Red Roof Inn Franchise Review 2026: Ratings & Verdict

Product details

Contents

Key facts


The Verdict

Quick Verdict · who it fits

Red Roof Inn fits first-time franchise buyers looking for a mature hospitality concept.

✓ Strengths

Key FDD Facts

The numbers a buyer needs first — straight from the filing.

Initial investment (Item 7)

$7.3M - $15.8M

Franchise fee (Item 5)

$27K

Royalty (Item 6)

5% + 4% ad

System size (Item 20)

596 +37

Years in business

19+ yrs

Item 3 litigation

3 suits

Model Red Roof Inn's costs in the investment calculator → Prefilled from this filing — startup cost, cash flow and break-even.

Buyer qualifications

Data extracted from the 2026 FDD filed with state regulators. Fees and terms may have changed since filing — request the current FDD from the franchisor before deciding. Not legal, financial, or investment advice. Full disclaimer.

What you'd pay the franchisor

Drag to your projected annual sales. Royalty 5% + ad fund 4% on gross sales.

PROJECTED ANNUAL SALES$500,000

$100k$2M

Royalty (5%)

Ad fund (4%)

Total / year

▪ Of-sales fees only · excludes rent, labor, COGS, and one-time costs · for illustration

Executive Summary

Free AI summary — the first read on the filing.

Key Numbers

623

Total units open

596 franchised + 27 affiliate-owned as of December 31, 2025

37 franchised units opened in 2025

Units opened last year

25 franchised units closed/terminated in 2025

Units closed last year

12 franchised units

Net unit growth

584 to 596

AI Due Diligence Findings PREMIUM

What our analysis flagged across the 2026 filing.

5

Risks to review

4

Strengths identified

5

Questions to ask

Industry Benchmarks

How Red Roof Inn ranks against 80 Hospitality & Travel peers we've analyzed.

Initial investment

71st pct · of 80 peers

Franchise fee

31st pct · of 80 peers

System size

89th pct · of 80 peers

Hospitality & Travel industry averages

Avg investment

$7.6M - $24.8M

Avg franchise fee

$42K

Avg system size

244

Franchises analyzed

80

How Red Roof Inn stacks up

Closest concepts by category and investment.

Brand Item 19 Fee Investment Royalty Units
Red Roof Inn Disclosed $27K $7.3M - $15.8M 5% 596
Dollar Rent a CarSimilar price Disclosed $25K $879K - $15.9M 6–8% 66
CpBiggest system Disclosed $11K $2K - $21K 1.5–3% 3,124
TaTop-rated in category None $140K $1.5M - $14.1M 2–4.5% 33

Compare side-by-side ↗

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Frequently Asked Questions

How much does a Red Roof Inn franchise cost?

Red Roof Inn requires a $27,000 initial franchise fee and a total initial investment range of $7,253,500–$15,836,090, per the most recent FDD on file.

Who owns Red Roof Inn?

Red Roof Inn is franchised by Red Roof Franchising, LLC, the franchisor entity of record on its Franchise Disclosure Document. Item 1 of the FDD discloses the franchisor's corporate history, parents, and predecessors.

Does Red Roof Inn disclose financial performance (Item 19)?

Yes. Red Roof Inn discloses Item 19 financial performance representations in its FDD. See the financials sub-page for the disclosed figures.

What ongoing fees does Red Roof Inn charge?

Franchisees pay a royalty of 5% and an advertising fund contribution of 4% of Gross Room Revenues on gross sales as defined in Item 6 of the FDD.

How many Red Roof Inn locations are there?

As of their 2026 FDD, Red Roof Inn has 596 total locations, with 37 new locations opened in the most recent reporting year. This information comes from Item 20 of the FDD.

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