Planning To Own A Marriott International Franchise in USA? Here’s What You Need to Know
The hotel franchise industry has experienced substantial growth in the last few years. According to JLL research, in 2022, around 82% of branded hotels were franchise operations, up from roughly 70% in 2010.
Among them, most brands have recognisable names like Motel 6, Travelodge, Super 8 and Red Roof. But did you know that hotel franchises are not just limited to them? It also includes premier names like Marriott International.
Yes, you can own a Marriott International franchise in USA. Just imagine your future as a franchisee of the world’s leading luxury hotel brand. With that, you can take over ownership of a hotel bearing the trademark of one of the most well-known hotel chains.
Planning to own a Marriott International franchise in USA? The article will help you understand the process thoroughly. Through this article, we will discuss all the information related to the fees, requirements and processes to own a Marriott International franchise in USA.
Expansion Of Marriott International Franchise In USA & World
In 1927, J. Willard and Alice Marriott launched an A&W root beer franchise in Washington, D.C. Their son Bill founded the first Marriott motor hotel in Arlington, Virginia, in 1957, benefited from his parent’s business and leadership expertise.
With rapid growth, Marriott group established its first international hotel in Acapulco in 1969. The hotel chain started spreading across Europe during the late 1980s when it launched its 500th location.
Marriott kept expanding and eventually launched competing hotel brands that catered to various travel needs and price points. In order to become the largest hotel and resort chain in the world, Marriott acquired Starwood Hotels in 2016. Starwood Hotels was the parent company of a variety of well-known hotel brands across the world.
With more than 6,000 locations globally, Marriott International is still committed to redefining travel experiences through technology and innovation. So, investing in a well-settled business like this is probably an ideal decision.
|Parent Company||Marriott International, Inc.|
10400 Fernwood Road
Bethesda, Maryland 20817-1102
|Industries||Travel, Hotel, Resort|
Marriott International Franchised Hotel Brands: An Overview
Marriott has more hotels and brands than any other company in the hotel and resort sector could have, making it the largest in the sector. Classifying the company’s enormous (and continuously changing) portfolio of hotel brands may be quite a challenge.
The first concern for anyone looking to invest in a Marriott franchise in the USA is: which one? The term “Marriott Hotels & Resorts” is frequently used to refer to any Marriott, JW Marriott, or maybe Marriott Executive Apartments. However, the parent company’s portfolio goes far more than that.
Here’s a breakdown of the Marriott International portfolio by tier and class:
Tier 1: Luxury Brands
- JW Marriott (“Classic” designation)
- Edition (“Distinctive” designation)
- W Hotels (“Distinctive” designation)
- Bulgari Hotels & Resorts (“Distinctive” designation)
- Regis Hotels & Resorts (“Classic” designation)
- The Ritz-Carlton (“Classic” designation)
- The Luxury Collection (“Distinctive” designation)
Tier 2: Upper Upscale Brands
- Marriott (“Classic” designation)
- Autograph Collection Hotels (“Distinctive” designation)
- Le Meridien (“Distinctive” designation)
- Sheraton (“Classic” designation)
- Westin Hotels & Resorts (“Distinctive” designation)
- Renaissance Hotels (“Distinctive” designation)
- Delta Hotels by Marriott (“Classic” designation)
- Marriott Executive Apartments (“Classic” designation)
- Tribute Portfolio (“Distinctive” designation)
- Gaylord Hotels (“Distinctive” designation)
Tier 3: Upscale Brands
- Springhill Suites by Marriott (“Classic” designation)
- Residence Inn by Marriott (“Classic” designation)
- C. Hotels by Marriott (“Distinctive” designation)
- aloft Hotels (“Distinctive” designation)
- Four Points by Sheraton (“Classic” designation)
- element by Westin (“Distinctive” designation)
- Courtyard by Marriott (“Classic” designation)
Tier 4: Upper Midscale Brands
- Towneplace Suites by Marriott (“Classic” designation)
- Moxy Hotels (“Distinctive” designation)
- Protea Hotels by Marriott (“Classic” designation)
- Fairfield by Marriott (“Classic” designation)
Although each brand has its own pricing range, development strategy, target market, and brand promise, the buying power, loyalty programmes, digital platforms, and operational expertise of Marriott International bind the portfolio together.
You should look at each of them as a potential franchisee to discover which Marriott brand could meet your investment requirements.
What Is the Estimated Initial Investment for Opening a Marriott International Franchise in USA?
The estimated initial investment for opening a Marriott international franchise in USA is between $74,082,490 to $117,152,490, according to the Marriott Franchise Disclosure Document (FDD).
|Initial Franchise Application Fee||$120,000||$120,000|
|Market Feasibility Study||$15,000||$25,000|
|Pre-Opening Training, Marketing Support, Revenue Management, and Related Services||$129,000||
|Impact Fees, Building Permit, & Tap||Variable||Variable|
|Reservation System, Yield Management System, Property Management System, and Sales & Catering System||$260,000||$300,000|
|Other Systems and Training||$84,000||
|Kitchen and Laundry Equipment (per guestroom)||$5,600||$6,900|
|Building Construction (per guestroom)||$187,900||
|Network Infrastructure and Technology Hardware & Software (per guestroom)||$2,500||$13,300|
|Furniture and Fixtures (per guestroom)||$24,700||$30,100|
|Operating Supplies (per guestroom)||$5,800||$7,100|
|Professional Design Services (per guestroom)||$9,400||$14,900|
|Start-Up Costs (per guestroom)||$4,800||
|Hard Cost Contingency (10% of hard costs)||Variable||Variable|
|Food Safety and Sanitation Compliance||$490||$490|
|Additional Funds (first 3 months) (per guestroom)||$3,500||$8,000|
|Real Estate Expenses||Variable||Variable|
How To Apply For A Marriott International Franchise In USA?
Now that you fully understand all the costs and financial requirements, here’s how you can start your business journey with the world’s most prestigious hotel chain.
Submit Your Application
It all starts with filling out an application. For that, you can visit the official website of Marriott International and submit an application by filling in your details.
Later, your application will be reviewed by the franchisor, and if you pass the eligibility criteria, your application will move further.
Attend The Meeting
Once your application meets the minimum required criteria, you will be invited to meet the team. During the meeting, the company’s representative will discuss all legal terms and conditions of the agreement.
Sign The Contract
Now that you have understood the conditions and have adequate financial support go ahead and sign the contract. After signing the papers, you will officially join the world’s leading luxury hotel chain.
Prepare For The Training
After officially getting the rights to own the Marriott International franchise in USA, you and your staff will have to undergo the training program. Usually, a franchisor’s representative is present to assist the team at this time. The idea is to help the franchise owner set up and run the unit smoothly.
Marriott International conducts on-site training before the opening and starts by deciding on a team for the same. Their on-site training time averages 14-21 days. It also includes post-opening hotel training.
Why Should You Own A Marriott International Franchise In USA Today?
By becoming a part of this global business, you can enjoy many benefits and privileges. Here are some reasons why owning a Marriott International franchise in USA is a perfect business idea.
Marriott has been a leading name in the hotel & travel industry for over eight decades. The group’s unique brands provide fantastic RevPAR premiums and a variety of development choices on a worldwide scale.
Its strong portfolio gives guests and owners the appropriate brand in the right location across the world, differentiating itself via creative design and distinctive programmes and services.
Marriott Bonvoy Loyalty Program
The company introduced a Bonvo loyalty program that is claimed to be the world’s most extensive loyalty program. The program allows members to earn, book, or redeem across the vast portfolio to benefit the franchise owner directly.
High Return Prospects
The company aims to deliver high-value guests through cutting-edge technology, global negotiating power, and extensive shared services and maximise investment returns for franchise owners. Each Marriott International hotel is supported by a robust global distribution platform and innovative sales & marketing network.
To assist you in achieving your goals, the most knowledgeable staff in the sector offers comprehensive franchisee advantages and services, from development to continuous operations.
The company’s dedication to open communication and openness fosters the development of long-lasting, mutually beneficial partnerships, as shown by the fact that multi-unit partners hold the bulk of our units.
Bridging The Gap Program
The Marriott international group recently introduced a multifaceted owner incentive programme for Black, Native American/First Nation, Hispanic/Latino, and Women owners in the U.S. and Canada.
The program aims to help them overcome unique barriers to hotel ownership. Beginning on June 1, 2022, the programme applies to all qualified development applications. To find out more, you can check out the official website.
Estimated Earning Of A Marriott Franchise In USA
Franchise earnings depend significantly on a variety of factors, such as labour expenses, commercial leasing rates, and a number of other things.
Franchise earnings often follow the magnitude of the initial investment. Therefore, by analysing your circumstances, you can estimate how much money you can make with the help of the average revenue per available room (RevPAR) in the FDD.
Does Marriott International Provide Any Financial Assistance?
The franchisor typically does not offer direct or indirect financial or guarantee any financing, loans, or other obligations for franchised Marriott hotels.
For a limited number of franchisees, the franchisor may provide further assistance in the form of a conditional guarantee of the loan’s portion provided by a third-party lender.
In certain circumstances and at the exclusive discretion of the firm, it may issue a mezzanine loan.
In contrast to other franchise enterprises, franchising with Marriott International needs good market knowledge, hefty investment and financial requirements. Therefore, in addition to a sizable initial investment in assets, the time it takes to recover your investment may vary significantly.
You might need to leverage the use of loans. Once the property is up and running, the brand’s popularity will do the remaining part. Particularly in light of the pandemic’s effects, the average failure rate over the course of three years is 0.8%.
The hospitality sector is growing, and it is a sector that will always be present. Owning a Marriott Hotel franchise may seem challenging, but it’s a rewarding opportunity for a dedicated franchisee interested in the hospitality sector.
- A Marriott franchise offers a 20-year initial term of ownership. It is usually the 20th anniversary of the start of business. Franchisees must also remember that the franchise agreement will not be renewed.
- Franchisees in need may be able to get credit help. Marriott provides two options. The first is a dependent third-party loan guarantee for a portion of a loan. The other option is a mezzanine loan.
- The Marriott brand is dedicated to environmental issues. For instance, they decreased the intensity of water and carbon in 2018. They also stopped using plastic stirrers and straws.
- Because of its Revenue Generation Engines approach, Marriott International, Inc. makes sure all of its brands can remain dominant. To ensure that repeat visitors become regulars in all of their hotels, they also operate a loyalty programme called Marriott Bonvoy.
- The company aid franchisees in a variety of ways, including operations, sales and marketing, revenue management, and more. They support the pre-opening, opening, and post-opening as the franchisor.
Yes, Marriott International has been franchising for a very long time.
The original term of the Mariott franchise agreement is usually 20 years.
Marriott International is a global and leading hotel chain that offers profitable opportunities.
According to the company’s Franchise Disclosure Document (FDD), currently, there are 236 franchised Marriott locations in the USA.
Marriott International charges a franchise fee of up to $150,000, with a total initial investment/cost range of $74,082,490 to $117,152,490.
About 1% of the 7,200 hotels and resorts in its network of 30 lodging brands are owned by Marriott. Marriott does not own the remaining 99% of its hotels; instead, it has management agreements with many of them and licences the Marriott brand to franchisees.