HOW TO START A HOTEL BUSINESS

Are you wondering how to start a hotel business? You’re not alone. Here’s a step to step guide on how to go about it.

Understand the business

The first and most important step when learning how to start a hotel business is to gain a thorough understanding of the hospitality industry. To get a full understanding of how the industry is, you’ll need to set time aside daily or weekly to gather as much information as possible you need. Once you’ve become familiar with how things work in the hotel industry, it’s time to swing into action.

Determine whether to build or buy

After thorough research has been made on the hotel industry, the next step is to decide whether to buy an already existing hotel or to build a new one from scratch. Both have their own advantage and disadvantages.

Acquiring an already existing hotel have lower risk because with the past performance history, you already know what you’re getting and you also avoid the time consuming process of acquiring a permit. It should be noted too that there’s a database of valuable guests and staff that are already trained, this can be an added advantage.

On the other hand, building a hotel from scratch gives you more control over building experience from the ground up. New hotel developments can also produce more profit long-term than buying an existing hotel. Generally speaking, once completed, you’ll have an opportunity to make more money because you took on more risk — including the potential for a future windfall if you ever sell.

Create A Hotel Business Plan

Without a credible plan, it’s going to be nearly impossible to secure investment — especially if you’re going through traditional institutions such as banks, which have more stringent requirements.

For your hotel business plan to be persuasive, it should contain:

1. Executive summary
2. Brand positioning
3. Market analysis
4. Competitor analysis
5. Guest segmentation
6. Strategic plan
7. Operations plan
8. Financial plan
9. The team
10. Milestones
11. Appendix

Do your paperwork

Like any other business, your hotel business needs to fulfill some important legal, regulatory and insurance requirements in order to establish.

Consult with your legal, insurance, accounting, and operations teams to determine the requirements for your location. At a minimum, you’ll need to set up a business structure and get business insurance. You will also likely need building or renovation permits, hotel licensing, and licensing for serving food and alcoholic beverages. There will also be a number of health and safety requirements as you complete your building or renovation process. 

Staff hiring

The hotel cannot function without team members, therefore there’s great need in hiring good employees at all levels that will deliver value to your guests and take the hotel business to a higher level.

Application and Interview processes should be made easy. Find ways to communicate your core mission, values, and approach to this new business throughout the hiring process. This will help you attract candidates who share your vision.

Throw an opening party

Finally, it’s time to enjoy the fruit of your labour: an opening party! This moment is worth celebrating alongside family, friends, well-wishers and investors.

The purpose for the launch is to introduce your hotel to guests. It’s also a great way of introducing yourself to the local community, key stakeholders, influencers and potential partners.

References:

cvent.com

hoteltechreport.com