Keys to Success in Hotel Business

8/2/2019 Keys to Success in Hotel Business

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The location for your hotel is highly linked with the

opportunity that you feel there is for your hotel. In the rightlocation, where competitors are not fulfilling all customerneeds, a hotel can thrive.

However, in a beautiful neighborhood that happens to

have heavy competition from existing hotels, success may notbe so forthcoming.

Likewise, if the neighborhood leaves too much to bedesired, you may not be able to price the rooms low enough to

encourage travelers to stay at your hotel, even if you are withinwalking distance of key attractions.


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1- You need people around to become your potential

guests and to use as valuable employees

2-You need attractions in terms of Touristic sites

Historical Places , Amusement Parks , Natural Parks ,

Festivals etc

Something that makes People want to bethere


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3-You need to have ways to get there in terms of

Accessibility

You have to be capable to offer people different forms of

Transportation

Both in terms of Comfort , Time ,Security and Price RangeAnd do not forget to add the Shuttle options between the

transportation point to your Hotel

4-You need to be able to offer

decent standarts of Accommodation .This includes the wheather conditions , Hygiene Standarts

,Health and Safety regulations as well. You need a good

reputation so people will find it prestigious to be there.


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5-You need to estimate Government Regulations in terms

of Human Resources Management , Tax Policies ,

Financial Aids , Energy Policies , Resources in terms of

equipment and other items you will be needing in

running your business , Customs Policies and Mostimportant their Tourism Policies in terms of Visa

Procedures , boundries and regulations .And

Sustainability of the Governments.


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And you need to

Consider all these Five Steps

at the same time


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But could you able to see anypeople around , in terms of Both

Potential Guests or PotentialHuman Resources as Employees


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Macca Picchu. is one of the Most Desirableplaces at South America .But According to

Unescoregulations .They can only serve up to 800visitors per day , which covers only %10 percent of

the Total Demand


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Turkish Rebuplic of Northern Cyprus

It used to be the one of the most popular

Island in the Mediterranean Sea . But , because

of its recognition problems It can have only

20% of the Visitors among its capacity..


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1- Only Few Air companies can fly to TRNC.

2-Can not accept any International Flight .3-Can not buy Electricity from neighbour

country.And it is too expensive to produce Electricity

for only 50.000 people.4-Not enough consuable /clean water resources ,

due to lack of High mountains which gets a lots of

rain.


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5- Visa procedures can turn into a pain .

6-Most countries announce it As unsafe .

7-Most Travel Insurance companies do not coveryour loss.

8-International Finance companies do not recognise

you in terms of Travel Checks, Money Transfers andCredit Cards.

9-It is almost impossible to hire non-residents.

10-Even your country may not be shown on a map

by most countries.


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Sustainability

Before 1970s Lebanon and Cyprus werethe main tourist destionations .For a

Hollywood star it used to be very

prestigious to have a summer home in

these destinations .After wars that held in

that area these destination names areforgotten.


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Sustainability

At 1990s Kusadasiwas one of the most popular

Gambling Destination within Turkey .Government

banned Gambling and all Hotels lost half of their valuein terms of Assets.


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Reputation.

Everybody knows Sicily , everybody knows Sibiria

,Everybody knows Baghdat , Everybody Heard of Chernobil

.But no one wants to go these places ..

So Reputation does not refer to Knowing only .Knowing

is important of course but it is valuable with a good

reputation only.


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The next step is to know how customers will answer the question"why my hotel?" How will you tailor your services to the

customers you want to attract, whether they are families withkids, couples on romantic vacations, business people, orinternational tourists? Consider the combination of amenities,atmosphere, location, and services that will be right for your

customers. Always keep in mind that strategy means makingtradeoffs - it is almost impossible to be everything to everyoneand succeed. You might have to forgot certain customer targetmarkets in order to make your service offering perfect for your

most desired customers.


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How can I choose my Target Market?

You need to cover a demand or youneed to create a new demand which

people has not discovered yet


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Before 1970s in Kusadasi people were thinking that to open avacation resort was the most unfortunate think to do for an

investor.

The first Kusadasi Hotel Hotel Imbatwas built in early

1970s and in the first place the land owner did not want to sell

the land to the investor, because he did not want the investor to

loose his money.

After he built the hotel , within few years it was the most

popular tourism destination in Turkey .


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Remember the 5 steps that we have considered earlier while

discussing about the Location.

-Would you consider building a hotel in Las Vegas in 1950s .

- In 1980s if you would attemp to open a hotel in CommunistRussia everybody would have laughed at you but today it is one

of the strongest economy that spents billions of US dollars as

tourism expenditures.


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There are millions of people travelling around and millions ofpeople with thousands of reasons are staying at a hotel.

It is impossible to satisfy everyone .We are all aware of that .Sowhat we need to do is to find a specific way, a unique way to satisfysome or any group within these people.

Whatever it is that you will be serving at your hotel will bedemanded for some groups for sure.The main important think increating your Strategy is to put what ever it is you have planned in itsbest condition.

People will come.


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Planning

A simple, clear, but persuasive hotel business plan will be

necessary not only for you to think through how you will take

on the opportunity, but for you to convince any investor or

lender that you have the ability to do so. No savvy investor willbe attracted by a lack of planning. There is no excuse to not

create a plan with the wealth of information available on

writing business plans and even business plan templatestailored to the hotel business sector.


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Hotel Business Plan: 4 Keys to make a Successful PlanA hotel business plan is going to serve as a guide for your

successful launch and operation of your hotel business, but,

most importantly, as evidence to investors and lenders that

you are worthy of their investment. No investor is likely to putthousands or millions of dollars into your hotel business

unless you've paid attention to the following in your plan.


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1) Industry & Competitive AnalysisInvestors will want to see that you have a good overall

understanding of what it means to be in the hotel industry

.You must show that you have a grasp of industry trends, how

those trends will or won't impact your business, and why.Then investors want to know that youve analyzed your

competition and understand the local conditions you will

operate within. Show how you can exploit competitors'weaknesses and why their strengths won't put you out of

business.


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2) Customer AnalysisInvestors want to know that you are clear on who your

guests will be. When they read vague statements such as "wewill be the best hotel in the city for families, business travelers,and tourists" they will worry that you are defining your

customer market too broadly. The readers of your businessplan should see that you will serve one customer group so wellthat you will be able to steal customers from the entrenched

competitors in the market. Show this by demonstrating yourunderstanding of who these customers are, what they wantout of a hotel, and how your service will fit those demands.


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3) Financial PlanPreparation a financial plan must be based on detailed

research into the start-up costs of the hotel, the ongoing costs

of doing business, and the revenue levels you can project.

These revenue projections are based on the number of roomsyou will have, an average nightly price per room and the

expected occupancy rate ( average is around 60%). These

numbers will give you the RevPAR (Revenue per availableroom), a key metric that will show investors that you are savvy

about the hotel industry.


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Financial Plan

In terms of costs you need to watch these percentages

Labor 30/35%Operations 30/35%

Net Profit 30/35%


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4) Management ExperienceInvestors dont have to see only the plan that is well thought out and that

the financial assumptions are reasonable, but that the management team youhave chosen is well positioned to deliver. You may not have in-depth experience asa hotel professional, but don't let that stop you from showing how whatever

management experience you have will translate into your ability to operate thehotel. If you choose someone else to be the manager, the same applies. Show a bioand resume of key managers or a plan for how you will find and hire them.Finally, the investor must see that you are adequately compensating this managerso that they know he or she will stick around through the launch. Ideally, this

should include company stock or profit sharing that will tie their compensation tothe hotel's success.


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Fundraising

Whether you buy an existing hotel, build one from

scratch, or renovate a building into a hotel, you will need

millions of dollars to invest. Assuming you do not have this

money, you will need to seek bank loans and/or angelinvestment in your hotel. As you will be working with

considerable assets, dependable and experienced legal and

accounting help is a must as you create deals with investors.


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Hospitality MindsetFinally, you must have an ingrained sense of how you want your

guests to be treated so that you can instill this mindset in your top

management and they can in turn teach this to the staff.

Staying at a hotel can be stressful and uncomfortable, and guestsdemand the highest attention to their needs or they will have no

problem complaining loudly and publicly. If employees sense you have

higher motives than customer satisfaction, customer service may fall

by the wayside and your hotel business may fail or never take off in thefirst place.


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Documents

Keys to Success in Hotel Business