What determination must Best Western make regarding existing members' ability to compete before granting an application?

According to Best Western's 2025 Franchise Disclosure Document, before approving a new membership application, Best Western must determine whether granting the application will materially impair the ability of existing members to compete with properties or other hospitality services operated by non-members in the relevant market. This determination is made after reviewing and analyzing any requested Impact Analysis.

An Impact Analysis, if requested by an existing member within the applicable radius of the new property, is conducted by an independent consulting firm. This firm assesses the applicant's potential for success, the demand for their services, and the incremental impact on existing Best Western members within the relevant market. Incremental impact is defined as the projected occupancy and revenue losses resulting from the new Best Western hotel, minus any losses projected due to the property operating as a non-Best Western hotel.

This process ensures that Best Western considers the potential effects of a new hotel on its existing franchisees. The Board of Directors must approve new member applications with a favorable vote of at least five directors. The Board also has the discretion to resolve any ambiguities or conflicts in the application of the rules regarding MMA radius protection and Impact Analysis, or to select appropriate data to rely on when making their decision. This process aims to balance the growth of the Best Western brand with the interests of its current members.