To Örebro University

A large proportion of any business’ values is made up of the intangible asset vaule (IAV) - in many cases up to 70% - in most business sectors, even in hospitality. But the extent to which IAV is used, known and measured in the business community is very limited and in the hospitality business even more so. Based on the development and importance of affiliations and brand in the industry, it makes perfect sense that all senior managers/owners are fully aware of the implications and use of IAV, but as this research shows, this is not the case.

To be able to use IAV as a valuable tool and strategic measurement, it seems appropriate to develop this further and look at the possible implications for business in general and more specifically hospitality.

This study has so far been conducted in two phases; a first part with interviews with independent hotels and branded hotels, interviews with affiliations and financiers, business valuators and consultants in order to identify the use and the possibilities with IAV. The second part is a quantitative analysis of the advantages/disadvantages in terms of occupancy, RevPAR, Average Daily Rate (ADR) and Net Operating Income (NOI) for a large population of hotels during a full economic cycle.

The results show that IAV (as in branding) is not used, measured or defined, but there is a need for such an inclusion as the second part of the study indicated major differences between branded hotels and independet hotels in performance, especially in times of economic recession.