New Hotel Business Plan
Are you considering opening a brand-new hotel? You may have an amazing location, a great concept; but if you’ve never set up a new business, you may be wondering “where do I start?” Writing a detailed, persuasive business plan is not easy, but it is vital to the success of your hotel.
With over 25 years working in the finance industry, WestWon are proud to have funded a whole range of new start hotels, from luxury 5 star hotels in London to 3 bedroom bed and breakfast cottages in Cornwall.
Using our wealth of experience, we’ve taken note of the most vital things to include when writing your business plan to give your business every chance to succeed.
Hotel Business Analysis
You need to set out your hotel’s mission statement and detail how you will accomplish it.
You should write what you are looking to achieve with your hotel and how you are going to make it happen. Will your hotel offer budget accommodation for your customers? Luxury accommodation? Great service at a fair price?
Next is to clarify your hotel’s concept. What makes your hotel unique and stands out from local competitors?
Outline the size of your hotel. How many rooms are there? Over how many floors? Does your hotel have a bar or restaurant area? Are there any spa facilities? If so, include these within your business plan.
Next is the structure of your organisation. Management of the hotel is vitally important. Your employees need to believe in the mission statement to ensure your goals are being met. How many managers will you have? The total number of employees should also be included.
Hotel Customer Analysis
After your mission statement and concept, you should consider who your hotel business target customer is. Once you know who your average customer is likely to be, it will be easier to cater to their needs to ensure your target customer is happy.
For example, if your target customer is likely to be business clients, they are likely to be using the hotel for one night, and free Wi-Fi is important.
Alternatively, if your average customer is likely to be families on holiday, then they are likely to stay for more than one night. Offering free leaflets of family activities for the local area may seem simple, but it could be what makes you stand out from other local accommodation.
Local Area & Competitors
Before opening a new hotel business, it’s important to research the local area. You will also need to analyse your local competition.
First up for review is location. What local activities are there for your customers? Are you near a theme park? The seaside? National park or a National Trust site? Exhibition centres or venues? Research the local area to ensure your hotel meets the expectations of your target customer.
Investigate local accommodation pricing, locations, and facilities on offer. How do they compare to you? Do you have any local hotels who have the same concept as yours?
Look at reviews of your competitors. Take notes of your competitors’ strengths and weaknesses. Can you avoid the same mistakes as your competitors? How can you ensure you stand out for the right reasons?
SWOT Analysis for Your Hotel
SWOT analysis stands for Strengths, Weaknesses, Opportunities, and Threats. Creating a SWOT analysis for your business highlights the internal and external factors which will affect the running of your business. Conducting a SWOT analysis is a vital component of your business plan.
It’s important to maximise your hotel’s strengths, attempt to minimise your weaknesses, work towards seizing your opportunities and reducing the impact of or eliminating threats.
Hotel or Restaurant Marketing Plan
How are you going to market your hotel? Will you be using online hotel booking facilities? What about Social Media? What marketing can you do yourself? Is there budget to get professional marketing advice?
Return on Investment
Finally, you need to conduct your Cash Flow Forecasts and Return on Investment. This is especially important if you require additional funding to help get your project off the ground.
You must include how much money needs to be invested in the business, as well as the monthly income and outgoings for the business. This will help you budget your purchases as well as give you and any potential investors an idea on when the business can expect to be making a profit.
Written by George Shillingford.