Can Embassy Suites change the Monthly Program Fee rate at any time?
Embassy_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
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- 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's 2025 Franchise Disclosure Document, Embassy Suites can change the Monthly Program Fee rate at any time. However, there is a limit to how much the rate can increase. The FDD states that 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 covers various programs that benefit the Embassy Suites system and network. These programs include maintaining reservation service systems, developing internet sites, advertising, marketing programs, quality assurance, technology programs, and administrative costs. These fees do not cover the costs for optional marketing programs or the cost of operating the hotel according to the brand standards.
This means that while Embassy Suites franchisees should anticipate potential changes to the Monthly Program Fee, they also have some assurance that these changes will be capped. Franchisees should factor in potential fee increases when projecting revenue and expenses. It is important to note that the Monthly Program Fee does not cover all marketing or operational costs, so franchisees need to budget separately for those expenses.