What is the fee adjustment frequency for the Sonesta Select Sonesta Essential call center fees?
Sonesta_Select_Sonesta_Essential Franchise · 2025 FDDAnswer from 2025 FDD Document
We will charge you a fee of $4.00 for each call received by the Call Center.
Payments will be made when and by the same method by which your monthly fees due under the Franchise Agreement are paid.
This fee is subject, no more than once per year, to a Fee Adjustment.
4 These fees are subject to, no more than once per year, the Fee Adjustment. "Fee Adjustment" means an increase at our discretion by up to the greater of (i) 5% annually (or 10% for TMC and Consortia Fees and Operations Insights Fees), on a compounding basis regardless of whether we exercise such adjustment in any calendar year, or (ii) the difference, expressed as a percentage, in CPI as determined by comparing the CPI in effect as of the Effective Date to the CPI in effect as of the date of the Fee Adjustment, without reference to any prior Fee Adjustment, if any. "CPI" means the National Consumer Price Index-All Urban Consumers-All Items (1982-1984 = 100) published by the U.S. Department of Labor (or if the CPI is no longer published, another substitute reference reasonably designated by us).
Source: Item 22 — CONTRACTS (FDD page 84)
What This Means (2025 FDD)
According to the 2025 Franchise Disclosure Document, Sonesta Select Sonesta Essential charges franchisees a fee of $4.00 for each call received by their call center. This fee is subject to adjustment, but the adjustment can occur no more than once per year.
The "Fee Adjustment" is defined as an increase at Sonesta Select Sonesta Essential's discretion by up to the greater of (i) 5% annually (or 10% for TMC and Consortia Fees and Operations Insights Fees), on a compounding basis regardless of whether they exercise such adjustment in any calendar year, or (ii) the difference, expressed as a percentage, in CPI as determined by comparing the CPI in effect as of the Effective Date to the CPI in effect as of the date of the Fee Adjustment, without reference to any prior Fee Adjustment, if any. "CPI" means the National Consumer Price Index-All Urban Consumers-All Items (1982-1984 = 100) published by the U.S. Department of Labor (or if the CPI is no longer published, another substitute reference reasonably designated by them).
This means that Sonesta Select Sonesta Essential has the option to increase the call center fee annually, but they are not obligated to do so. The adjustment is capped at the higher of 5% (or 10% for certain other fees) or the percentage change in the CPI. This provides some predictability for franchisees, as the fee increase is tied to an objective economic indicator. However, franchisees should be aware that the compounding nature of the adjustment means that even if Sonesta Select Sonesta Essential does not increase the fee in a given year, they can still factor in previous years' potential increases when making future adjustments.