Under what condition will Crowne Plaza place dispensers in new or acquired hotels during the term?
Crowne_Plaza Franchise · 2025 FDDAnswer from 2025 FDD Document
Where permitted by law, Company will lease to Customer without any additional charge during the Term the Dispensers owned by Company as follows: (i) for Hotels existing as of the Agreement Effective Date, the Dispensers that are currently installed, without extending the equipment lease term length of any such currently installed Dispensers, and (ii) for each Hotel that becomes a Hotel during the Term, the Dispensers reasonably necessary to enable such Hotel to dispense a quality Fountain Beverage. With respect to new and/or acquired hotels that become Hotels during the Term, unless otherwise mutually agreed upon by the parties, Dispensers will be placed in such new or acquired Hotel only if such Hotel is forecast to purchase a minimum of 400 gallons of Company's Fountain Syrups per Year. Customer will use commercially reasonable efforts to assist in the conversion of any Hotels purchasing less than 400 gallons of Company's Fountain Syrups per Year to a Bottle/Can Program as described in Exhibit A-3.
Source: Item 23 — Receipts (FDD pages 100–424)
What This Means (2025 FDD)
According to Crowne Plaza's 2025 Franchise Disclosure Document, Crowne Plaza will lease dispensers to franchisees without any additional charge during the term of the agreement. For new or acquired hotels that become Crowne Plaza hotels during the term, dispensers will be placed in the hotel only if the hotel is forecast to purchase a minimum of 400 gallons of the company's fountain syrups per year, unless otherwise mutually agreed upon by both parties.
If a new or acquired hotel does not meet the 400-gallon forecast, the franchisee is expected to assist in converting the hotel to a Bottle/Can Program. This implies that franchisees need to carefully evaluate the potential syrup consumption of any new or acquired hotels to ensure they meet the minimum requirement for dispenser installation.
This condition is important for prospective franchisees to consider, as it directly impacts the beverage service options and potential revenue streams at new or acquired hotel locations. Franchisees should discuss with Crowne Plaza what support or flexibility exists if a hotel initially falls short of the 400-gallon forecast but has a plan for growth. Additionally, franchisees should clarify what alternative beverage programs are available and how they might affect profitability if the dispenser requirement is not met.