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Description
Investment Icon

What Are the Initial Investment Requirements for a Rodeway Inn Franchise?

To open a Rodeway Inn franchise, you should anticipate an initial investment ranging from $116,045 to $648,895. This includes a franchise fee of $20,000. Additionally, you will need to have cash available between $20,000 and $25,000, and a net worth of $500,000 to $1,000,000. Understanding these financial commitments is crucial for aspiring franchisees to gauge their readiness for this opportunity.

Fees Icon

What Are the Ongoing Fees Associated with a Rodeway Inn Franchise?

Franchisees of Rodeway Inn are required to pay ongoing fees, which include a royalty fee of 5% on gross sales and a marketing fee of 3.5%. These fees contribute to the brand's overall marketing efforts and operational support, ensuring that franchisees can benefit from a recognized name and shared resources. It’s important to factor these costs into your financial planning for sustained profitability.

Revenue Icon

What Is the Revenue Potential for a Rodeway Inn Franchise?

The average annual revenue per Rodeway Inn unit is approximately $36,750, with a median revenue of $33,760. However, revenues can vary significantly, with the lowest reported annual revenue at $2,580 and the highest at $131,040. Understanding this revenue spectrum can help potential franchisees set realistic financial expectations and develop strategies to maximize their earnings.

Breakeven Icon

How Long Does It Take to Break Even with a Rodeway Inn Franchise?

Franchisees can expect to break even within approximately 24 months of operation. This timeframe is essential for planning, as it indicates when you might start seeing a return on your investment. Additionally, the investment payback period aligns with the breakeven time, highlighting the potential for financial recovery in a relatively short span. Knowing these metrics can help franchisees manage their cash flow effectively.

Rodeway 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.

Net Worth Required icon The minimum total assets (minus liabilities) you must possess.

i Net Worth Required:

$500,000 - $1,000,000
Investment Payback icon The estimated period to recoup your total investment.

i Investment Payback:

24 Months
Franchise Fee icon The initial fee paid to join the franchise system.

i Franchise Fee:

$20,000
Royalty Fee icon Ongoing percentage of revenue paid to the franchisor.

i Royalty Fee:

5.00%
Marketing Fee icon Regular contribution toward the franchise’s advertising fund.

i Marketing Fee:

3.5%
Breakeven Time icon The estimated timeframe to recover your initial costs.

i Breakeven Time:

24 Months
Initial Investment icon The total amount required to launch the franchise.

i Initial Investment:

$116,045 - $648,895
Cash Required icon The minimum liquid capital you must have on hand.

i Cash Required:

$20,000 - $25,000
Average Revenue icon The typical yearly revenue generated per franchise location.

i Average Revenue:

$36,750
Median Revenue icon The middle value of yearly revenue among franchise locations.

i Median Revenue:

$33,760
Highest Revenue icon The largest reported annual revenue among franchisees.

i Highest Revenue:

$131,040
Lowest Revenue icon The smallest reported annual revenue among franchisees.

i Lowest Revenue:

$2,580
Industry icon A broad sector defining similar types of franchise businesses.

i Industry:

Restaurant Franchises
Category icon A more specific division within the broader industry.

i Category:

Full-Service Restaurants
Leadership icon The key individuals guiding the franchise’s strategy and growth.

i Leadership:

Patrick S. Pacious
Corporate Address icon The official business address of the franchisor’s headquarters.

i Corporate Address:

1 Choice Hotels Circle, Suite 400, Rockville, Maryland 20850
Funding Year icon Available financing options to help start the franchise.

i Funding Year:

1997
Parent Company icon The main organization that owns the franchise brand.

i Parent Company:

Choice Hotels International, Inc.

Rodeway Inn Franchise Unit Growth Summary

A breakdown of corporate, franchised, and total units, with yearly net changes.

The overall number of operating franchise locations.

Total Units i

472
The number of locations owned by independent franchisees.

Franchised Units i

472
The number of locations owned and run by the franchisor.

Corporate Units i

0
Units 2021 2022 2023
Total Units 528 503 472
Net Change YoY -25 -31
Franchised Units 528 503 472
Net Change YoY -25 -31
Corporate Units 0 0 0
Net Change YoY 0 0
Investment About

Initial Investment

The Rodeway Inn franchise offers a range of initial investment options, with costs ranging from $116,045 to $648,895. This flexibility allows aspiring franchisees to assess their financial capabilities and choose the best fit for their budget. The initial franchise fee is set at $20,000, making it accessible for those looking to enter the hospitality industry.

Potential About

Financial Requirements

To qualify for a Rodeway Inn franchise, a cash reserve of $20,000 to $25,000 is required, alongside a net worth of $500,000 to $1,000,000. These financial benchmarks ensure that franchisees possess the necessary capital to support their operations and contribute to the brand's overall success.

Metrics About

Revenue Potential

Average annual revenue per unit for Rodeway Inn stands at $36,750, with a median of $33,760. While the lowest annual revenue recorded is $2,580, the highest reaches $131,040. This wide revenue range provides franchisees with the potential for significant earnings, depending on location and management.

Fees About

Operating Costs

Franchisees can expect operating expenses to include costs such as marketing and advertising ($20,000), utilities ($30,000), and salaries ($40,000). Overall, the average total annual operating expenses are approximately $116,045, which emphasizes the importance of effective cost management for profitability.

Breakeven About

Breakeven and Payback

The breakeven period for a new Rodeway Inn franchise is estimated at 24 months, indicating that franchisees can expect to recover their initial investments within this timeframe. This relatively quick payback period is attractive for potential investors looking for a return on their investment.

Units About

Franchise Growth

The Rodeway Inn franchise has seen a slight decline in the number of franchised units, dropping from 528 in 2021 to 472 in 2023. This trend highlights the importance of strategic market positioning and operational excellence for current and prospective franchisees to ensure long-term sustainability and growth.

Frequently Asked Questions

The initial investment for a Rodeway Inn franchise ranges from $116,045 to $648,895, which includes the franchise fee and other startup costs.