HOLIDAY INN: Defranchising a PA Dutch Country Icon

October 7, 2008 Franchise Publicity

(Franchise Pick) For decades, the Lancaster, PA Holiday Inn on historic Route 30 served as tourism’s gateway to PA Dutch country. Its prominent and kitschy sign, flanked by a giant Amish couple, was a favorite tourist photo opp – ranking right up there with the nearby “Welcome to Intercourse, PA” sign.

In recent years, the increasing disrepair of the graffitied roadside sign has signalled the overall decline of a once warm, welcoming and trustworthy member of the IHG-owned Holiday Inn franchise family. Holiday Inn Lancaster has been increasingly plagued with high management turnover, a decaying infrastructure and credit-unworthiness. After Atlanta-based Kronos Hotels and Resorts took ownership 15 months ago, Amish country’s Holiday Inn went downhill fast. It all came to a head last week when franchisor IHG International announced that the hotel has been “terminated from the Holiday Inn system.”

According to the Lancaster Sunday News:

The terse IHG statement reads, “Holiday Inn is very concerned about the reported issues at the former Holiday Inn hotel in Lancaster, PA (Visitor’s Center).
“As a franchiser, we have brand standards that franchised hotels must comply with; however, we do not control the day-to-day operations of franchised hotels since they are independently owned and operated. “At this time, the hotel has been terminated from the Holiday Inn system.”

Being ousted from the Holiday Inn franchise system is a huge blow for the ailing hotel. Not only will they lose the branding power and name recognition that comes with being a Holiday Inn, they will no longer be part of Holiday Inn’s online reservation system. With a number of serious restaurant and health code violations, allegations of liquor laws, and termination of services by unpaid vendors (including having electricity shut off last week by PP&L), the termination of the Holiday Inn (Visitor’s Center) franchise was well-founded if not overdue.

According to the Lancaster Sunday News, Holiday Inn franchisor IHG has previously revoked the franchise agreements of several other Kronos Hotels & Resorts properties, including Holiday Inn franchises in Pittsburgh, PA and Lansing, MI.

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