Inn Vogue

Running a bed & breakfast is a tough business, but one that can succeed with the right plan

consultant who specializes in appraising bed and breakfasts, zoning issues are just the tip of obstacles to surmount. “Yes, you’ll find that good bed-and-breakfast-type homes are generally in residential areas, and because of that, you can usually expect neighborhood opposition to a commercial operation,” he says. “Then there are building codes aplenty. Compliance with the American Disabilities Act alone will require ramps, wheelchair access, and special bathing facilities that can today run between $40,000 and $75,000, while most old homes are bound to have code violations for fire safety and electrical systems.” One solution, he says, is to buy an existing bed and breakfast. “It will cost more, but it might be wiser to buy into a known quantity that is established and has a revenue stream from the very start.”

Given the commitment and outlays needed, Pat Hardy, co-author of So–You Want to be an Innkeeper (Chronicle Books; $16.95), recommends that you prepare before you plunge into a bed and breakfast. The first step is to estimate an occupancy rate or the number of nights a year you can reasonably expect guests to stay in your establishment. It is a good idea to interview local hotel and inn owners as well as the local visitors’ bureau and chamber of commerce. According to calculations by Professional Association of Innkeepers International, bed and breakfasts in and around cities and resort areas tend to fill just under 50% of their daily capacity in the course of a year, while inns in rural areas average about 38% occupancy. Both Greenwood and Hardy say it is wisest to assume that your rate will start off at half the national average for the first year or two.

Another number-crunching drill is to calculate the room rate. Again, local tourism bureaus, chambers of commerce, and hotel owners may be able to help you hammer out a figure. Greenwood says that for her first establishment, she also had to rely on a hunch or two. Since her Brooklyn bed and breakfast had no local hotel competition, Greenwood instead dug up rates charged by hotels near LaGuardia Airport, some 10 miles away. She charged $85 a night her first couple of years. “After a while, my guests seemed shocked that my rates were so low, and it seems beginning business owners often undervalue their service or the good they sell,” she recalls. “I waited until we were established, but I raised the cost of a room to $135 after our third year.”

Then there’s the marketing aspect. Greenwood and Pogue don’t have a marketing budget, but rely on word of mouth and community involvement to increase awareness about their bed and breakfasts. “The bed and breakfast in New York will be 10 years old next year and so you get a lot of repeat customers who also then tell their friends and family. … We’re [also] aggressive with our Website.”

Though challenges remain for Greenwood and Pogue, they’ve done well for themselves and have no desire to exit the business. In

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