If you have a nice house in a good location and you love opening up your home to guests, starting a bed and breakfast business might just be the business idea you are looking for. Hospitality is an old and established industry and it is not going away any time. People who love to travel or go for weekend vacations and romantic getaways often need the convenience that comes with a bed and breakfast accommodation.
A bed and breakfast, often abbreviated as a B&B is a business that hosts guests overnight and provides them with a breakfast menu the next morning. B&Bs often take the form of large family homes with multiple rooms, where guests are hosted for a short period of time. Starting a bed and breakfast business is a great business idea for any entrepreneur. In this article, we will go over the steps you need to take to start a successful bed and breakfast business today:
1. Look at the Industry
Before you start any business, you need to stop and ask yourself: Is this business right for me? Should I start a bed and breakfast business? What’s in it for me with a bed and breakfast business? In order to establish this, you need to look at the industry and do a thorough competitor and customer analysis. You also have to know the advantages and the disadvantages of starting a bed and breakfast business.
For your competitor analysis, you must know who they are and where they are located. Look for any other bed and breakfast businesses and learn how they run this business. What services do they offer? Any current trends that B&Bs are offering? What is their pricing range and what makes them have a competitive advantage?
For your customers, you need to know where they are located, the type of customer you’ll be serving and also your most preferred age. Having a customer profile is important for this step. How much are they willing to pay to stay in your B&B? What services do they expect from your bed and breakfast business?
Remember, customers are the lifeblood of your business and without them, your business will not exist.
A SWOT analysis will help you determine the feasibility of your business in this industry. What is the chance that it will survive for the long term? You have to identify all the strengths, weaknesses, opportunities and threats for starting a bed and breakfast business. For example, a bed and breakfast business will have high profit margins when the business picks up pace, but the startup costs may also be high.
2. Bed and breakfast business plan
A business plan is like a map. It shows you where you are going and how you are going to get there. If you are starting any business, this is a key ingredient for business success.
Many entrepreneurs resist preparing a business plan as they consider it a waste of time or they think they already know what needs to be done. Without a business plan, you may not have the commitment and focus you need to get your bed and breakfast business rolling.
Writing a business plan is quite simple. There are no hard and fast rules about what should be included, but the contents should be tailored to the needs of the business it represents.
For a bed and breakfast business plan, you must include the bed and breakfast business overview, bed and breakfast services you will be offering, your financial analysis/financial projection, operational strategy including how much staff you’ll need, your marketing strategy?
There are numerous sites online which carry templates, toolkits and sample business plans that you can use to structure and develop your business plan.
Remember, a good business plan will help you get inventors, seek funds from financial institutions and convince strategic partners to propel your business to success.
3. Cost of starting a bed and breakfast
Once you prepare a business plan, the next challenge is organising your resources. A good business plan which is not backed by resources becomes just a dream. Ask yourself: how much does it cost to start a bed and breakfast business?
As you start a bed and breakfast business, you will incur both initial startup costs and ongoing expenses. You have to have to know what your bed and breakfast startup costs will be so that you can actualise your business idea.
Some of these expenses include:
- •Down payment on rent; especially if you are renting other apartments for your bed and breakfast business.
- •Renovation costs for your house(s) to fit the purpose of a bed and breakfast
- •Furniture expenses
- •Cost of ingredients for the breakfast menu
- •Utility bills e.g electricity and water bills
- •Licensing fees
- •Insurance premiums e.g fire and safety insurance
If you want to reduce startup costs for starting a bed and breakfast business, you can choose to “rent out” rooms in your home, or look for areas which have cheaper business rates and find a property there.
Funding options available to start a bed and breakfast business include your own personal savings, loans from banks, partnering with friends or seeking investors.
4. Find a location
In real estate, we know that location is everything. If you are starting a bed and breakfast business, you have to be very strategic about where you want your B&Bs to be situated.
When choosing a location, ask yourself: what are the best places to open a bed and breakfast? Can I open a bed and breakfast in a residential area? What experience do I wish to give guests? Do you want your B&Bs to be like a secluded getaway in a historic village on the outskirts of major cities or near the beach? Analysing trends will help you pick out the best location.
Some other things to consider include the competition, accessibility, lighting of the area, parking access, crime-free zone and zoning regulations. For example, you do not want to start a bed and breakfast business in a place that is saturated with similar businesses because then, you will have to cut prices regularly to win customers over.
This hurts your chances of succeeding fast.
If you list the best location for your bed and breakfast business, you will attract more guests to your B&B.
5. Find a property
Perhaps your house is not in a suitable location, big and captivating or your family members don’t want strangers in their home. If you do not want to use your own home to start a bed and breakfast business, you can always find property and rent or buy it.
Create a list of the things that you’d want your bed and breakfast business to have. For example, how many rooms do you wait for a bed and breakfast? What size do you want for your bed and breakfast? As you think about this, you need to factor in things like your budget and the profit margin you’d need your bed and breakfast business to give you.
Next, you need to plan for renovation and make any necessary changes. Start thinking about buying new furniture, painting, installing private bathrooms and restructuring the house.
There are a lot of bed and breakfast design ideas that you can find on Pinterest or Instagram. You can choose to design your B&B alone or find a professional to do it.
6. Design a breakfast menu
What is a bed and breakfast without the breakfast menu? Ask yourself: what type of food is served at a B&B? What are the basic breakfast foods and do you have a special menu to offer that makes you unique? Also, what time do you want your guests to have breakfast in order to complete the whole B&B experience?
The contents of the breakfast menu will be influenced by your preferences, your budget and whether the ingredients are available or not. For example, your breakfast menu can consist of: french toast, pancakes, omelettes, sandwiches, waffles etc.
7. Consider hiring staff
Usually, running a bed and breakfast business is usually a one man job. You can do it single handedly. However, if you are having a hard time managing multiple guests, you can get people to help you. Your bed and breakfast staff will help you improve the efficiency of your bed and breakfast operations and ensure that all your guests are taken care of.
They will help you to maintain the cleanliness of the rooms, assign rooms to guests, provide meals and keep books of record. Some of the staff you should consider hiring include cooks, housekeepers and desk clerks.
Your staff should be good at what they do. You need to have them well trained and equipped with the skills necessary to start and run a successful bed and breakfast business.
8. Legal requirements for a bed and breakfast business
Before you start any business, you need to meet all legal requirements to avoid paying hefty fines or having your business shut down. Failure to do this derails your efforts of meeting your business goals and objectives. When you involve the legal authorities in what you do, everything becomes easier.
So, what qualifications do you need to run a bed and breakfast? What certificates do you need? How do you apply for a bed and breakfast licence?
The first thing you need to do here is to register your bed and breakfast business with the state so that it can operate as a legal entity. Choose a business structure and a name for your business before you register it. For example, you can choose to start a bed and breakfast business as a sole proprietorship or an LLC.
Next, you need to apply for the necessary licences and permits. This includes a fire and safety licence and a food and health certificate.
Getting a bed and breakfast insurance plan is also another thing you should not ignore here. You need to insure your employees and yourself from risk of loss caused by fire or theft.
9. Promote your bed and breakfast business
Once you have set up your business, you need to get word out there about your bed and breakfast business. With marketing a bed and breakfast business, your presence has to be felt both online and offline.
For starters, word-of-mouth marketing is one of the easiest ways to spread word about your bed and breakfast business.
Next, you have to build a strong bed and breakfast business website. Have a professional create your website and make sure it has clear messaging about your bed and breakfast business and strong branding.
Go on social media pages like Facebook, Instagram and Twitter and share pictures of your bed and breakfast business. You can also use email marketing and send out newsletters to your already established clientele.
For print media marketing, you can use flyers and posters. A good bed and breakfast business signage will also attract guests to your B&B. Focus on your unique selling point and don’t forget about asking for feedback and referrals from satisfied guests.
How to Improve a Bed and Breakfast Business
If you already own a B&B and you would want to make some slight or major adjustments to improve your bed and breakfast business performance, this is what you can do:
Excellent customer service. This can be done by offering flexible check ins and check outs as well as having extra supplies ready for guests when they need them.
Social media. Make use of all the social media platforms you can think of to thoroughly market your bed and breakfast business.
Good pricing. When you price your bed and breakfast services well, more guests are likely to opt to use your B&B.
Look at the current trends that B&Bs offer today. For example, some bed and breakfast business owners create workspaces for remote workers and look at safety precautions for their guests during their stay. You can also include entertainment activities like dance and music or nature walks.
FAQs On Starting a Bed and Breakfast Business
Q. Is it hard to run a bed and breakfast?
No. Starting a bed and breakfast is quite simple if you have a proper budget and a comprehensive bed and breakfast business plan.
Q. What makes a bed and breakfast special?
A bed and breakfast allows guests to spend the night in your house, after which they wake up to a warm breakfast meal of their choice prepared from your kitchen. This is what makes a bed and breakfast special.
Q. How much does it cost to start a bed and breakfast business?
The amount of money it will cost you to start a bed and breakfast business will mostly be influenced by whether or not you are using your home for a B&B or finding property. On average, it should cost you around Ksh. 100,000 or more, depending on the size of your bed and breakfast and the rent costs.
Conclusion
A bed and breakfast business is a profitable business to start. You do not need to have any educational qualifications to start and run a successful bed and breakfast business. A bed and breakfast business has a high profit margin. Once this business picks up pace, you can get high returns on investment.
Although the startup costs can sometimes be high, this should be taken care of with the funding options available for you to start a bed and breakfast business. B&Bs is a crowded industry, so you have to be very intentional with how you market your business if you want to survive in this game in the long term. With that, the tips available in this article, it should be easy to start and run your first bed and breakfast business.
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