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Quality Inn Franchise ProfileLodging & Leisure > Lodging |
What Are the Initial Investment Requirements for a Quality Inn Franchise?
To open a Quality Inn franchise, you will need to prepare for a range of initial investment costs. The total investment can vary significantly, with a low end of approximately $291,650 and a high end reaching up to $1,828,495. An initial franchise fee of $53,750 is required, alongside a cash requirement of at least $40,000. Additionally, potential franchisees must have a net worth of between $500,000 and $1,000,000 to qualify for ownership. Understanding these financial commitments is crucial for aspiring franchisees.
What Are the Ongoing Fees Associated with a Quality Inn Franchise?
Owning a Quality Inn franchise comes with several ongoing fees that you need to budget for. The royalty fee for new units is set at 5.25%, which is a percentage of your revenue paid to the franchisor for ongoing support and brand use. Additionally, there is a marketing fee of 3.50% that contributes to collective advertising efforts. These fees are essential to factor into your financial planning to ensure that your franchise remains profitable.
What Is the Average Revenue Potential for a Quality Inn Franchise?
The average annual revenue for a Quality Inn franchise unit is approximately $797,224. However, revenue can vary widely, with the lowest reported annual revenue at $12,610 and the highest at $206,650. This range highlights the potential for profitability but also emphasizes the importance of location and management in achieving financial success. Understanding these revenue metrics can help prospective franchisees gauge the viability of their investment.
How Long Does It Take to Break Even with a Quality Inn Franchise?
Franchisees of Quality Inn can expect a breakeven timeframe of about 18 months, which is a crucial milestone for any business. Additionally, the investment payback period is estimated at 24 months. These timelines can vary based on several factors, including location, operational efficiency, and market conditions. Being aware of these timeframes can help franchisees set realistic expectations and financial plans as they embark on their business journey.
Quality Inn Franchise Financial Requirements
Below, you’ll find an overview of the initial investment needed to launch the business, along with the ongoing fees required by the franchisor to maintain operations over time.
The minimum total assets (minus liabilities) you must possess.
Net Worth Required:
The estimated period to recoup your total investment.
Investment Payback:
The initial fee paid to join the franchise system.
Franchise Fee:
Ongoing percentage of revenue paid to the franchisor.
Royalty Fee:
Regular contribution toward the franchise’s advertising fund.
Marketing Fee:
The estimated timeframe to recover your initial costs.
Breakeven Time:
The total amount required to launch the franchise.
Initial Investment:
The minimum liquid capital you must have on hand.
Cash Required:
The typical yearly revenue generated per franchise location.
Average Revenue:
The middle value of yearly revenue among franchise locations.
Median Revenue:
The largest reported annual revenue among franchisees.
Highest Revenue:
The smallest reported annual revenue among franchisees.
Lowest Revenue:
A broad sector defining similar types of franchise businesses.
Industry:
A more specific division within the broader industry.
Category:
The key individuals guiding the franchise’s strategy and growth.
Leadership:
The official business address of the franchisor’s headquarters.
Corporate Address:
Available financing options to help start the franchise.
Funding Year:
The main organization that owns the franchise brand.
Parent Company:
Quality Inn Franchise Unit Growth Summary
A breakdown of corporate, franchised, and total units, with yearly net changes.
Total Units
Franchised Units
Corporate Units
| Units | 2020 | 2021 | 2022 |
|---|---|---|---|
| Total Units | 1688 | 1697 | 1652 |
| Net Change YoY | 9 | -45 | |
| Franchised Units | 1688 | 1697 | 1652 |
| Net Change YoY | 9 | -45 | |
| Corporate Units | 0 | 0 | 0 |
| Net Change YoY | 0 | 0 |
Franchise Overview
Quality Inn is a well-known hotel franchise that offers affordable lodging options across the United States and internationally. With a focus on providing value and comfort, Quality Inn caters to both business and leisure travelers. The brand is part of the Choice Hotels International portfolio, which includes a variety of hotel types, ensuring a strong market presence and brand recognition in the hospitality industry.
Investment Requirements
To become a Quality Inn franchisee, the initial investment ranges from $291,650 to $1,828,495, depending on the location and size of the property. The initial franchise fee is $53,750, with ongoing royalty fees set at 5.25% of gross sales. Additionally, franchisees are required to contribute 3.5% of their revenue to marketing efforts, ensuring that the brand remains competitive and visible in the marketplace.
Financial Performance
Quality Inn franchises generate an average annual revenue of approximately $797,224 per unit. However, revenue can vary significantly, with the lowest annual revenue recorded at $12,610 and the highest at $206,650. This variability highlights the importance of location, management, and market conditions in determining a franchise's financial success.
Operational Insights
The average breakeven time for a Quality Inn franchise is 18 months, with an investment payback period of around 24 months. This relatively quick return on investment is attractive for potential franchisees, allowing them to recoup their initial costs and begin generating profit in a reasonable timeframe.
Franchise Growth
Quality Inn has consistently maintained a strong presence in the hotel industry, with 1,688 franchised units in 2020, increasing to 1,697 in 2021 before slightly declining to 1,652 in 2022. This trend indicates a stable brand performance, although potential franchisees should consider market dynamics and competition when evaluating growth opportunities.
Support and Training
Quality Inn provides comprehensive support and training for its franchisees, ensuring they are well-equipped to manage their operations effectively. This includes assistance with site selection, marketing strategies, and ongoing operational guidance. The franchise's commitment to supporting its owners helps foster a collaborative environment that enhances overall brand success and customer satisfaction.
Frequently Asked Questions
The initial investment for a Quality Inn franchise ranges from approximately $291,650 to $1,828,495. This includes the franchise fee, equipment, and other startup costs.