Besides directing and administering the Reservation System, what other expenses can Holiday use Services Contribution monies for regarding Even Hotels?
Even_Hotels Franchise · 2025 FDDAnswer from 2025 FDD Document
ted under Holiday's marketing programs may be national, regional or local in scope. Holiday will use all types of media that it determines are appropriate, including print, radio, television and outdoor billboards. Any advertising Holiday creates will be created either by its inhouse advertising department or outside advertising agency.
Holiday will maintain all Services Contribution sums paid by you, other Brand System licensees and company owned hotels, plus any interest or other income earned from these contributions, in a separate account from other funds. Holiday will not use these monies to defray any of its general operating expenses, except for the reasonable administrative costs and overhead expenses Holiday incurs in directing and administering the Reservation System, and Holiday's sales, marketing and training programs.
The Loyalty Program and your required contributions to the Loyalty Program are described in Item 6. Holiday's Senior Vice President, Global Loyalty and Partnerships administers the Loyalty Program. The financial information of the Loyalty Program is included within an audited Statement of Revenues and
Expenses that is made available for review to the appropriate IHG Owners Association's brand marketing committee under a confidentiality agreement, and is not generally available for distribution. In the most recently concluded twelve-month period ended December 31, 2024, the Loyalty Program contributions were used as follows: 78% on award costs, 17% on member communication/promotions, 3% on administrative expenses, and 2% on services from corporate allocations such as Information Technology Data Warehouse, and the Service Center.
The audited Statement of Revenues and Expenses will be prepared each year; however, it is not generally available for review by licensees, and Holiday does not provide periodic accounting reports.
Holiday pools Services Contributions from Brand System hotels together with the Services Contributions from hotels operating under one or more of Holiday's and its affiliates' current and/or future portfolio of brands (see Item 1) ("IHG Portfolio Brands").
Source: Item 11 — Franchisor's Assistance, Advertising, Computer Systems, and Training (FDD pages 70–82)
What This Means (2025 FDD)
According to Even Hotels' 2025 Franchise Disclosure Document, Holiday will not use service contribution monies to defray general operating expenses, except for reasonable administrative costs and overhead expenses Holiday incurs in directing and administering the Reservation System, and Holiday's sales, marketing and training programs. These service contributions are sums paid by Even Hotels, other Brand System licensees, and company-owned hotels, plus any interest or other income earned from these contributions, in a separate account from other funds.
Funds used for marketing programs will be used for developing, preparing, producing, directing, administering, conducting, maintaining, and disseminating advertising, marketing, promotional, and public relations materials, programs, and campaigns, publishing a directory of hotels, and conducting market research. Advertising conducted under Holiday's marketing programs may be national, regional, or local in scope, utilizing various media such as print, radio, television, and outdoor billboards. Any advertising Holiday creates will be created either by its in-house advertising department or an outside advertising agency.
In the fiscal year ended December 31, 2024, 49% of the marketing funds went for media, advertising, promotions and marketing programs, 16% for sales, 6% for hotel performance support, 5% for administration (e.g., corporate functions) and 24% for other costs. The Even Hotels franchisee should note that Holiday has no obligation to spend any amounts on advertising in the vicinity of your Hotel nor does it have any obligation to expend any amounts for marketing or reservation services greater than the amounts it receives from licensees using the Brand System and the funds it contributes. Services Contributions are not intended to benefit any specific market or hotel.