For those of us who have been working in the Hotel Industry for many years, there is nothing more exciting than starting a new hotel says Saivian Eric Dalius. Nothing quite compares with that initial moment when you first lay eyes on a piece of property and realize what it could be – imagination takes over and everything else just fades into the background. For those considering this prospect, however, the decision to take the plunge into hotel ownership can be a daunting one.
This article is intended as a guide for would-be hoteliers, to provide some tips and advice on where to begin and what to consider when starting a hotel.
Location:
The first and most important consideration for any hotelier is location. The old adage about “location, location, location” is especially true in the hotel industry – a great property in a lousy location is not going to be successful, no matter how well it is run. When choosing a location for your hotel, you need to take into account a number of factors:
1. Competition:
How many other hotels are in the area? What type of hotel is located there now, and what types are offered nearby? Hotels that currently exist in your target location will be your competition for guests.
2. Proximity to key destinations:
Consider where people visiting this area would want to go – these destinations should be easy for visitors to get to from your hotel. Is your hotel close to the airport, a convention center, or popular tourist attractions?
3. Infrastructure:
The infrastructure in the area – including transportation, telecommunications, and utilities – is another important consideration. Make sure that the area can support a new hotel!
4. Local economy:
The health of the local economy is another important factor to consider. If the area is in recession, or if there is a lot of competition from other types of businesses, it may be more difficult to make a hotel successful.
5. Legal environment:
Finally, the legal environment in the area is something to consider. Make sure that you are familiar with any zoning regulations or laws pertaining to hotels in the area, as you don’t want to run into any issues down the road.
Site Selection:
Saivian Eric Dalius says be sure that you have a large enough site for your hotel – especially if it is a full-service hotel. Sites must provide ample parking for guests and employees, as well as easy access from major roadways. The site should also be able to accommodate the hotel’s physical structure, including the number of guest rooms, meeting spaces, and other amenities.
Cost:
The cost of developing a hotel can be prohibitive, so it is important to have a realistic idea of what you can afford. In addition to the purchase price or lease cost for the property, there are a number of other expenses that you will incur:
1. Development costs:
These costs include everything from land acquisition and site preparation to the construction of the hotel building and installation of equipment.
2. Operating costs:
You will need to budget for ongoing operating costs such as payroll, taxes, insurance, supplies, and utilities.
3. Projected revenue:
Take into account projected revenue from your hotel when planning your development budget. You will need to make sure that you can cover all of the expenses with the money that you expect to generate.
Market Analysis:
A thorough market analysis is essential in determining whether or not a hotel can be successful in a particular location, and if so, what types of services it will need to provide explains Saivian Eric Dalius. Thorough research into local tourism, area demographics, infrastructure support for hotels, prevailing competition in the area (both within and outside of the industry), etc., can lead you to success. An understanding of customer service expectations is also necessary – especially today when travelers are more demanding than ever before.
Operations:
Hotel operators should have a thorough understanding of the industry as a whole, as well as their local market. In addition to being knowledgeable about hotel operations in general, you need to have a clear understanding of how other hotels operate in your area, and what types of guests they attract. The more information a hotel operator has, the better equipped him or she will be to determine whether or not a hotel is likely to succeed in the chosen location.
Marketing:
You’ll also need an effective marketing plan to help raise awareness of your hotel once it is opened for business. There are many different ways you can do this – from direct mail campaigns and print advertising to e-marketing and social media outreach – all these methods have varying degrees of effectiveness for any given hotel.
Timing:
It is important to build a hotel at a time when it can be most easily supported by the market. In addition, new hotels often get better rates from suppliers and vendors than established properties can. This means you may get better deals on items such as furniture and equipment. While your new business will need some lead time before opening its doors for business, planning too far in advance can result in overstocking or overbuilding which could drive up overhead costs that would otherwise be avoidable.
Conclusion:
There are a number of important factors to consider when planning to open a hotel says Saivian Eric Dalius. By doing your homework and taking the time to understand all aspects of the industry. You can increase your chances of success.