The hotel industry is an industry with many opportunities for advancement and development. Those who are ambitious and understand something about their subject can make a career in a wide variety of departments and play a key role in shaping the quality and reputation of a company. For some employees in the hotel industry, however, this may no longer be enough at some point, and they want to give their own ideas of the perfect hotel even more space. In this case, starting your own business is a consideration that can certainly have potential. The hotel and catering industries are still growing and extremely diverse sectors and a well-run hotel have excellent opportunities to establish itself in the long term. So the idea of your own hotel doesn’t have to remain a dream.
Direct your own vision into concrete paths
The desire for your own hotel usually arises for two reasons:
- There are aspects of the hospitals that have been looked after that do not seem optimal to an employee.
- He or she has an idea of how it could be done better and would like to implement it.
When this idea becomes more concrete and develops into a comprehensive hotel concept, the vision of one’s own house is born.
So that your own ideas can take on concrete forms, it should first be decided which type of hotel is to be opened, which category is aimed at and which target group comes into question as guests. As reported by the internet portal businessplan.org, the hotel categories in Germany in 2011 were distributed as follows:
“In 2011 there were 8206 star-certified hotels in Germany. At 59.8 percent, the 3-star category made up the largest share. There were also 28.6 percent of the 4-star category and 9.6 percent with 2 stars. The share of 5-star luxury hotels was rather low at 1.6 percent, as was 1-star accommodations at 0.9 percent. ”
According to the portal, there is constant growth, especially in the day and business travel sector and in the wellness segment. So if you want to gain a foothold here, you are well-advised. Above all, a business plan should present a unique selling point with which a hotel can stand out from the competition in the region and in the entire industry. Above all, the competition from the large and established hotel chains should not be underestimated. If you want to score points here, you should come up with something very special and give your concept an individual touch.
These questions can help with the development of an individual hotel concept:
- Which target group should be addressed and which individual needs does this target group have?
- Which cultural framework conditions does the location offer and how can they be used sensibly?
- What philosophy should the hotel concept be based on?
- How can the design of the hotel be tailored to the cultural characteristics of the location, your own philosophy, and the expectations of the target group?
- What culinary orientation should the hotel have with regard to the questions discussed above?
- What additional offers can the hotel offer its guests that may serve a niche or define a unique selling point?
The more individual a hotel concept is, the better it is possible to stand out from the competition. But the choice of the right location also plays a more important role if a very special concept is chosen.
Choose the right location
Choosing the right location is an essential factor for the success of a newly opened hotel. Above all, hotels with an individual background should choose a location that is receptive to the unique selling proposition that has been conceived and where it is easy to acquire the relevant clientele. A hotel should fit into the picture at its location and meet guests’ expectations of accommodation.
Location analysis is therefore essential before an appropriate property is selected. The location analysis is based on the following questions:
- What is the location of the hotel and how is it integrated into the local infrastructure at this location (public transport such as airports, train stations, etc., shopping opportunities, and leisure activities for travelers)?
- Does the location offer a balanced mix of offers for guests and tranquility?
- How many competitors have already settled at this location and how is the individual orientation of the hotel represented among these competitors?
- Does the hotel fit in its individual orientation to the location and the clientele represented there?
- How interesting is the location for travelers and which category of travelers can be found there (leisure tourists, business travelers, group travelers, families, etc.)?
- How does the clientele to be met on-site fit in with the orientation of your own hotel and the clientele to be expected?
- Which potential suppliers are available at the location and how are the delivery routes?
After a detailed location analysis, it is usually easy to determine whether your own house with its special orientation is well located there or whether another location would be recommended based on the determining factors. If you want to have long-term success with your own concept, you should definitely be flexible here and also consider moving to another city or even another country. The best hotel concept often cannot really take off in the wrong location.
With a professional relocation service, a change of location is usually a small effort compared to the advantages that your own business receives from the perfect location.
Find the right property
After a detailed location analysis, it is worth looking for the right property to open the hotel. A new building is usually only an option for large hotel chains. If you want to open a rather small and individual house, you are well-advised to have a well-preserved property that is tailored to your own concept. Internet portals are suitable for a quick search for properties on offer. A simple query can be made there using a simple search mask. It is also possible to set up a profile for the property you are looking for and to have messages sent to you as soon as a suitable property ad has been published on the portal.
The location analysis has already summarized and discussed many important features of a suitable property. Of course, only a detailed site inspection can show whether an object actually corresponds to your own ideas. Budding hotel founders should also pay attention to the little things and hidden details. Important points are:
- What renovation and refurbishment requirements does the property have?
- How is the outdoor area designed? Can it be used in summer?
- How are outdoor areas such as balconies, terraces, etc. aligned (sunlight)?
- Are there enough parking spaces for guests in the immediate vicinity?
- Is the house easy to find and is it possible to put up signs in the area?
- Are there any disruptive sources in the area, such as long-term construction sites, railway tracks, approach lanes, factory grounds, etc.?
- Is the property located in such a way that it is easily accessible in all weathers?
If an object has been found that meets all of these requirements, a personal viewing appointment should be arranged as soon as possible. If necessary, it is advisable to consult a building expert who can expertly assess the building’s condition and potential renovation needs.
Turn your vision and initial analyzes into a business plan
In the next step, it is important to check your own vision for its feasibility and translate it into a business plan that enables concrete planning and implementation. Since opening your own hotel usually requires large-scale investments, a well-thought-out business plan is essential in order to define your own options and convince financing partners of the concept developed.
But the heart of the business plan is the financing. After all, the business plan is the basis of all discussions with potential investors and financial partners. The financing plan compares the income and expenses of the hotel opening and the subsequent operation as detailed and concrete as possible. Key figures should be thoroughly researched and realistic and comprehensible based on experience from the industry. Therefore, it is good if a detailed location analysis and an initial search for possible properties have already been carried out so that the necessary investments and profit potential can be better assessed in the business plan. Essential points should also be included in the cost calculation, without which a hotel opening is not possible:
- The business registration
- The restaurant permit/liquor license
- If applicable, GEMA fees for musical ambiance or events
- Costs for special entertainment offers in common rooms or in the rooms (video on demand)
- Checks by the public order office and the veterinary office, for example as part of the initial instruction on the Infection Protection Act
A detailed overview of the required licenses and registrations is given in the leaflet on establishing and running a hotel run by the Chamber of Commerce and Industry.
What a financial plan looks like also depends on which legal form is chosen for the company. The sole proprietorship is the most frequently chosen legal form when opening a hotel. What this legal form is all about and why it can be a good choice for opening your own hotel is explained on the website www.existenzgruender.de of the Federal Ministry for Economic Affairs and Energy.
In addition to the legal form, a business plan should also discuss in detail what potential the company has in terms of generating profit. When a hotel is opened, it is primarily a matter of calculating the number of beds available in relation to the expected average occupancy. In addition to the number of beds, the number of planned opening days per year is important for a preliminary calculation. With these key figures, a calculation can be made according to the following pattern.
Calculation of the capacity: number of beds x opening days (overnight stays x 100/capacity)
An exact calculation of the actual occupancy is of course only possible after a house has been in operation for a year. For a calculation, before the hotel opens, a precise market analysis can provide a guideline. The occupancy rate in small houses with few beds should be well over 50 percent on average. Large houses with three-digit beds are only profitable in the long term with an occupancy rate of over 60 percent.
Since the business plan is an absolute must for start-ups, professionalism is required. If you have little experience and expertise yourself, you should get a specialist on board and create the business plan together with an expert. If you want to try your hand at the business plan for your own hotel, you can fall back on numerous samples and work templates on the Internet. The company Auxmoney, for example, which has been advising business start-ups for years, has made a detailed business plan available as a PDF for free download.
Once the business plan has been drawn up, initial discussions on financing the hotel project can be arranged. The project is now entering the concrete implementation phase. Company founders in the hotel industry can take advantage of various funding opportunities. It is essential to prepare well for every single conversation because potential investors can only be won if the subject matter is presented convincingly.