Sheraton Franchise Cost and Profit

Sheraton requires a total initial investment of $214K to $343K (midpoint approximately $278K), with an initial franchise fee of $40K. The ongoing fee burden is 0.3% . This is below the industry average of approximately 15.5%, leaving more margin for the operator.

According to Item 19 of the 2024 FDD, the median revenue for Sheraton locations is $3.2M. The implied franchisee EBITDA is approximately $478K, based on the margin assumptions disclosed in the FDD. The estimated cash-on-cash return is 171.8% with a payback period of approximately 0.6 years.

Sheraton operates approximately 209 franchised units. Unit count is relatively stable with a -0.9% year-over-year change.

Prospective franchisees should verify all figures against the most recent FDD, conduct validation calls with multiple existing franchisees, and consult with a franchise attorney before signing any agreement.