How is 'Gross Food and Beverage Revenue' defined for an Embassy Suites hotel, and what is excluded from this definition?
Embassy_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
- [INSERT FOR CI, HFS: "Gross Food and Beverage Revenue" means all revenues (including credit transactions whether or not collected) derived from food and beverage-related operations of the Hotel and associated facilities, and all banquet, reception and meeting room rentals, including all restaurants (unless leased to third-party operators), dining, bar, lounge and retail food and beverage services, at the actual rates charged, less allowances for any rebates and overcharges, and excluding any sales, hotel, entertainment or similar taxes collected from patrons or guests.
Source: Item 22 — CONTRACTS (FDD page 97)
What This Means (2025 FDD)
According to Embassy Suites' 2025 Franchise Disclosure Document, Gross Food and Beverage Revenue is defined as all revenues derived from food and beverage-related operations of the Hotel and associated facilities. This includes revenues from banquet, reception, and meeting room rentals, as well as all restaurants (unless leased to third-party operators), dining, bar, lounge, and retail food and beverage services. The revenue is calculated at the actual rates charged.
From this total revenue, allowances for any rebates and overcharges are subtracted to arrive at the gross food and beverage revenue.
However, the definition specifically excludes any sales, hotel, entertainment, or similar taxes collected from patrons or guests. These taxes are not considered part of the Gross Food and Beverage Revenue for the purposes of calculating fees and other financial obligations under the Franchise Agreement.