When evaluating a franchise opportunity reviewing the "reported success and failure rate" of the franchise is only one of the many factors that must be considered. Just because a franchisor reports (what appears to be ) a high success rate – by itself – should not determine whether or not your franchise investment is a wise one. In my opinion these reported rates should only be viewed as a warning or caution sign but never a positive sign that – by itself – would justify an investment. Nevertheless‚ when it comes to hotel franchises‚ the SBA has compiled an interesting list of the highest and lowest SBA franchise loan failure rates for hotel franchises.
The failure rates for some of the more popular hotel franchises‚ include
|Rank||Franchise Brand||Failure %|
|337||Best Value Inn||15.15%|
|481||Econo Lodge Motel||6.00%|
|489||Red Carpet Inn||5.88%|
|490||Red Roof Inn||5.88%|
|504||Super 8 Motel||5.00%|
|509||Best Western Inn||4.00%|
|510||Choice Hotels International Inc.||4.00%|
|522||La Quinta Inn||3.00%|
|527||Holiday Inn Express||1.00%|
|535||Baymont Inns & Suites||0.00%|
|542||Country Hearth Inn||0.00%|
|544||Country Inns & Suites||0.00%|
|572||Sleep Inn Motel||0.00%|
Keep in mind that statistical percentages do not tell the whole story and we are only talking about SBA loan defaults. There are many hotel franchises that do not rely on SBA loans.
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