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Hotel business plan: Basics Guid For You

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What’s a hotel business plan?

A hotel business plan details a project’s goals, target market, products and services, marketing strategies, and financial projections. Starting a hotel business requires a business plan to establish credibility and guide long-term success. Creating a business plan helps you understand how to achieve your goals and make your hotel project successful.

This blog will explain why a good business plan is important, what it should include, and how to start writing it.

Hotel business plans—why?

Putting together flat-pack furniture or starting a hobby is one thing, but running a hotel is another. Business plans are a must. There are many reasons to take time to plan.

It aids:

Decide if your idea is worth pursuing.

Set your hotel business goals.

Persuade business partners to collaborate.

Convince yourself that your business is viable.

Manage your business better and prioritize success.

Assess your progress over time.

A business plan will help you make better decisions as you grow. According to research, business plans can boost growth by 30% and prevent failure. 

Hotel business planning

Start now. Don’t just read this blog; agree that a plan is great, and vaguely consider writing it. 

image of Hotel business planning

Start now. You can even start taking notes as you read through the four most crucial hotel business plan sections:

Executive summary

The executive summary and business plan overview are easier to write at the end.

This section is usually one or two pages. Give it your full attention—it’s usually the only part read.

Set out:

Your vision: Disney wanted to “make people happy,” while Instagram wanted to “capture and share the world’s moments.” What is your small business’s big-picture goal?

Your task: What guests does your property serve, and how does it meet their expectations?

Your goals: List your business goals and timeline here. Make them measurable, like 90% occupancy and 25% website lead growth in two years.

Here, you can also capture your brand identity—the colors, logo, font, and design that define your business. 

This is your plan’s most crucial part. After writing, ask yourself: 

Is it exciting?

Is it compelling? 

Alternatively, work harder. You want to capture your idea and create something to help you make big and small decisions.

Hotel market and competitor analysis

Take a broad look at the industry, understand the market and your competition, and explain why customers will choose your hotel over a nearby one.

Industry analysis first.

Tourism and hospitality encompass your hotel. Research these sectors’ issues and trends. How are technology, the economy, politics, environmental, and global health issues affecting hotels like yours? Red flags?

Next, study your rivals.

Your rivals? Prioritize your local competitors. What’s working? 

It would help if you also defined your ideal guests. Your hotel serves whom? Do city families with younger children need a break? Or wealthy couples seeking privacy? Include education, personality, lifestyle, and buying habits.

This competitor and guest deep dive address one of the most crucial business plan questions. Your USP? What distinguishes you from competitors? Why would that difference make guests choose you over your competition? What distinguishes your lodging?

Hotel facilities

This plan section highlights your hotel. It provides a detailed description of your hotel’s main services and amenities.

image of Hotel facilities

Consider adding:

Hotel location The tropics? Pools may top the list.

Ideal guests’ diets (Serving fit people? Healthy breakfasts may be necessary. 

Can you include sustainability in your policies?

Your ideal guests’ budget (Will a clear and generous cancellation and refund policy encourage booking?)

Marketing, management, and operations 

Another consideration is how your hotel will operate and make money daily. Cover these four key areas:

Hotel Operations

Operations require good people and processes. 

List important tasks and decide if you need to outsource. Do you need a worker? Will you need training to handle some of the duties? 

Create what policies and manuals? How will you manage people, suppliers, service standards, and inventory? 

Hotel Marketing

Your marketing strategy helps you target the right audience with the right message. Consider your audience, message, and timing.

Options for spreading the word:

Traditional and digital ads

Loyalty program creation

Content marketing

Social networks

E-mail marketing

Web reviews

SEO (SEO).

Look at what your competitors are doing and use digital marketing to grow your business quickly and cheaply. 

Hotel Distribution

Your distribution strategy describes how you will sell and manage rooms via your website, third-party websites, or travel agents. 

It would help if you decided how to sell rooms financially and operationally. Double bookings can affect your guests and your business. To avoid hiccups and streamline distribution, consider a channel manager.

Hotel revenue and pricing

It would help if you kept your business profitable to survive.

Consider your pricing and room types. Include discounts, cancellation and refund policies, payment options, and rate parity.

Hotel financial plan essentials

You’ll need to determine your capital investment, how you’ll make a profit, and your projected return on investment (ROI) here.

To discuss:

Your business structure—partnership or company?

Business model

Startup and ongoing budgets

Bookkeeping, accounting, and taxes 

Licenses and Insurance

Important partners.

This part of your plan can be complicated, so consider hiring a professional.

Hotel business plan: Next steps

Remember, a business plan is the first step to realizing your dreams.

If you’re overwhelmed, break it down and start with what’s easiest. 

Use it to:

Set goals and tasks to launch your idea.

Set deadlines and prioritize your action plan.

Bring in anyone who can handle your plan.

As your business idea or business grows, you may need to update your business plan. Reviewing the plan every six months or a year helps you track your progress and assess your goals. Are you pursuing them? Should you change them to match your goals?

Hotel technology can transform your business, simplify daily operations, and increase revenue.

Little Hotelier for hotel business plans

Follow your hotel business plan, whether you’ve been running your small hotel business for a while or just starting your boutique hotel. An all-in-one technology platform like Little Hotelier makes hotel business plan implementation easy. An example:

From reservations to housekeeping, manage your hotel business in one place and save time from manual data entry into multiple systems.

Market your hotel on over 450 distribution channels and automatically update room rates and availability with one click.

An online booking engine that lets guests book directly with you lets you increase hotel reservations without double bookings.

Maximize revenue using hotel performance reports and dynamic pricing to achieve business goals.

 

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