In recent years, we have seen  a number of small- and medium-scale hospitality companies allying themselves with global brands.

This is a decision that works best for those who are challenged by their operational infrastructure, as well as those who need the extra weight that comes with a globally-recognised brand name.

However, there are still a number of small or emergent players who opt to maintain their operational freedom as a way of preserving their unique brand identity.

It’s also a budget-friendly decision: maintaining independence also means you don’t need to pay franchise fees of any kind.

In the context of contemporary hospitality, what exactly are the merits of staying independent and those of becoming part of a global franchise?

Also, is there such a thing as middle ground between the two?

Loyalty alliances to maintain uniqueness

For those who are keen on maintaining identity over global recognition, the best option is to be part of a loyalty alliance as opposed to outrightly signing their name away, so to speak.

Indeed, alliances like the Global Hotel Alliance (GHA) have enabled smaller players to retain their original names, signature aesthetic, as well as their ambience.

Also, joining an alliance is more cost-effective: standard charges are significantly lower than that of franchises which could claim up to 12 percent of gross room revenues as fees.

Furthermore, especially for smaller players seeking to make themselves more visible on the global map, entering a loyalty alliance gives them access to millions of loyalty programme members worldwide.

A good example here would be GHA’s GHA Discovery programme which has made a number of smaller boutique properties immediate visibility to more than 35 million travellers around the globe.

In which case, programme members can earn and spend rewards across other non-competing independent luxury hotels globally, giving lesser-known properties a massive competitive advantage against the bigger players in the international market.

Who should consider a franchise?

On the other hand, opting to go the franchise route is great for properties facing a deficit in infrastructure and operational assets.

A global franchise already gives a hotel management company a host of tools to use, ranging from optimised central reservation systems, to property management tools, as well as procurement systems, essentially delivering a fully-operational working ecosystem.

At the same time, taking on a franchise can make properties located in highly-competitive commercial zones more visible to travellers.

It also helps that bankers and those investing in hospitality real estate would rather opt for franchised properties as their asset valuations are highly predictable and backed by global corporate pipelines.

Soft brands are the middle ground

To answer the question about finding middle ground, hoteliers and hospitality investors may find it in what are known as soft brand franchises.

Under the soft brand model, brands like Tribute Portfolio by Marriott or Curio Collection by Hilton offer hotel owners the powerful distribution engine and massive loyalty networks of a global franchise without compromising the property’s unique identity and character.

There is a caveat here, though: soft brand franchises are still franchises, so smaller players will still face significant fees should they opt to move in this direction.

Travel Daily Media’s Marga Manlapig is set to moderate the panel Loyalty alliances or franchises: What is the best solution for smaller and medium-sized hotel groups? at the South East Asia Hotel Investors’ Summit (SEAHIS) 2026 in Bangkok, Thailand on Monday, 15th June. To know more about the event, visit the official website.