A Unique Franchise Agreement That Doesn't Leave Owners Hanging

Settle Inn & Suites® and GuestHouse International® have a simple secret to their fierce customer loyalty and double-digit franchise growth: a simple, award-winning 39-page agreement with the lowest fees in the industry. The result is a relationship that puts control back into the hands of franchise owners and a better share of revenue in their pockets.

“The company is going back to the basics of franchising, which means creating a close working relationship between the company and franchise owners”, says Terry Kline, senior vice president of franchise sales and development for Settle Inn and GuestHouse. “We want that true relationship with the hotel owners so they can manage their assets most effectively. They get to decide what programs work for them in their particular market and location.”

Settle Inn LLC is a 14-year-old regional hospitality company with franchise operations in five states. It recently purchased GuestHouse International Inns, Hotels & Suites, a leading upper-economy brand of more than 70 franchisees with operations in 22 states and China.

Entrusting owners to make competent decisions around the framework of a smart agreement and franchise system is what has lead the Aberdeen, South Dakota-based company to a history of success — and a quickly emerging path for stronger growth. For CEO Brendan Watters, who consciously has re-worked the franchise concept back 30 years to its beginning, it's a simple strategy. “The basic concept hasn't changed: Make the franchisee profitable — that's number one,” he says. “Then, we will be profitable.”

Settle Inn & Suites are dedicated to what guests really want: clean comfortable accommodations, friendly helpful staff, time-saving amenities and consistently great rates. Most Settle Inn and GuestHouse properties feature indoor swimming pools, free expanded breakfast (with hot waffles) and free wireless Internet access. The result is that Settle Inn has created basic lodging products that have become remarkable brands. A greater focus on a guest service culture has set new standards in lodging and created an unusually strong brand presence for the company.

“We listened as franchise owners and investors told us what they need and want in a franchise relationship,” Watters says, “and we built a franchise agreement that fosters a genuine working relationship between us and our owners — eliminating many of the one-sided restrictions often placed on franchisees.”

Kline says the agreements are not the typical franchise deals with high franchisee fees and costly opt-out clauses. For example, after the first 24 months of operation, a franchisee can terminate a contract with no liquidated damages as long as they give a year's notice. In addition, the franchisee can opt out of the agreement within only 60 days if the hotel's annual occupancy rate drops below 50 percent during any 12-month period. “Settle Inn was recently recognized by the American Association of Franchisees and Dealers (AAFD) for setting a new standard when it comes to franchise agreements,” Kline says. “The AAFD rated Settle Inn's contract to be 99.3 percent compliant with their fair franchising conformity standards. That means no one else is as franchise friendly as we are.”

And unlike bigger brands, Settle Inn and GuestHouse still have access to the best markets in America.

Stake your claim

The success of Settle Inn and GuestHouse has been built on prime locations, a simple approach to lodging, and delivering legendary customer service. For more information on their unique franchise agreement, how to earn a higher rate of return on lodging sector investments, or how to join the Settle Inn and GuestHouse family of lodging properties, contact Terry Kline, senior vice president of franchise sales and development.

415 N. 4th Street • Aberdeen, SD 57401
Direct: 605-725-5302 •Cell: 605-228-2265


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