Do you want to start a hotel business successfully? If YES, here is a 17-step guide to starting a hotel business with NO money and no experience plus a sample hotel business plan template. All over the world, the hospitality business is seen as a very serious trade and the reason for this is not far-fetched. The reason the hospitality business, especially the hotel business, is taken seriously is because of its relationship with the tourism industry.

Either locally or internationally, one of the ways to make people who arrive at unknown places at ease is by having a very relaxed hotel in place for them to lodge in. This is one of the reasons why the hotel business continues to witness a boom.

The hospitality industry has been in existence from time immemorial and it is still waxing strong because people can’t do away with the services they offer. When you talk about a hotel, you are talking about an establishment that provides lodging for guests/travelers, tourists, visitors et al, on a short-term basis for a fee.

When people lodge in hotels, they have the option of subscribing to other services the hotel offers; services like feeding, drinks, laundry, fitness center, swimming pool, conference room and business room, amongst others. Starting a hotel business could eventually be one of the best businesses for an entrepreneur.

This is because of the lucrative nature and the prosperity involved in this industry. Every day, foreigners as well as local migrants and business people travel from one point to the other and the option they are faced with is staying in hotels.

It is pertinent to note that there are different categories of hotels, the 5 star, 4 star or even 3 star hotels. One of the essential things that is unique to each category of hotels is the facilities that make up each. Indeed, starting a hotel business is capital intensive and it is considered a long-term investment because it takes a while for the owners to breakeven and starts making profits.

It takes a big-time investor to consider starting his or her own hotel business, which is why loads of hotels are owned by groups of investors. It’s one thing to put up the physical hotel structure (building) but the real challenge is running it profitably.  This is why you must take into consideration the cost of starting a hotel business.

One good thing about the hotel business is that the business can grow so big that it will not only have active presence in key cities in the country where it started from, but in major cities in all the continents of the world. If indeed you want to start a hotel business, then you should read through this article keenly, it will help you establish your own hotel facility from the scratch and build it to profitability within the shortest time possible.

17 Steps to Starting a Hotel Business With No Money

1. Understand the Industry

The hospitality industry has been in existence from time immemorial and it is still waxing strong because people can’t do away with the services they offer. When you talk about a hotel, you are talking about an establishment that provides lodging for guests/travelers, tourists, visitors et al on a short-term basis for a fee.

When people lodge in hotels, they have the option of subscribing to other services the hotel offers; services like feeding, drinks, laundry, fitness center, swimming pool, conference room and business room et al. It is important to state that hotel operations vary in size, function, and cost which is why hotels are classified into different grades (two-star hotel, five-star hotel, seven-star hotel et al).

As a matter of fact, the facilities provided by some hotels may range from a basic bed and storage wardrobe, to luxury features such as en-suite bathrooms, mini parlor et al. It is the norm for big hotels to provide additional guest facilities like swimming pool, conference center, business center, childcare, self-service laundry, fitness center and social function services.

In some countries, hotels are required by law to serve food and drinks to all clients that lodged in their facility while in some countries, you would have to choose the additional services you want from the hotel. The bottom line is the higher the amount you pay in hotels, the more the services you are entitled to.

In recent time, the Hotels industry has experienced steady growth as several consumer trends supported demand for the services offered by hotel operators. For instance, consumer confidence and spending have both experienced steady increase over the period, allowing rates of both domestic and international travel to increase.

Another consumer trend has been the gravitation toward unique lodging and experiences which establishments in the Hotel industry offer. Going forward, the Hotels industry will continue experiencing this robust growth as domestic and non-US resident trips increase.

The Hotels/Hospitality industry is a thriving sector of the economy of the United States, United Kingdom, France, Italy, and Canada and in most countries of the world. Statistics has it that in the united states of America, The Hotels / Hospitality industry generates a whooping sum of $7 billion annually from more than 1,997 registered and licensed standard hotels scattered all around the United States of America.

The industry is responsible for the employment of well over 60,106 people. Experts project the Hotels/Hospitality industry to grow at a 5.0 percent annual rate. InterContinental Hotels and Starwood are leaders in this industry; they have a lion share of the available market.

A recent report research conducted by IBISWorld shows that the Hotels/Hospitality industry has a low-level concentration, with the top four players expected to account for about 33.0 percent of the available market share in 2015. The report further stated that the hotels benefit from being able to convert buildings not normally suitable for hotel use using low-cost luxurious materials (e.g. slate instead of imported marble).

Furthermore, independent hotels do not have franchise fees, and some boutique hotel brands offer limited partnerships with investors. On the other hand, capital expenditure remains high. Labor costs are lower for boutique hotels because of their smaller size in relation to chain hotels.

Lastly, the hotel business will continue to blossom because people will always have need to lodge for various reasons especially when they are out of their base.

2. Conduct Market Research and Feasibility Studies

  • Demographics and Psychographics

The demographic and psychographic composition of those who need the services provided by hotels is wide and far reaching; it involves everyone who has any reason to lodge in a hotel or patronize services and products offered by hotels.

As such if you are looking in the line of  defining the demographics of your hotel facility business, then you should make it all encompassing; it should include corporate executives, business people, sports men and women, government officials, college students, tourists, travelers, travelling agencies, event managers and religious organizations et al in and around your target location.

3. Decide Which Niche to Concentrate On

Most hotel facility businesses tend to operate general services that a standard hotel facility provider is expected to offer. That is why it seems like there are no niche areas in the industry. But the truth is that there are various niche ideas in the hotel and hospitality industry.

These are some of the niche ideas within the hotel and hospitality industry that an aspiring investor who intend launching a hotel business can choose from;

  • Boutique Hotel
  • Conventional Hotels (2 Stars, 3 Stars, 4 Stars, 5 Stars, 6 Stars and 7 Stars)
  • Motels
  • Bed and Breakfast
The Level of Competition in the Industry

The level of competition in the hotel and hospitality industry to some extent depends on the location of the business, your niche area of operation and of course the capacity of your hotel facility. If you can successfully create a unique niche for your hotel facility business, you are likely going to experience little or no competition.

For instance, if you are the only boutique hotel facility or 7-star hotel in your location, you can successfully monopolize the market for a long time before you start having competitions. It is important to also state that the competition in the hotel line of business is not restricted to the line of business alone, but also you will be competing against all players in the hotels and hospitality industry.

4. Know Your Major Competitors in the Industry

It is important to point out the fact that in every industry, there are always brands that perform better or are better regarded by customers and the general public than others. Some of these brands are those that have been in the industry for a long while and so are known for that, while others are best known for how they conduct their businesses and the results they have achieved over the years.

These are some of the leading hotel facilities in the United States of America and in the globe;

  • Wyndham Hotels and Resorts
  • Hilton Hotels & Resorts
  • Marriott International
  • InterContinental Hotels
  • Starwood
  • Mandarin Oriental, Las Vegas
  • The Langham, Chicago
  • Montage Palmetto Bluff
  • The Peninsula Beverly Hills
  • Four Seasons Resort
  • The Jefferson, Washington, DC.
  • The Lodge at Sea Island
  • The Nantucket Hotel & Resort, Nantucket, Massachusetts
  • The Roof Garden at The Peninsula
  • Lord Elgin Hotel
  • Sofitel Chicago Magnificent Mile
  • The Hermitage Hotel
  • DoubleTree by Hilton Hotel & Conference Centre Regina
  • MGM Grand Las Vegas
  • Grand Hyatt San Antonio
  • Monte Carlo Hotel And Casino
Economic Analysis

When starting a hotel facility business, you just have to get your costing cum economic analysis right if your intention of building the business is to generate profits, grow the business and perhaps expand the business and start competing at the national level.

When conducting costing and economic analysis for your hotel facility business, you have to critically examine these key factors; place, pricing, and promotion. As a matter of fact, you would have to continue to review these key factors at regular intervals while running your hotel facility business.

It is important to note that acquiring a facility, construction and furnishing the facility, providing overhead and running cost are some of the most important factors contributing to the overall cost of running a hotel facility business and should be considered as a major factor when carrying out your costing and economic analysis.

5. Decide Whether to Buy a Franchise or Start from Scratch

There is no hard and fast rule when it comes to choosing how you intend starting a business. Basically, you should be guided by your overall business vision and mission statement.

When it comes to starting a business of this nature, it will pay you to buy the franchise of a successful and well – established hotel chain as against starting from the scratch. Even though it is relatively expensive buying the franchise of an established hotel chain, but it will definitely pay you in the long run.

But if you truly want to build your own brand after you must have proved your worth in the hotel and hospitality industry, then you might just want to start your own hotel business from the scratch. The truth is that it will pay you in the long run to start your hotel business from the scratch. Starting from the scratch will afford you the opportunity to conduct thorough market survey and feasibility studies before choosing a location to launch the business.

Please note that most of the big and successful hotel brands around started from the scratch and they were able to build a solid business brand.

6. Know the Possible Threats and Challenges You Will Face

If you decide to open your own hotel facility today, one of the major challenges you are likely going to face is the presence of well – established hotel facilities and of course other players in the hotels and hospitality industry in your target market location. The only way to avoid this challenge is to create your own market.

Other threats and challenges that you are likely going to face when you start your hotel facility are mature markets, bad economy (economy downturn), stiff competition, volatile costs, and rising furniture prices.

So also, unfavorable government policies, seasonal fluctuations, demographic/social factors, downturn in the economy which is likely going to affect consumers spending and of course emergence of new competitors within the same location where yours is located. There is hardly anything you can do as regards these threats and challenges other than to be optimistic that things will continue to work for your good.

7. Choose the Most Suitable Legal Entity (LLC, C Corp, S Corp)

You have the options of either choosing a general partnership, limited liability Company which is commonly called an LLC, or even a sole proprietorship for a business such as hotel facility. Ordinarily, sole proprietorship should have been the ideal business structure for a small – scale hotel facility business especially if you are just starting out with moderate start – up capital and you want to operate a motel or bed and breakfast. But people prefer limited liability Company for obvious reasons.

As a matter of fact, if your intention is to grow the business and have chains of your hotels via franchising all across the United States of America, then choosing sole proprietor is not an option for you. Limited Liability Company, LLC or even general partnership will cut it for you.

For example, Setting up an LLC protects you from personal liability. If anything goes wrong in the business, it is only the money that you invested into the limited liability company that will be at risk. It is not so for sole proprietorships and general partnerships. Limited liability companies are simpler and more flexible to operate and you don’t need a board of directors, shareholders meetings and other managerial formalities.

These are some of the factors you should consider before choosing a legal entity for your hotel facility business; limitation of personal liability, ease of transferability, admission of new owners, investors’ expectation and of course taxes.

If you take your time to critically study the various legal entities to use for your hotel facility business, you will agree that limited liability company; an LLC is most suitable. You can start this type of business as limited liability company (LLC) and in future convert it to a ‘C’ corporation or an ‘S’ corporation especially when you have the plans of going public.

Upgrading to a ‘C’ corporation or ‘S’ corporation will give you the opportunity to grow your hotel facility business so as to compete with major players in the industry; you will be able to generate capital from venture capital firms, you will enjoy separate tax structure, and you can easily transfer ownership of the company; you will enjoy flexibility in ownership and in your management structures.

8. Discuss with an Agent to Know the Best Insurance Policies for You

In the United States and in most countries of the world, you can’t operate a business without having some of the basic insurance policy covers that are required by the industry you want to operate from. Thus, it is imperative to create a budget for insurance policy cover and perhaps consult an insurance broker to guide you in choosing the best and most appropriate insurance policies for your hotel facility business.

Here is some of the basic insurance policy covers that you should consider purchasing if you want to start your own hotel facility business in the United States of America;

9. Protect your Intellectual Property With Trademark, Copyrights, Patents

If you are considering starting your own hotel facility business, usually you may not have any need to file for intellectual property protection/trademark. This is so because the nature of the business makes it possible for you to successfully run the business without having any cause to challenge anybody in court for illegally making use of your company’s intellectual properties.

On the other hand, if you just want to protect your company’s logo and other documents or software that are unique to you or even operation concepts, then you can go ahead to file for intellectual property protection. If you want to register your trademark, you are expected to begin the process by filing an application with the USPTO. The final approval of your trademark is subjected to the review of attorneys as required by USPTO.

10. Get the Necessary Professional Certification

If you intend starting a hotel facility in the United States of America, you are encouraged to pursue professional certifications; it will go a long way to show your commitment towards the business. Certification validates your competency and shows that you are highly skilled, committed to your career, and up-to-date in the competitive market. Besides it is almost impossible to run a hotel facility business in the United States without the proper professional certification.

These are some of the certifications you can work towards achieving if you want to run your own hotel facility business in the United States of America;

  • AHLEI Professional Certification
  • Eco-Friendly Hotel Certifications
  • Certified Hotel Administrator (CHA)
  • Certification in Hotel Industry Analytics (CHIA)
  • Certified Hospitality Revenue Manager (CHRM®)
  • Green Globe Certification

Please note that you cannot successfully run a standard hotel in most developed countries of the world if you do not acquire the required certifications, licensing and permits from the appropriate authority.

11. Get the Necessary Legal Documents You Need to Operate

The essence of having the necessary documentation in place before launching a business in the United States of America cannot be overemphasized. It is a fact that you cannot successfully run any business in the United States without the proper documentations. If you do, it won’t be too long before the long hands of the law catch up with you.

These are some of the basic legal documents that you are expected to have in place if you want to legally run your own hotel facility in the United States of America;

12. Raise the Needed Startup Capital

Starting a standard, equipped and well – furnished hotel facility business is capital intensive even if you choose to launch the business on a small scale and you only have a handful of full – time employees on your payroll. Leasing of a standard facility that can accommodate your guests and staff members and of course the purchase of daily supplies (toiletries and food ingredients et al) are part of what will consume a large chunk of your startup capital, in essence, if you choose to start the business on a small scale, you will still have the need to go source for fund to finance the business.

When it comes to financing a business, one of the major factors that you should consider is to write a good business plan. If you have a good and workable business plan document in place, you may not have to labor yourself before convincing your bank, investors and your friends to invest in your business.

Here are some of the options you can explore when sourcing for startup capital for your hotel facility business;

13. Choose a Suitable Location for your Business

Starting a hotel facility business comes with its own challenges; it is a business that cannot be started in any location. As a matter of fact, you will need approval from the local council and other regulating authorities in the city you intend opening your hotel facility business.

Hotels are part of the human lifestyle hence it must be located in good location; a location that is that is highly secured and easily accessible from airports and business districts if indeed you want to maximize profits from the business.

Generally, in business, it cannot be overemphasized that the location you chose to start your business is key to the success of the business, hence entrepreneurs are willing to rent or lease a facility in a visible location; a location where the demography consists of the people who are always looking for a place to lodge and of course people with the require purchasing power and lifestyle.

If you make the mistake of renting or leasing a facility for your hotel facility business in a not too visible or hidden location simply because it is cheap, then you must be prepared to spend more in promoting the business.

Most importantly, before choosing a location for your hotel facility business, ensure that you first conduct a thorough feasibility studies and market survey. The possibility of you coming across similar business that just closed shop in the location you want to open yours can’t be ruled out.

These are some of the key factors that you should consider before choosing a location for your hotel facility business;

  • The demography of the location
  • The demand for hotel facilities and other services provided by hotels in the location
  • The purchasing power of the residents of the location
  • Accessibility of the location and closeness to airports, event centers, tourist locations and train stations et al
  • The number of hotel facilities and lodging related service businesses in the location
  • The local laws and regulations in the community/state
  • Traffic, parking and security et al

14. Hire Employees for your Technical and Manpower Needs

It is important to state that there are no special technologies needed when it comes to opening a standard hotel facility, but you will need the following start-up inventory and equipment (flat screen TVs, sound systems, supply of food ingredients and drinks, beds and pillows, cabins, racks, fridges, kitchen gadgets, washing machines, and bar equipment amongst others.

Washing machines, dryers, industrial pressing irons, ironing boards, washer hook-up fees (sewer connection), cleaning supplies, soap, washing powder, bleach, starch/adhesive, laundry bags, invoices for wash-and-fold, bathroom supplies, racks, hooks/hangers et al).

It is important to state that these equipment can be purchased as fairly used if you are operating on a low budget. In setting up a small office for your hotel facility, you will also need computer, printer, relevant software apps, telephones, pager, photocopier, scanner, fax machine, first aid kit and uniform.

When it comes to choosing between renting and leasing a facility for your hotel facility business, the size of the hotel facility you want to own, and your entire budget for the business should influence your choice. Besides, you will need a facility that is in a serene environment, a facility that is big enough to accommodate the number of rooms you have in mind.

As regards the number of employees that you are expected to kick start the business with, you would need to consider your finance before making the decision. When it comes to starting a standard hotel facility business on a large scale, you would need the services of the following professionals; Chief Operating Officer (you can occupy this position), Hotel Managers, Bartender/Baristas, Marketing and Sales Executive (Business Developer), Accountant, Facility/Maintenance Manager, Human Resources and Admin Manager, Customer Services Executive/Front Desk Officer, Security Guards and Cleaners.

Over and above, you would need a minimum of 10 to 15 key staff members to effectively run a medium scale but standard hotel facility.

The Service Delivery Process of the Business

The service delivery as it relates to a hotel facility to a large extent depends on the organization, the facilities they have to offer and what they stand to achieve.

Basically, a hotel facility business sources for clients. Once they are able to win the client over based on the services they intend offering and the facility available; the clients either make payment directly to the hotel, specifying the type of rooms, services and the number of days they intend lodging in the hotel. If it is a full service that a client paid for, it then means that the client will enjoy all the services and facilities available in the hotel.

The services and facilities will include food delivery to rooms, laundry, gym, conference hall, internet facility, photocopier, telephone and fax services and swimming pool et al.

It is important to state that a hotel facility business may decide to improvise or adopt any business process and structure that will guarantee them efficiency and flexibility; the above stated hotel facility business process is not cast on stone.

15. Write a Marketing Plan Packed with ideas & Strategies

The fact that the services and facilities provided by hotels are key to our social life means that there is bound to be more players in the industry no matter the location you choose to start yours. In essence, you must come up with creativity and innovations if you must carve out a market for yourself within the available market in your community, city, state or country.

So, when you are drafting your marketing plans and strategies for your hotel facility, make sure that you create a compelling personal and company profile. Aside from your qualifications and experience, it is important to clearly state in practical terms what you have been able to achieve in time past as it relates to your line of business. This will help boost your chances in the market place when marketing your services.

Here are some of the platforms you can utilize to market your hotel facility;

  • Introduce your business by sending introductory letters alongside your brochure to traveling agencies, households, hospitals, religious organizations, clubs/organizations, campuses and NGOs et al within and outside the location where your hotel facility is located
  • Open your hotel facility with a party so as to capture the attention of residents who are your first targets
  • Engage in roadshows in targeted communities from time to time to market your services and facilities
  • Advertise your hotel in community based newspapers, local TV and radio stations
  • List your hotel on yellow pages ads  (local directories)
  • Leverage on the internet to promote your hotel facility
  • Engage in direct marketing and sales
  • Encourage the use of Word of mouth marketing (referrals)
  • Leverage on the internet to promote your business
  • Join local chambers of commerce and industries around you with the main aim of networking and marketing your facilities and services; you are likely going to get referrals from such networks
  • Engage the services of marketing executives and business developers to carry out direct marketing for you

16. Work Out a Reasonable Pricing for your Services & Products

One key factor that will help you offer your facilities and services at the right price is to ensure that you cut operational cost to the barest minimum, and channel your efforts towards marketing and promoting your brand name. Aside from the fact that this strategy will help you save cost, it will also help you get the right pricing for your facility and services.

You can also try as much as possible to work with independent contractors and marketers; it will help you save cost for paying sales and marketing executives. So also, if you are able to secure business partnership with travel and tour companies as it relates to getting referrals, then you will be able to get the right pricing and of course maximize profits from your hotel facility business.

As regards toiletries, cooking ingredients and other supplies that you need to effectively run your hotel facility; you need to ensure that you purchase your items directly from the manufacturers or from wholesale distributors in pretty large quantities.

17. Develop Strategies to Boost Brand Awareness and Create a Corporate Identity

If your intention of starting a hotel facility business is to grow the business beyond the city where you are going to be operating from to become a national and international brand by opening chains of hotel facilities and franchising, then you must be ready to spend money on promotion and advertisement of your brand.

No matter the industry you belong to, the truth is that the market is dynamic and it requires consistent brand awareness and brand boosting cum promotion to continue to appeal to your target market. Here are the platforms you can leverage on to boost your brand awareness and create corporate identity for your hotel facility business;

  • Place adverts on both print (newspapers and travels and tours magazines) and electronic media platforms
  • Sponsor relevant community based events
  • Leverage on the internet and social media platforms like Instagram, Facebook, Twitter, YouTube, Google + et al to promote your facilities and services
  • Install your billboards in strategic locations all around your city or state
  • Engage in roadshows from time to time in targeted neighborhoods to create awareness of your hotel facility
  • Distribute your fliers and handbills in target areas
  • Contact traveling agencies, households, hospitals, religious organizations, clubs/organizations, campuses and NGOs et al within and outside the location where your hotel facility is located informing them of the facilities and services you offer
  • List your hotel facility in local directories
  • Advertise your hotel facility in your official website and employ strategies that will help you pull traffic to the site
  • Position our Flexi Banners at strategic positions in the location where your hotel facility is located
  • Ensure that all your staff members wear your branded shirts and all your vehicles and trucks/vans are well branded with your company logo et al.

Frequently Asked Questions

  1. How Do You Start Your Own Hotel?
  • Determine the type of hotel you would like to start (e.g., how many rooms, luxury vs affordable, etc.)
  • Determine the ideal location(s) for your hotel
  • Determine whether you will build your hotel from scratch or renovate an existing structure
  • Speak with architects and others who will be involved in building/renovating your hotel to determine costs
  • Speak with local government to understand zoning and permit issues and associated costs
  • Develop your hotel business plan that details your strategy, plans and financial projections
  • Present your plan to investors and lenders to raise the required funding
  • Build/renovate your hotel
  • Recruit and train your hotel staff
  • Purchase the required systems (e.g., reservation system, accounting software, etc.) to effectively manage your hotel
  • Launch your pre-opening hotel marketing plan
  • Open your hotel to the public
2. If You Want To Start A Hotel Business What Factors Do You Consider?
  • Hotel Location
  • Hotel Amenities
  • Accessibility
  • Value
  • Testimonials/Reviews
3. Can You Buy A Hotel Room Permanently?

The short answer is Yes. In the real estate industry, these are known as condo hotels. Hotel rooms boast of higher occupancy rates and greater monthly returns than regular condominiums.

4. How Much Does It Cost To Start A Hotel?

The average cost of starting a hotel in the US ranges from $750,000-$1,000,000 for a small motel, to the national average being around $22,000,000 for a hotel.

5. What Are The Costs Involved In Opening A Hotel Business?

That figure breaks out into 5 buckets:

  • Land: $33,900 (10%); this includes real estate cost
  • Building/Construction:  $221,500 (66%); naturally building and construction is the largest budget item.
  • Soft Costs: $41,800 (12%); these include everything non-construction related like designers, architects, lawyers, insurance, permits and taxes.
  • FF&E: $29,100 (9%); FF&E stands for “Furniture, Fixtures & Equipment” and includes anything that’s movable in the building desks, computers, electronic equipment tables.  FF&E is also sometimes referred to as “hard costs”
  • Pre-Opening & Working Capital: $10,700 (3%); you’ll need to hire staff ahead of opening so pre-opening expenses fund salaries before the operation goes live and revenue starts flowing in to fund the day-to-day.
  • Registration fee = $750
  • Legal fees incl. securing licenses, permits, accounting, etc. = $15,300
  • Marketing = $3,580
  • Business consultant (help with business plan) = $2,500
  • Insurance premiums = $30,400
  • Leasing a stand facility in a central location = $4,500
  • Hotel conversion = $800,000
  • Startup expenses (stationary, phone, utilities, sewage, deposits…) = $20,500
  • Operational costs for first 3 months (staff salaries, bills, etc.) = $120,000
  • Startup inventory and equipment (from food to cleaning products, from to pillows to coat hangers) = $45,000
  • Store equipment (cash register, security, ventilation and signage) = $13,750
  • Furniture and gadgets (from TVs to telephones, PCs and printers to tables and chairs) = $40,000
  • CCTV installation = $15,000
  • Website build and hosting = $600
  • Opening party (!) = $20,000
  • Misc (yes there’s stuff we haven’t covered!) = $50,000
  • So that’s an estimated hotel startup cost of $1, 214, 100.
6. How Much can you Put Down On A Hotel?

20 percent down payments are the norm if you use a bank loan to purchase your hotel. However, with seller financing (borrowing from the seller of the property), you may be able to get the down payment percentage down to 5 percent.

7. What Are Some Ideas To Grab Customers for your hotel?
  • Take Prospects on a Virtual Tour
  • Leverage the Power of Loyalty Programs
  • Invest in Text Message Marketing
  • Encourage Online Reviews
  • Share User Generated Content via Instagram
  • Create a Digital Community Guide
  • Use Twitter as a Customer Service Tool
8. How Do Hotels Get Funding?

Consider traditional commercial real estate loans from banks, hard money loans, or commercial real estate crowdfunding for alternative hotel construction financing. Many hotel lenders will also call construction loans CapEx loans—or capital expenditure loans—so keep an eye out for those, too

9. Which Is bigger, Hilton Or Marriott?

Marriott. The U.S.-based hotel chain is the world’s biggest, after its merger with Starwood Hotels and Resorts in 2016. Today Marriott’s annual revenue tops $14.5 billion.

Hilton and Marriott are two of the biggest hotel chains in the world. Hilton has 18 brands and more than 6,100 properties across 118 countries. Marriott has 30 brands and more than 7,000 properties across 131 countries and territories.

10. What Happens During A Typical Day At A Hotel Business?
  • Getting up early. In fact very early. This is one rule that you have to follow in the hospitality industry.
  • The daily meeting happens where the daily staff report is presented about what has happened over last night, those details are provided by the staff.
  • Managers will always roam around the hotel making sure that each and everything is in place.
  • Hotel staff meet their clients and take their feedbacks.
  • Managers provide instructions to the hotel staff multiple times a day about how to do things.
  • There are several operational meetings in a day and also with the senior management in some cases.
11. How Profitable Is Owning A Hotel?

Hotels can be a very good investment and also highly profitable. But you really need to understand the business before you can make any profit in it.

12. How Much Does A Marriott Hotel Owner Make?

Approximately $25,000 to $75,000 per year. The above information was compiled from the FDD of Marriott International.

13. How Much Does A Normal Hotel Room Cost?

The average cost of a hotel room, determined by surveying 100 hotels in U.S. cities, is $177.36 per night as of 2016.

14. Is Owning A Hotel A Good Investment?

The answer is yes and no. Yes, if it’s in the right location, has the proper management, is well capitalized and the economy is doing well. It will not be profitable if it is in the wrong location, poorly run, run down, undercapitalized, and the economy is in a downturn. Like any other business, there are winners and losers.

15. What Are The Ins And Outs Of Starting A Hotel Business From Scratch?
  • Make a plan
  • Conduct research
  • Create your Unique Value Proposition
  • Develop your marketing plan
  • Enquire about permits and zoning
  • Raise startup capital
  • Find hotel premises, build and furnish
  • Recruit staff
  • Put systems in place
  • Train your team
  • Open your hotel
16. How Much Does It Cost To Build A Marriott Hotel?

The total investment to open and operate a Courtyard by Marriott hotel as a franchisee is between $7 million and $10 million. The initial franchise fee is $60,000 or $500 per room, whichever is greater.

17. Is Living In A Hotel Expensive?

Living in a hotel is as expensive as you make it. It can be less expensive or more expensive than renting an apartment, depending on your standard of living and how you are able to deduct expenses.

18. What Are The Costs of Running A Small Boutique Hotel ?
  • Registration fee = $750
  • Legal fees incl. securing licenses, permits, accounting, etc. = $15,300
  • Marketing = $3,580
  • Business consultant (help with business plan) = $2,500
  • Insurance premiums = $30,400
  • Leasing a stand facility in a central location = $4,500
  • Hotel conversion = $800,000
  • Startup expenses (stationary, phone, utilities, sewage, deposits…) = $20,500
  • Operational costs for first 3 months (staff salaries, bills, etc.) = $120,000
  • Startup inventory and equipment (from food to cleaning products, from to pillows to coat hangers) = $45,000
  • Store equipment (cash register, security, ventilation and signage) = $13,750
  • Furniture and gadgets (from TVs to telephones, PCs and printers to tables and chairs) = $40,000
  • CCTV installation = $15,000
  • Website build and hosting = $600
  • Opening party (!) = $20,000
  • Misc (yes there’s stuff we haven’t covered!) = $50,000
  • So that’s an estimated hotel startup cost of $1, 214, 100.
19. Do Boutique Hotels Make Money?

According to CBRE’s Trends survey, boutique hotels achieved a gross operating profit margin of 33.8 percent in 2017 versus the 38.3 percent average for all hotels included in their survey. The boutique sector also exhibits strong growth in RevPAR.

20. How Do You Get A Good Financial Start For A Small Hotel?

It takes time for your hotel to start yielding the needed revenure and for it to become profitable. So the best financial start you can get is to get your loan form a source that gives you the best payment option. Like something that won’t stress you out or put you under pressure to pay back.

21. What Are Some Insider Tips For Jump Starting A Hotel Business?
  • Keep an eye on those reviews
  • Generate great leads
  • Give customers an innovative experience
  • Keep your guests safe
  • Communicate, communicate, communicate
  • Give managers flexibility
  • Be observant
22. What Is The Most Important Skill That A Hotel Owner Must Have?

Multi-tasking.

No day is the same within the hospitality industry. Customer footfall varies on a daily basis, therefore, staff must be able to multi-task in order to deal with a potentially high number of jobs in one day.

23. What Are Some Skills And Experiences That Will Help You Build A Successful Hotel Business?
  • Teamwork
  • Multi-tasking
  • Flexibility
  • Attention to Detail
  • Industry Awareness
  • Time Management
  • Communication
  • Interpersonal Skills
24. Is Owning An Inn Profitable?

Inns can be profitable and enjoyable to operate if you have realistic expectations.

25. How Much Do Hotel Owners Make Yearly?

As the owner, they don’t have a salary; rather, they have (or don’t have) a profit. Based on estimates, how much a hotel franchise owner makes varies between $40,000 to $60,000 annually. Given that the average salary in the US is around $40,000, then the average hotel owner isn’t making much more than the average white-collar worker.

26. What Are The Requirements Of A 5 Star Hotel?
  • Standalone concierge staff available at least 16 hours a day
  • A high staff-to-room ratio—ideally above 2.5
  • Multilingual staff
  • 24-hour reception, room service, valet parking, butler, doorman
  • Nightly turndown
  • Daily housekeeping that is also available upon request at any time
  • Laundry, ironing, dry cleaning, and shoe polishing
  • Guest elevators separate from staff elevators.
  • Luggage storage in which bags are out of guest view
  • Fine dining restaurant(s) and a standalone lounge and/or bar
  • Transfers and executive or house car
  • Childcare
27. What Is The Average Profit Margin For A Hotel?

Using information from CBRE’s Trends in the Hotel Industry database, at 39.8 percent, hotels have historically averaged a GOP margin of 11.6 percent.

28. What Are Some Great Tips To Start A Hotel Business In The States?
  • You should work on redefining your OTA strategies
  • Focus on direct bookings
  • Start working on your digital marketing
  • You just need to focus on your reviews
  • Set the right pricing at the RIGHT time
  • Employ an effective reputation management plan for your hotel
  • Keep an eye on your competitors and their pricing methods
29. Michael Forrest Jones’s Answer To What Would Be A Good Way To Promote A Small Hotel?
  • If it’s your first time, and you have no construction or real estate development experience, consider the acquisition route, at least starting out.
  • Let’s start with your location. Give it a rest for now about streets, thoroughfares, zoning, traffic counts, etc. You want to make sure you’re in the right town.
  • If you’re contemplating building something more downscale and economical, with more spartan amenities (e.g., a Super 8 Motel) – my best advice is, don’t.
  • If you’re contemplating something more upscale, with food and beverage service, unless you yourself have restaurant management experience and can market a restaurant location in that spot successfully from scratch, my best advice is – again – don’t.
  • Once you’ve picked a town, check their various room rates
  • Provide a service that is missing in that town
  • Whatever you build, wherever you build it, you can make it as posh as you like, you can include as many amenities and services of any kind at all as anyone could want, you could make it a veritable Fantasy Island, heaven on earth even … but there’s a catch: it has to make money.
30. What Is The Most Profitable Hotel Chain?

Hilton Hotels & Resorts was the most valuable hotel brand in 2020, with a global brand value of approximately 10.83 billion U.S. dollars.

31. Why Does a Hotel Owner Need Hkeeper?

HKeeper is a universal cloud-based platform for hotel management personnel to use remotely and in real-time mode. In the Hospitality industry Hkeeper dramatically decrease operational costs and highly increase service quality.

HKeeper is a unique tool, visualizing everything that happens in the hotel and displays all the information to a single control panel, where at a glance you can see and evaluate the accuracy of the workflow or its deviation from established quantitative and qualitative standards.

32. What Are The Four Pillars Of Hotel Marketing?
  • Popularise
  • Capture
  • Convert
  • Share
33. What Is The Best Location For A Hotel?

Upcoming Neighborhoods

People are usually stressed out by the noise in bustling towns and if they can snatch a bit of a getaway, they’d much rather spend it in a hotel that is devoid of the hustle and bustle of major cities. Even experienced hotel chains are convinced their hotel will clean up an area and be the catalyst for improving an underdeveloped or neglected neighborhood.

34. How Do You Know If You Need A Night Porter For Your Small Hotel?

Porter responsibilities include carrying guests’ luggage, fixing minor issues (like changing light bulbs) and cleaning building areas, including entrances.

If your hotel gets a lot of guests at night, then it may be a sign that you need a night porter.

36. Is Marriott Owned By Chinese?

Marriott International, Inc. is an American multinational company. The company was founded by J. Willard Marriott and his wife Alice Marriott; the executive chairman of the company is now their son, Bill Marriott and the Marriott family retains majority ownership of the company.

37. How Much Does It Cost To Build A Small Motel?

$7,265,000. For a typical motel project, you would be looking at $150-$180 per square foot.

38. What Can You Do If You Want To Start Your Own Hotel Business But You Are Just 17 Years Old?

You cannot build a hotel at the age of 17. First off, building a hotel is very financially intensive and no sensible business person or investor will lend a teen money to start building a hotel.

39. Does Your Hotel Need To Be Close To A Train Station?

No, your hotel does not need to be close to a train station to be successful. Though there are lots of hotels that are located close to train stations and they are pretty successful.

40. How Can You buy A Hotel With No Money?

The hotel business is capital intensive and requires quite a substantial amount of money to invest in. Therefore, buying one with no money may be fun for the interested party, but it isn’t to the seller. More so, it is almost impossible.

41. What Are The Key Financial Metrics In The Hotel Market?
  • Liquidity Ratios
  • Financial Leverage Ratios
  • Profitability Ratios
42. What Specific Qualities Do Owners Of Successful Small Hotels Usually Possess?
  • Commitment
  • Communication Skills
  • Enthusiasm
  • Leadership
  • Organisation
  • Knowledgeable of Safety/Hygiene issues
  • Teamwork
43. How Much Money Do You Get Monthly If You Own A Hotel Business?

Hotel owners don’t make a salary; they make a profit. $40,000 and $60,000 per year. That should give you roughly $5000 per month.

44. How Can A Foreigner Open A Hotel Or Restaurant In The USA?

There are a number of possibilities.

  • As an arm’s length investor. Employ a manager; form an LLC; put up the cash. You can even do this without setting foot in the USA.
  • Obtain Employment Authorisation to work as a non-immigrant using the E-2 visa
  • If you are investing over $500,000 then apply for an immigrant visa using the EB5 visa route
  • Use the B1/B2 visa categories to spend up to a year in the US doing the groundwork.
  • Use the L1 visa category by opening a restaurant in your home country first.
45. How Much Does It Cost To Stay In A 5 Star Hotel?

North America has the most expensive luxury hotels, with an average cost of $884 per night but it can average at $400 or even less. They are also 5 star hotels that are over a thousand dollars per night.

46. Being An International Student In USA, How Can Start A Hotel Business In New York?

Under the F1 program, international students are not allowed to own a business. This means that international students cannot earn revenue or salary derived from a business which they operate.

47. Who Is The Richest Hotel Owner?

Sheldon Adelson. With a net worth of $21.8 billion, Sheldon Adelson is the 12th wealthiest American and the 24th richest man on Earth.

48. How Much Does It Cost To Build A 100 Room Hotel?

The average cost to build a 100-room 5-star hotel is over $60,000,000.

49. Can You Run A BB From Your Home?

Yes. But first you need to contact your local council. You may need a “change of use” application to run a B&B business from your house, even if you aren’t making any structural changes. With regard to health and safety, all B&Bs have to comply with fire safety legislation and have a gas safety inspection.

50. Can You Make Money Running A BB?

B&Bs can be profitable and enjoyable to operate if you have realistic expectations. The pros are many: you meet different people, you avoid a daily commute, you can live where you work while minimizing your home expenses, and you might have valuable time off during the off-season.

51. What Personality Traits Differentiate Average Hotel Owners From Great Hotel Owners?
52. How Can Hotels Improve Revenue During The Autumn And Winter Months?
  • Offer tailor made packages
  • Have A good CRM
  • Segmentation
  • Give your website a polish
  • Create a landing page
  • Retarget abandoned bookings
  • Don’t neglect metasearch
  • Blog about it
Joy Nwokoro