Wyndham Hotels and Resorts Franchise Cost & Fees

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Description

Year Business Began: 1990Franchising Since: 1990Headquarters: Parsippany, New JerseyEstimated Number of Units: 110 (8,425 for Wyndham Worldwide)Franchise Description: Wyndham Franchisor, LLC is the franchisor. The franchisor is part of Wyndham Hotel Group, which is part of the Wyndham Worldwide family of companies. Wyndham Worldwide operates hotels under the following brands: AmericInn, Baymont Inn & Suites, Days Inn, Dolce Hotels and Resorts, Hawthorn Suites by Wyndham, Howard Johnson, Knights Inn, Microtel Inn & Suites by Wyndham, Ramada, Super 8, Travelodge, TRYP by Wyndham, Wingate by Wyndham, Wyndham Hotels and Resorts, Wyndham Garden, Wyndham Grand, Dazzler Hotels, Esplendor Boutique Hotels, and The Trademark Hotel Collection.The franchisor offers, sells and supports franchises for the establishment and operation of Wyndham Hotels, which offer customers a full service experience in primary destinations, include restaurant, bar (where legally permitted), fitness facilities and, in business locations, business center and meeting and event facilities that are flexible for large and small meetings. Wyndham Resort properties also offer amenities such as golf, tennis, beaches and/or spas.Training Overview: Wyndham Hotel Group’s School of Hospitality Operations (SoHO) offers a variety of mandatory and optional training programs, workshops, online training and other training resources. All personnel employed at the Hotel in those positions the franchisor designates to receive training must attend and successfully complete the initial training program and other training programs the franchisor may require. Training will be provided to the general manager by SoHO in the General Manager Certification Program. This training will be approximately five 5 days long. Required attendees must satisfactorily complete all components (including any pre-course activities or related diagnostic assessments). The franchisor requires at least 4 employees of the Hotel to have access to Internet-based training via Wyndham Hotel Group’s learning management system, SoHO Learning Zone. At the franchisee’s request, the franchisor may provide on-site training at their Hotel for their front desk, restaurant, reservations, housekeeping, engineering, and/or other operations employees before and/or after the Hotel opens. The franchisor requires general managers to attend an annual national leadership conference. Certain personnel employed at the Hotel may be required to attend periodic meetings held to address matters of general interest to the System.Territory Granted: The franchise is for the development and operation of a single System Hotel at a specified location. The standard Franchise Agreement does not provide a protected territory. Franchisees may face competition from other franchisees, from outlets that the franchisor owns or from other channels of distribution or competitive brands that the franchisor controls. When business circumstances warrant, however, we may in our sole discretion agree to some measure of territorial protection after considering various relevant factors. If the franchisor agrees to territorial protection, it will not open or license anyone else to open a System Hotel within a defined area for a certain period of time. Territorial protection would not include protection from (i) the establishment of hotels, timeshares, vacation or resort properties or other lodging facilities under other brands that the franchisor or its affiliates own, manage or franchise, or (ii) the conversion of another hotel to a System Hotel as a result of an acquisition.Obligations and Restrictions: Franchisees do not have to participate personally in the direct operation of their Hotel although the franchisor recommends that they do so. If franchisees do not personally manage the Hotel, they must hire a management company or individual manager with significant training and experience in general management of similar lodging facilities to manage the Hotel. The manager must successfully complete the training program. Franchisees may not offer goods or services in their Hotel that the franchisor does not authorize. Franchisees must operate the Hotel in strict conformity with the standards the franchisor specifies in the Franchise Agreement, its Manual, or otherwise. Franchisees must use the Hotel premises solely for the operation of a System Hotel.Term of Agreement and Renewal: The length of the initial franchise term is 20 years for new construction; 15 years for conversions and transfers. There are no renewal rights. Any continuation of the Hotel’s affiliation with the Wyndham Hotel chain is subject to the execution and delivery of the then current form of Franchise Agreement, which may differ materially from the previous Agreement.Financial Assistance: The franchisor may defer payment of the Initial Franchise Fee, if it determines that business circumstances warrant. The deferral is usually for a short term such as 90 days, or until the Hotel opens as a member of the System Hotel, whichever occurs first. The franchisor also may offer certain “Development Incentives” for new construction and conversion System Hotels. The incentives are based on various factors and are determined in its sole discretion. Except as specified above, the franchisor does not offer or provide any financing arrangements for Wyndham Franchisees, either directly or indirectly. Investment Tables: Estimated Initial Investment Name of Fee Low High Application Fee, Initial Franchise Fee $150,500 $150,500 Integration Fee $37,400 $37,400 Market Study $12,000 $50,000 Phase I Environmental Survey $4,000 $7,500 Architecture, Design and Engineering $1,150,716 $2,495,175 Land Acquisition Highly variable; not estimated Insurance $40,000 $51,000 Permits, Licenses, Deposits and Related Fees $419,000 $1,200,000 Hotel Construction $29,680,000 $49,676,900 Furniture, Fixtures and Equipment $4,762,424 $5,096,764 Signage $45,000 $150,000 Opening Inventory and Supplies $766,652 $882,729 Liquor License $2,000 $400,000 Technology Systems $199,047 $201,047 Property Management Set-Up$23,075$36,000Property Management Installation$0$37,000 Training Expense $770 $6,500 Pre-Opening Marketing/ Grand Opening $50,000 $450,000 Pre-Opening Wages $501,466 $1,002,932 Other Expenses $100,000 $200,000 Construction Contingency $1,484,000 $2,483,845 Additional Funds for First 3 Months of Operation $576,175 $1,227,058 ESTIMATED TOTAL* $40,004,225 $64,842,350 *The estimated initial investment range is for a 301-room Wyndham Hotel New Construction. The range does not include the cost of purchasing or leasing real estate. Please see FDD for more details, including Conversion estimates. Other Fees Type of Fee Amount Royalty Fees 5% of Gross Room Revenues (GRR). Marketing and Global Sales Fee 3% of GRR. Reservation System Fee (a) brand.com bookings: $3.50; (b) Voice reservations: $15.00 per reservation (resorts); $12.90 per reservation (hotels) GDS Fees$7.75 per reservation.Internet Booking Fees$7.75 per reservation.Signature Reservation Services FeeCurrently, 3.5% of the amount of GRR booked with a maximum of $6.00 per booking. Third Party Channel Fee $3.00 per reservation. OPERA Property Management System (PMS) Premises Based Set-up Fee – Option 1 Currently $35,000 – $37,000+. OPERA PMS: Premises Based (Option 1) – HTCS Fee Currently, $46.00 per room, per year. OPERA PMS Subscription SaaS Model Set-Up and Implementation Fee – Option 2 Currently, $23,075, plus $450/Interface $5,000 EMV Interface, and $3,150/OXI Interface HTCS Service Fee – OPERA PMS: SaaS Subscription Model (Option 2) $297 – $687 per month. Wyndham Referral Rewards Program 10% of GRR Additional Central Reservation System Training Fee Currently, $750 per day, plus expenses; minimum of two days. Opening Date Extension Fee $2.00 per room per day. Re-license Fee Same formula as then current Application Fee and Initial Fee. Conference Fee $949 – $1,149. Loyalty Program Charge 5% of total folio (invoice) for each member’s stay (e.g., GRR, food and beverage revenues, in-room movie charges and taxes). Retraining FeeUp to $400 per month.Loyalty Member Services Administration FeeCurrently $50 per complaint. Condemnation Payments Royalties and Marketing and Global Sales Fees for one year after notice of Condemnation or to the date of Condemnation, whichever is longer. Corporate Training Fee Currently, $28 per room per year, but this fee is subject to change in the future. Training Fees and Expenses Currently, $2,000. Additional Attendee Fee Currently, $1,400. Expansion Fee Then-current initial franchise fee per room times the number of rooms proposed to be added. Paper Check Fee $160 processing fee per each occurrence. Late Charge The lesser of 1.5% per month or the maximum rate permitted by law on the amount owed. Indemnifications Will vary under circumstances but likely to include cost of defending and resolving indemnified claims. Audit Costs All fees and expenses incurred for the audit (including, without limitation, reasonable accounting and attorneys’ fees). Taxes Amount assessed by federal, state and local tax authorities. Interest Lesser of 1.5% per month or the maximum rate permitted by law. Enforcement Costs Will vary. Agency Commissions Up to 20% of GRR Agency Commissions Service Charge 1.5% of commissionable revenue. Member Benefits Commissions Up to 10% of GRR Member Benefits Commissions Service Charge Up to 1.5% of commissionable revenue. Digital Pay-For-Performance (PFP) Commission Up to 10% of GRR. Quality Assurance Inspection Fees Currently, $1,400 for initial inspection. $2,100 per re-inspection. Customer Care Fee $195 plus resolution costs. Best Rate Guarantee Processing Fee Currently $60 per transaction. Start-Up Revenue Management Services Currently $2,780. Monthly Revenue Management Advocacy Fees Currently, $3.25 per room per month, minimum $395 (up to and including 122 rooms) and maximum of $1,300 per month (400 + rooms). Weekly Revenue Management Services Fee $15 per room per month with a minimum monthly fee of $1,500 (up to and including 100 rooms) and a maximum monthly fee of $5,250 (350 + rooms). Brand Offer Pages $2,500 per year. Reconnection Fee Currently, $4,000 De-Identification Fee $2,000 per day. Liquidated Damages Greater of $3,000 per guest room or monthly average Royalty Fees and Marketing and Global Sales Fees (computed over the prior 12 months or such shorter period that has elapsed since the Opening Date) multiplied by 36. If the remaining term of the Franchise Agreement at the time of default is less than 36 months, the lesser time period is used to calculate liquidated damages. PIP Reinspection FeeCurrently, $2,500. Preventative Maintenance Software Up to $1,500 per year. Custom Interior Design Review FeeCurrently, $5,000. The above information has been taken from the FDD of Wyndham Hotels and Resorts. Year of FDD: 2018Franchise Direct’s Disclaimer

Other Fees
Type of Fee Amount
Royalty Fees 5% of Gross Room Revenues (GRR).
Marketing and Global Sales Fee 3% of GRR.
Reservation System Fee (a) brand.com bookings: $3.50;
(b) Voice reservations: $15.00 per reservation (resorts); $12.90 per reservation (hotels)
GDS Fees $7.75 per reservation.
Internet Booking Fees $7.75 per reservation.
Signature Reservation Services Fee Currently, 3.5% of the amount of GRR booked with a maximum of $6.00 per booking.
Third Party Channel Fee $3.00 per reservation.
OPERA Property Management System (PMS) Premises Based Set-up Fee – Option 1 Currently $35,000 – $37,000+.
OPERA PMS: Premises Based (Option 1) – HTCS Fee Currently, $46.00 per room, per year.
OPERA PMS Subscription SaaS Model Set-Up and Implementation Fee – Option 2 Currently, $23,075, plus $450/Interface $5,000 EMV Interface, and $3,150/OXI Interface
HTCS Service Fee – OPERA PMS: SaaS Subscription Model (Option 2) $297 – $687 per month.
Wyndham Referral Rewards Program 10% of GRR
Additional Central Reservation System Training Fee Currently, $750 per day, plus expenses; minimum of two days.
Opening Date Extension Fee $2.00 per room per day.
Re-license Fee Same formula as then current Application Fee and Initial Fee.
Conference Fee $949 – $1,149.
Loyalty Program Charge 5% of total folio (invoice) for each member’s stay (e.g., GRR, food and beverage revenues, in-room movie charges and taxes).
Retraining Fee Up to $400 per month.
Loyalty Member Services Administration Fee Currently $50 per complaint.
Condemnation Payments Royalties and Marketing and Global Sales Fees for one year after notice of Condemnation or to the date of Condemnation, whichever is longer.
Corporate Training Fee Currently, $28 per room per year, but this fee is subject to change in the future.
Training Fees and Expenses Currently, $2,000.
Additional Attendee Fee Currently, $1,400.
Expansion Fee Then-current initial franchise fee per room times the number of rooms proposed to be added.
Paper Check Fee $160 processing fee per each occurrence.
Late Charge The lesser of 1.5% per month or the maximum rate permitted by law on the amount owed.
Indemnifications Will vary under circumstances but likely to include cost of defending and resolving indemnified claims.
Audit Costs All fees and expenses incurred for the audit (including, without limitation, reasonable accounting and attorneys’ fees).
Taxes Amount assessed by federal, state and local tax authorities.
Interest Lesser of 1.5% per month or the maximum rate permitted by law.
Enforcement Costs Will vary.
Agency Commissions Up to 20% of GRR
Agency Commissions Service Charge 1.5% of commissionable revenue.
Member Benefits Commissions Up to 10% of GRR
Member Benefits Commissions Service Charge Up to 1.5% of commissionable revenue.
Digital Pay-For-Performance (PFP) Commission Up to 10% of GRR.
Quality Assurance Inspection Fees Currently, $1,400 for initial inspection. $2,100 per re-inspection.
Customer Care Fee $195 plus resolution costs.
Best Rate Guarantee Processing Fee Currently $60 per transaction.
Start-Up Revenue Management Services  Currently $2,780.
Monthly Revenue Management Advocacy Fees Currently, $3.25 per room per month, minimum $395 (up to and including 122 rooms) and maximum of $1,300 per month (400 + rooms).
Weekly Revenue Management Services Fee $15 per room per month with a minimum monthly fee of $1,500 (up to and including 100 rooms) and a maximum monthly fee of $5,250 (350 + rooms).
Brand Offer Pages $2,500 per year.
Reconnection Fee Currently, $4,000
De-Identification Fee $2,000 per day.
Liquidated Damages Greater of $3,000 per guest room or monthly average Royalty Fees and Marketing and Global Sales Fees (computed over the prior 12 months or such shorter period that has elapsed since the Opening Date) multiplied by 36. If the remaining term of the Franchise Agreement at the time of default is less than 36 months, the lesser time period is used to calculate liquidated damages.
PIP Reinspection Fee Currently, $2,500.
Preventative Maintenance Software Up to $1,500 per year.
Custom Interior Design Review Fee Currently, $5,000.