Marriott Franchise Cost, Profit & Failure Rate 2024

If you are interested in owning a hotel franchise, Marriott International Franchise is the best option to choose for. It is one of the 10 best hotels and top franchises of 2024 that you must own.

This article has detailed information about investment, agreement, and others about the ownership of the hotel, So keep reading.

Marriott Franchise

About Marriott

Marriott International is a company that has its headquarters in Bethesda, Maryland, and manages a portfolio of more than 7,500 hotels in 132 countries and territories under 30 prominent brands.

Moreover, Marriott also owns and manages hotels and franchises and licenses vacation ownership resorts worldwide.

Marriott Bonvoy, the company’s well-regarded travel program, is available.

Marriott operates and leases hotels under the Marriott, The Ritz-Carlton, Renaissance, Courtyard, TownePlace Suites, and Bulgari brands.

It also runs Marriott Executive Apartments and develops and operates vacation ownership properties under the Marriott Vacation Club brand.

Marriott History 

In 1927, it all started with an A&W root beer stand. J. Willard Marriott and his wife, Alice, launched their fledgling company by satisfying people’s thirst in Washington, D.C. The Marriott introduced hot food to their menu, a first for A&W franchisees, so the term “Hot Shoppes” was established.

Later, the Marriott developed their business into a network of Hot Shoppes restaurants, which went public in 1953 under Hot Shoppes, Inc.

In 1957, Marriott entered the hotel business for the first time. In Arlington, Virginia, Bill Marriott, J. Willard Marriott’s son, opened the world’s first motor hotel.

There was no turning back, and Marriott grew into a broad global corporation over the next few decades.

Marriott Franchise Model

Cost Or FeesAmount
Investments$5,000,000 – $7,000,000  
Area RequirementN/A
Royalty-Fee  6.0%
Total Outlets7,500 hotels

Marriott Franchise Revenue & Profit

The revenue and profit of a Marriott franchise can differ based on location, the size of the hotel, operating expenses, number of employees, etc.

On average, Marriott franchise owner earns $8.1 million in sales per year. And if we consider a profit margin of 12% on average, then we can find out that a Marriott franchise owner make $972,000 in yearly net profits on average.

Financial OverviewPercentage of RevenueAmount ($)
Individual Franchise Annual Revenue100%8100000.00
Franchise Royalty Fees5.50%(445500.00)
Cost of Goods Sold (COGS)27.50%(2227500.00)
Labor (Variable)14.30%(1158300.00)
Total (Expenses)88.00%(7128000.00)
Net Profit12.00%972000.00

Note: The displayed expenses are estimates based on industry averages and standard costs. Actual expenses may vary due to factors like location, business size, and market conditions. We recommend conducting detailed research or consulting with a financial advisor for a tailored financial analysis.

Marriott Franchisor Revenue & Profit

Marriott, as a company, made $5.125B in revenue in the quarter ending June 30, 2023, and $4.558B in profits, seeing a 62.73% increase from 2021. This tells us that the Marriot chain of hotels is in good standing.

Payback Period Of Marriott

With an investment of $7,000,000 and an estimated 12% profit on the average net sales, the yearly profit would be $972,000.

So, to find out how long it will take to earn back the initial investment:

Payback Period = Investment / Yearly Profit = $7,000,000 / $972,000 = 7.2 years

Based on these figures, it will take approximately 7 years to pay back the initial investment for Marriott. This time period could be longer or shorter depending on your sales, revenue, and profit figures.

Failure Rate Of Marriott

Franchised Outlets:

YearOutlets at the Start of the YearOutlets at the End of the YearNet Change

For the Franchised outlets:

  • In 2019, the growth rate was (5)/225×100≈2.22%
  • In 2020, the growth rate was (6)/230×100≈2.60%
  • In 2021, the growth rate was (7)/236×100≈2.96%

According to the above table and data, we can conclude that the Marriott franchise has been showing positive transition consecutively for 3 years, showing a growth rate between 2.22% and 2.96%.

This shows that it is safe and profitable to invest in Marriott International Franchise.

Marriott Obligations And Restrictions

Marriott Obligations And Restrictions

The franchisor expects the franchisee to operate the hotel or engage a management company that the franchisor has approved.

Following completion of the training program, the General Manager can begin working.

Marriott Financial Assistance

Typically, the franchisor does not provide direct or indirect funding or guarantee any financing, loans, or other commitments for franchised Marriott hotels.

The franchisor might offer complementary support in a conditional guarantee of a portion of a loan granted by a 3rd lender for select franchisees.

Alternatively, it may issue a mezzanine loan in restricted situations and our exclusive discretion.

Marriott Franchise Period Of Agreement And Renewal

The original term of a franchise is usually 20 years. The franchisee cannot renew the Franchise Agreement.

If opening a hospitality or hotel franchise appeals to you, consider the Motel 6 Franchise as a viable option.

Marriott Comparison

CompanyMarriott Urban Air
Founded In19272011
Initial Investment$5,000,000 – $7,000,000  $2,992,600-$7,460,145
Franchise-Fee$50,000 $50,000-$75,000
Total Outlet7,500200
Annual Revenue$13.86 Billion$468 Billion

Frequently Asked Question 

What is the business strategy of Marriott?

Marriott International endeavors to provide great guest experiences in all of its branded hotels and resorts, no matter where they are located.

What methods does Marriott use to advertise itself?

Marriott’s marketing and advertising strategy are centered on digital promotions.

What distinguishes Marriott from the competition?

Bonvoy distinguishes itself from other loyalty programs with Point Savers and Points Advance features.

Is Marriott a franchise or a chain?

Marriott is a hotel franchise, and around half of its outlets are franchised.

How much does a Marriott franchise cost?

Marriott requires a franchise fee of up to $100,000, with a total initial investment of $82,965,890 to $136,885,490.

Who owns Marriott?

Bill Marriott is currently the Executive Chairman and Chairman Board of Marriott International.

Who founded Marriott?

Marriott was founded by J. Willard Marriot in the year 1927.

How many locations does Marriott has?

Marriott is the largest hotel chain in the world by number of available rooms. It has 31 brands with 8,000 properties in 139 countries and territories.

Where is the headquarters of Marriott?

The headquarters of Marriott is located in Bethesda, Maryland, United States.

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