fact, Greenwood and Pogue are about to close on an eight-room bed and breakfast and spa in New Orleans.
10 STEPS TO A SUCCESSFUL B&B
1. Formulate a business plan. Include an introduction, description of the business, sales potential, personnel, consultants, commitments (escrow), and financial information. Make a month-by-month schedule of projected income and expenses. Review the outline often and make changes as necessary.
2. Determine your market. Determine who comes to your location: tourists, travelers, or businesspeople. Form a profile (economic standing, family status, interests) of potential customers based on the local attractions they visit. Ask other inn or hotel executives in the area about their primary market.
3. Project sales revenue. One way is to combine projected occupancy and room rates. Local chambers of commerce and tourist bureaus have information on occupancy rates for existing hotels, motels, and inns.
4. Research your location. Choose a location based on your potential market. Find out how many inns are in the area, how long they have been in business, and if any have gone out of business.
5. Choose a building. Your inn will be someone’s home away from home. To succeed in this competitive industry, most inns offer a private bathroom for each bedroom. The building must be in an area with a low crime rate and within the service area for emergency service. It should also accommodate parking for guests and owners.
6. Learn the law. Visit your local chamber of commerce for information on the federal, state, and local regulations that will apply to your inn. Obtain a business license, which requires an annual fee. State regulations include sales tax permits and unemployment insurance taxes, if you have employees. Local requirements, which vary by community, are administered by the health department, building and zoning department, the department of public works, the fire department, and the planning commission.
7. Get insurance. As an innkeeper, you will be liable for personal injury to guests and damage to your property. Innkeepers should have commercial liability coverage for their building and contents of the public areas. Keep records of contents, receipts, and appraisals, and report all losses.
8. Renovate and furnish. Develop a schedule for subcontractors and ordering materials. Avoid costly fees by learning basic maintenance skills. A queen- or king-sized bed in each bedroom is standard.
9. Calculate room rates. Find out what other inns and hotels in the area are charging. Set your price by analyzing what the room has to offer such as a private bath, or Jacuzzi. Breakfast is usually factored into the rate.
10. Promote your inn. Plan how to promote your inn. Create or order brochures, stationery, and business cards. “Be able to convince people why they should come to your location,” Hardy adds. Use your Website as a valuable marketing asset and offer specials during certain seasons.
–Additional reporting by Stephanie Young