What is included in the 'Contribution' calculation for Sonesta Simply Suites Brand Hotels?
Sonesta_Simply_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
d on a per Brand Hotel basis instead of aggregated amongst all Brand Hotels. We use RevPAR as a measure of performance yield in our system of hotels.
- "Contribution" means the net rooms revenue from reservations made at the relevant Brand Hotels through our CRS; OTAs and GDS; our brand website; our call center; our Global Sales Department; our guest recognition program;
Source: Item 19 — FINANCIAL PERFORMANCE REPRESENTATIONS (FDD pages 70–74)
What This Means (2025 FDD)
According to Sonesta Simply Suites's 2025 Franchise Disclosure Document, 'Contribution' is defined as the net rooms revenue derived from reservations made through various channels, excluding direct bookings with the hotel itself. These channels include the brand's Central Reservation System (CRS), Online Travel Agencies (OTAs), Global Distribution Systems (GDS), the brand's website, the call center, the Global Sales Department, the guest recognition program, and all other sources excluding direct hotel bookings. Net rooms revenue is the gross rooms revenue minus timely cancellations.
For a prospective Sonesta Simply Suites franchisee, understanding the 'Contribution' metric is crucial because it reflects the revenue generated through Sonesta's corporate booking infrastructure. This indicates the degree to which the franchise can rely on Sonesta's systems to drive business, as opposed to needing to independently attract customers. A higher 'Contribution' percentage suggests a stronger reliance on Sonesta's booking channels, while a lower percentage might indicate a greater need for the franchisee to focus on local marketing and sales efforts.
The FDD also presents financial performance data related to 'Contribution' for both company-owned and franchised hotels. For the 12 franchised hotels analyzed, the average 'Contribution' was 63.6%, with a median of 54.9% and a range from 39.5% to 82.6%. This data provides a benchmark for franchisees to evaluate their own performance against and to understand the potential variability in revenue contribution from Sonesta's booking channels. For the 50 company-owned hotels, the average 'Contribution' was 82.5%, with a median of 82.2% and a range from 53.4% to 98.6%. For the 62 company-owned and franchised hotels, the average 'Contribution' was 79.8%, with a median of 80.5% and a range from 39.5% to 98.6%.
Prospective franchisees should consider these figures in their business planning and due diligence. It's important to recognize that these are historical averages and individual results may vary. Franchisees should inquire about the strategies they can implement to maximize 'Contribution' from Sonesta's booking channels and what support Sonesta provides in this area.