Under what conditions can the Commercial Services Fee for a Caption By Hyatt franchise increase?
Caption_By_Hyatt Franchise · 2025 FDDAnswer from 2025 FDD Document
ServiceNow, in-room technology and network access.
The Hyatt Group may periodically change the benefits and services currently included as Commercial Services and the charges and fees for those benefits and services. The Hyatt Group may adopt other methodologies for fees and charges related to chain-wide programs to Participating Hotels, including segregation by brand, geographic location, or other criteria that the Hyatt Group deems appropriate in its discretion. The Hyatt Group may periodically allocate the Commercial Services Fee as a fixed charge, percentage charge, direct billback, or any other combination of multiple allocation methodologies. The Hyatt Group may spend in any year more or less than the total Commercial Services Fee contributions in that year, but will use all Commercial Services Fees collected for Commercial Services.
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- Digital Acquisition Fee. We currently charge the Hotel and other Participating Hotels the "Digital Acquisition Fee" to help drive bookings through the Hyatt Group's online direct booking channels (the "Digital Channels"). The Digital Channels currently are the Hotel System Website and any Hyatt-branded website or mobile app (such as the World of Hyatt app). You must pay the Digital Acquisition Fee on the subset of Gross Rooms Revenue resulting from reservations that are generated through the Digital Channels, whether directly or via a link from another platform, such as a search engine advertisement, social media page, or any Franchisee Organization Website. We may, in our sole judgment and subject to change, exclude certain types of bookings that originate through Digital Channels for purposes of calculating the Digital Acquisition Fee and certain portions of Gross Rooms Revenue that is generated through the Digital Channels, such as the Upsell Revenue (defined below).
Source: Item 6 — Other Fees (FDD pages 20–36)
What This Means (2025 FDD)
According to Caption By Hyatt's 2025 Franchise Disclosure Document, the Commercial Services Fee can increase under certain conditions. The Hyatt Group may periodically change the benefits and services included as Commercial Services, which could affect the associated charges and fees. Additionally, the fees and other charges imposed by the Providers may periodically increase. These Providers include entities such as the CRS operator, GDS and ADS operators, and other suppliers to the Hotel. At Hyatt's option, franchisees may be required to pay these fees and other charges directly to the applicable Provider(s).
This means that as a Caption By Hyatt franchisee, you should anticipate potential fluctuations in the Commercial Services Fee due to changes in the services offered or increased costs from third-party providers. It is important to stay informed about any modifications to the Commercial Services and their associated costs to effectively manage your budget. The franchisor has the discretion to change the included benefits and services, as well as the allocation methodology for the Commercial Services Fee, which could impact the overall cost.
Furthermore, the Hyatt Group may adopt different methodologies for fees and charges related to chain-wide programs, including segregation by brand, geographic location, or other criteria. The Commercial Services Fee may be allocated as a fixed charge, percentage charge, direct billback, or any combination of these methods. While the Hyatt Group intends to use all Commercial Services Fees collected for Commercial Services, they may spend more or less than the total contributions in any given year. This flexibility in allocation and spending means that the actual cost to the franchisee may vary based on these factors.
In summary, the Commercial Services Fee for a Caption By Hyatt franchise is subject to change based on modifications to the included services, increased costs from service providers, and the franchisor's discretion in allocating and managing these fees. Franchisees should maintain open communication with the Hyatt Group to stay informed about any potential changes and their impact on the overall cost of operating the franchise.