Bathroom and Supplies and Amenities standards and the IHG Journey to Tomorrow initiative. Approved IHG suppliers have been identified for Crowne Plaza bath amenities. To ensure brand-wide consistency of quality, look and feel, you must purchase the Crowne Plaza bath amenities and bulk amenity brackets from the specified vendors. Under the Crowne Plaza Fitness Center program, all Crowne Plaza brand group hotels must install the fitness center design elements outlined in the section of the Standards regarding fitness centers. Additionally, approved equipment vendors have been identified and all equipment purchases must go through one of the three approved vendors outlined in the section of the Standards regarding fitness centers. Lastly, minimum fitness center square footage requirements which must be adhered to are also outlined in the section of the Standards regarding fitness centers. All plans must be submitted to the IHG PIP and Plan Review team at amerplanreview@ihg.com for review and approval prior to ordering any equipment or design elements.
What This Means (2025 FDD)
According to the 2025 Crowne Plaza FDD, franchisees must adhere to the brand's standards and specifications, which apply to an estimated 90% to 95% of purchases and leases. These standards cover various aspects, including hotel construction, design, furnishing, equipment, and supplies. Crowne Plaza can modify these standards, with changes becoming binding on franchisees after a 30-day written notice and approval from Holiday's designated internal franchise committee or subcommittee, following advice from the IHG Owners Association committee. Failure to comply with these standards can lead to specific repercussions.
If a Crowne Plaza franchisee purchases or leases equipment or supplies not previously approved, Crowne Plaza has the right to demand the removal of the non-approved product at the franchisee's expense. For certain items like mattresses, pillows, bath amenities and fitness center equipment, franchisees are required to purchase them through approved suppliers to ensure brand-wide consistency. Submitting design work from unqualified individuals can result in plan default and an assessment of fees up to $5,000.
Moreover, before a Crowne Plaza hotel opens, it undergoes an inspection by Holiday to ensure compliance with all requirements. If the hotel fails this inspection or if the franchisee needs to reschedule the opening date or any visits, a fee of up to $5,000 may be charged for each extension or additional visit. Holiday's approval for any extension must be in writing, and the franchisee is responsible for covering any expenses Holiday incurs while processing the extension request. These measures are in place to maintain the quality and consistency of the Crowne Plaza brand, and failure to adhere to them can result in financial penalties and the potential removal of non-compliant products or designs.