How are the fees, dues, and assessments for Surestay Hotel By Best Western established?
Surestay_Hotel_By_Best_Western Franchise · 2025 FDDAnswer from 2025 FDD Document
Fees, dues and assessments are established by the membership and the Board of Directors to compensate the Company for providing services to Members, soft brand licensees, SureStay franchisees, and WorldHotels licensees. The Company has performance obligations to provide hotel support and marketing, and a license to our hotel system intellectual property for the use of our brand names. Our performance obligations are a series of distinct goods or services, for which the Company receives the following types of variable consideration through our membership agreements with our Members. Monthly fees and assessments (which include advertising, sales and marketing and reimbursement for the Company's technology expenses) represent fixed and variable consideration and are billed monthly and recognized as revenue in the same month as the services are provided and charges become fixed or determinable and payable. Annual dues are established, billed and payable each year for continuing membership during the succeeding year. Annual dues are recognized as revenue ratably in the year to which the continuing membership applies. Any Member may resign from the Company at any time, but if the Member resigns or is terminated, fees and dues become immediately due and payable per the terms of the applicable contract and are recognized as revenue when cash is received regardless of the term of the contract.
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 fees, dues, and assessments are established by the membership and the Board of Directors. These charges compensate the company for providing services to members, soft brand licensees, SureStay franchisees, and WorldHotels licensees. The services include hotel support and marketing, along with a license to use the hotel system's intellectual property and brand names.
The fees and assessments are structured to cover the costs of advertising, sales, marketing, and technology expenses. These are billed monthly and recognized as revenue in the same month the services are provided, and the charges become fixed, determinable, and payable. Annual dues are established and billed each year for continuing membership and are recognized as revenue ratably over the year to which the membership applies.
If a member chooses to resign or is terminated, all fees and dues become immediately due and payable according to the terms of the applicable contract. These amounts are recognized as revenue when cash is received, regardless of the contract's term. This approach ensures that Surestay Hotel By Best Western can maintain consistent service levels and support for its franchisees and members.