Can Embassy Suites allocate monies derived from Monthly Program Fees to any regions or localities?
Embassy_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
We may change the Monthly Program Fee rate at any time. The Monthly Program Fee rate will not exceed the current rate plus 1% of Gross Rooms Revenue over the term of the Franchise Agreement. The Monthly Program Fee pays for various programs to benefit the System and/or the Network, including: (i) developing and maintaining the Reservation Service systems and support; (ii) developing and maintaining directories and Internet sites for System Hotels; (iii) advertising, promotion, publicity, public relations, market research, and other marketing programs; (iv) certain quality assurance programs; (v) certain technology programs; and (vi) administrative costs and overhead related to the administration or direction of these projects and programs. We may create or modify any programs and allocate monies derived from Monthly Program Fees to any regions or localities. The Monthly Program Fee does not cover your costs of participating in any optional marketing programs or other programs or services periodically offered by us or our affiliates in which you voluntarily choose to participate. These fees also do not cover the cost of operating the hotel in accordance with the Standards or the Manual.
Source: Item 6 — OTHER FEES (FDD pages 27–41)
What This Means (2025 FDD)
According to Embassy Suites' 2025 Franchise Disclosure Document, the brand has the authority to allocate funds collected from Monthly Program Fees to specific regions or localities. These fees are used to support various programs that benefit the Embassy Suites system and network. These programs include maintaining reservation services, directories, and internet sites, as well as advertising, marketing, quality assurance, and technology initiatives.
This means that Embassy Suites has the flexibility to direct resources to areas where they believe it will have the greatest impact, potentially benefiting franchisees in those regions. This could involve increased marketing efforts in a particular area or investment in technology upgrades that are specifically tailored to the needs of certain locations.
However, the Monthly Program Fee does not cover the costs for franchisees to participate in optional marketing programs or other services offered by Embassy Suites or its affiliates. It also does not cover the standard costs of operating the hotel in accordance with brand standards. Franchisees should be aware that while the franchisor can allocate funds geographically, they are still responsible for their own operational and marketing expenses beyond what is covered by the standard programs funded by the Monthly Program Fee.