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Buying a Motel

Buying motels.

Resort Brokers Australia has been pioneering the niche tourism real estate sector with a team second to none and a commitment to excellence. Buying a motel is an important decision, so ensure you cover all your bases to secure a fair deal by hiring the first-class services of Resort Brokers Australia.

Over 25 years ago, Resort Brokers revolutionised the tourism property investment market. We introduced the concept of motel leasing to Australia, having recognised the cost of buying a motel outright was a huge financial barrier holding back potential entrepreneurs eager to enter the motel sector. We saw an important opening in Australia’s tourism industry, and sought to make ourselves the best in the business.

We want to make your accommodation business succeed. If you’re looking into entering the motel business, expanding your existing business, or just want more information about how to buy a motel business , we can help. We have the knowledge of what makes a motel succeed, and we will work with you to ensure you make the right purchasing decision.

At Resort Brokers, we have a policy that we will not sell you into a business that we can’t sell you out of. Additionally, we take into consideration your financial position, lifestyle goals, and existing commitments to ensure you find the perfect property. With Resort Brokers, you will know that we will not try to sell you just any property. Resort Brokers will find you a motel business that meets all your requirements.

We also assist with other elements of the buying, leasing, and selling process. Whether you are looking to buy, lease, or sell a motel, we can help. We can even facilitate management rights should you be looking for a change in lifestyle.

Call us on 1300 665 966 or contact us .

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From idea to execution: 10 sections to include in your hotel business plan

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Lana Cook

By Lana Cook

Do you love connecting with people from all over the world who share your passion for travel? Don’t want to work a typical 9-5 job and instead want to build a business where every day is different, and you own your schedule?

Starting a hotel business is a dream many entrepreneurs have, but it can be a daunting venture to start. A hotel business plan is a critical first step for business owners to turn their dreams into reality. A strategic plan allows one to study the hotel industry, identify their hotel’s unique point of view, and outline how exactly they will reach their goals.

Read on to learn more about the ten sections to include in your hotel business plan, tips for creating an effective plan, and key things you need to start your new hotel business.

Ready to get started creating your plan? Download our hotel business plan template.

What is a hotel business plan?

A hotel business plan is a detailed document that identifies your business’s goals, objectives, and strategies for success. It includes market research and a roadmap for building and operating your business.

motel business plan australia

Why do you need a hotel business plan?

Studies show that entrepreneurs who finished their business plan were twice as likely to succeed in growing their business than those with no plan. A hotel business plan:

  • Helps you identify whether you have a viable business idea
  • Provides a detailed roadmap on what you need to accomplish and why
  • Gives potential investors insight into your business idea and confidence that you can be successful
  • Keeps you on track as you start to execute the different tactics outlined in your plan
  • Identifies critical milestones for you and your team to reach

Your plan does not have to be static and should change over time as your business grows and evolves. Your first draft is a starting point to help guide your strategy and instill confidence in potential investors.

10 sections to include in your hotel business plan

Whether you’re starting a small boutique hotel, a cozy B&B, or a 5-star resort, you will need to address the following sections in your hotel business plan.

1. Executive summary

An executive summary is the most essential part of your business plan. It should concisely explain the purpose of your business and why it will be a success.

Include your mission statement explaining why your hotel exists and its overall goal. For example, Capella Hotels & Resorts ’ mission is to combine tradition, discovery, individuality, and twist of the unexpected to create the perfect stay for each guest.

You should also include your vision statement that clearly describes your hotel’s purpose for being in a single sentence. For Capella Hotels, its vision is to embody excellence in the craft of hospitality.

We recommend writing your executive summary as the final stage, as it should summarize the goals and objectives laid out in your plan.

2. Company analysis

Your company analysis is where you can dive into your hotel’s competitive advantage. Ask yourself what makes your hotel unique . Why would guests want to stay with you instead of your competitors?

In this section, identify your brand’s identity and the goals and objectives you want to accomplish. Outline how many rooms and room categories your property will have. For example, will you offer a hybrid hospitality model with dorms, single rooms, and suites? Explain what ancillary revenue sources you’ll offer, like in-room food and beverage options, welcome drinks, or airport shuttles.

Use storytelling to communicate your excitement and passion and make it clear what your hotel will bring to the hospitality industry that hasn’t been done before.

3. Industry analysis

As a business owner, you must be prepared for forces outside your control. You will need to conduct a market analysis that looks at the hospitality industry to identify micro and macro trends that may impact your business. Look at:

  • Economic trends
  • Environmental trends
  • Political trends
  • Global health trends
  • Technology trends

For each trend, identify how it will impact your business and ways to mitigate risk or take advantage of opportunities.

For example, digital check-in technology has increased across the hotel industry with the rise of tech-savvy guests, new innovative software providers, and labor challenges. Therefore, consider what guest experience solution you’ll include at your hotel.

In addition to trends, look at the history of the hospitality industry, its current size, and how it’s expected to grow in the short and long term. This research will impact the rest of your plan, especially your marketing and financials.

4. Customer analysis

What type of hotel guests do you want to attract? It’s impossible to please every kind of guest, which is why it’s important to identify your target market . Once you know who you want to stay at your property, you can develop amenities, services, and marketing materials to attract these guests and deliver exceptional experiences .

Ask yourself:

  • What type of guests do I want? Business or leisure travelers? Retirees or Gen-Z?
  • What demographics? Age, gender, marital status, etc.
  • What are my target market’s interests? Water sports, hiking, relaxation, museums, etc.
  • What does my target market value? Sustainability, contactless technology, personalized service, localized experiences, etc.

This section will help you formulate the guest experience to ensure that expectations meet reality .

5. Competitive analysis

The competition you face will vary depending on where your hotel is located. In this section, you should conduct in-depth competitor research to understand how your hotel will compare. Identify your five major competitors — ideally, three direct competitors you will be competing with upon opening and two aspirational competitors you can emulate as you grow your business.

Conduct a SWOT analysis based on your competitors to look at:

  • Strengths . Where does your property excel in comparison to competitors? Why would travelers pick you? Price, amenities, location, technology, etc.
  • Weaknesses . Where does your property fall short in comparison to competitors? Price, amenities, location, technology, etc.
  • Opportunities . What industry trends can you take advantage of? What local events or partnerships can you capitalize on?
  • Threats . What are the biggest threats facing your property? War, travel restrictions, recession, etc.

A thorough analysis can help solidify your competitive advantage and develop a contingency plan for how you will deal with your weaknesses and threats.

6. Marketing plan

Without demand, there is no business. A hotel marketing plan outlines the channels you’ll use to reach your target audience to drive bookings. Your marketing strategy should include three key channels:

1) Paid media . Paid advertising to promote your property and drive bookings. This includes online travel agencies (OTAs) , search engine marketing (SEM), retargeting, and metasearch advertising.

2) Owned media. The content  you create, like your hotel website , social media channels, blog posts, and SEO.

3) Earned media. User-generated content created by third parties like media coverage or online reviews.

Hotel marketing plan templates

7. Operations plan

How do you plan to run your day-to-day operations? This section of your plan will outline all of the key tasks and responsibilities of your team and what exactly your hotel will offer. Consider:

  • The number of staff and supervisors required
  • Job descriptions and responsibilities
  • Your service standards (check out our downloadable SOPs for some inspiration)
  • How you’ll manage your inventory
  • What hotel technology solutions will you need? PMS, channel manager, booking engine, payment terminal, revenue management tools, guest engagement software, etc.
  • What services and amenities do you want to offer? Room service, bar, restaurant, pool, spa, wellness center, etc. 

Detail your short and long-term operational plans and the stakeholders involved for each area.

8. Management team

Whether or not you’ve hired your team yet, this is one of the most important sections potential investors will look at. Make sure to outline the key personnel you will require and their roles. 

In general, these are the following roles you’ll want to outline:

  • Hotel management (general manager, front office manager, housekeeping manager, maintenance manager, revenue manager)
  • Hotel sales team
  • Housekeeping staff
  • Front office staff
  • Maintenance

Depending on the size of your hotel, your team will vary. Identify the team members you need to open and your hiring plans over the next five years.

9. Strategic plan

Hoteliers must be strategic in optimizing occupancy rates across seasons to maintain revenue. As part of your strategic plan, identify how you will manage:

  • Pricing – what room types will you offer, and how will the pricing vary?
  • How will you maintain consistent occupancy throughout the high and low seasons? Will you adapt your pricing and marketing strategies?
  • How will you conduct revenue management ? What type of rules/alerts will you use to adjust rates? Will you use technology to help with revenue management?
  • What will your online reputation management strategy be? How will you collect and respond to online reviews?
  • What will your distribution mix look like? How will you drive reservations across a variety of channels?

10. Financial plan

Your financial projections are the most challenging but arguably the most crucial part of your hotel business plan. In this section, you should include the following:

  • Start-up costs. How much money will you need from lenders to operate your hotel? Consider business licenses, furniture, down payments, etc.
  • Operating costs . How much money will you need to keep your business running? Consider staffing costs, guest acquisition costs, mortgage payments, utilities, SaaS payments, etc.
  • Income statement . What will your revenue, expenses, and profit be over the first 3-5 years of business?
  • Cash flow projections . How will cash flow in and out of your business? Show what capital investment you’ll need to start.
  • Balance sheet . Identify your assets, liabilities, and equity.

If you’re looking for a potential investor, your financial plan will be the section they care about most. Here, you must prove how your business will provide a return on investment. Don’t forget to include an Appendix that shows more detailed reporting and financial figures.

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8 tips for creating an effective plan

1. Start with the section that excites you the most! Covering all the topics outlined above can feel overwhelming, so don’t feel pressured to go in order.

2. Reach out to a business owner you admire. No matter what type of business you’re starting, getting advice from another business owner is always helpful. Reach out to a successful local business owner to see if they’d be willing to share some insights they learned along the way.

3. Be concise. While there’s a lot to cover, you must be concise in each section of your plan. Include any additional research or documentation in the appendix to keep your business plan clean.

4. Try to avoid industry jargon. Depending on what type of investor is reading your plan, they may find jargon irrelevant and distracting.

5. Ensure you have a clear competitive advantage. You should be able to state in one sentence what makes your property unique. This unique selling point (USP) will be prominent in all of your marketing materials.

6. Set SMART goals. Setting specific, measurable, achievable, relevant, and time-bound goals is important to stay organized and on track to reach milestones.

7. Don’t forget about your plan. You will have spent hours developing your plan, so make sure you use it! Reference your plan as you build and grow your business , and remember that it’s ok if things change.

8. Illustrate your passion. Communicate why you want to be a part of the hospitality industry. Passion is contagious and gives investors more confidence that you will work hard to achieve your dreams.

motel business plan australia

What do you need to start a hotel business?

Ok, so you’ve read through this article and are now wondering — what’s next? Ensure you have the following items on your radar to start your business.

  • A vision. Know exactly what kind of business you want to build (a quaint bed and breakfast is very different from a large-scale resort).
  • A business plan. Stay on track with a well-developed business plan.
  • A location. Decide if you want to build a new property or renovate an existing hotel.
  • Capital. Do you need to raise an upfront capital investment? Remember that new businesses usually aren’t profitable for the first few years and will need cash flow to pay for expenses.
  • Business licenses & permits. Depending on the type of property and its services, you’ll need an occupancy permit, alcohol license, food service license, sales tax license, etc.
  • Technology. Choose technology to help streamline operations and earn more revenue.
  • Furniture & equipment. You must furnish your property with the proper furniture, electronics, appliances, etc.
  • Staff. Take time hiring staff you can trust and who understand your hotel’s brand and vision.

Final thoughts

Your business plan provides the foundation for your new business and outlines the next steps in the journey. Ensure you fully understand the market and competitive landscape to enter the industry prepared for the future. Start slow and invest in the right people and technology to support the growth of your business.

Looking to start a hotel? Download the technology guide. Download now

About Lana Cook

Lana Cook is a Content Writer at Cloudbeds where she is able to combine her love of writing and passion for travel. She has spent the last few years writing about all things technology and the ways in which it can be used to help businesses thrive. When she’s not busy writing, you can find her checking out the latest movie or searching for a new TV show to binge.

Hotel business plan

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How to Start a Hotel

start a hotel business

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How To Start Your Own Hotel Business

If you’re looking to start a new hotel business, you’ve come to the right place since we’re going to show you exactly how to do it. We’ll start by sharing how to open a hotel step-by-step, then answer some frequently asked questions about running a hospitality industry business and being a successful hotel owner.

Importantly, a critical step in starting a hotel is to complete your hotel’s business plan. To help you out,   you should download Growthink’s Ultimate Hotel Business Plan Template here.

Download our Ultimate Business Hotel Plan Template here

15 Steps to Start a Hotel Business:

  • Choose the Name for Your Hotel
  • Develop Your Hotel Business Plan
  • Choose the Legal Structure for Your Hotel
  • Secure Startup Funding for Your Hotel (If Needed)
  • Find a Location to Buy or Start Building Your Hotel
  • Register Your Hotel with the IRS
  • Open a Business Bank Account
  • Get a Business Credit Card
  • Get the Required Business Licenses and Permits
  • Get Business Insurance for Your Hotel
  • Buy or Lease the Right Hotel Business Equipment
  • Develop Your Hotel Marketing Materials
  • Purchase and Setup the Software Needed to Run Your Hotel
  • Hire and Train Your Hotel Staff
  • Open for Business

1. Choose the Name for Your Hotel

The first step to starting a successful hotel business is to choose your hotel’s name.  

This is a very important choice since your hotel name is your brand and will last for the lifetime of your hotel. Ideally, you choose a name that is meaningful and memorable. Here are some tips for choosing a name for your hotel business:

  • Make sure the name is available. Check your desired name against trademark databases and your state’s list of registered business names to see if it’s available. Also check to see if a suitable domain name is available.
  • Keep it simple. The best names are usually ones that are easy to remember, pronounce and spell.
  • Think about marketing. Come up with a name that reflects the desired hotel identity and/or focus of your hotel.

2. Develop Your Hotel Business Plan

One of the most important steps in how to start a hotel business is to develop a hotel business plan . The process of creating your hotel business plan ensures that you fully understand your market and your business strategy. The plan also provides you with a roadmap to follow and if needed, to present to potential investors for your business.

Your hotel business plan should include the following sections:

  • Executive Summary – this section should summarize your entire business plan so readers can quickly understand the key details of your hotel.
  • Company Overview – this section tells the reader about the history of your hotel and what type of hotel you operate. For example, are you a boutique hotel, a bed and breakfast, or an inn?
  • Industry Analysis – here you will document key information about the hotel industry. Conduct market research and document how big the industry is and what trends are affecting it.
  • Customer Analysis – in this section, you will document who your ideal or target customers are and their demographics. For example, what is their income level? What amenities do they look for in a hotel? What do they find important when choosing where to stay?
  • Competitive Analysis – here you will document the key direct and indirect competitors you will face and how you will build competitive advantage.
  • Product : Determine and document what products/services you will offer. 
  • Prices : Document the prices of your products/services.
  • Place : Determine where your business will be located and how that location will help you increase sales.
  • Promotions : Determine what promotional methods you will use to attract guests to your hotel.
  • Operations Plan – here you will determine the key processes you will need to run your day-to-day operations. You will also determine your staffing needs. Finally, in this section of your plan, you will create a projected growth timeline showing the milestones you hope to achieve in the coming years.
  • Management Team – this section details the background of your hotel’s management team.
  • What startup costs will you incur?
  • How will your hotel make money?
  • What are your projected sales and expenses for the next five years?
  • Do you need to raise funding to launch your hotel?

3. Choose the Legal Structure for Your Hotel

Next you need to choose a legal structure for your hotel and register it and your business name with the Secretary of State in each state where you operate your business.

Below are the five most common legal structures:

1) Sole Proprietorship

A sole proprietorship is a business entity in which the owner of the hotel and the business are the same legal person. The owner of a sole proprietorship is responsible for all debts and obligations of the business. There are no formalities required to establish a sole proprietorship, and it is easy to set up and operate. The main advantage of a sole proprietorship is that it is simple and inexpensive to establish. The main disadvantage is that the owner is liable for all debts and obligations of the business.

2) Partnerships

A partnership is a legal structure that is popular among small businesses. It is an agreement between two or more people who want to start a hotel business together. The partners share in the profits and losses of the business. 

The advantages of a partnership are that it is easy to set up, and the partners share in the profits and losses of the business. The disadvantages of a partnership are that the partners are jointly liable for the debts of the business, and disagreements between partners can be difficult to resolve.

3) Limited Liability Company (LLC)

A limited liability company, or LLC, is a type of business entity that provides limited liability to its owners. This means that the owners of an LLC are not personally responsible for the debts and liabilities of the business. The advantages of an LLC for a hotel business include flexibility in management, pass-through taxation (avoids double taxation as explained below), and limited personal liability. The disadvantages of an LLC include lack of availability in some states and self-employment taxes.

4) C Corporation

A C Corporation is a business entity that is separate from its owners. It has its own tax ID and can have shareholders. The main advantage of a C Corporation for a hotel business is that it offers limited liability to its owners. This means that the owners are not personally responsible for the debts and liabilities of the business. The disadvantage is that C Corporations are subject to double taxation. This means that the corporation pays taxes on its profits, and the shareholders also pay taxes on their dividends.

5) S Corporation

An S Corporation is a type of corporation that provides its owners with limited liability protection and allows them to pass their business income through to their personal income tax returns, thus avoiding double taxation. There are several limitations on S Corporations including the number of shareholders they can have among others.

Once you register your hotel, your state will send you your official “Articles of Incorporation.” You will need this among other documentation when establishing your banking account (see below). We recommend that you consult an attorney in determining which legal structure is best suited for your company.

4. Secure Startup Funding for Your Hotel (If Needed)

In developing your hotel business plan, you might have determined that you need to raise funding to launch your business. Determining whether you want to purchase and renovate or build a new structure will majorly impact when you can open your new hotel and the amount of funding you will need.

If so, the main sources of funding for a hotel to consider are personal savings, family and friends, credit card financing, bank loans, crowdfunding and angel investors. Angel investors are individuals who provide capital to early-stage businesses. Angel investors typically will invest in a hotel that they believe has high potential for growth.

5. Find a Location to Buy or Start Building

Having the right space is important for your hotel and choosing the best location can have a major impact on your business.

To find the right space, consider:

  • How many rooms will your hotel have?
  • What are the zoning requirements for hotels in your area?
  • Is the local market a good match for your target customers?

If you plan to build a new structure for your hotel, you will also need to work with architects to establish a timeline and determine construction costs.

6. Register Your Hotel with the IRS

Next, you need to register your business with the Internal Revenue Service (IRS) which will result in the IRS issuing you an Employer Identification Number (EIN).

Most banks will require you to have an EIN in order to open up an account. In addition, in order to hire employees, you will need an EIN since that is how the IRS tracks your payroll tax payments.

Note that if you are a sole proprietor without employees, you generally do not need to get an EIN. Rather, you would use your social security number (instead of your EIN) as your taxpayer identification number.

7. Open a Business Bank Account

It is important to establish a bank account in your hotel’s name. This process is fairly simple and involves the following steps:

  • Identify and contact the bank you want to use
  • Gather and present the required documents (generally include your company’s Articles of Incorporation, driver’s license or passport, and proof of address)
  • Complete the bank’s application form and provide all relevant information
  • Meet with a banker to discuss your business needs and establish a relationship with them

8. Get a Business Credit Card

You should get a business credit card for your hotel to help you separate personal and business expenses.

You can either apply for a business credit card through your bank or apply for one through a credit card company.

When you’re applying for a business credit card, you’ll need to provide some information about your business. This includes the name of your business, the address of your business, and the type of business you’re running. You’ll also need to provide some information about yourself, including your name, Social Security number, and date of birth.

Once you’ve been approved for a business credit card, you’ll be able to use it to make purchases for your hotel. You can also use it to build your credit history which could be very important in securing loans and getting credit lines for your business in the future.

9. Get the Required Business Licenses and Permits

Every state, county and city has different business license and permit requirements.

Nearly all states, counties and/or cities have license requirements for hotel, including:

  • Business License :  A general business license is required for all businesses, including hotels. The cost of a business license varies depending on the state, county and/or city in which the hotel is located.
  • Occupancy Permit :   An occupancy permit, also called a Certificate of Occupancy, is required before you can open your hotel to the public.
  • Alcohol Licenses :  If you plan to serve alcohol at your hotel, you will need to obtain the appropriate license from the state in which your hotel is located.
  • Sales Tax License :  You will need to obtain a sales tax license in order to collect sales tax from your customers.
  • Food Service License : If you plan to serve food at your hotel, you will need to obtain a food service license.
  • Fire Department Approval :  Most hotels are required to have approval from the local fire department before they can open to the public.

Be sure to check local government guidelines to determine which licenses and permits hotels are required to obtain in your area.

10. Get Business Insurance for Your Hotel

The right business insurance is important to protect your new hotel. Business insurance policies that you should consider for your hotel include:

  • General Liability Insurance: This insurance protects your hotel business from third-party claims of bodily injury, property damage, and personal injury that occur on your premises or are caused by your business.
  • Workers’ Compensation Insurance: If you have employees, you may be required to have workers’ compensation insurance. This insurance protects your employees if they are injured or become ill as a result of their job.
  • Property Insurance: This insurance protects your hotel property from loss or damage due to fire, theft, vandalism, and other covered events.

11. Buy or Lease the Right Hotel Business Equipment

Beyond the furniture and equipment you will need in each room, opening a hotel will also require some business equipment, including:

  • A reservation system to take bookings
  • A property management system (PMS) to manage rooms and rates
  • A booking engine if you want to accept online bookings
  • Rooms keys and/or access cards
  • Reception furniture

12. Develop Your Hotel Business Marketing Materials

Marketing materials will be required to attract and retain customers to your hotel.

The key marketing materials you will need are as follows:

  • Website : Likewise, a professional hotel website provides potential customers with information about the services you offer, your company’s history, and contact information. Importantly, remember that the look and feel of your website will affect how customers perceive you.
  • Social Media Accounts : establish social media accounts in your company’s name. Accounts on Facebook, Twitter, LinkedIn and/or other social media networks will help customers and others find and interact with your hotel.
  • Logo : Spend some time developing a good logo for your hotel. Your logo will be printed on company stationery, business cards, marketing materials and so forth. The right logo can increase customer trust and awareness of your brand.

13. Purchase and Setup the Software Needed to Run Your Hotel

Most hotel businesses need a few types of software to run successfully.

First, you will need a PMS. This is software that helps you manage reservations, check-ins, and other aspects of your operations. Some popular options include Cloudbeds, Oracle Hospitality, and HOTELTIME.

You will also want to have a customer relationship management (CRM) system. This software helps you track interactions with customers, manage customer data, and market to potential guests. Many hotels use programs such as Experience Hotel, Oracle NetSuite, and Salesforce.

Additionally, you need to use accounting software such as Quickbooks or M3 to manage your hotel’s expenses.

Research the software that best suits your needs, purchase it, and set it up.

14. Hire & Train Your Hotel Staff

The quality of your hotel staff can make or break your business. You need to take the time to find, interview, and hire the right people.

Start by writing job descriptions for the positions you need to fill. Then, post the job openings online and in places where potential employees are likely to see them. Once you have a pool of candidates, conduct phone and in-person interviews to narrow down your choices.

Finally, once you have selected the employees you want to hire, provide training on your hotel’s policies and procedures. Additionally, give them a tour of the property and introduce them to other staff members. It helps to build out a strong sales team to prospect new business and nurture customer loyalty.

15. Open for Business

You are now ready to host a grand opening for your hotel. Make sure to include your grand opening event in your marketing plan and promote your hotel launch to the right target audience.

If you follow the steps above, you should be in a great position to build a successful business and know everything you need about how to start a hotel business. Below are answers to frequently asked questions that might further help you.

How to Finish Your Hotel Business Plan in 1 Day!

How to open a hotel faqs, is it hard to start a hotel.

Starting any business has its challenges and opening a hotel does require some planning and preparation. The biggest challenges in owning a hotel are securing funding for your new hotel, finding a great location to buy or build, and setting up systems that help your hotel achieve operational efficiency.

As with starting any business, having a good business idea, doing market research, and getting support from experts in the industry increase your chance of success.

How Can I Own a Hotel With No Experience?

If you have no experience in the hotel industry, you will need to find a good hotel management company. A hotel management company can help you with all aspects of starting and running your hotel. They will also be able to provide you with the necessary training.

What Types of Hotels Are Most Profitable?

There is no one-size-fits-all answer to this question. The type of hotel that is most profitable will depend on the location of your hotel and what is of value to the market in that area. A boutique hotel might be a huge success in a small city, while a family-friendly hotel could make more money when placed near a theme park. It is important to do market research to determine which type of hotel can be a profitable business in your area.

How Much Does It Cost To Start a Hotel?

Again, there is no one-size-fits-all answer to this question. The cost of starting a hotel will depend on a number of factors, such as the location of your hotel, the type of hotel, and the level of service you offer. You will also have different upfront costs depending on whether you are building a new hotel or purchasing an existing structure.

With regards to building costs or buying an existing property, this varies tremendously based on the type of hotel (e.g., budget vs luxury) and hotel size (e.g., 5 rooms vs 500 rooms).

How Does a Hotel Make Money?

A hotel makes money by charging guests for the use of the hotel's facilities. The amount charged will depend on the type of hotel, the location, and the level of service offered. Beyond charging for guest rooms, hotels may also make money from additional amenities, such as in-house restaurants, room service, and high-speed internet access.

Is Owning a Hotel Profitable?

Owning a hotel business can be profitable, but the amount of profit is highly-dependent on a number of factors, such as the location of your hotel. You can improve the profitability of your hotel by offering a higher level of service, attracting more guests, and keeping your expenses low.

How Much Does a Hotel Owner Make?

Hotel owners, operators and executives receive varied pay amounts based on the success of their hotel. According to Glassdoor, the typical Starwood Hotels & Resorts Vice President salary is $244,472, which is 45% above the national average.

What Are the Key Financial Metrics and Costs in the Hotel Market?

The key financial metrics in the hotel market are as follows:

Industry profit is measured as earnings before interest and taxes. Industry profits have averaged 15.5% of sales in recent years.

The industry’s major expenses are purchases and cost of sales, such as bedding and room supplies. Many hotels also provide meals and liquor, either in individual rooms or in separate restaurants or dining areas.

Last year, purchases were estimated to account for 29.9% of an average operator’s revenue.

Labor is required in many aspects of hotel management, from front-of-house activities, such as front desk, concierge and related activities, to all back-of-house activities, including general management, accounting, marketing, room cleaning and servicing the kitchens, bars and restaurants.

Many hotel jobs have a low skill and training requirement, and employees can be hired on a part-time or casual basis. Because of this practice, many hotels have high staff turnover.

Therefore, there is a constant need for recruitment and training, which can be costly. Some hotel owners and operators have outsourced part of their staff services to specialist staff-recruitment agencies to lower recruitment costs.

Last year, industry wages accounted for approximately 25.7% of total industry revenue.

Rent and Utilities

Rent and utilities on average comprise 7.6% of hotel revenue.

Other Expenses

Marketing expenses and royalty fees are another significant cost for those industry participants that operate on a franchise basis. Franchisees typically pay an annual fee of 4.0% to 6.0% of total revenue.

Other major operational expenses include repairs and maintenance, promotional costs, commission paid to agents, bookings and internet fees, accounting and legal costs, motor vehicle expenses, stationery and printing, insurance and other administrative and overhead costs.

Why Do Hotels Fail?

Hotels can fail for a number of reasons, including high expenses and low occupancy rates. Hotels can also fail due when owners misunderstand the market in an area and target the wrong customers or fail to do adequate research into hotel industry trends that impact their business.

Often, hotels begin to struggle due to poor management decisions that negatively impact the guest experience. Closely monitoring your spending and making sure your staff is performing well both go a long way toward making your hotel succeed.

How Big Is the Hotel Industry?

According to IbisWorld, there are 74,372 hotels, and the hotel industry generated $166.5 billion in revenue in the United States alone last year. This represents an annual growth rate of 4.7% over the past 5 years.

Industry profits were $26.0 billion, and wages paid to hotel employees totaled $42.7 billion.

What Are the Key Segments of the Hotel Market?

 A hotel is an establishment that provides lodging and, often times, meals and other services for travelers and other paying guests. A motel, on the other hand, provides lodging for motorists in rooms usually having direct access to an open parking area.

A particular hotel or motel can be classified by a number of characteristics, including whether it provides full or limited service, whether or not it is located in a metropolitan area, the state or region in which it is located, its price or rate level, the number of rooms, and whether it is independent or part of a chain operation.

Hotels and motels can also be segmented by room price rates. The establishments with room rates in the highest 30 percentile that are located in local or metropolitan markets are classified as upscale or luxury. The middle 30 percentile is classified as mid-priced, and the lowest 40 percentile as either economy or budget.

Overall, sales from hotels account for 87.4% of industry revenue and 82.0% of industry employment, though they account for only 44.0% of industry establishments.

Hotels that consist of 25 or more rooms provide 83.6% of industry revenue (with 62.7% of industry revenue coming from guest room rentals, 12.5% coming from food and alcohol sales, 4.2% coming from conference and meeting rooms and 4.2% coming from other charges), while hotels that offer fewer than 25 rooms only constitute 3.8% of industry revenue.

Motels provide about 12.6% of industry revenue. The relative proportion of revenue from each of these segments has been relatively stable over the past five years, although motels experienced some growth at the expense of higher-priced hotels during the recession.

What External Factors Affect the Hotel Market?

A number of factors affect the performance of the hotel industry. These drivers include:

  • Domestic Trips By US Residents : Trends in domestic travel, especially for business travellers, and the total nights spent away from home directly affect demand for accommodation. As the number of trips made by US citizens rises, demand for hotels and motels to house them increases.
  • Consumer Confidence Index : Changes in consumer confidence influence decisions that individuals make concerning expenditure on entertainment and traveling, particularly during a recession.
  • Consumer Spending : Consumer spending levels have a direct effect on travel demand. When consumers are spending more overall, they are more likely to spend some of their money on travel and accommodations.
  • Inbound Trips By Non-US Residents : Trends in international visitor arrivals and their lengths of stay influence demand for accommodation. A rise in inbound trips positively affects demand for hotels and motels.

Who Are the Key Competitors in the Hotel Market?

 As specified above, there are 74,372 hotels in the United States.

The market leaders (in terms of market share) include Hilton Worldwide Holdings Inc. (13.7%), Marriott

International Inc. (13.5%) and InterContinental Hotels Group PLC (7.5%).

The rest of the market is comprised of many smaller players.

Who Stays in Hotels?

Recent demographics show that totel guests are comprised of: 

  • Domestic leisure travelers: 48.5%
  • Business travelers: 24.0%
  • International leisure travelers: 14.0%
  • Meetings, events and incentive travelers: 13.5%

What Are the Keys to Launching a Successful Hotel?

Starting a hotel requires careful choice of a location and strategy, a business plan, access to considerable financial resources, and a customer service mindset.

1) Location and Opportunity

The location for your hotel is highly linked with the opportunity that you feel there is for your hotel. In the right location, where competitors are not fulfilling all customer needs, a hotel can thrive. However, in a beautiful neighborhood that happens to have heavy competition from existing hotels, success may not be so forthcoming. Likewise, if the neighborhood leaves too much to be desired, you may not be able to price the rooms low enough to encourage travelers to stay at your hotel, even if you are within walking distance of key attractions.

2) Strategy

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 with kids, couples on romantic vacations, businesspeople, or international tourists? Consider the combination of amenities, atmosphere, location, and services that will be right for your customers. Always keep in mind that strategy means making tradeoffs – it is almost impossible to be everything to everyone and succeed. You might have to forgo a certain customer target market in order to make your service offering perfect for your most desired customers.

3) Planning

A hotel business plan is 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 will be 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 templates tailored to the hotel business sector.

4) 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 angel investment 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.

5) Hospitality Mindset

Finally, 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 guests demand 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 the first place.

The first step to starting a hotel is to develop your hotel business plan . Growthink provides products and services to help you develop a professional business plan and turn your dream into reality.

Where Can I Download a Hotel Business Plan PDF?

You can download our hotel business plan PDF template here. This is a business plan template you can use in PDF format.

Additional Resources in the Hotel Market

For additional information on the hotel market, consider these industry resources:

  • American Hotel & Lodging Association: ahla.com
  • Hospitality Net: hospitalitynet.org
  • Hotel Mavericks: www.hotelmavericks.com

OR, Let Us Develop Your Plan For You

Since 1999, Growthink has developed business plans for thousands of companies who have gone on to achieve tremendous success.

Click here to see how Growthink’s professional business plan consultants can create your business plan for you.

Other Helpful Business Plan Articles & Templates

How to Write a Great Business Plan

How to Start a Hotel Business: Everything You Need to Know

close up of hotel exterior with sign

Wondering how to start a hotel business? You’re not alone. One of the  first-ever hotels , as we’ve come to know them, was started in Exeter, England in 1768. Today, the industry has skyrocketed to be part of  one of the largest in the world.  But dreaming of starting a hotel business and actually doing it are two completely different things. That's where we come in. 

In this guide, we’ll teach you how to start a hotel business with step-by-step instructions, expert advice, and actionable tips. Keep reading to discover the fundamentals all hotel businesses need to succeed.

The steps we cover in this guide:

  • Step 1: Find a market need
  • Step 2: Craft your strategic goals
  • Step 3: Run the numbers
  • Step 4: Review financing options
  • Step 5: Do your paperwork
  • Step 6: Hire and train your team
  • Step 7: Draft a marketing plan
  • Step 8: Launch your hotel business

Discover how to start a hotel business in 8 steps:

Step 1: find a market need..

The first and most important step when learning how to start a hotel business is to gain a thorough understanding of  the hospitality industry  worldwide, as well as in your location. To get started, find your favourite  hotel news sources , then set aside time each day or week to stay informed. Once you have some familiarity with the industry, it’s time to dive into the market research for your hotel.

Let us help you start your hotel business

Cvent's resources library  is a great place to start. It's where you can read the latest news, thought leadership, and best practices from a wide variety of industry experts. The goal of your industry research is to get a clear idea of whether you can be competitive in your market. Also, what characteristics your hotel will need in order to succeed. 

Rather than starting with an idea and making the research fit, try to find an area of need in your market. What audiences are underserved? Where is demand outpacing supply? What does your location need in terms of hospitality and accommodation?

To give you a good understanding of where you’ll fit in, your market research should include:

  • Property type.  All hotels are not built the same. The industry is made up of resorts, spas, airport hotels, all-inclusives, hostels, boutiques, and many other property types. Determine what property type you plan to offer and what other options in that category exist in your location.
  • Hotel size.  Closely related to your property type is the hotel size. How many guest rooms will you offer, and how does that compare to your competitors?
  • Star rating.  What level of service and  hotel amenities  do you plan to offer?
  • Location.  What region will you operate in? Is demand increasing in the area? What location amenities, like airports, beaches, or  event venues , will you be in close proximity to?
  • Brand affiliation.  Will you be a part of a larger brand’s umbrella? Being affiliated with a brand  can help with marketing , business intelligence, pricing, and audience targeting.
  • Extra amenities.  What services or amenities are important for hotels of your type and star rating in your location? Things like free Wi-Fi, meeting space, a pool, or  wedding services  are all important, depending on your target audience.
  • Guest demographics.  How would you define the  types of guests  who may frequent your location? What is the purpose of travel, and what are some common characteristics of these travellers? Knowing whether you are targeting business travellers, families, couples, solo travellers, retirees, or other demographic groups will help you to craft your marketing plan and hotel concept.

All of this research should give you a good idea of your main competitors and target audience. Those two pieces of information will determine everything else about your property, from budget and financing to marketing and daily operations. Spend time on this step to make sure you’ve found a true need in the market. You’ll be better prepared for success.

You can utilise tools like  Cvent's Hotel Business Intelligence™ Software Solutions  to provide you with the transformative business insights needed to conduct your market research and benchmark against the competition.

Step 2: Craft your hotel's strategic goals.

Once you have an understanding of market needs, you’ll need to create a smart solution to fill that gap. Your unique combination of amenities, concept, decor, marketing, location, and services can help you stand out from the crowd and capture market share if you approach it strategically.

Consider how you’ll approach pricing,  revenue management , sustainability, customer satisfaction, events, and other market needs when crafting your goals. As with all goals, they should be S.M.A.R.T - specific, measurable, attainable, relevant, and time-based. According to the  Naples Hotel Group , an expert hotel development firm, some of the best goals a hotel owner can focus on include: 

  • Measuring and increasing customer satisfaction.
  • Creating a solid revenue management system.
  • Building a strong online reputation.
  • Attending at least one  hotel industry conference .
  • Considering working with a consulting firm to bypass the common roadblocks new hotel owners face.

Make sure the needs of the market and your target audience, along with your business needs, help determine your goals. This will ensure that everything you do helps your customers, as well as your bottom line.

You can use a  hotel business plan template  to outline the results of your research and planning, including your competitive advantage, goals, and your plan to get those results.

Step 3: Run the numbers.

With your goals and plan in place, it’s time to run the numbers to make sure you'll be profitable. Using your market research, you can estimate key factors like room pricing, vacancy rates, RevPAR (revenue per available room), and operating costs. A basic overview of  hotel finances  will help you hire the right revenue manager and sales team later on. The two key areas to focus on are profitability and any external factors that may affect your hotel business. You’ll also need to estimate initial costs for your hotel business. This includes startup and hiring costs, licensing, permits, construction, renovations, and your first year of operations.

Set up a few scenarios in your forecasting to see how key decisions affect the potential profitability of your business. For instance, do you want to buy or build? Buying into a franchise or taking over an existing hotel building has lower startup costs, unless you have to renovate extensively. But it also requires you to establish your new hotel identity, which can be a challenge depending on the current state of the business. On the other hand, building a hotel, while usually considerably more expensive upfront, can provide a solution to a lack of available buildings and can be more lucrative in the long run. 

Step 4: Review financing options for your hotel business.

Once you decide on the right financial plan for your business, you’re ready to fund it. There are a number of available options for financing your hotel business. Jim Pendergast, Senior Vice President and General Manager of  altLINE , discussed this topic in a recent interview with Cvent.

“It's important to understand the full scope of financing options available for your hotel's funding," he said. "Generally, you have two commercial financing categories when opening your hotel: traditional credit or specialty credit.

With traditional credit lines, you receive financing based on long-term assets. These are things like real estate owned by your hotel as well as cash flow projections and calculations submitted during underwriting. Lenders review these assets before awarding your loan.

With specialty credit, you'll receive financing or credit lines based on near-term assets. This might be hotel equipment or invoices from accounts receivable. The idea is these backings are more liquid than what's needed in traditional lending.

Both traditional and specialty financing are appropriate vehicles for hotels depending on your capital needs. However, the larger and more established your hotel franchise, the more specialty lending could make ongoing sense. This is because large hotels manage significant account receivables operations. 

Consider the amount of credit card transactions that must be administered. Also, hospitality-related vendor operations happening within the establishment. The larger your AR activities, the more something like AR-based asset lending and similar specialty lending might benefit you.”

Step 5: Do your paperwork.

There are many important legal, regulatory, and insurance requirements to fulfill in order to establish any new business. Your hotel business is no different. 

Consult with your legal, insurance, accounting, and operations teams to determine the requirements for your location. At a minimum, you’ll need to set up a business structure and get business insurance. You will also likely need building or renovation permits, hotel licensing, and licensing for serving food and alcoholic beverages. There will also be a number of health and safety requirements as you complete your building or renovation process. 

All of this paperwork is not the motivating factor for getting into the hospitality industry, but it is important. Work with your team to check requirements at the local, state, and federal level. Additionally, keep on top of the process throughout so you don’t have to repair costly mistakes later.

Modern hotel management begins here

Step 6: Hire and train your hotel team.

A business is only as good as the team members that contribute to its success. By hiring great employees at all levels, you’ll set yourself up to deliver value to your guests and become a market leader.

Many hotels opt to hire for executive and departmental positions first, setting the tone and direction. These leaders can then identify what they want to see within their teams and how many staff members they need. Each team should identify the roles and skills they’re looking for, as well as developing a plan to reach and source great new hires.

Make sure that your application and interview processes are easy for candidates so that you don’t introduce needless friction. Find ways to communicate your core mission, values, and approach to this new business throughout the hiring process. This will help you attract candidates who share your vision.

Once you’ve hired a great team, take the time to onboard and train them. This is an incredibly important step that will help everyone in the long run. Any employees who will interact with guests should receive extra training on  customer service  and guest relations so that they’re ready to lend a helping hand, regardless of whether it’s in their job descriptions.

Focus from the beginning on becoming the employer of choice in your market. You’ll attract a stellar team that’s ready to help you become a market leader.

Step 7: Draft a marketing plan.

You’re now ready to share your hotel concept with the world. Well in advance of opening, you’ll need to spread the word and set yourself up for a profitable launch. 

Your  hotel marketing plan  is an important part of your overall business strategy. It guides your decision-making on decor, daily operations, communications, customer service, and more. 

Think back to the target audience that you identified in your market research. Using that initial audience, you can now conduct more in-depth customer research to determine who your customers are. Also, where you’ll find them, how you’ll communicate with them, and how they define value.

Hotel marketing made simple

Hotel marketing expert and Co-Founder of Saffron Key, Ben Weagraff, advises that there is no one-size-fits-all plan for new hotel businesses.

“There’s a number of strategies that can work very well,” he  told SiteMinder . “But they depend on the hotel itself; its digital properties (including  website ,  email relationships , the strength of  social media channels ) and what exactly the hotel is trying to do.”

He goes on to note: “However, generally these techniques present a good repeatable path towards driving high-value customers. The greatest thing about  content marketing  is that it is low-cost, measurable, repeatable, and it builds upon itself. Once the foundation is in place, customers roll in at increasing rates.”

If you’re looking for ideas for inspiration, check out  Marriott’s marketing strategy . Also, be sure to check out all of  Cvent's hotel marketing solutions  to help guide you throughout the process.

Step 8: Launch your hotel business.

At this point, you’ve put in the work to open a profitable and high-quality hotel business for your market. You’ve got the plan and the team to make your vision a reality. Now it’s time to launch.

The goal of your launch is of course to introduce your hotel to guests. But it’s also a great opportunity to introduce yourself to the local community, key stakeholders, influencers, and potential partners. Put your best foot forward with these audiences by planning a  grand opening event  that reflects your mission and values.

Use  event planning and diagramming tools  to create your layouts, collaborate with vendors, and assign tasks to team members. As long as you focus on building relationships with your community, investors, and potential clients, your grand opening will be a success. 

Now you know how to start a hotel business using proven strategies from across the industry.

Now that you know how to start a hotel business, it's time to start thinking about reputation. Read on for  hotel reputation management tips  every hotelier should know.

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Motel Business Plan Template & Guidebook

Are you interested in starting a motel business but don't know where to start? Look no further than the #1 Motel Business Plan Template & Guidebook. This comprehensive guide offers everything you need to create a solid business plan for your motel, from financial planning to networking and marketing strategies. Whether you're just starting out or already have experience in the hospitality industry, this guide will help you take your motel to the next level. With the #1 Motel Business Plan Template & Guidebook, success is just around the corner!

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  • How to Start a Profitable Motel Business [11 Steps]

How to Write a Motel Business Plan in 7 Steps:

1. describe the purpose of your motel business..

The first step to writing your business plan is to describe the purpose of your motel business. This includes describing why you are starting this type of business, and what problems it will solve for customers. This is a quick way to get your mind thinking about the customers’ problems. It also helps you identify what makes your business different from others in its industry.

It also helps to include a vision statement so that readers can understand what type of company you want to build.

Here is an example of a purpose mission statement for a motel business:

Our mission at ABC Motel is to provide a safe and clean lodging experience for travelers of all backgrounds, at an affordable price. We strive to make our customers feel welcome and comfortable with exceptional customer service and quality amenities. We are committed to exceed customer expectations and create a memorable stay for each of our guests.

Image of Zenbusiness business formation

2. Products & Services Offered by Your Motel Business.

The next step is to outline your products and services for your motel business. 

When you think about the products and services that you offer, it's helpful to ask yourself the following questions:

  • What is my business?
  • What are the products and/or services that I offer?
  • Why am I offering these particular products and/or services?
  • How do I differentiate myself from competitors with similar offerings?
  • How will I market my products and services?

You may want to do a comparison of your business plan against those of other competitors in the area, or even with online reviews. This way, you can find out what people like about them and what they don’t like, so that you can either improve upon their offerings or avoid doing so altogether.

Image of Zenbusiness business formation

3. Build a Creative Marketing Stratgey.

If you don't have a marketing plan for your motel business, it's time to write one. Your marketing plan should be part of your business plan and be a roadmap to your goals. 

A good marketing plan for your motel business includes the following elements:

Target market

  • Who is your target market?
  • What do these customers have in common?
  • How many of them are there?
  • How can you best reach them with your message or product?

Customer base 

  • Who are your current customers? 
  • Where did they come from (i.e., referrals)?
  • How can their experience with your motel business help make them repeat customers, consumers, visitors, subscribers, or advocates for other people in their network or industry who might also benefit from using this service, product, or brand?

Product or service description

  • How does it work, what features does it have, and what are its benefits?
  • Can anyone use this product or service regardless of age or gender?
  • Can anyone visually see themselves using this product or service?
  • How will they feel when they do so? If so, how long will the feeling last after purchasing (or trying) the product/service for the first time?

Competitive analysis

  • Which companies are competing with yours today (and why)? 
  • Which ones may enter into competition with yours tomorrow if they find out about it now through word-of-mouth advertising; social media networks; friends' recommendations; etc.)
  • What specific advantages does each competitor offer over yours currently?

Marketing channels

  • Which marketing channel do you intend to leverage to attract new customers?
  • What is your estimated marketing budget needed?
  • What is the projected cost to acquire a new customer?
  • How many of your customers do you instead will return?

Form an LLC in your state!

motel business plan australia

4. Write Your Operational Plan.

Next, you'll need to build your operational plan. This section describes the type of business you'll be running, and includes the steps involved in your operations. 

In it, you should list:

  • The equipment and facilities needed
  • Who will be involved in the business (employees, contractors)
  • Financial requirements for each step
  • Milestones & KPIs
  • Location of your business
  • Zoning & permits required for the business

What equipment, supplies, or permits are needed to run a motel business?

  • Motel licenses and permits
  • Reservation software
  • Front desk computer system
  • Desk supplies
  • Cleaning supplies
  • Linens and towels
  • Credit card machine and POS system
  • Guest room furniture and fixtures
  • "Do not disturb" door hangers or signs

5. Management & Organization of Your Motel Business.

The second part of your motel business plan is to develop a management and organization section.

This section will cover all of the following:

  • How many employees you need in order to run your motel business. This should include the roles they will play (for example, one person may be responsible for managing administrative duties while another might be in charge of customer service).
  • The structure of your management team. The higher-ups like yourself should be able to delegate tasks through lower-level managers who are directly responsible for their given department (inventory and sales, etc.).
  • How you’re going to make sure that everyone on board is doing their job well. You’ll want check-ins with employees regularly so they have time to ask questions or voice concerns if needed; this also gives you time to offer support where necessary while staying informed on how things are going within individual departments too!

6. Motel Business Startup Expenses & Captial Needed.

This section should be broken down by month and year. If you are still in the planning stage of your business, it may be helpful to estimate how much money will be needed each month until you reach profitability.

Typically, expenses for your business can be broken into a few basic categories:

Startup Costs

Startup costs are typically the first expenses you will incur when beginning an enterprise. These include legal fees, accounting expenses, and other costs associated with getting your business off the ground. The amount of money needed to start a motel business varies based on many different variables, but below are a few different types of startup costs for a motel business.

Running & Operating Costs

Running costs refer to ongoing expenses related directly with operating your business over time like electricity bills or salaries paid out each month. These types of expenses will vary greatly depending on multiple variables such as location, team size, utility costs, etc.

Marketing & Sales Expenses

You should include any costs associated with marketing and sales, such as advertising and promotions, website design or maintenance. Also, consider any additional expenses that may be incurred if you decide to launch a new product or service line. For example, if your motel business has an existing website that needs an upgrade in order to sell more products or services, then this should be listed here.

7. Financial Plan & Projections

A financial plan is an important part of any business plan, as it outlines how the business will generate revenue and profit, and how it will use that profit to grow and sustain itself. To devise a financial plan for your motel business, you will need to consider a number of factors, including your start-up costs, operating costs, projected revenue, and expenses. 

Here are some steps you can follow to devise a financial plan for your motel business plan:

  • Determine your start-up costs: This will include the cost of purchasing or leasing the space where you will operate your business, as well as the cost of buying or leasing any equipment or supplies that you need to start the business.
  • Estimate your operating costs: Operating costs will include utilities, such as electricity, gas, and water, as well as labor costs for employees, if any, and the cost of purchasing any materials or supplies that you will need to run your business.
  • Project your revenue: To project your revenue, you will need to consider the number of customers you expect to have and the average amount they will spend on each visit. You can use this information to estimate how much money you will make from selling your products or services.
  • Estimate your expenses: In addition to your operating costs, you will need to consider other expenses, such as insurance, marketing, and maintenance. You will also need to set aside money for taxes and other fees.
  • Create a budget: Once you have estimated your start-up costs, operating costs, revenue, and expenses, you can use this information to create a budget for your business. This will help you to see how much money you will need to start the business, and how much profit you can expect to make.
  • Develop a plan for using your profit: Finally, you will need to decide how you will use your profit to grow and sustain your business. This might include investing in new equipment, expanding the business, or saving for a rainy day.

motel business plan australia

Frequently Asked Questions About Motel Business Plans:

Why do you need a business plan for a motel business.

A business plan is an essential document when starting a motel business. It helps identify the direction of your business, provides a detailed roadmap that outlines the steps necessary to reach your objectives, and helps secure financing. Additionally, it serves as a tool to measure progress and provides a clear vision of the future. A business plan can also help identify any potential roadblocks and develop strategies for mitigating them.

Who should you ask for help with your motel business plan?

A professional business consultant or mentor would be the ideal person to ask for help with a motel business plan. An accountant or lawyer may also be consulted to ensure that the business plan is compliant with all applicable legal and financial regulations.

Can you write a motel business plan yourself?

Yes, it is possible to write a motel business plan yourself, though it may require a substantial amount of time and research. A business plan should include an executive summary, market analysis, competitive analysis, financial projections and a detailed description of the business objectives, products or services and strategies. Additionally, research into local zoning laws, potential customer base and other relevant topics may be required to ensure the plan is comprehensive. There are also many resources available online to help with writing a motel business plan.

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I'm Nick, co-founder of newfoundr.com, dedicated to helping aspiring entrepreneurs succeed. As a small business owner with over five years of experience, I have garnered valuable knowledge and insights across a diverse range of industries. My passion for entrepreneurship drives me to share my expertise with aspiring entrepreneurs, empowering them to turn their business dreams into reality.

Through meticulous research and firsthand experience, I uncover the essential steps, software, tools, and costs associated with launching and maintaining a successful business. By demystifying the complexities of entrepreneurship, I provide the guidance and support needed for others to embark on their journey with confidence.

From assessing market viability and formulating business plans to selecting the right technology and navigating the financial landscape, I am dedicated to helping fellow entrepreneurs overcome challenges and unlock their full potential. As a steadfast advocate for small business success, my mission is to pave the way for a new generation of innovative and driven entrepreneurs who are ready to make their mark on the world.

COMMENTS

  1. How to start a motel business: Complete guide

    A motel business is a type of accommodation business that offers motel rooms to travellers. The 'motel' was born after post-World War II America decided on a portmanteau of 'motorist' and 'hotel'. Motels are hotels that cater specifically to drivers, whether road trippers passing through, people in town for an event or travelling salespeople.

  2. There's no business like motel business: four ways to profit

    With motel freeholds starting at $650,000 and profits coming in at around an 8 - 10% return, it's certainly a financially-sound business model. Before taking the plunge, you should consider the size of the land, room for expansion, and the value of the motel. Consider whether you'll need to invest in any refurbishments.

  3. How to write a business plan for a motel?

    To get visibility on future cash flows If your small motel runs out of cash: it's game over. That's why we often say "cash is king", and it's crucial to have a clear view of your motel's future cash flows. So, how can you achieve this? It's simple - you need to have an up-to-date financial forecast.

  4. How to Buy a Motel Business

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  5. How to Start a Profitable Motel Business [11 Steps]

    5. Acquire necessary licenses and permits for motel. Starting a motel business requires compliance with various regulations, and obtaining the necessary licenses and permits is a critical step. These documents are essential to ensure your motel operates legally and meets all local, state, and federal standards.

  6. 4 Reasons Regional Hotels & Motels are Doing it Tough

    4 insights for Regional Hotel & Motel Operators that may help them build a better Motel Business Plan Michael Harper As an experienced Hotel Sales & Yield Manager in my past life, and upon returning to my roots in regional NSW, I see so many regional Hotels & Motels missing opportunity and leaving money on the table as they struggle to compete.

  7. How to Create a Hotel Business Plan in 2024 (+Free Template)

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    1. Choose the Name for Your Hotel The first step to starting a successful hotel business is to choose your hotel's name. This is a very important choice since your hotel name is your brand and will last for the lifetime of your hotel. Ideally, you choose a name that is meaningful and memorable.

  9. Legal Considerations for Starting a Motel or Hotel

    Your business structure is the foundation when starting a motel or hotel. Common business structures you can choose from include: Partnership: If you want to go into business with a fellow people-person, you may want to set up a partnership structure. It is relatively cheap to set up and simple to run.

  10. How to Start a Hotel Business: The 8-Step Guide

    Keep reading to discover the fundamentals all hotel businesses need to succeed. The steps we cover in this guide: Step 1: Find a market need. Step 2: Craft your strategic goals. Step 3: Run the numbers. Step 4: Review financing options. Step 5: Do your paperwork. Step 6: Hire and train your team.

  11. Hotel Business Plan: Beginners Guide

    A hotel business plan is a formal document that provides a detailed roadmap for a hotel project, outlining everything from its goals and target market to the products and services it will offer, marketing strategies, and financial projections.

  12. Why running a Motel in Australia is a great first business

    With the Motel's future business value in mind you'll need to factor in upgrading your Motel facilities every 7 to 10 years. To ensure that your accommodation business continues to attract and retain customers, plus maintain its resale value.

  13. Hotel Business Plan

    The hotel business plan covers all the aspects such as an industry analysis, the financial plan of the hotel, operational plan, and other important points to be considered while starting a hotel business.

  14. Starting an accommodation business

    Common types of registrations, permits and licences required for accommodation businesses Registration of Prescribed Accommodation. Under the provisions of the Public Health and Wellbeing Regulations 2009, an accommodation business will need to be registered with its local council.As part of the registration process, you must include a plan of the premises, drawn to a scale of not less than 1: ...

  15. The #1 Motel Business Plan Template & Guidebook

    How to Write a Motel Business Plan in 7 Steps: 1. Describe the Purpose of Your Motel Business. The first step to writing your business plan is to describe the purpose of your motel business. This includes describing why you are starting this type of business, and what problems it will solve for customers. This is a quick way to get your mind ...

  16. Hotel Business Plan

    Hotel Business Plan The Australian hotel industry grows steadily driven by increasing numbers of both international visitors, in particular from Asian countries, and domestic travelers. Owning and managing a hotel does not require formal qualifications or training. Previous qualifications, training or experience in management and hospitality ...

  17. Tips to help you start a business in 2024

    Develop a business plan; It's never too early to start your business plan. Get your thoughts out on paper and start evaluating your business idea. Use our Business plan tool to help you document key information, set goals for the year ahead and keep your business on track. Register for an ABN

  18. How to Start, Run, and Profit From a Motel Business

    A comprehensive guide on how to start and run a successful motel using technology to maximize efficiency, revenue, and profit.

  19. Motel Business Plan Template [Update 2024]

    HOME Blog Motel Business Plan Template SEPT.08, 2021 Motel Business Plan Template ( 2 votes, average: 5.00 out of 5) Blogs Business Plan Templates Hotel Business Plans Real Estate Business Plans Table of Content Motel business plan for starting your own business

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