How To Start A Small Hotel Business: Easy Guide
Owning a hotel is a dream. Maybe the idea was inspired by a movie or a magazine feature, but there's something dignified about running your own hotel. And as travel continues to evolve into a need, it makes it accessible to more people. Your vision of starting a hotel business may no longer have to be a distant possibility. If you're wondering how to jumpstart that idea and make it a reality, we'll teach you how to start a small hotel business with some tried-and-true tips and methods.
An Easy Guide To Starting A Small Hotel Business
Whether you're looking to make a profit or turning a childhood dream into a reality, the basic principles on how to start a small hotel business are similar to starting other businesses, with few exceptions.
Step 1 - Turn your vision to a plan.
If you're reading this article, you may already have the idea and the vision in your head. It may be rough around the edges, so all you need to do is a little polishing.
- visualize your hotel: how it looks, smells, and feels like
- do your research.
- Put the plan into the paper.
The target market:
Select a niche or target market since it affects everything about your hotel.
- focus on people that you know best
- select a niche that will want what your hotel offers
- select your target market based on the location
Do more research about your target market.
- converse with other hotel front-liners
- create surveys on social media
- check reviews on competitor hotels
- converse with people you've identified as a target audience
Location is a vital part of successfully learning how to start a small hotel business since hotels thrive in the right location.
- check the average room rates of hotels within the area
- evaluate what type of service you can offer that's not available in popular chains within the area
- identify the advantages of your chosen location
Now that you've identified the target audience and location, it's time to focus on your hotel.
- evaluate your finances: are you getting a loan, or do you have savings for capital?
- finalize your location
- will you be renovating an existing structure or building a hotel from scratch?
- check on room rates within your area
- research on the rates that will attract your target audience
- match the price rates of your competitors
- set rates at an unrounded price
- throw in unique and extra services to justify increased rates
- capture the middle market by pricing your basic room to the cheapest and the rest of the rooms with standard prices
- make short promotional bursts to attract crowds and get the word out
- visit and observe your competitors
- understand their operations
- note your competitor's best practices
- research on similar accommodations you want to build
- subscribe to your competitor for emails
- attend events to network with competitors
Step 2 - Develop and perfect your unique value proposition (UVP).
A UVP is a promise of value that you promise to deliver. Your unique value proposition is your main selling point and the reason your guests cannot refuse you.
- easy to understand
- it is unique and stands out from your competitors
- it is straight to the point
- it states a major benefit
Step 3 - Create your marketing plan.
Knowing how to start a small hotel business effectively is all about understanding location and an effective marketing strategy. Your small hotel, its operations, and your direction will revolve on your marketing strategy. The key is to be consistent.
- Develop a vision and mission statement
- Note your planned services and amenities
- Create a guest profile or target persona
- Identify your strengths and weaknesses
- Develop strategies for sales and guest retention
- Create advertising plans
- Use online platforms for marketing
Step 4 - Work on permits and zoning.
This step is the least liked when starting a business, but they are a necessity.
Step 5 - Evaluate your finances and raise capital.
There are many ways to raise capital. Before you get to this step, make sure you already have a solid marketing plan in mind. Here are some ideas:
- take a small business loan
- attract investors
- use a crowdfunding campaign
Step 6 - Start Building
You've already gathered everything else you need to start building and furnishing your hotel by this step.
Step 7 - Recruit your staff.
Hiring people and identifying their potential are skills you need to learn when running a business. The people you will work with have to share the same vision and enthusiasm you have to help grow your hotel.
Step 8 - Set technology and systems in place.
You should utilize technology to make your tasks easier and convenient. Softwares that help with bookings and reservations, accounting, and payroll are just a few of the things you need to consider.
Step 9 - Empower and train your entire staff.
Share your vision and goals with your staff and equip them with skills and knowledge to handle guests well. They play a vital role in a hotel's growth. Investing in your staff is a wise investment.
Step 10 - Open your hotel to the public!
Before the actual ribbon-cutting ceremony, you can employ several marketing strategies to increase hype before your hotel opens. So that on the day of the opening, you already have reservations waiting. Know more about small hotels.
Starting a business comes with a lot of challenges and details, but if you check the history of hotels, it all begins with a vision and a story. Knowing how to start a small hotel business can only be possible with an idea. If you already have the idea, continue to nurture it. Your dream is not a distant possibility.
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