What is the Best Western Rewards (BWR) program for Surestay Hotel By Best Western?
Surestay_Hotel_By_Best_Western Franchise · 2025 FDDAnswer from 2025 FDD Document
Best Western Rewards® frequent stay program ("BWR® program")
The Company administers the BWR program for the benefit of BWH and BWR program members. Under our BWR program, the Company has a performance obligation to provide or arrange for the provision of goods or services between BWR program members and BWH hotels in exchange for the redemption of points earned from past activities. Costs of operating the BWR program, including costs for marketing, promotion, and other member services, are charged to the BWH hotels through an assessment fee that is based on members' qualified expenditures. The assessment fees received from BWH hotels are deferred and recognized as program revenues in the Consolidated Statements of Revenues and Expenses as the loyalty points are redeemed and the related service, net of redemption expense, is provided. The amount of revenue the Company recognizes upon point redemption is impacted by the Company's estimate of the breakage for points that BWR members will never redeem. The Company estimates breakage based on historical experience and expectations of future BWR member behavior, including analyses performed by and input of third-party actuaries. All BWR program costs are recognized as incurred and are recorded in program cost of sales in the Consolidated Statements of Revenues and Expenses.
Program revenues in excess of redemption costs are used to fund the operational expenses of the BWR program.
Best Western Travel Card® (a card having no expiration date and no usage or non-usage fees) revenue is recognized when: (i) the Best Western Travel Card is redeemed, or (ii) the likelihood of the Best Western Travel Card being redeemed is remote (Best Western Travel Card breakage), and the Company determines that there is not a legal obligation to remit the unredeemed Best Western Travel Card balance to the relevant jurisdiction. The determination of the Best Western Travel Card breakage rate is based upon Company specific historical redemption patterns. Best Western Travel Card breakage is included in program revenues in the Consolidated Statements of Revenues and Expenses.
Source: Item 23 — Receipts (FDD pages 88–286)
What This Means (2025 FDD)
According to Surestay Hotel By Best Western's 2025 Franchise Disclosure Document, the Best Western Rewards (BWR) program is a frequent stay program administered by the company for the benefit of BWH and BWR program members. Under the BWR program, Surestay Hotel By Best Western has a performance obligation to provide or arrange for the provision of goods or services between BWR program members and BWH hotels in exchange for the redemption of points earned from past activities.
The costs of operating the BWR program, including marketing, promotion, and other member services, are charged to BWH hotels through an assessment fee based on members' qualified expenditures. These assessment fees are deferred and recognized as program revenues as loyalty points are redeemed and related services are provided, net of redemption expenses. The revenue recognized upon point redemption is affected by the company's estimate of breakage for points that BWR members will never redeem, which is estimated based on historical experience, expectations of future member behavior, and input from third-party actuaries. All BWR program costs are recognized as incurred.
Program revenues exceeding redemption costs are used to fund the operational expenses of the BWR program. Surestay Hotel By Best Western also utilizes Best Western Travel Cards, which have no expiration date or usage fees. Revenue from these cards is recognized either when the card is redeemed or when the likelihood of redemption is remote, and the company determines there is no legal obligation to remit the unredeemed balance. The determination of breakage rates for these travel cards is based on the company's historical redemption patterns. As a Surestay Hotel By Best Western franchisee, your hotel will likely participate in this program and incur assessment fees based on member expenditures at your location.