Can Embassy Suites use personnel used in connection with the System in Other Businesses?
Embassy_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
We may also: (a) modify the System by adding, altering, or deleting elements of the System; (b) use or license to others all or part of the System; (c) use the facilities, programs, services and/or personnel used in connection with the System in Other Businesses; and (d) use the System, the Brand, and the Marks in the Other Businesses. You acknowledge and agree that you have no
rights to, and will not make any claims or demands for, damages or other relief arising from or related to any of the foregoing activities, and you acknowledge and agree that such activities will not give rise to any liability on our part, including, but not limited to, liability for claims for unfair competition, breach of contract, breach of any applicable implied covenant of good faith and fair dealing, or divided loyalty. "Other Businesses" means any business activity we or our affiliates engage in, other than the licensing of your Hotel.
Source: Item 12 — TERRITORY (FDD pages 67–70)
What This Means (2025 FDD)
According to the 2025 Embassy Suites Franchise Disclosure Document, Embassy Suites retains the right to utilize personnel associated with the franchise system in other business ventures. This means that the staff, resources, and expertise that support the Embassy Suites franchise network may also be deployed in other business activities that Embassy Suites or its affiliates are involved in.
For a prospective franchisee, this has several implications. It suggests that Embassy Suites is not solely reliant on the franchise network for its business operations and has diversified interests. While this could provide stability to the franchisor, it also means that the attention and resources of Embassy Suites' personnel may be divided among various business activities. This could potentially impact the level of support and service that franchisees receive.
Furthermore, the FDD explicitly states that franchisees have no recourse for damages or claims arising from these activities. This includes claims for unfair competition, breach of contract, or divided loyalty. Therefore, franchisees must acknowledge and accept that Embassy Suites' engagement in other businesses, even those that may compete with the franchisee's hotel, will not give rise to any liability on the part of Embassy Suites. This underscores the importance of carefully considering the potential competitive landscape and the degree of support a franchisee can expect before investing in an Embassy Suites franchise.
This practice is not uncommon in the franchise industry, where franchisors often have multiple revenue streams and business interests. However, the extent to which personnel and resources are shared can vary significantly. Prospective franchisees should seek clarification from Embassy Suites regarding the allocation of resources and personnel between the franchise system and other business ventures to fully understand the potential impact on their investment.