What happens if I or my proposed Management Company are considered inexperienced or unqualified by Embassy Suites?
Embassy_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
You must provide qualified and experienced management for the operation of your Hotel. To fulfill this responsibility, your Hotel must be operated either by you or a third-party management company ("Management Company") that we have approved. No other person or entity may operate the Hotel.
We will only grant approval when we consider you or your proposed Management Company to be qualified to manage the Hotel. We may refuse to approve you or any proposed Management Company that, in our reasonable business judgment, is inexperienced or unqualified in managerial skills or operating capacity or capability, or is unable to adhere fully to the obligations and requirements of the Franchise Agreement.
If you wish to manage your Hotel directly, you must have our prior written approval and successfully complete our training program, unless we waive this requirement. If we determine that you are not qualified to operate the Hotel, at any time, we may require you to retain a Management Company that is acceptable to us to manage the Hotel.
If you wish to hire or are required to hire a Management Company to manage your Hotel, you must obtain our prior written approval. Your Management Company must have the authority to perform all of your obligations under the Franchise Agreement, including all indemnity and insurance obligations. After we approve the Management Company, we can require the general manager and other personnel, such as the director of sales, to attend training programs that pertain to the operational functions of the Hotel related to those roles as are necessary to meet our Brand Standards. If your Management Company resigns or is terminated by you, or otherwise becomes unsuitable or unqualified to operate the Hotel as determined by us, in our sole judgment, you must retain a new Management Company that is acceptable to us within 90 days.
Source: Item 15 — OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF THE FRANCHISE BUSINESS (FDD pages 74–75)
What This Means (2025 FDD)
According to Embassy Suites's 2025 Franchise Disclosure Document, franchisees must provide qualified and experienced management for their hotel, either themselves or through an approved third-party management company. Embassy Suites retains the right to refuse approval of a franchisee or management company they deem inexperienced or unqualified in managerial skills, operating capacity, or unable to meet the Franchise Agreement obligations.
If a franchisee wishes to manage the hotel directly, they must obtain prior written approval from Embassy Suites and successfully complete their training program, unless this requirement is waived. However, if Embassy Suites determines that the franchisee is not qualified to operate the hotel at any time, they can require the franchisee to hire an Embassy Suites-acceptable management company.
If a franchisee hires a management company, that company must have the authority to fulfill all obligations under the Franchise Agreement, including indemnity and insurance. Embassy Suites can also require the management company's general manager and other personnel, like the director of sales, to attend training programs. If a management company resigns, is terminated, or becomes unsuitable, the franchisee has 90 days to find a replacement management company that is acceptable to Embassy Suites.