A good business plan is vital for any business, and accommodation businesses are no different. In many cases, it can be difficult to know where to start, so here are some tips for creating a good accommodation business plan.
Start with Who You Are
Your business plan should begin with a brief description and introduction of your business. State your long-term goals and your general target market. You can also briefly define what makes your motel or company unique from a local perspective or differentiates it from the competition.
The next section should deal with your company and whether it has been established or not. Include what it has been trading as, and if that is different to the current or future name. You should also note how the business will be structured, so state if it is a partnership, a leasehold or any other form of ownership, and include the names of the people who own these parts.
The third part of this section should deal with your services. It’s a good idea to begin with a brief history of the business, if that’s relevant, and any major changes in the local area that have affected the way the business has operated. If the business is new, ignore the history unless the business has been used in another way that’s of historical interest.
Next, look at what you offer. Note whether the business offers budget accommodation for students and backpackers, upmarket accommodation for high-end tourists or something in between or entirely different. Your target market determines how much you can charge, and you must adjust your business accordingly. Plans for rates should be included.
If there is room for expansion, briefly discuss it in this section, although this should be no more than one or two sentences in this particular section.
Define Your Market
The local market should be discussed in detail in this section. If you’re in an area renowned for tourism, note this and define what sort of tourism the area typically attracts and when. If your target market is more business-oriented, note it here. Statistics New Zealand has average occupancy rates for specific areas of New Zealand, so you can get some figures with a broad perspective to include. If the business is established, you can compare historical trends to how the business is doing currently.
Don’t forget that there is often room for expansion, and any good business plan should be able to show and justify how expansion has achieved. You can start by comparing competitors and demonstrating how your occupancy rate or your tariff can exceed the average of the area with certain changes. This may be based on average increases in tourism or due to renovations.
Outlining Financial Matters
Talk about how you are financing the project. You might be using money saved or an inheritance, and this makes finances relatively simple. In other cases, you may require a mortgage or loan from the bank. Don’t forget that mortgages for businesses often run substantially higher than residential mortgages, as there is much more risk. Keep this section brief but comprehensive.
More Detail
After introducing all basic elements in your plan, you can expand on all information in the rest of your document. Essentially, you want to create support that helps you convince an investor or bank that you know what you’re doing and that you can run a business effectively. It also gives you a roadmap and set goals for achieving your ideas.
By carefully enumerating all the points that your business plan raises, you can create a vision that others can follow. Your business plan is a key part of your overall operating plan, and it should be thought of as a five-year guideline where possible. Although other events may overtake your business plan, you’ll find that having a reliable guide can help you weather the storms.
