Opening a new hotel can be an exciting yet daunting endeavour. It requires careful planning to ensure that it is above board and successful from the get-go. If you’ve never started a business before you may not know where to start. We’ve put together this article to share the basics of starting a hotel to help you on your way.
1. Have a business plan
Before making any concrete commitments, you must have a well thought out business plan in place. This can help you establish whether you are on the right track or if there are any areas you need to rectify. Here are some important things to think of:
- The type of traveller you are marketing to
- Your business name
- The price to stay at your hotel
- How much is it going to cost upfront and annually to run?
2. The type of traveller you are marketing to
The average price of a hotel room per night in Australia is around $170 although this can vary significantly depending on what time of year it is, the location and the quality of the hotel. Anyone can stay at your hotel obviously but your business will need to have a clear vision of the type of travellers you are trying to attract. For example, if your hotel is located in an area where many millennials come through you may want to consider including options that will appeal to that age demographic such as Instagram worthy photo opportunities within the hotel grounds.
3. Choosing your business name
Choosing a name for your hotel requires careful thought and there are several factors you will need to consider. Before deciding on a name you will need to check and see:
- If someone else doesn’t already have it.
- If it isn’t trademarked.
- If it isn’t already registered as a domain name.
- If it may be misconstrued or misunderstood by other cultures.
Additionally, your business name should have a point of difference and relay the image that your hotel represents.
4. What is the price to stay at your hotel?
To get people through the door, you must be realistic with your pricing. Usually, hotels are in high demand in the holiday periods and you should adjust your pricing to reflect that. When business is slow try including additional extras that will set you apart from other stays in your area.
5. How much will it cost to start your hotel?
One of the biggest considerations is if you can accommodate the initial outlay involved with opening a new hotel. Generally speaking, starting a hotel is a significant cost. It’s not just the building itself that will need to be considered but also the furnishings, equipment and necessary licences and permits.
6. How much will it cost to keep your hotel running?
There are many costs associated with running a hotel. Some of these include:
- Replacing damaged/old goods
Plus many more. You will need to sit down and work out the realistic monthly expenses and make sure that this can be covered, even if the business is slow.
7. Organise business accounting
You must monitor your businesses outgoing and ongoing expenses as well as sources of profit to get an understanding of the hotel’s success. You will need to register your business for taxes. Having detailed accounts makes it easier to prepare for tax time too.
8. Open a business bank account
You will need to have a bank account that is separate from your personal one. This will protect your assets if your business was to ever get sued and it makes accounting more efficient and professional.
9. Apply for necessary licences and permits
Every hotel has to apply for necessary permits and licences to run lawfully. You can find detailed information on this topic on the business.gov.au website.
10. Business insurance
Your hotel must be covered by insurance not only to protect the company’s assets but also to ensure that the hotel is safe and lawful. There are various types of business insurance some of these include public liability insurance which will cover your property and personal injury sustained by a guest or visitor when at your hotel. Product liability insurance which covers illness or damage caused by drink or food. It’s best to talk to your insurance provider to discuss your options and to find the best cover for your hotel.
11. Have a strong marketing strategy
Most people book their accommodation online and this is where they will most likely find your business and reviews about it. Advertising is key to ensure that your hotel is seen and by including special offers in your advertising campaigns you can help to boost bookings. Having a strong social media presence and an appealing website will attract new customers. Before opening the doors to your new hotel, its important to pre-market your business. This will build anticipation and excitement leading up to your grand opening.
12. Provide exceptional customer service
Customer satisfaction or dissatisfaction can either make or break a hotel. Word of mouth is a strong tool that can bring in or deter customers. Make sure that your customer service is consistently high.
If you’re looking for amenities for your new hotel, you’ve come to the right place. LePack has a huge selection of hotel supplies suited to every hotel and budget. You can simply browse our selection online or contact our friendly team for further information.