How to Start a Hotel Business?

3 min read

Everyone steps foot inside the world of hotel business having full knowledge about how profitable it truly is. It is a business that offers many opportunities to expand and experiment as you gain success. Having said that, the process of starting one can be a bit technical and requires you to make strategies. So, today’s article will focus on informing you on how to start your own hotel business. You may also like to see the article of How to Start a Resort Business?


Start a Hotel Business

Deciding the type of hotel amenities to have

Deciding the type of hotel amenities to have - Hotel Business

Before everything else, you will need to reach a decision on the kind of hotel you are looking to operate. There are categories for hotels on the basis of certain aspects, a few of which are:

  • Hotel capacity
  • Location of the hotel
  • Variations in services and rooms provided

There are a number of popular hotels, such as:

Bed and Breakfast Hotels:

This type of hotel comprises twenty to thirty rooms. While these hotels begin as an individual’s home, they slowly transform into a hotel facility. The owner and manager of this kind of hotel tend to be one and the same.

Budget Hotel:

As a hotel it offers affordable rooms for guests with very little service.

Resort Hotel:

This form of hotel allows the guest to enjoy recreation-based activities. Some examples of these activities are golfing, enjoying time at the beach, or going to the spa.

Airport Hotel:

Passengers at an airport need a place to spend the night. This is where an airport hotel comes in handy. Their location is quite close to an airport.

Business Hotel:

This form of hotel is constructed for business travelers. These hotels provide a complimentary newspaper, internet usage, fax machines etc. to the traveling businessmen.


Creating a unique concept

Creating a unique concept - Hotel Business

Every year, a new hotel emerges almost out of nowhere to compete with the top ones. So, you can imagine how stiff the competition is within the hospitality industry. In order to become visible to the customers, you have to develop a unique concept. The main goal is to satisfy the customers to such an extent that they come back for a visit.

Your hotel needs to have excellent services that cater to the customer’s needs. Generally, a good hotel provides complimentary morning food, swimming pools, Jacuzzis etc. There are other hotels that also provide massage service as well as internet availability. A hotel is not just brick and mortar, it is where people visit to spend quality time as well.

Creating a unique concept - Hotel Business

With that in mind, the hotel needs to promote a welcoming and peaceful environment. On the other hand, you may provide customers with the option of shifting into new rooms after the first night. It is a move that can garner the attention of potential guests.


Conducting the viability research

Conducting the viability research

In this type of business, no one can succeed by rushing in without any prior knowledge. So, you must take responsibility for conducting a study to find out whether the targeted area for the hotel is feasible. This research is going to help you in the decision making process. When you finish the research, you will understand if the location is suitable to create a hotel or not.

This study includes taking a tour of the area. In fact, you can take a tour of the surrounding hotel and hand out questionnaires to obtain useful information. There is a possibility that you will not be able to manage the study on your own. In such a case, you can ask an expert or consultant to complete the study in your place.


Fixing the ownership infrastructure

Fixing the ownership infrastructure - Hotel Business

Running a hotel business is not easy since you will probably need a large amount of capital to function smoothly. So, if you come to the realization that you are unable to run it with your fund, contact the investors. Usually, these decisions are taken before starting the business itself. As such, you need to make a decision regarding the ownership infrastructure of the hotel business.

At the end of the day, you need to decide if you are going to for sole proprietorship business. If it is not a plausible option, you can opt for the partnership form of business.


Buying in

Buying in

Instead of starting from scratch, you can always purchase the charter of an established business. This might seem like an unappealing prospect, but you can always give it a make-over. Ultimately, it is a big decision, so take some time to think about it.


Preparing a solid business plan

Preparing a solid business plan - Hotel Business

Now, you must prepare a business plan with help from professionals. The business plan for your hotel has to be solid as you are going to show it to banks. It’s also what is presented to a potential investor. Either way, you need to prove that the business plan is feasible and it is smart to invest in it.

When your business plan is sloppy, it discourages investors and banks. Therefore, be cautious and thorough when creating your business plan.


Securing the license and permit

Securing the license and permit

When you get investors on board, you need to make a registry of the business. This includes securing necessary permits from the office for a license. As a result of getting the license, no government official can harass you in any way while conducting the business.


Recruiting staff

Recruiting staff

As you enter a hotel, you will be able to see a number of employees all working as a unit. These individuals are the staff of the respective hotel. So, for your hotel business to start functioning, you will have to recruit such people. If you are absolutely inexperienced in this department, you can always hire an experienced manager for the job.

This form of business has quite a few technical aspects which should not be handled by inexperienced people. It is why there are managers at every hotel instead of the owners running it themselves. Furthermore, hotels need support staff as well. If the hotel staff are polite and intelligent, then customers are likely to be impressed by their services.


In conclusion, there are multiple aspects to cover if you want to start a hotel business. This article aims to make those aspects appear much more straightforward as a whole.

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