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From idea to execution: 10 sections to include in your hotel business plan

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By Lana Cook

Do you love connecting with people from all over the world who share your passion for travel? Don’t want to work a typical 9-5 job and instead want to build a business where every day is different, and you own your schedule?

Starting a hotel business is a dream many entrepreneurs have, but it can be a daunting venture to start. A hotel business plan is a critical first step for business owners to turn their dreams into reality. A strategic plan allows one to study the hotel industry, identify their hotel’s unique point of view, and outline how exactly they will reach their goals.

Read on to learn more about the ten sections to include in your hotel business plan, tips for creating an effective plan, and key things you need to start your new hotel business.

Ready to get started creating your plan? Download our hotel business plan template.

What is a hotel business plan?

A hotel business plan is a detailed document that identifies your business’s goals, objectives, and strategies for success. It includes market research and a roadmap for building and operating your business.

Why do you need a hotel business plan?

Studies show that entrepreneurs who finished their business plan were twice as likely to succeed in growing their business than those with no plan. A hotel business plan:

• Helps you identify whether you have a viable business idea
• Provides a detailed roadmap on what you need to accomplish and why
• Gives potential investors insight into your business idea and confidence that you can be successful
• Keeps you on track as you start to execute the different tactics outlined in your plan
• Identifies critical milestones for you and your team to reach

Your plan does not have to be static and should change over time as your business grows and evolves. Your first draft is a starting point to help guide your strategy and instill confidence in potential investors.

10 sections to include in your hotel business plan

Whether you’re starting a small boutique hotel, a cozy B&B, or a 5-star resort, you will need to address the following sections in your hotel business plan.

1. Executive summary

An executive summary is the most essential part of your business plan. It should concisely explain the purpose of your business and why it will be a success.

Include your mission statement explaining why your hotel exists and its overall goal. For example, Capella Hotels & Resorts ’ mission is to combine tradition, discovery, individuality, and twist of the unexpected to create the perfect stay for each guest.

You should also include your vision statement that clearly describes your hotel’s purpose for being in a single sentence. For Capella Hotels, its vision is to embody excellence in the craft of hospitality.

We recommend writing your executive summary as the final stage, as it should summarize the goals and objectives laid out in your plan.

2. Company analysis

Your company analysis is where you can dive into your hotel’s competitive advantage. Ask yourself what makes your hotel unique . Why would guests want to stay with you instead of your competitors?

In this section, identify your brand’s identity and the goals and objectives you want to accomplish. Outline how many rooms and room categories your property will have. For example, will you offer a hybrid hospitality model with dorms, single rooms, and suites? Explain what ancillary revenue sources you’ll offer, like in-room food and beverage options, welcome drinks, or airport shuttles.

Use storytelling to communicate your excitement and passion and make it clear what your hotel will bring to the hospitality industry that hasn’t been done before.

3. Industry analysis

As a business owner, you must be prepared for forces outside your control. You will need to conduct a market analysis that looks at the hospitality industry to identify micro and macro trends that may impact your business. Look at:

• Economic trends
• Environmental trends
• Political trends
• Global health trends
• Technology trends

For each trend, identify how it will impact your business and ways to mitigate risk or take advantage of opportunities.

For example, digital check-in technology has increased across the hotel industry with the rise of tech-savvy guests, new innovative software providers, and labor challenges. Therefore, consider what guest experience solution you’ll include at your hotel.

In addition to trends, look at the history of the hospitality industry, its current size, and how it’s expected to grow in the short and long term. This research will impact the rest of your plan, especially your marketing and financials.

4. Customer analysis

What type of hotel guests do you want to attract? It’s impossible to please every kind of guest, which is why it’s important to identify your target market . Once you know who you want to stay at your property, you can develop amenities, services, and marketing materials to attract these guests and deliver exceptional experiences .

Ask yourself:

• What type of guests do I want? Business or leisure travelers? Retirees or Gen-Z?
• What demographics? Age, gender, marital status, etc.
• What are my target market’s interests? Water sports, hiking, relaxation, museums, etc.
• What does my target market value? Sustainability, contactless technology, personalized service, localized experiences, etc.

This section will help you formulate the guest experience to ensure that expectations meet reality .

5. Competitive analysis

The competition you face will vary depending on where your hotel is located. In this section, you should conduct in-depth competitor research to understand how your hotel will compare. Identify your five major competitors — ideally, three direct competitors you will be competing with upon opening and two aspirational competitors you can emulate as you grow your business.

Conduct a SWOT analysis based on your competitors to look at:

• Strengths . Where does your property excel in comparison to competitors? Why would travelers pick you? Price, amenities, location, technology, etc.
• Weaknesses . Where does your property fall short in comparison to competitors? Price, amenities, location, technology, etc.
• Opportunities . What industry trends can you take advantage of? What local events or partnerships can you capitalize on?
• Threats . What are the biggest threats facing your property? War, travel restrictions, recession, etc.

A thorough analysis can help solidify your competitive advantage and develop a contingency plan for how you will deal with your weaknesses and threats.

6. Marketing plan

Without demand, there is no business. A hotel marketing plan outlines the channels you’ll use to reach your target audience to drive bookings. Your marketing strategy should include three key channels:

1) Paid media . Paid advertising to promote your property and drive bookings. This includes online travel agencies (OTAs) , search engine marketing (SEM), retargeting, and metasearch advertising.

2) Owned media. The content  you create, like your hotel website , social media channels, blog posts, and SEO.

3) Earned media. User-generated content created by third parties like media coverage or online reviews.

7. Operations plan

How do you plan to run your day-to-day operations? This section of your plan will outline all of the key tasks and responsibilities of your team and what exactly your hotel will offer. Consider:

• The number of staff and supervisors required
• Job descriptions and responsibilities
• Your service standards (check out our downloadable SOPs for some inspiration)
• How you’ll manage your inventory
• What hotel technology solutions will you need? PMS, channel manager, booking engine, payment terminal, revenue management tools, guest engagement software, etc.
• What services and amenities do you want to offer? Room service, bar, restaurant, pool, spa, wellness center, etc. 

Detail your short and long-term operational plans and the stakeholders involved for each area.

8. Management team

Whether or not you’ve hired your team yet, this is one of the most important sections potential investors will look at. Make sure to outline the key personnel you will require and their roles. 

In general, these are the following roles you’ll want to outline:

• Hotel management (general manager, front office manager, housekeeping manager, maintenance manager, revenue manager)
• Hotel sales team
• Housekeeping staff
• Front office staff
• Maintenance

Depending on the size of your hotel, your team will vary. Identify the team members you need to open and your hiring plans over the next five years.

9. Strategic plan

Hoteliers must be strategic in optimizing occupancy rates across seasons to maintain revenue. As part of your strategic plan, identify how you will manage:

• Pricing – what room types will you offer, and how will the pricing vary?
• How will you maintain consistent occupancy throughout the high and low seasons? Will you adapt your pricing and marketing strategies?
• How will you conduct revenue management ? What type of rules/alerts will you use to adjust rates? Will you use technology to help with revenue management?
• What will your online reputation management strategy be? How will you collect and respond to online reviews?
• What will your distribution mix look like? How will you drive reservations across a variety of channels?

10. Financial plan

Your financial projections are the most challenging but arguably the most crucial part of your hotel business plan. In this section, you should include the following:

• Start-up costs. How much money will you need from lenders to operate your hotel? Consider business licenses, furniture, down payments, etc.
• Operating costs . How much money will you need to keep your business running? Consider staffing costs, guest acquisition costs, mortgage payments, utilities, SaaS payments, etc.
• Income statement . What will your revenue, expenses, and profit be over the first 3-5 years of business?
• Cash flow projections . How will cash flow in and out of your business? Show what capital investment you’ll need to start.
• Balance sheet . Identify your assets, liabilities, and equity.

If you’re looking for a potential investor, your financial plan will be the section they care about most. Here, you must prove how your business will provide a return on investment. Don’t forget to include an Appendix that shows more detailed reporting and financial figures.

8 tips for creating an effective plan

1. Start with the section that excites you the most! Covering all the topics outlined above can feel overwhelming, so don’t feel pressured to go in order.

2. Reach out to a business owner you admire. No matter what type of business you’re starting, getting advice from another business owner is always helpful. Reach out to a successful local business owner to see if they’d be willing to share some insights they learned along the way.

3. Be concise. While there’s a lot to cover, you must be concise in each section of your plan. Include any additional research or documentation in the appendix to keep your business plan clean.

4. Try to avoid industry jargon. Depending on what type of investor is reading your plan, they may find jargon irrelevant and distracting.

5. Ensure you have a clear competitive advantage. You should be able to state in one sentence what makes your property unique. This unique selling point (USP) will be prominent in all of your marketing materials.

6. Set SMART goals. Setting specific, measurable, achievable, relevant, and time-bound goals is important to stay organized and on track to reach milestones.

7. Don’t forget about your plan. You will have spent hours developing your plan, so make sure you use it! Reference your plan as you build and grow your business , and remember that it’s ok if things change.

8. Illustrate your passion. Communicate why you want to be a part of the hospitality industry. Passion is contagious and gives investors more confidence that you will work hard to achieve your dreams.

What do you need to start a hotel business?

Ok, so you’ve read through this article and are now wondering — what’s next? Ensure you have the following items on your radar to start your business.

• A vision. Know exactly what kind of business you want to build (a quaint bed and breakfast is very different from a large-scale resort).
• A business plan. Stay on track with a well-developed business plan.
• A location. Decide if you want to build a new property or renovate an existing hotel.
• Capital. Do you need to raise an upfront capital investment? Remember that new businesses usually aren’t profitable for the first few years and will need cash flow to pay for expenses.
• Business licenses & permits. Depending on the type of property and its services, you’ll need an occupancy permit, alcohol license, food service license, sales tax license, etc.
• Technology. Choose technology to help streamline operations and earn more revenue.
• Furniture & equipment. You must furnish your property with the proper furniture, electronics, appliances, etc.
• Staff. Take time hiring staff you can trust and who understand your hotel’s brand and vision.

Final thoughts

Your business plan provides the foundation for your new business and outlines the next steps in the journey. Ensure you fully understand the market and competitive landscape to enter the industry prepared for the future. Start slow and invest in the right people and technology to support the growth of your business.

Looking to start a hotel? Download the technology guide. Download now

About Lana Cook

Lana Cook is a Content Writer at Cloudbeds where she is able to combine her love of writing and passion for travel. She has spent the last few years writing about all things technology and the ways in which it can be used to help businesses thrive. When she’s not busy writing, you can find her checking out the latest movie or searching for a new TV show to binge.

Hotel business plan

You might also be interested in..., a 2024 guide to hotel automation, infinitely scalable: build your ideal hotel tech stack with a modern platform, what is a booking engine how to increase profitability and direct bookings.

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Hotel Business Plan

OK, so you have decided to realize your dream and open your own hotel business . You have thought out an amazing concept delivering unparalleled guest service. The next step would be to write a hotel business plan. It’s like a road map to the opening. However, as a seasoned hotel revenue management consulting and hotel management company , we have seen that this is where most entrepreneurs get stuck.

Why? Many do not have the time and don’t know what to write or how to do the financials. But until you finish your business plan, you will not be able to get the financing either. So you end up with ideas sitting in your head not realizing your dream.

Really it is not that difficult to make a good hotel business plan. It is merely a structured summary of your idea. Most people try to include everything about their hotel concept in the plan. This leads to an indigestible super novel-like bookwork, aka a mess.

The key is, knowing what to include, and what not to include in your hotel business plan. Create a clear road map for success. Excite investors rather than bore them to death like most business plans full of redundant information do. And you need to lead readers down the exact path you want.

One of the main challenges for example is that after reading the first page most businesses often don’t fully understand what the hotel is all about. For investors and lenders, it is crucial they can quickly comprehend your plan, without reading the whole document.

Hotels 101: The Basics of Business Planning

We have put together a hotel business plan template to help you on your way. Check out our approach based on 10 critical points, being:

• Executive Summary
• Company Analysis
• Industry Analysis
• Customer Analysis
• Competitive Analysis
• Strategic Plan
• Operations Plan
• Management Team
• Financial Plan
• Key Milestones

Steps of your Hotel Business Plan

Let’s dive into the step-by-step checklist of what your hotel business plan should look like.

Infographic by Xotels

1. Executive Summary

This first part should consist of two main parts, being:

• Mission Statement (Introduction): a 1 line company description only the essence of your hotel (not 2 lines or a paragraph). It explains why you are in business or which huge need you are solving, that currently is not being met. For example in the case of Qbic Hotels “Moving modular hotels into under-utilized real-estate to reduce build-out cost and time.” 
• Objectives : What do you hope to accomplish (i.e. “Reach an annual occupancy of 90%”).

 2. Company Analysis

More detailed information on the USPs (unique selling points) of your hotel concept.

3. Industry Analysis

Information on the current industry trends and the current state of the market and how this will impact your hotel. This is needed as investors want to be sure you really understand the hotel industry. This acts as the foundation on which decisions such as trends and developments to follow will be based.  

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4. Customer Analysis

In-depth information on your target market, including geographic, demographic, socioeconomic, psychographic, and behavioural segmentation details. It can also help you to keep up to date with the latest hotel marketing trends to understand which are the types of guests who will be staying at your hotel. Explain which features will be meeting the needs and wants of these main segments when thinking of:

Basically, how will consumers answer this question ‘Why my hotel?’

Aim to break it up to the point value can be easily communicated (do not make it too overcomplicated). Think of the following examples:

• Psychographics: interests, lifestyles, personality, values, opinions, and attitudes
• Behavioural segmentation: purchasing behaviour, level of engagement, customer loyalty
• Demographics: gender, age, marital status and education
• Geographics: location (country, state, region, city)
• Socio-economics

Any of the above examples of hotel segmentation can, if described well, be of great value to your business plan. An example of this could be a hotel located in a beach town, where you should be able to describe how demographics and psychographics differ from summer to winter time. Especially, since this example is typically known for lower demand in winter which you could be compensating for with the right hotel marketing strategies on hand.

5. Competitive Analysis

A study of your local competition or global concept competitors, with each of their strengths, weaknesses, occupancy rates and market share ( SWOT analysis ). And don’t forget the most important part; what differentiates you from them. What makes you stand out?

Ask yourself: “can I add value to a specific area”, especially when it comes to hotel-dense areas like city centres or major destinations.

6. Strategic Plan

This exists of 3 parts:

• Marketing : How exactly will you attract customers/guests? How will you position yourself? What will your message be to the different segments of your business mix? How will your direct marketing work? What will be the plan for your hotel website, SEO, SEM and SMM? Will you do offline promotion? In short, your hotel marketing strategy should cover everything there is to know about how to market your hotel.
• Distribution : Which 3rd party channels will you use and how will you manage availability? What technology will you need?
• Revenue management : What pricing and yield techniques will you use? What will your payment and cancellation policies be? Which room types will you be selling, and how will they be individually marketed? How many revenue scenarios will I create? Where can I compensate income/demand streams when necessary?

Make sure you have the capabilities to plan out a strong marketing, distribution and revenue management strategy. 

Things get complicated rather fast, and choosing to outsource hotel and revenue management is likely to give you a strategic advantage, during the planning phase, and the execution of your business plans.

7. Operations Plan

How will you run your hotel? Think of the following elements:

• How many staff and supervisors will you need? 
• What are their job descriptions/responsibilities? 
• What background and experience should they have? 
• When should they start? 
• What are your service standards?
• Will you develop manuals?
• Which supplier will you use?
• How will you manage inventory?

8. Management Team

Include the bios of your team. Focus on what uniquely qualifies you to make your hotel such a success. Having a great team is the key to success , and stakeholders will be impressed with a thorough explanation of the added value everyone brings to the table.

9. Financial Plan

Provide the start-up costs of the hotel (capital investment), the ongoing business costs, operational expenses and revenue projections for the next five years. These figures should be always based on your Hotel Feasibility Study . The KPIs to look at include expected occupancy, ADR (Average Daily Rate) and RevPAR (Revenue per Available Room).

If you are raising money , outline how much funding will be needed and when. Explain how you will generate a return on investment for investors, or when lenders will be paid back.

10. Key Milestones

These are the most important achievements which once they have been completed, will make your hotel more likely to succeed. Think off:

• Location selection
• Permits & Licenses
• Build-out / Construction of the Hotel
• Staffing and Training
• GOP Break-even
• NOI Break-even

Each time one of the key milestones is achieved, the risk of lenders or investors decreases . And once your last key milestone is reached, the chance of success is more or less guaranteed.

11. Appendix

Provide any other relevant information here. Don’t clutter the main sections of your hotel business plan with too many details. Rather support them with attachments in this part.

Putting Your Plan into Action

Many people have great business ideas. But that really doesn’t matter. The difference between dreamers and entrepreneurs is the action mindset. Are you ready to ship your idea to the market? 

The first step is to put your ideas on paper. I hope this free sample will help you write a persuasive hotel business plan. Because no investor or lender will be interested if you cannot present a clear plan.

Follow your dreams and go for it!

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With cost-effective implementations and best practices developed over years of experience, successful business for your boutique hotel, resort, B&B, aparthotel, hostel, or any other lodging concept for that matter.

Hope this template has helped you get inspired to start your own hotel business .

Best of luck in your endeavours!

Patrick Landman

PS. Get in touch with us if you need help developing and managing your hotel concept, and help bring your hotel to the next level with our hotel consulting services.

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How to Write a Successful Hotel Business Plan + Template

Creating a business plan is essential for any business, but it can be especially helpful for hotel businesses who want to improve their strategy and/or raise funding.

A well-crafted business plan not only outlines the vision for your company, but also documents a step-by-step roadmap of how you are going to accomplish it. In order to create an effective business plan, you must first understand the components that are essential to its success.

This article provides an overview of the key elements that every hotel business owner should include in their business plan.

Download the Ultimate Hotel Business Plan Template

What is a Hotel Business Plan?

A hotel business plan is a formal written document that describes your company’s business strategy and its feasibility. It documents the reasons you will be successful, your areas of competitive advantage, and it includes information about your team members. Your business plan is a key document that will convince investors and lenders (if needed) that you are positioned to become a successful venture.

Why Write a Hotel Business Plan?

A hotel business plan is required for banks and investors. The document is a clear and concise guide of your business idea and the steps you will take to make it profitable.

Entrepreneurs can also use this as a roadmap when starting their new company or venture, especially if they are inexperienced in starting a business.

Writing an Effective Hotel Business Plan

The following are the key components of a successful hotel business plan:

Executive Summary

The executive summary of a hotel business plan is a one to two page overview of your entire business plan. It should summarize the main points, which will be presented in full in the rest of your business plan.

• Start with a one-line description of your hotel company
• Provide a short summary of the key points in each section of your business plan, which includes information about your company’s management team, industry analysis, competitive analysis, and financial forecast among others.

Company Description

This section should include a brief history of your company. Include a short description of how your company started, and provide a timeline of milestones your company has achieved.

If you are just starting your hotel business, you may not have a long company history. Instead, you can include information about your professional experience in this industry and how and why you conceived your new venture. If you have worked for a similar company before or have been involved in an entrepreneurial venture before starting your hotel firm, mention this.

You will also include information about your chosen hotel business model and how, if applicable, it is different from other companies in your industry.

Industry Analysis

The industry or market analysis is an important component of a hotel business plan. Conduct thorough market research to determine industry trends and document the size of your market. 

Questions to answer include:

• What part of the hotel industry are you targeting?
• How big is the market?
• What trends are happening in the industry right now (and if applicable, how do these trends support the success of your company)?

You should also include sources for the information you provide, such as published research reports and expert opinions.

Customer Analysis

This section should include a list of your target audience(s) with demographic and psychographic profiles (e.g., age, gender, income level, profession, job titles, interests). You will need to provide a profile of each customer segment separately, including their needs and wants.

For example, a hotel business’ customers may include:

• Business travelers
• Leisure travelers
• Groups and conventions
• Wedding parties
• Local residents

You can include information about how your customers make the decision to buy from you as well as what keeps them buying from you.

Develop a strategy for targeting those customers who are most likely to buy from you, as well as those that might be influenced to buy your products or hotel services with the right marketing.

Competitive Analysis

The competitive analysis helps you determine how your product or service will be different from competitors, and what your unique selling proposition (USP) might be that will set you apart in this industry.

For each competitor, list their strengths and weaknesses. Next, determine your areas of competitive differentiation and/or advantage; that is, in what ways are you different from and ideally better than your competitors.

Below are sample competitive advantages your hotel business may have:

• Location : if your hotel is located in an ideal spot for leisure or business travelers, this could be a key competitive advantage
• Amenities : if your hotel offers unique amenities that are appealing to your target market segments, this could give you a leg up on the competition
• Customer service : if you focus on delivering exceptional customer service, this could be a key selling point

Marketing Plan

This part of the business plan is where you determine and document your marketing plan. . Your plan should be clearly laid out, including the following 4 Ps.

• Product/Service : Detail your product/service offerings here. Document their features and benefits.
• Price : Document your pricing strategy here. In addition to stating the prices for your products/services, mention how your pricing compares to your competition.
• Place : Where will your customers find you? What channels of distribution (e.g., partnerships) will you use to reach them if applicable?
• Promotion : How will you reach your target customers? For example, you may use social media, write blog posts, create an email marketing campaign, use pay-per-click advertising, launch a direct mail campaign. Or you may promote your hotel business via public relations (PR), speaking engagements, or other thought-leadership activities.

Operations Plan

This part of your hotel business plan should include the following information:

• How will you deliver your product/service to customers? For example, will you do it in person or over the phone only?
• What infrastructure, equipment, and resources are needed to operate successfully? How can you meet those requirements within budget constraints?

The operations plan is where you also need to include your company’s business policies. You will want to establish policies related to everything from customer service to pricing, to the overall brand image you are trying to present.

Finally, and most importantly, in your Operations Plan, you will lay out the milestones your company hopes to achieve within the next five years. Create a chart that shows the key milestone(s) you hope to achieve each quarter for the next four quarters, and then each year for the following four years. Examples of milestones for a hotel business include reaching $X in sales. Other examples include adding new locations, launching a new product/service, or hiring new employees.

Management Team

List your team members here including their names and titles, as well as their expertise and experience relevant to your specific hotel industry. Include brief biography sketches for each team member.

Particularly if you are seeking funding, the goal of this section is to convince investors and lenders that your team has the expertise and experience to execute on your plan. If you are missing key team members, document the roles and responsibilities you plan to hire for in the future.

Financial Plan

Here you will include a summary of your complete and detailed financial plan (your full financial projections go in the Appendix). 

This includes the following three financial statements:

Income Statement

Your income statement should include:

• Revenue: how much revenue you generate.
• Cost of Goods Sold: These are your direct costs associated with generating revenue. This includes labor costs, as well as the cost of any equipment and supplies used to deliver the product/service offering.
• Net Income (or loss): Once expenses and revenue are totaled and deducted from each other, this is the net income or loss

Sample Income Statement for a Startup Hotel Business

Balance sheet.

Include a balance sheet that shows your assets, liabilities, and equity. Your balance sheet should include:

• Assets : All of the things you own (including cash).
• Liabilities : This is what you owe against your company’s assets, such as accounts payable or loans.
• Equity : The worth of your business after all liabilities and assets are totaled and deducted from each other.

Sample Balance Sheet for a Startup Hotel Business

Cash flow statement.

Include a cash flow statement showing how much cash comes in, how much cash goes out and a net cash flow for each year. The cash flow statement should include:

• Cash Flow From Operations
• Cash Flow From Investments
• Cash Flow From Financing

Below is a sample of a projected cash flow statement for a startup hotel business.

Sample Cash Flow Statement for a Startup Hotel Business

You will also want to include an appendix section which will include:

• Your complete financial projections
• A complete list of your company’s business policies and procedures related to the rest of the business plan (marketing, operations, etc.)
• Any other documentation which supports what you included in the body of your business plan.

Writing a good business plan gives you the advantage of being fully prepared to launch and/or grow your hotel company. It not only outlines your business vision but also provides a step-by-step process of how you are going to accomplish it.

As you can see, there is a lot that goes into creating a successful hotel business plan. But with careful planning and execution, you can set your hotel business up for success.  

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How to Write a Hotel Business Plan: An Overview

Ever dreamt of establishing a serene oasis or a buzzing urban escape that guests rave about? As the grandeur of a hotel vision takes shape, a sturdy business plan is the foundation stone, the architectural blueprint of your dream sanctuary.

This blueprint doesn’t just sketch your vision but strategically builds it, ensuring every corner exudes comfort and luxury. And for those aiming for investment ? A hotel business plan is your showpiece, showcasing thorough research and a crystal-clear roadmap to prosperity.

Table of Contents

How To Create A Hotel Business Plan

Clearly articulate your hotel’s unique mission and pinpoint the short-term and long-term objectives to give direction to your endeavor. Thoroughly analyze competitors, not just in your vicinity but also in global trends. Identifying your primary target audience and discerning the prevailing industry trends can give insights into crafting offers that cater specifically to their preferences.

Enumerate the distinct amenities you offer, whether that’s eco-friendly features, unparalleled city views, or exclusive guest experiences that set you apart. In this age of the digital revolution, concentrate on innovative strategies like online promotions, influencer partnerships , hosting events, or forging collaborations with local businesses to attract potential guests.

Finally, financial forecasting is crucial. Precisely outline expected profits, potential losses, and return on investment. Always factor in variables like occupancy rates, operational costs, and seasonal variations when mapping out your financial trajectory. This detailed financial overview aids in securing investors or loans.

Use Our Expertly Crafted Hotel Business Plan Template

Why begin with an empty slate when you can leverage the wisdom of industry experts? A carefully curated hotel business plan template becomes the bedrock of your hotel’s future success. This pre-structured layout ensures every critical aspect of your hotel business is covered, serving as a roadmap for your venture.

Delving deep into the hotel sector’s intricacies, our template is meticulously designed to resonate with the industry’s demands. It ensures you don’t miss out on any pivotal aspects, from guest experience considerations to inventory management.

With our template, you can expedite the planning phase without cutting corners, guaranteeing that your business plan remains both comprehensive and effective

Our template recognizes this, allowing ample space for you to weave in your brand’s narrative, core values, and distinct offerings, ensuring your plan isn’t just another generic blueprint.

Hotel Business Plan

Components of a Comprehensive Hotel Business Plan

Executive summary.

This offers an overview of your hotel business, providing a snapshot of your mission, vision, and the business structure you intend to employ. A well-crafted executive summary entices readers to delve deeper into your plan.

Market analysis

In this section, detailed research about your target market, competitors, and the overall hospitality industry’s trends is laid out. It reveals market gaps and showcases opportunities for your hotel to thrive.

Marketing strategies

A key element that maps out how you plan to attract and retain your guests. This section encompasses advertising, public relations, online marketing, and direct sales strategies tailored to your hotel’s unique offerings.

Operational plan

This is a holistic view of the daily operations of your hotel, covering everything from inventory management and guest services to staff training and retention.

Financial projections

An essential component, this section gives potential investors a clear idea of the expected ROI. It includes profit and loss statements, cash flow projections, and balance sheets.

Connect With Fill For Your Template Requirements

The hotel industry is marked by rapid shifts in traveler preferences and market trends. By treating your hotel business plan as a dynamic document, you can stay ahead of these changes, continually refining your strategies based on real-time insights and feedback.

In the realm of hospitality, change isn’t a challenge but an opportunity. By regularly revisiting and adapting your business plan, you ensure your hotel remains relevant, competitive, and in tune with the ever-evolving demands of modern travelers.

Andria is a seasoned content writer, specializing in document management solutions and HIPAA compliance, providing valuable insights for businesses and professionals alike.

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How to Make a Business Plan for your Hotel

Whether you own a bed and breakfast, a family-run inn, a cosmopolitan hotel or an all-inclusive resort, a business plan is absolutely essential to your success.

You might have the best hotel concept in the world, but none of that will matter if you don’t have a well-organized plan that lays out how it will come to fruition.

Unfortunately, many hoteliers don’t use business plans to their full potential. Instead, they throw together a collection of ad-hoc documents to show stakeholders, investors and other interested parties. Even worse, they don’t put together a business plan at all. This is a big mistake, but it often stems from people finding the concept of business plans intimidating.

Fortunately, hotel business plans aren’t as daunting as they seem. At their most basic, they’re summaries of the most important details of your hotel concept . They allow readers to learn everything they need to know about your hotel idea in a detailed yet succinct manner.

Need guidance in doing so? Follow the points outlined here and you’ll have no trouble developing an effective business plan for your hotel.

Table of contents for this article:

Hotel Business Plan Essentials

Other elements to include, focus on the essential, 1. executive summary.

Your business plan in a nutshell.

The placement of executive summaries is misleading. They normally come first in business plans, but really, they should be written last. This is because they cover all the key points that are mentioned in your business plan.

Along with summarizing the basics, remember to include your broader mission statement and specific project objectives.

We’ve said it once and we’ll say it again, it’s much easier to write a great executive summary once you’ve finished the rest of your business plan!

2. Company Analysis

Think of this as an elevator pitch.

Provide an accurate yet exciting impression of your hotel project as it stands. Talk about background information like business stage, legal structure, investors and/or stakeholders and other major milestones. Most importantly, make sure you also highlight your hotel’s unique features and qualifications, sometimes referred to as USPs (Unique Selling Propositions).

USPs are key in the highly competitive hotel market and can really make your concept stand out from the crowd. Does your hotel have pool, jacuzzi or spa amenities? Is it completely wheelchair accessible? Does it offer amazing views of the city or surrounding countryside? These are all key features to highlight in your company analysis.

Some company analyses also use the SWOT analysis framework to assess their hotel concept’s strengths, weaknesses, opportunities and threats.

• Optimizing occupancy, revenue or ADR
• Upgrading your software stack
• Solving distribution or/and tech issues
• Improving their hotel online presence

3. Industry Analysis

What context will you be operating in, exactly?

In a business plan, industry analysis refers to researching relevant market trends. Understanding short and long-term trends that affect the hotel industry is key in putting together an effective hotel business plan, and eventually running a successful hotel.

Think about trends and events in relation to broader themes like technology, health, environment, politics, culture and economy. Reflect on how they might affect your business, or better yet, how your business could use them to its advantage. In the context of COVID-19 , for example, it’s a great idea to be transparent about the sanitary measures and distancing policies your business has (or would be able to) put into effect.

Depending where your hotel is located, industry analysis may be daunting. A more manageable way to think about it is in relation to your relative market. That is, focus your research specifically on hotels that have a similar concept to yours .

Industry trends affect family-run bed and breakfasts very differently than they do all-inclusive resorts, so make sure to undertake analysis that’s relevant to your business.

4. Competitive Analysis

Now, it’s time to size up the competition.

One of the best ways to put together a successful hotel business strategy is to have an excellent idea of what the competition is doing. Emulate what they’re doing correctly and improve upon what they’re doing wrong. If you see that many customers are complaining about the weak WiFi or lack of breakfast at hotels in the area, see if your business can provide those amenities.

You can focus your research solely on local competitors, but you can also include global competitors with similar concepts to your own . How you choose to do this will depend on your hotel’s concept and where it’s located.

Similar to industry analysis, competitive analysis is intimidating to many. In order to simplify it, only undertake in-depth analysis of your most direct competitors. Some market experts also use the SWOT analysis framework when analyzing the competition as well.

When it comes to more indirect competitors, try grouping them together and thinking about big picture comparisons.

5. Ideal Customer Profile

Next, you’ve got to figure out who exactly will be coming to your hotel.

It’s incredibly important to have a specific picture of your hotel’s ideal customer. Just like any other product or service, you’ll need to determine who you’ll be marketing to . Different kinds of hotel guests have different priorities and needs, so it’s important to determine who you’ll be catering to .

Put simply, a businessman staying in central London for a work conference will have very different hotel needs compared to a family of four on a week-long summer vacation.

Ideal hotel guest profiles take geographic, demographic, socio-economic, psychographic, cultural and behavioral considerations into account. You’ll also want to consider whether your hotel concept will be broadly appealing to several hotel guest profiles or if you’ll be catering to a specific niche.

Need help putting together ideal customer profiles? Get inspired by checking out your direct competitors’ guest reviews online.

6. Marketing Plan

Last but not least, how will you attract guests?

A strong concept is only half the battle. Without an effective marketing strategy , your hotel will remain empty. At its most basic, your marketing plan should describe how you’ll attract guests to your hotel and therefore make it a profitable business.

In doing so, marketing plans usually touch on the following categories:

• Marketing How will you get the word out to guests? In the modern age, this most often refers to online marketing strategies related to your hotel’s website, search engine results and social media presence. You can also cover direct marketing, offline marketing, networking, third-party promotion and partnerships here.
• Sales & Distribution How will you secure bookings? Think about what channels you’ll use to communicate availability and manage reservations, for example if your hotel is being listed in Airbnb, you'll need an Airbnb channel manager to handle your reservations and avoid double bookings. Most hotels use a combination of direct and indirect sales and distribution strategies.
• Yield & Revenue Management How will you make sure that your hotel is profitable? Consider pricing and yield strategies early on to maximize your business’s revenue growth.

We’ve talked about hotel business plan essentials, but we’re not done yet. The points we covered above are the basics, but there are several additional elements that you might want to consider including.

Remember, your hotel business plan should most importantly present the specific context of your project . The elements you include should reflect that.

We’ve included some ideas of additional elements you might like to include below, but the possibilities are endless.

• Operations Discuss how your hotel will run on a day-to-day basis. This connects to management but focuses on the big picture. Make sure to include details like staff numbers, hotel processes, service standards, external suppliers and inventory management.
• Management Have you established who will be in charge of your hotel’s management? Or who will be working at your hotel? If you have, talk about their profiles and what qualifies them to do their jobs here.
• Finances Put simply, discuss the money you have, the money you’ll require and how much you estimate that your project will cost in total. This is also a good opportunity to mention ROI projections.
• Reference Materials Be sure to include any supporting materials that support the information presented in your business plan. e.g. charts, graphics, resources, imagery and other media.

There you have it! Follow the steps above and you’ll have an effective business plan for your hotel in no time.

If you’re feeling overwhelmed by the process, remember to focus on the essentials first . Basic information like your project background, industry trends, competitor research and ideal clientele is your bread and butter. Once you’ve got those elements covered, start thinking about what additional elements you want to include based on your needs.

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Firstly, we assess

We evaluate objective(s), defining opportunities and setting goals.

Then, we plan

We make a plan detailing what should be done to help reach set goals.

Finally, we make it happen

We implement change, as planned, within set timeline and budget.

How to Start a Hotel

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How To Start Your Own Hotel Business

If you’re looking to start a new hotel business, you’ve come to the right place since we’re going to show you exactly how to do it. We’ll start by sharing how to open a hotel step-by-step, then answer some frequently asked questions about running a hospitality industry business and being a successful hotel owner.

Importantly, a critical step in starting a hotel is to complete your hotel’s business plan. To help you out,   you should download Growthink’s Ultimate Hotel Business Plan Template here.

Download our Ultimate Business Hotel Plan Template here

15 Steps to Start a Hotel Business:

• Choose the Name for Your Hotel
• Develop Your Hotel Business Plan
• Choose the Legal Structure for Your Hotel
• Secure Startup Funding for Your Hotel (If Needed)
• Find a Location to Buy or Start Building Your Hotel
• Register Your Hotel with the IRS
• Open a Business Bank Account
• Get a Business Credit Card
• Get the Required Business Licenses and Permits
• Get Business Insurance for Your Hotel
• Buy or Lease the Right Hotel Business Equipment
• Develop Your Hotel Marketing Materials
• Purchase and Setup the Software Needed to Run Your Hotel
• Hire and Train Your Hotel Staff
• Open for Business

1. Choose the Name for Your Hotel

The first step to starting a successful hotel business is to choose your hotel’s name.  

This is a very important choice since your hotel name is your brand and will last for the lifetime of your hotel. Ideally, you choose a name that is meaningful and memorable. Here are some tips for choosing a name for your hotel business:

• Make sure the name is available. Check your desired name against trademark databases and your state’s list of registered business names to see if it’s available. Also check to see if a suitable domain name is available.
• Keep it simple. The best names are usually ones that are easy to remember, pronounce and spell.
• Think about marketing. Come up with a name that reflects the desired hotel identity and/or focus of your hotel.

2. Develop Your Hotel Business Plan

One of the most important steps in how to start a hotel business is to develop a hotel business plan . The process of creating your hotel business plan ensures that you fully understand your market and your business strategy. The plan also provides you with a roadmap to follow and if needed, to present to potential investors for your business.

To enhance your planning process, incorporating insights from a  sample hotel business plan  can be beneficial. This can provide you with a clearer perspective on industry standards and effective strategies, helping to solidify your own business approach.

Your hotel business plan should include the following sections:

• Executive Summary – this section should summarize your entire business plan so readers can quickly understand the key details of your hotel.
• Company Overview – this section tells the reader about the history of your hotel and what type of hotel you operate. For example, are you a boutique hotel, a bed and breakfast, or an inn?
• Industry Analysis – here you will document key information about the hotel industry. Conduct market research and document how big the industry is and what trends are affecting it.
• Customer Analysis – in this section, you will document who your ideal or target customers are and their demographics. For example, what is their income level? What amenities do they look for in a hotel? What do they find important when choosing where to stay?
• Competitive Analysis – here you will document the key direct and indirect competitors you will face and how you will build competitive advantage.
• Product : Determine and document what products/services you will offer. 
• Prices : Document the prices of your products/services.
• Place : Determine where your business will be located and how that location will help you increase sales.
• Promotions : Determine what promotional methods you will use to attract guests to your hotel.
• Operations Plan – here you will determine the key processes you will need to run your day-to-day operations. You will also determine your staffing needs. Finally, in this section of your plan, you will create a projected growth timeline showing the milestones you hope to achieve in the coming years.
• Management Team – this section details the background of your hotel’s management team.
• What startup costs will you incur?
• How will your hotel make money?
• What are your projected sales and expenses for the next five years?
• Do you need to raise funding to launch your hotel?

3. Choose the Legal Structure for Your Hotel

Next you need to choose a legal structure for your hotel and register it and your business name with the Secretary of State in each state where you operate your business.

Below are the five most common legal structures:

1) Sole Proprietorship

A sole proprietorship is a business entity in which the owner of the hotel and the business are the same legal person. The owner of a sole proprietorship is responsible for all debts and obligations of the business. There are no formalities required to establish a sole proprietorship, and it is easy to set up and operate. The main advantage of a sole proprietorship is that it is simple and inexpensive to establish. The main disadvantage is that the owner is liable for all debts and obligations of the business.

2) Partnerships

A partnership is a legal structure that is popular among small businesses. It is an agreement between two or more people who want to start a hotel business together. The partners share in the profits and losses of the business. 

The advantages of a partnership are that it is easy to set up, and the partners share in the profits and losses of the business. The disadvantages of a partnership are that the partners are jointly liable for the debts of the business, and disagreements between partners can be difficult to resolve.

3) Limited Liability Company (LLC)

A limited liability company, or LLC, is a type of business entity that provides limited liability to its owners. This means that the owners of an LLC are not personally responsible for the debts and liabilities of the business. The advantages of an LLC for a hotel business include flexibility in management, pass-through taxation (avoids double taxation as explained below), and limited personal liability. The disadvantages of an LLC include lack of availability in some states and self-employment taxes.

4) C Corporation

A C Corporation is a business entity that is separate from its owners. It has its own tax ID and can have shareholders. The main advantage of a C Corporation for a hotel business is that it offers limited liability to its owners. This means that the owners are not personally responsible for the debts and liabilities of the business. The disadvantage is that C Corporations are subject to double taxation. This means that the corporation pays taxes on its profits, and the shareholders also pay taxes on their dividends.

5) S Corporation

An S Corporation is a type of corporation that provides its owners with limited liability protection and allows them to pass their business income through to their personal income tax returns, thus avoiding double taxation. There are several limitations on S Corporations including the number of shareholders they can have among others.

Once you register your hotel, your state will send you your official “Articles of Incorporation.” You will need this among other documentation when establishing your banking account (see below). We recommend that you consult an attorney in determining which legal structure is best suited for your company.

4. Secure Startup Funding for Your Hotel (If Needed)

In developing your hotel business plan, you might have determined that you need to raise funding to launch your business. Determining whether you want to purchase and renovate or build a new structure will majorly impact when you can open your new hotel and the amount of funding you will need.

If so, the main sources of funding for a hotel to consider are personal savings, family and friends, credit card financing, bank loans, crowdfunding and angel investors. Angel investors are individuals who provide capital to early-stage businesses. Angel investors typically will invest in a hotel that they believe has high potential for growth.

5. Find a Location to Buy or Start Building

Having the right space is important for your hotel and choosing the best location can have a major impact on your business.

To find the right space, consider:

• How many rooms will your hotel have?
• What are the zoning requirements for hotels in your area?
• Is the local market a good match for your target customers?

If you plan to build a new structure for your hotel, you will also need to work with architects to establish a timeline and determine construction costs.

6. Register Your Hotel with the IRS

Next, you need to register your business with the Internal Revenue Service (IRS) which will result in the IRS issuing you an Employer Identification Number (EIN).

Most banks will require you to have an EIN in order to open up an account. In addition, in order to hire employees, you will need an EIN since that is how the IRS tracks your payroll tax payments.

Note that if you are a sole proprietor without employees, you generally do not need to get an EIN. Rather, you would use your social security number (instead of your EIN) as your taxpayer identification number.

7. Open a Business Bank Account

It is important to establish a bank account in your hotel’s name. This process is fairly simple and involves the following steps:

• Identify and contact the bank you want to use
• Gather and present the required documents (generally include your company’s Articles of Incorporation, driver’s license or passport, and proof of address)
• Complete the bank’s application form and provide all relevant information
• Meet with a banker to discuss your business needs and establish a relationship with them

8. Get a Business Credit Card

You should get a business credit card for your hotel to help you separate personal and business expenses.

You can either apply for a business credit card through your bank or apply for one through a credit card company.

When you’re applying for a business credit card, you’ll need to provide some information about your business. This includes the name of your business, the address of your business, and the type of business you’re running. You’ll also need to provide some information about yourself, including your name, Social Security number, and date of birth.

Once you’ve been approved for a business credit card, you’ll be able to use it to make purchases for your hotel. You can also use it to build your credit history which could be very important in securing loans and getting credit lines for your business in the future.

9. Get the Required Business Licenses and Permits

Every state, county and city has different business license and permit requirements.

Nearly all states, counties and/or cities have license requirements for hotel, including:

• Business License :  A general business license is required for all businesses, including hotels. The cost of a business license varies depending on the state, county and/or city in which the hotel is located.
• Occupancy Permit :   An occupancy permit, also called a Certificate of Occupancy, is required before you can open your hotel to the public.
• Alcohol Licenses :  If you plan to serve alcohol at your hotel, you will need to obtain the appropriate license from the state in which your hotel is located.
• Sales Tax License :  You will need to obtain a sales tax license in order to collect sales tax from your customers.
• Food Service License : If you plan to serve food at your hotel, you will need to obtain a food service license.
• Fire Department Approval :  Most hotels are required to have approval from the local fire department before they can open to the public.

Be sure to check local government guidelines to determine which licenses and permits hotels are required to obtain in your area.

10. Get Business Insurance for Your Hotel

The right business insurance is important to protect your new hotel. Business insurance policies that you should consider for your hotel include:

• General Liability Insurance: This insurance protects your hotel business from third-party claims of bodily injury, property damage, and personal injury that occur on your premises or are caused by your business.
• Workers’ Compensation Insurance: If you have employees, you may be required to have workers’ compensation insurance. This insurance protects your employees if they are injured or become ill as a result of their job.
• Property Insurance: This insurance protects your hotel property from loss or damage due to fire, theft, vandalism, and other covered events.

11. Buy or Lease the Right Hotel Business Equipment

Beyond the furniture and equipment you will need in each room, opening a hotel will also require some business equipment, including:

• A reservation system to take bookings
• A property management system (PMS) to manage rooms and rates
• A booking engine if you want to accept online bookings
• Rooms keys and/or access cards
• Reception furniture

12. Develop Your Hotel Business Marketing Materials

Marketing materials will be required to attract and retain customers to your hotel.

The key marketing materials you will need are as follows:

• Website : Likewise, a professional hotel website provides potential customers with information about the services you offer, your company’s history, and contact information. Importantly, remember that the look and feel of your website will affect how customers perceive you.
• Social Media Accounts : establish social media accounts in your company’s name. Accounts on Facebook, Twitter, LinkedIn and/or other social media networks will help customers and others find and interact with your hotel.
• Logo : Spend some time developing a good logo for your hotel. Your logo will be printed on company stationery, business cards, marketing materials and so forth. The right logo can increase customer trust and awareness of your brand.

13. Purchase and Setup the Software Needed to Run Your Hotel

Most hotel businesses need a few types of software to run successfully.

First, you will need a PMS. This is software that helps you manage reservations, check-ins, and other aspects of your operations. Some popular options include Cloudbeds, Oracle Hospitality, and HOTELTIME.

You will also want to have a customer relationship management (CRM) system. This software helps you track interactions with customers, manage customer data, and market to potential guests. Many hotels use programs such as Experience Hotel, Oracle NetSuite, and Salesforce.

Additionally, you need to use accounting software such as Quickbooks or M3 to manage your hotel’s expenses.

Research the software that best suits your needs, purchase it, and set it up.

14. Hire & Train Your Hotel Staff

The quality of your hotel staff can make or break your business. You need to take the time to find, interview, and hire the right people.

Start by writing job descriptions for the positions you need to fill. Then, post the job openings online and in places where potential employees are likely to see them. Once you have a pool of candidates, conduct phone and in-person interviews to narrow down your choices.

Finally, once you have selected the employees you want to hire, provide training on your hotel’s policies and procedures. Additionally, give them a tour of the property and introduce them to other staff members. It helps to build out a strong sales team to prospect new business and nurture customer loyalty.

15. Open for Business

You are now ready to host a grand opening for your hotel. Make sure to include your grand opening event in your marketing plan and promote your hotel launch to the right target audience.

If you follow the steps above, you should be in a great position to build a successful business and know everything you need about how to start a hotel business. Below are answers to frequently asked questions that might further help you.

How to Finish Your Hotel Business Plan in 1 Day!

How to open a hotel faqs, is it hard to start a hotel.

Starting any business has its challenges and opening a hotel does require some planning and preparation. The biggest challenges in owning a hotel are securing funding for your new hotel, finding a great location to buy or build, and setting up systems that help your hotel achieve operational efficiency.

As with starting any business, having a good business idea, doing market research, and getting support from experts in the industry increase your chance of success.

How Can I Own a Hotel With No Experience?

If you have no experience in the hotel industry, you will need to find a good hotel management company. A hotel management company can help you with all aspects of starting and running your hotel. They will also be able to provide you with the necessary training.

What Types of Hotels Are Most Profitable?

There is no one-size-fits-all answer to this question. The type of hotel that is most profitable will depend on the location of your hotel and what is of value to the market in that area. A boutique hotel might be a huge success in a small city, while a family-friendly hotel could make more money when placed near a theme park. It is important to do market research to determine which type of hotel can be a profitable business in your area.

How Much Does It Cost To Start a Hotel?

Again, there is no one-size-fits-all answer to this question. The cost of starting a hotel will depend on a number of factors, such as the location of your hotel, the type of hotel, and the level of service you offer. You will also have different upfront costs depending on whether you are building a new hotel or purchasing an existing structure.

With regards to building costs or buying an existing property, this varies tremendously based on the type of hotel (e.g., budget vs luxury) and hotel size (e.g., 5 rooms vs 500 rooms).

How Does a Hotel Make Money?

A hotel makes money by charging guests for the use of the hotel's facilities. The amount charged will depend on the type of hotel, the location, and the level of service offered. Beyond charging for guest rooms, hotels may also make money from additional amenities, such as in-house restaurants, room service, and high-speed internet access.

Is Owning a Hotel Profitable?

Owning a hotel business can be profitable, but the amount of profit is highly-dependent on a number of factors, such as the location of your hotel. You can improve the profitability of your hotel by offering a higher level of service, attracting more guests, and keeping your expenses low.

How Much Does a Hotel Owner Make?

Hotel owners, operators and executives receive varied pay amounts based on the success of their hotel. According to Glassdoor, the typical Starwood Hotels & Resorts Vice President salary is $244,472, which is 45% above the national average.

What Are the Key Financial Metrics and Costs in the Hotel Market?

The key financial metrics in the hotel market are as follows:

Industry profit is measured as earnings before interest and taxes. Industry profits have averaged 15.5% of sales in recent years.

The industry’s major expenses are purchases and cost of sales, such as bedding and room supplies. Many hotels also provide meals and liquor, either in individual rooms or in separate restaurants or dining areas.

Last year, purchases were estimated to account for 29.9% of an average operator’s revenue.

Labor is required in many aspects of hotel management, from front-of-house activities, such as front desk, concierge and related activities, to all back-of-house activities, including general management, accounting, marketing, room cleaning and servicing the kitchens, bars and restaurants.

Many hotel jobs have a low skill and training requirement, and employees can be hired on a part-time or casual basis. Because of this practice, many hotels have high staff turnover.

Therefore, there is a constant need for recruitment and training, which can be costly. Some hotel owners and operators have outsourced part of their staff services to specialist staff-recruitment agencies to lower recruitment costs.

Last year, industry wages accounted for approximately 25.7% of total industry revenue.

Rent and Utilities

Rent and utilities on average comprise 7.6% of hotel revenue.

Other Expenses

Marketing expenses and royalty fees are another significant cost for those industry participants that operate on a franchise basis. Franchisees typically pay an annual fee of 4.0% to 6.0% of total revenue.

Other major operational expenses include repairs and maintenance, promotional costs, commission paid to agents, bookings and internet fees, accounting and legal costs, motor vehicle expenses, stationery and printing, insurance and other administrative and overhead costs.

Why Do Hotels Fail?

Hotels can fail for a number of reasons, including high expenses and low occupancy rates. Hotels can also fail due when owners misunderstand the market in an area and target the wrong customers or fail to do adequate research into hotel industry trends that impact their business.

Often, hotels begin to struggle due to poor management decisions that negatively impact the guest experience. Closely monitoring your spending and making sure your staff is performing well both go a long way toward making your hotel succeed.

How Big Is the Hotel Industry?

According to IbisWorld, there are 74,372 hotels, and the hotel industry generated $166.5 billion in revenue in the United States alone last year. This represents an annual growth rate of 4.7% over the past 5 years.

Industry profits were $26.0 billion, and wages paid to hotel employees totaled $42.7 billion.

What Are the Key Segments of the Hotel Market?

 A hotel is an establishment that provides lodging and, often times, meals and other services for travelers and other paying guests. A motel, on the other hand, provides lodging for motorists in rooms usually having direct access to an open parking area.

A particular hotel or motel can be classified by a number of characteristics, including whether it provides full or limited service, whether or not it is located in a metropolitan area, the state or region in which it is located, its price or rate level, the number of rooms, and whether it is independent or part of a chain operation.

Hotels and motels can also be segmented by room price rates. The establishments with room rates in the highest 30 percentile that are located in local or metropolitan markets are classified as upscale or luxury. The middle 30 percentile is classified as mid-priced, and the lowest 40 percentile as either economy or budget.

Overall, sales from hotels account for 87.4% of industry revenue and 82.0% of industry employment, though they account for only 44.0% of industry establishments.

Hotels that consist of 25 or more rooms provide 83.6% of industry revenue (with 62.7% of industry revenue coming from guest room rentals, 12.5% coming from food and alcohol sales, 4.2% coming from conference and meeting rooms and 4.2% coming from other charges), while hotels that offer fewer than 25 rooms only constitute 3.8% of industry revenue.

Motels provide about 12.6% of industry revenue. The relative proportion of revenue from each of these segments has been relatively stable over the past five years, although motels experienced some growth at the expense of higher-priced hotels during the recession.

What External Factors Affect the Hotel Market?

A number of factors affect the performance of the hotel industry. These drivers include:

• Domestic Trips By US Residents : Trends in domestic travel, especially for business travellers, and the total nights spent away from home directly affect demand for accommodation. As the number of trips made by US citizens rises, demand for hotels and motels to house them increases.
• Consumer Confidence Index : Changes in consumer confidence influence decisions that individuals make concerning expenditure on entertainment and traveling, particularly during a recession.
• Consumer Spending : Consumer spending levels have a direct effect on travel demand. When consumers are spending more overall, they are more likely to spend some of their money on travel and accommodations.
• Inbound Trips By Non-US Residents : Trends in international visitor arrivals and their lengths of stay influence demand for accommodation. A rise in inbound trips positively affects demand for hotels and motels.

Who Are the Key Competitors in the Hotel Market?

 As specified above, there are 74,372 hotels in the United States.

The market leaders (in terms of market share) include Hilton Worldwide Holdings Inc. (13.7%), Marriott

International Inc. (13.5%) and InterContinental Hotels Group PLC (7.5%).

The rest of the market is comprised of many smaller players.

Who Stays in Hotels?

Recent demographics show that totel guests are comprised of: 

• Domestic leisure travelers: 48.5%
• Business travelers: 24.0%
• International leisure travelers: 14.0%
• Meetings, events and incentive travelers: 13.5%

What Are the Keys to Launching a Successful Hotel?

Starting a hotel requires careful choice of a location and strategy, a business plan, access to considerable financial resources, and a customer service mindset.

1) Location and Opportunity

The location for your hotel is highly linked with the opportunity that you feel there is for your hotel. In the right location, where competitors are not fulfilling all customer needs, a hotel can thrive. However, in a beautiful neighborhood that happens to have heavy competition from existing hotels, success may not be so forthcoming. Likewise, if the neighborhood leaves too much to be desired, you may not be able to price the rooms low enough to encourage travelers to stay at your hotel, even if you are within walking distance of key attractions.

2) Strategy

The next step is to know how customers will answer the question “why my hotel?” How will you tailor your services to the customers you want to attract, whether they are families with kids, couples on romantic vacations, businesspeople, or international tourists? Consider the combination of amenities, atmosphere, location, and services that will be right for your customers. Always keep in mind that strategy means making tradeoffs – it is almost impossible to be everything to everyone and succeed. You might have to forgo a certain customer target market in order to make your service offering perfect for your most desired customers.

3) Planning

A hotel business plan is necessary not only for you to think through how you will take on the opportunity, but for you to convince any investor or lender that you have the ability to do so. No savvy investor will be attracted by a lack of planning. There is no excuse to not create a plan with the wealth of information available on writing business plans and even business plan templates tailored to the hotel business sector.

4) Fundraising

Whether you buy an existing hotel, build one from scratch, or renovate a building into a hotel, you will need millions of dollars to invest. Assuming you do not have this money, you will need to seek bank loans and/or angel investment in your hotel. As you will be working with considerable assets, dependable and experienced legal and accounting help is a must as you create deals with investors.

5) Hospitality Mindset

Finally, you must have an ingrained sense of how you want your guests to be treated so that you can instill this mindset in your top management and they can, in turn, teach this to the staff. Staying at a hotel can be stressful and uncomfortable, and guests demand the highest attention to their needs or they will have no problem complaining loudly and publicly. If employees sense you have higher motives than customer satisfaction, customer service may fall by the wayside and your hotel business may fail or never take off in the first place.

The first step to starting a hotel is to develop your hotel business plan . Growthink provides products and services to help you develop a professional business plan and turn your dream into reality.

Where Can I Download a Hotel Business Plan PDF?

You can download our hotel business plan PDF template here. This is a business plan template you can use in PDF format.

Additional Resources in the Hotel Market

For additional information on the hotel market, consider these industry resources:

• American Hotel & Lodging Association: ahla.com
• Hospitality Net: hospitalitynet.org
• Hotel Mavericks: www.hotelmavericks.com

OR, Let Us Develop Your Plan For You

Since 1999, Growthink has developed business plans for thousands of companies who have gone on to achieve tremendous success.

Click here to see how Growthink’s professional business plan consultants can create your business plan for you.

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• How to Create a Hotel Business Plan: Beginners Guide

November 21, 2023

Would you build a house without a blueprint?

Probably not, because it could lead to inconvenience and problems.

The same concept is genuine in the corporate world.

It would be best to have a business plan to operate in the hospitality industry. When planning to own or operate a hotel, you must include everything from the project strategy to budgeting and implementation.

As the studies show that the global hospitality industry is expected to grow to 5.8 trillion U.S. dollars in 2027 at a CAGR of 5.5%, a detailed roadmap is what you need to enter the hotel business.

A hotel business plan will keep you on track and help attract investors. Remember, it is a crucial component for planning for success .

Let’s explore the concrete steps to include in your hotel business plan.

The path starts here.

5 Key Components of a Hotel Business Plan

Having a business plan is a no-brainer.

With a solid business plan, attracting investors , staying on track, ensuring workflows are followed, and enabling you to make crucial decisions becomes more accessible.

Let’s explore the critical components of the business plan for a hotel:

1. Executive Summary

An executive summary is a quick and concise part of a business plan that provides a complete roadmap of your hotel business.

A concise business overview encapsulating visionary business goals is a strategic compass, providing a snapshot of a company’s direction and objectives.

It offers stakeholders a quick understanding of the business’s purpose and potential, aiding informed decision-making and fostering alignment with the organization’s vision.

An executive summary should include:

• Business Overview
• Vision statement
• Mission statement
• Business objectives

You must write your executive summary at the final stage of business planning , as it would help you summarize the goals and objectives of your hotel business.

2. Business Description and Concept

A business plan’s business description and concept section should clarify your mission, the goals you are looking to achieve, unique selling points, and a breakdown of shareholder involvement.

In this section, you will outline the full-service hotel’s concept , target market, unique selling points, and overall vision, which is crucial for standing out in the competitive landscape.

The hotel landscape looked very different 20 years ago; today’s market is saturated.

Therefore, defining hotel concepts around the following key elements will help.

• Positioning

Hotel concept must define how your hotel should look like, what services will be offered, how it presents and markets itself the differentiating factors, and how its staff interacts with guests. Providing this information helps establish a clear market position and enhances its chances of success.

3. Market Analysis and Competitive Landscape

A comprehensive market analysis is indispensable in a business plan. It provides vital insights into the target market, industry, competitive landscape, and consumer behavior.

Understanding hotel industry trends enables you to make informed decisions, mitigate risks, and identify market gaps and opportunities. It’s the foundation for a successful and sustainable business strategy.

Take a broad look and analyze industry trends using business models such as SWOT, Porter’s five forces framework, and PESTEL analysis.

• SWOT Analysis

A SWOT analysis will give you an in-depth analysis of the hotel industry’s strengths, weaknesses, opportunities, and threats.

• Porter’s Five Forces Framework

Porter’s five forces framework helps you look beyond direct competitors when assessing strategy and, instead, consider broader environmental forces. It is best for in-depth competitor assessment and helps create a stand-out USP.

• PESTEL Analysis

PESTEL is an acronym for political, economic, social, technological, legal, and environmental. It gives a bird’s eye view of the whole environment from many different angles that one wants to check and keep track of while contemplating a business plan.

A thorough analysis can help solidify your competitive advantage and develop a contingency plan for how you will deal with your weaknesses and threats.

4. Organizational Structure and Management

An organizational structure is an integral part of the business plan as it provides an overview of the hotel’s management roles according to job responsibility and ranking.

Organizational structure enables quick decision-making , better coordination, and employee communication, enhancing productivity. It ensures the proper functioning of an organization by establishing its chain of command and workflow.

While structuring your hotel team, there are different types of organizational structures that you can choose from:

• Hierarchical

Management operational expertise is essential to ensure that each department carries out its goals to the best ability possible and handles any roadblocks that may stand in the way of business.

Let’s look at what management hierarchy looks like, practically speaking.

• Business owner
• General manager
• Assistant managers
• Department managers
• Operations staff

Detail your short and long-term operational plans and the stakeholders involved for each area. Mention efficient management practices that will help you make better strategic decisions relating to resources and make it easier to scale up your hotel business.

5. Services and Facilities

In this business plan section, you must mention all your hotel services, facilities, and guest offerings. Meeting guest expectations should be at the core of your hotel business plan.

You can enhance its appeal to potential investors and define the guest’s journey by showcasing services and facilities to meet diverse guest needs. Moreover, by outlining the services and facilities, the hotel can create a unique selling proposition and tailor its marketing efforts accordingly.

Here’s a list of standard services and facilities you can find in many hotels:

• Accommodation
• Front Desk Services
• Meeting and Event Facilities
• Recreational Facilities
• Business Services.
• Housekeeping
• Transportation Services
• Entertainment
• Concierge Services
• Childcare Services
• Pet-Friendly Services
• Special Needs Accessibility
• Luggage Storage
• Laundry and Dry Cleaning
• Room Amenities
• Spa and Wellness Services
• Emergency Services
• Wi-Fi and Internet Access

All the quality hotel amenities , services, and facilities must be mentioned in your business plan and aligned with the preferences of your target market.

Financial Projections and Funding

Establishing financial projections and identifying funding requirements and sources is fundamental to planning. They provide a roadmap for the hotel’s financial future, outlining revenue expectations, expense estimates, and profit projections.

Additionally, it offers a clear understanding of the return on investment potential, mitigating financial risks and ensuring sound financial planning for the hotel’s success and long-term sustainability.

Revenue Projections and Budgeting

Revenue projections and budgeting are essential for assessing the business’s viability, attracting investors or securing loans, and demonstrating a well-thought-out financial strategy.

Understanding the financial feasibility of the hotel business is essential to reduce or manage your business risk.

In this section, you should include the following:

• Revenue Projections
• Expense Projections
• Profit and Loss Statements
• Cash Flow Projections
• Financial Statement
• Break-Even Analysis
• Funding Requirements
• Use of Funds
• Funding Sources
• Return on Investment (ROI)
• Financial Assumptions
• Financial Contingency Plan
• Debt Repayment Plan
• Sensitivity Analysis

Financial forecasting based on sustainable budget practices will help you to decide whether a project or an investment is worthwhile by looking at its value and the minimum yield it generates. It

Funding Requirements and Investment Plan

Having an investment plan before starting the hotel business will provide a clear financial requirements roadmap, ensuring adequate capital for startup and improving ongoing operations .

Attracting investors and lenders becomes more accessible with a solid funding and investment plan, as it demonstrates financial preparedness to the investors and lenders.

Here’s how you can structure this section in your business plan:

• Startup Capital
• Working Capita
• Equity Investment
• Grants and Subsidies
• ROI Projections
• Exit Strategy
• Risk Mitigation
• Legal and Contractual Agreements

Securing hotel funding and attracting investments for your hotel becomes more accessible with a clear and well-structured plan. It instills confidence and makes your home business more attractive and feasible.

Risk Analysis and Mitigation

A Proactive approach to risk analysis and mitigation helps you develop contingency plans.

It helps mitigate operational, financial, and reputational threats , ensuring the safety and satisfaction of guests, protecting investments, and maintaining business continuity, ultimately supporting long-term profitability and success in a competitive industry.

Addressing risk mitigation strategies in the plan is crucial in creating a resilient and sustainable business model in the competitive and ever-evolving hotel industry.

To manage risks in the hotel business, you can implement the following strategies:

• Risk avoidance – For example, you may face a risk where you won’t be able to serve the customers on time due to a lack of staff. To avoid this risk, you could hire the correct number of staff in case of a seasonal rush at the hotel.
• Risk reduction – For example, you can’t serve an essential ingredient for your dish at your hotel due to seasonality issues. To avoid this risk, you must ensure inventory management practices and have connections with multiple suppliers.
• Risk transfer – For example, if you don’t have the expertise to maintain social media, you are at a loss for online opportunities. You can outsource digital marketing to an expert agency to avoid this risk.
• Risk control – For example, if you cannot achieve a certain staff performance level. To avoid this risk, you can provide on-site training and development.

The hotel business plan is committed to safeguarding investments and ensuring guest safety and satisfaction by identifying and assessing potential risks.

It also reassures investors, lenders, and stakeholders that the hotel is well-prepared to navigate unforeseen circumstances, enhancing confidence in the project’s viability.

Implementation Plan and Milestones

A strategy implementation plan is a detailed roadmap that clearly defines the steps and activities required to execute the strategy effectively.

In this section, you must present a breakdown of tasks into identifiable steps, assign tasks and responsibilities to the people involved, and create a definitive timeline for the entire project.

Operational Plan

An operational plan outlines the steps to achieve your hotel business objectives. It is helpful for investors and your employees because it pushes you to think about tactics and deadlines.

Your operations plan should be able to answer the following:

• Who – The person or departments in charge of completing specific tasks.
• What – A description of what each department is responsible for.
• Where – The information on where daily operations will be taking place.
• When –The deadlines for when the tasks and goals are to be completed.
• How much – The cost amount each department needs to complete their tasks

When creating your operational plan, consider all the activities that will help implement hotel operations, ensuring service excellence . Make sure your strategic objectives are in place and relevant.

Below is the list of the day-to-day operation plan for service delivery.

• Reception and Guest Services
• Food and Beverage Services
• Maintenance and Engineering
• Accounting and Finance
• Sales and Marketing
• Reservations and Front Desk
• Health and Safety
• Guest Relations and Services
• Room Reservations and Inventory
• Procurement and Supplies
• Efficient Staffing

Marketing and Promotion Strategy

Marketing strategy and promotion plans help hotel reach their target audience, build brand awareness, and drive sales. With it, a company may be able to compete, gain visibility, or achieve growth goals.

A well-defined marketing and promotion strategy is pivotal for revenue growth, profitability, and long-term success, ensuring that the hotel stands out and thrives in the hospitality sector.

Hotels increasingly embrace moral marketing , prioritizing sustainability, social responsibility, and ethical practices to connect with conscious consumers and create a positive impact. Include this in your business plan to manage the costs associated with green initiatives, ethical sourcing, social responsibility, and marketing to prioritize moral marketing and sustainability.

As a hotel business owner, online and offline marketing strategies must align with the hotel’s overall objectives and goals, enabling the hotel to achieve the desired operational efficiencies.

Online marketing and promotion strategies for the hotel business include:

• Search Engine Optimization (SEO)
• Pay-Per-Click Advertising (PPC)
• Social Media Marketing
• Email Marketing
• Online Travel Agencies (OTAs)
• Content Marketing
• Influencer Marketing
• Online Review Management

Offline promotion initiatives for guest attraction used by hotel business include:

• Local Event Sponsorship
• Print Advertising
• Direct Mail Marketing
• Travel Trade Shows
• Networking with Local Businesses
• Billboards and Signage

Promoting your hotel business will help you reach potential guests and give them a reason to choose your hotel over the competition, thanks to your unique value proposition.

Milestones and Key Performance Indicators (KPIs)

Setting milestones and key performance indicators helps hotel businesses stay on track and focused on achieving goals. These measurements enable informed decision-making , highlight areas that require improvement, and can be instrumental in adapting strategies to market trends.

Milestones and KPIs ensure goal tracking and enable accountability and efficiency, contributing to the overall success and sustainability of the hotel business.

Following are the ways to set milestones for your hotel business:

• Revenue Growth Targets
• Occupancy Rate Goals
• Customer Satisfaction Improvements
• Expansion and Renovation Milestones
• Marketing and Advertising Milestones
• Staff Training and Development Benchmarks
• Sustainability and Green Initiatives Targets

Once you’ve identified the milestones for hotel business performance , you can define key metrics to analyze the outcomes.

Critical metrics for tracking hotel performance:

• Occupancy Rate
• Average Daily Rate ( ADR )
• Revenue per Available Room ( RevPAR )
• Gross Operating Profit per Available Room ( GOPPAR )
• Customer Satisfaction Scores
• Direct Booking Percentage

Now, as we navigate the hotel business plan, this outline will be the compass that guides your venture toward success.

Conclusion on business plan creation showcases that your vision and strategies will serve as a tool to instill confidence in investors.

This meticulous planning, coupled with your commitment, inspires investor confidence and secures the necessary support for turning your hotel dream into a prosperous reality.

Maximize your hotel business by leveraging this dynamic plan to achieve your goals.

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Hotel Business Plan: How to Write a Business Plan For Your Hotel

Opening a hotel requires careful planning and a strategic roadmap for success.

A hotel business plan is your key to mapping out every essential detail of your venture, from its vision and target audience to financial projections and marketing strategies.

In this helpful post, we’ll look at how you can create a robust business plan specifically tailored to the hospitality industry.

Discover why a well-crafted plan is crucial, what elements it should encompass, and step-by-step insights on how to initiate the process effectively.

Whether you’re starting a new hotel or revitalizing an existing one, a solid business plan will be your cornerstone for achieving profitability and excellence in the competitive world of hospitality.

If you’re ready to get started, we put together a hotel business plan template that you can use.

What is a Hotel Business Plan?

A hotel business plan is an official document that serves as an in-depth guide for a hotel venture, encompassing aspects such as its objectives and intended audience, along with the offerings in terms of products and services, marketing tactics, and financial forecasts.

These business plans are vital instruments for initiating a new hotel enterprise , as they lend credence and furnish a framework for attaining long-term profitability and triumph.

Crafting a business plan enables you to ensure a thorough grasp of the necessary steps to fulfill your ambitions and the pathway to making your hotel endeavor prosperous.

In this post, we’ll explore the significance of writing a robust plan, the essentials that should be incorporated into it, and the approach to commence crafting your business plan with simplicity.

Do You Need a Hotel Business Plan?

Starting a hotel business requires a lot of strategy and planning.

The necessity of a business plan in this context is undebatable.

There are a number reason why you would want a hotel business plan before getting started.

A well-structured business plan can aid you in various ways:

• Determine if you truly wish to pursue your business concept.
• Learn the essentials for advancing your hotel enterprise.
• Convince potential business partners to collaborate with you.
• Build self-assurance and validate the viability of your business idea.
• Gain greater command over your enterprise and focus on the key ingredients for success.
• Assess your progress and whether you are meeting your goals at various stages.

Above all, a business plan enhances your decision-making ability as your business expands.

Studies indicate that possessing a business plan can accelerate business growth by 30% and safeguard against business collapse.

Starting Your Hotel Business Plan

The key takeaway is to start without delay.

You might even begin by noting down points as you learn about the four crucial components of a hotel business plan:

Executive Summary and Overview

Though it appears at the beginning, the executive summary and overview are often easier to compose after you’ve gone through the planning process.

This segment is concise, usually spanning only a page or two. It often garners the most attention, so it deserves your focus.

Be direct and clear, outlining:

• Your Vision: What’s your grand vision for your hotel?
• Your Mission: This should succinctly describe why your hotel exists today – who are your guests and how do you meet their expectations?
• Your Goals: Set out your primary business objectives and timelines. Make them tangible, like achieving a 90% occupancy rate and a 25% increase in website leads within two years.

Here, you also have the chance to showcase your hotel brand identity – the colors, logo, font, and design that embody your business ethos.

Remember, this segment is pivotal to your plan. After writing it, ask yourself:

• Does it reflect your passion and excitement?
• Is it compelling and engaging?

If not, invest more effort. Your aim is to encapsulate your vision and create a guiding tool for all future decisions, both major and minor.

Hotel Services and Amenities

Starting a a hotel business demands a comprehensive understanding of the industry, market, and competitors.

To differentiate your hotel from others, it’s crucial to have a clear grasp of these elements.

• Industry Analysis: Your hotel is a part of the wider hospitality and tourism sectors. Investigate current hotel trends and issues impacting these industries. Consider the effects of technology, economy, politics, environmental concerns, and global health issues, especially on hotels similar to yours. Identify any potential red flags.
• Competitor Analysis: Identify your competitors, focusing primarily on those in your locality. Analyze what they are doing effectively and areas where they lack.
• Understanding Your Target Guests: Define your ideal guests. Are they families seeking a getaway, or couples looking for a cozy retreat? Include detailed demographics, lifestyle, and purchasing habits.
• Unique Selling Point (USP): What sets your hotel apart from competitors? Why would guests choose your hotel over others? This could be a distinct feature or service that makes your accommodation stand out.

You’ll also want to detail the specific services and amenities your hotel will offer, such as:

• Location and corresponding amenities (e.g., a pool in a tropical location).
• Guests’ dietary needs and preferences.
• Sustainability practices.
• Guests’ budget considerations and policies like cancellation and refunds.
• Social media engagement strategies.
• Unique physical features of your hotel, like a potential conference venue.

Starting a hotel requires deep dives into industry trends, competitor strengths/weaknesses, and your target audience’s desires.

Be sure to worn on creating a unique selling point, define your service offerings, and consider details like location, guest needs, budget, and social media presence to truly stand out in the market.

Business Operations, Management, and Marketing

Hotel Operations: Detail the operational aspects, including key tasks, potential outsourcing needs, staff employment, training requirements, and the creation of policies and manuals.

Hotel Marketing: Develop a hotel marketing strategy targeting the right audience with an appropriate message. Consider various channels like traditional and digital advertising, loyalty programs, hotel content marketing , social media , email marketing, online reviews, and hotel SEO . Analyze competitors’ strategies and incorporate digital marketing for efficiency.

Hotel Distribution: Outline your room distribution strategy, whether through your website, third-party platforms, or travel agents. Consider operational and financial aspects, and think about using a channel manager to avoid issues like double bookings.

Hotel Revenue and Pricing: Focus on profitability by setting appropriate room prices, offers, discounts, and payment options. Address rate parity, cancellation, and refund policies.

By addressing these areas comprehensively, your business plan will form a solid foundation for your hotel’s success.

Writing the Financial Business Plan For Your Hotel

In this section, you’ll need to cover the financial specifics crucial for your hotel’s establishment and profitability, including the initial capital investment, ongoing operational costs, and anticipated return on investment (ROI).

Areas to address in your financial business plan:

• The structure of your business (Will it be a partnership, a company, or another form?)
• The business model you intend to follow.
• Detailed breakdown of start-up and recurrent expenses and budget planning.
• Bookkeeping, accounting, and tax management strategies.
• Essential insurance coverage and permits required.
• Key suppliers and partnerships that are vital for your business.

Given the complexity of these aspects, it’s a good idea to consult a professional while crafting this section of your business plan.

Next Steps for Your Hotel Business Plan

Remember, converting your business aspirations into reality starts with documenting them in a business plan.

If the process seems daunting, tackle it one section at a time, beginning with what you find easiest.

Once your hotel business plan is fleshed out, use it to:

• Enumerate specific goals and tasks essential for launching your idea.
• Prioritize actions and set definitive deadlines.
• Identify and engage individuals responsible for various aspects of your plan.

Be aware that as your business concept evolves or grows, modifications to your business plan might be necessary.

Regularly reviewing your business plan, perhaps every six months or annually, is beneficial. This allows you to evaluate your progress and reassess your goals: are they still relevant, or do they need to be adjusted?

As you develop and implement your plan, don’t overlook the impact of hotel technology. It can revolutionize your business, simplify daily operations, and enhance revenue.

About the author

Alexander has been working with business in the travel and tourism industries since 2012. With over a decade of experience, Alexander and Wizard of Tourism strive to help those in the travel industry grow their business online.

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BUSINESS STRATEGIES

How to start a hotel business

• Rebecca Tomasis

Get started by: Creating a website →  | Getting a domain →

If you're passionate about providing exceptional hospitality and managing a range of services, starting a hotel business could be a good fit for you. This guide will walk you through the steps of initiating and operating a successful hotel business, including the advantages and challenges involved in starting a business , how to go about creating a business website  to support your hotel business and how to generate revenue in the hotel industry.

What is a hotel business?

A hotel business is a service-oriented business  that offers a variety of accommodations, amenities and services to guests. Hotel businesses typically provide services such as:

Lodging services, including room reservations and check-ins

Dining options, such as restaurants and room service

Event hosting and conference facilities

Recreational facilities, like gyms, pools and spas that can be used both by hotel guests and visitors

Why start a hotel business?

The US hotel industry is on a steady climb, projected to grow by a healthy 5.5% per year through 2033 . That translates to big bucks for savvy hospitality entrepreneurs – travelers are spending billions annually on their stays, with the average US hotel room topping $212 per night, according to Hopper's Q1 2023 data . This market presents a ripe opportunity for anyone with a passion for guest experience and a knack for creative ideas. 

How to start a hotel business in 7 steps

Decide on your hotel business niche

Create a business plan

Select a business structure

Obtain business financing or capital

Set up accounting and bookkeeping services

Source specific hotel equipment

Register your hotel business

01. Decide on your hotel business niche

Various types of hotels cater to distinct preferences and market segments. When starting a hotel business, think about the target audience you wish to attract and what amenities can best suit their needs. Some of the more popular hotel business niches include:

Luxury hotel chains : Starting a luxury hotel chain or a resort hotel can provide guests with high-end experiences and upscale accommodations, emphasizing luxury amenities and personalized services. 

Resort hotels : Resort hotels focus on providing guests with enjoyable and luxurious experiences, often situated in scenic locations with extensive amenities like spas, recreational activities and fine dining options.

Boutique hotels : Boutique hotels are characterized by their intimate settings, unique themes and personalized services, appealing to travelers seeking distinctive hospitality experiences.

Extended stay hotels : Targeting guests with longer accommodation needs, extended stay hotels like Residence Inn by Marriott or Homewood Suites offer spacious rooms and kitchen facilities that are designed for extended visits.

Budget-friendly accommodations : Motels and economy hotels cater to cost-conscious travelers, providing amenities at affordable rates while maintaining a level of quality and cleanliness.

Class A hotels : Class A hotels include well-known brands like Hampton Inn, Holiday Inn Express and Courtyard by Marriott that offer comfort at competitive rates, appealing to a broad range of travelers.

02. Create a business plan

Develop a comprehensive business plan  that covers key aspects of your business planning such as your target market, executive summary, marketing strategy  and financial projections. This plan serves as a roadmap for your business and aids in conveying your vision to potential investors when seeking funding. It should also include other important business information such as the type of business  you plan to start and your choice of a business name . 

Here’s a hotel business plan template to get you started:

Hotel business plan template

Executive Summary

 Business Name:  [Your Hotel's Name]

 Business Structure:  [Sole Proprietorship/Partnership/LLC/Corporation]

 Location:  [City, State]

 Founding Date:  [Month, Year]

 Founders/Owners: [Names]

 Mission Statement:  [Concise statement of the hotel's purpose]

Business Description

Overview:  Briefly describe your hotel, including its key features, amenities and services.

 Unique Selling Proposition (USP): Clearly define what sets your hotel apart from competitors.

Target Market:  Identify your primary customer demographic and market segment.

Services and Amenities

 List and describe the accommodations, services and amenities your hotel will offer.

 Include room types, dining options, event spaces, recreational facilities, etc.

Market Analysis

 Industry Overview:  Provide an overview of the hotel industry, including trends and growth projections.

 Competitor Analysis : Identify key competitors and analyze their strengths and weaknesses.

 Target Audience:  Define your target customer profile and their preferences.

Marketing and Sales Strategy

Marketing Plan: Outline your strategies for promoting the hotel, including online and offline channels.

Pricing Strategy:  Detail your pricing structure and any promotional pricing.

Sales Tactics:  Describe how you will attract bookings and increase occupancy rates.

Operational Plan

Location and Facilities:  Describe the physical location and facilities of your hotel.

Suppliers:  List and describe key suppliers for goods and services.

Staffing:  Outline your staffing plan, including roles and responsibilities.

Financial Plan

Startup Costs:  Detail initial investment requirements and startup expenses.

Revenue Projections:  Provide realistic revenue projections for the first 3-5 years.

Operating Costs:  Outline ongoing operating expenses, including utilities, maintenance and staff salaries.

Funding Requirements:  Specify any funding needed and potential sources (loans, investors).

Funding Proposal

Purpose of Funding: Clearly state how the funds will be utilized.

Amount Needed: Specify the amount of funding required.

Repayment Plan:  Outline the proposed repayment plan for loans or investments.

Risk Analysis

 Identify potential risks and challenges that may impact the success of your hotel.

 Develop strategies to mitigate and manage these risks.

Include any additional documents or information relevant to your business plan.

Examples: Market research data, resumes of key team members, mock-ups of marketing materials.

 Summarize the key points of your business plan and highlight the potential success of your hotel.

 Conclude with a call to action or next steps.

Note: This template serves as a general guide. Adjust and expand sections based on your specific business model and goals.

03. Select a business structure

Choose an appropriate business entity  or structure for your hotel, such as a sole proprietorship , partnership , limited liability company (LLC ) or corporation . Each structure has its own advantages and disadvantages, so select the that algins with your business goals.

Learn more: How to start an LLC

04. Obtain business financing or capital

Starting a hotel business involves substantial start-up costs. You’ll need to secure considerable financing through methods like bank loans, grants or investments from stakeholders to launch and sustain your business.

Costs that you’ll need to factor in when securing financing for your business include:

Purchase or lease of land or existing property

Renovation or construction costs for the hotel building

Fees for obtaining necessary licenses and permits for operating a hotel

Interior design services

Furniture, fixture and equipment for guest rooms, common areas and facilities 

Installation of reservation systems and hotel management software

Purchase of computers, servers and other technology infrastructure

Recruitment and training costs for hotel staff

Initial salaries and benefits for employees

Marketing and advertising campaigns to promote the hotel

Making a website  and its maintenance

Initial inventory of linens, towels, toiletries and other guest supplies

Setup and stocking of restaurant, bar, or catering facilities

Licensing and health inspection costs for F&B operations

Property insurance to protect against fire, theft or natural disasters

Payment of applicable taxes, including property taxes and business taxes

05. Set up accounting and bookkeeping systems

Establish robust accounting and bookkeeping systems from the outset to track income, expenses and ensure financial viability. This includes managing corporate tax obligations if applicable.

06. Source specific hotel equipment

Acquire the necessary equipment for your hotel, ranging from room furnishings to kitchen appliances, based on the services you plan to offer. Some more specific examples of this include:

Front office systems:  Computers, POS systems for check-in/out, reservation management software, and key card systems.

Payment and communication:  Cash registers, credit card processing terminals, and telephone systems.

Guest room essentials:  Beds, mattresses, linens, towels, wardrobes, dressers, bedside tables, lamps, desks, chairs and room safes.

Room comforts:  Air conditioning/heating units, mini-fridges, minibars, televisions, irons, ironing boards and hairdryers.

Cleaning and maintenance:  Cleaning carts, vacuum cleaners, carpet cleaners, laundry equipment and basic maintenance tools.

Kitchen and dining facilities: Commercial ovens, stoves, grills, refrigerators, freezers, dishwashers, utensils, dining tables, chairs, tableware, and flatware.

Technology and entertainment:  Wi-Fi, internet connectivity, audiovisual equipment, gym equipment, pool/spa equipment and game room equipment.

Security and safety:  Surveillance cameras, monitoring systems, access control, alarms, security lighting, fire detection and suppression systems.

Operational supplies: Cleaning supplies, toiletries, guest amenities, staff uniforms and waste disposal systems.

Meeting and event facilities: POS systems for restaurant transactions, conference tables, chairs and catering equipment.

07. Register your hotel

Register your hotel business in compliance with local regulations, obtain the required licenses and secure appropriate insurance coverage.

Learn more: How to register a business , How to get a business license

How much does it cost to start a hotel business?

Starting a hotel business requires a substantial financial investment to cover various expenses such as property acquisition or lease, renovations or construction, operational costs, furnishing costs, staffing, amenities, marketing and contingency funds. The amount of money needed to start a hotel business can vary significantly depending on factors like location, size, target market and level of luxury.

Starting a small boutique hotel could require anywhere from hundreds of thousands to millions of dollars, while larger upscale hotels may require multi-million dollar investments. It's crucial to conduct thorough financial planning, including budgeting for both initial startup costs and ongoing operational expenses, to ensure the successful launch and sustainable growth of your hotel business.

Tips for managing your hotel business for profitability

Once you’ve got your hotel off the ground, you’ll need to understand how to properly run and manage it in order to make sure it’s profitable. Here are some general tips on how to achieve that: 

Research your industry

Gain a deep understanding of the hotel industry, including market competition, target demographics and financial requirements. If you lack experience in the hotel industry, consider working for an established hotel or volunteering at a local hospitality agency to acquire valuable insights and experience. You might also choose to partner with someone who has that experience and industry connections.

Create a financial plan

Create a financial plan that includes detailed projections for startup costs, operational expenses, revenue forecasts and a profitability analysis. It should also include a thorough market analysis to determine the feasibility of starting your hotel business, considering factors such as target market demand, competition, pricing strategies and potential ROI .

Your financial plan should also outline capital sources, whether through personal investment, loans, partnerships or investors and establish a clear budget allocation for areas like property acquisition, renovations, staffing, technology implementation and contingency funds. Effectively managing resources and startup capital , you can proactively mitigate risks.

Promote your hotel

Develop a robust marketing strategy from the beginning to proactively promote your hotel. You’ll also need to make a hotel website , for hotel bookings  and promotions.

Emphasize customer service

Exceptional customer service is crucial for success in the hotel industry. Ensure a positive experience for guests from booking to check-out. Invest in well-trained staff and establish clear customer service protocols to handle any hotel issues that may arise.

Hotel businesses to inspire (all built on Wix)

Coda hotels.

This boutique Williamsburg hotel offers unique rooms as well as a beach club, nightclub, dining and other great facilities for their guests. 

Chateau de Fontlozier

This alps based hotel offers luxury stays from its historic building. Their large lawns offer a number of popular activities for hotel guests, including a children's play area. 

This Mexican holiday rental villa includes 5 bedrooms and a stunning pool, for the perfect getaway. And is proof that you can start a hotel business with a vacation rental and build from there. 

Stay Gainesville

This furnished local accommodation for all lengths of stays also proves that a hotel business can be started with all types of properties. 

The Asheville Inn

This motel in North Carolina also offers pet stays and online booking services. 

Benefits of starting a hotel business

Operating a hotel allows you to be your own boss, set your own hours and make independent decisions. At the same time the demand for hotel services is consistently high, particularly in areas with a substantial tourist or business traveler presence. For business owners who enjoy interacting with people, a hotel business can be rewarding on many levels. 

Challenges of running a hotel business

Hotel management requires diverse skills in areas such as customer service, event planning and facility maintenance. You’ll either need to become an expert fast in all of these areas, or invest in people who can do them. 

Coordinating bookings, managing client expectations and ensuring timely service delivery can be challenging. Working with an online booking system or scheduling software  is crucial for managing this effectively. 

Hotel occupancy rates can vary, leading to fluctuations in workload and revenue. With these challenges comes also the fact that the hotel industry is competitive and standing out requires a unique value proposition and effective marketing.

How profitable is a hotel business?

The profitability of a hotel business depends on factors such as location, market demand, competition, pricing strategies and operational efficiency. For example, high population density and tourist-centric areas often offer more potential customers but may also mean increased competition from other hotels. This intense competition may be applying more competitive rates and diversified services in order to compete and make a profit. In general, regardless of the type of business, streamlining business processes can contribute to higher profitability by reducing costs and enhancing service delivery.

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How to Start a Hotel Business: Everything You Need to Know

Wondering how to start a hotel business? You’re not alone. One of the first-ever hotels , as we’ve come to know them, was started in Exeter, England in 1768. Today, the industry has skyrocketed to be part of one of the largest in the world.  But dreaming of starting a hotel business and actually doing it are two completely different things. That's where we come in. 

In this guide, we’ll teach you how to start a hotel business with step-by-step instructions, expert advice, and actionable tips. Keep reading to discover the fundamentals all hotel businesses need to succeed.

The steps we cover in this guide:

• Step 1: Find a market need
• Step 2: Craft your strategic goals
• Step 3: Run the numbers
• Step 4: Review financing options
• Step 5: Do your paperwork
• Step 6: Hire and train your team
• Step 7: Draft a marketing plan
• Step 8: Launch your hotel business

Discover how to start a hotel business in 8 steps:

Step 1: find a market need..

The first and most important step when learning how to start a hotel business is to gain a thorough understanding of the hospitality industry worldwide, as well as in your location. To get started, find your favorite hotel news sources , then set aside time each day or week to stay informed. Once you have some familiarity with the industry, it’s time to dive into the market research for your hotel.

Let us help you start your hotel business

Cvent's resources library is a great place to start. It's where you can read the latest news, thought leadership, and best practices from a wide variety of industry experts. The goal of your industry research is to get a clear idea of whether you can be competitive in your market. Also, what characteristics your hotel will need in order to succeed. 

Rather than starting with an idea and making the research fit, try to find an area of need in your market. What audiences are underserved? Where is demand outpacing supply? What does your location need in terms of hospitality and accommodation?

To give you a good understanding of where you’ll fit in, your market research should include:

• Property type. All hotels are not built the same. The industry is made up of resorts, spas, airport hotels, all-inclusives, hostels, boutiques, and many other property types. Determine what property type you plan to offer and what other options in that category exist in your location.
• Hotel size. Closely related to your property type is the hotel size. How many guest rooms will you offer, and how does that compare to your competitors?
• Star rating. What level of service and hotel amenities do you plan to offer?
• Location. What region will you operate in? Is demand increasing in the area? What location amenities, like airports, beaches, or event venues , will you be in close proximity to?
• Brand affiliation. Will you be a part of a larger brand’s umbrella? Being affiliated with a brand can help with marketing , business intelligence, pricing, and audience targeting.
• Extra amenities. What services or amenities are important for hotels of your type and star rating in your location? Things like free Wi-Fi, meeting space, a pool, or wedding services  are all important, depending on your target audience.
• Guest demographics. How would you define the types of guests who may frequent your location? What is the purpose of travel, and what are some common characteristics of these travelers? Knowing whether you are targeting business travelers, families, couples, solo travelers, retirees, or other demographic groups will help you to craft your marketing plan and hotel concept.

All of this research should give you a good idea of your main competitors and target audience. Those two pieces of information will determine everything else about your property, from budget and financing to marketing and daily operations. Spend time on this step to make sure you’ve found a true need in the market. You’ll be better prepared for success.

You can utilize tools like Cvent's Hotel Business Intelligence™ Software Solutions to provide you with the transformative business insights needed to conduct your market research and benchmark against the competition.

Step 2: Craft your hotel's strategic goals.

Once you have an understanding of market needs, you’ll need to create a smart solution to fill that gap. Your unique combination of amenities, concept, decor, marketing, location, and services can help you stand out from the crowd and capture market share if you approach it strategically.

Consider how you’ll approach pricing, revenue management , sustainability, customer satisfaction, events, and other market needs when crafting your goals. As with all goals, they should be S.M.A.R.T - specific, measurable, attainable, relevant, and time-based. According to the Naples Hotel Group , an expert hotel development firm, some of the best goals a hotel owner can focus on include: 

• Measuring and increasing customer satisfaction.
• Creating a solid revenue management system.
• Building a strong online reputation.
• Attending at least one hotel industry conference .
• Considering working with a consulting firm to bypass the common roadblocks new hotel owners face.

Make sure the needs of the market and your target audience, along with your business needs, help determine your goals. This will ensure that everything you do helps your customers, as well as your bottom line.

You can use a hotel business plan template to outline the results of your research and planning, including your competitive advantage, goals, and your plan to get those results.

Step 3: Run the numbers.

With your goals and plan in place, it’s time to run the numbers to make sure you'll be profitable. Using your market research, you can estimate key factors like room pricing, vacancy rates, RevPAR (revenue per available room), and operating costs. A basic overview of hotel finances will help you hire the right revenue manager and sales team later on. The two key areas to focus on are profitability and any external factors that may affect your hotel business. You’ll also need to estimate initial costs for your hotel business. This includes startup and hiring costs, licensing, permits, construction, renovations, and your first year of operations.

Set up a few scenarios in your forecasting to see how key decisions affect the potential profitability of your business. For instance, do you want to buy or build? Buying into a franchise or taking over an existing hotel building has lower startup costs, unless you have to renovate extensively. But it also requires you to establish your new hotel identity, which can be a challenge depending on the current state of the business. On the other hand, building a hotel, while usually considerably more expensive upfront, can provide a solution to a lack of available buildings and can be more lucrative in the long run. 

Step 4: Review financing options for your hotel business.

Once you decide on the right financial plan for your business, you’re ready to fund it. There are a number of available options for financing your hotel business. Jim Pendergast, Senior Vice President and General Manager of altLINE , discussed this topic in a recent interview with Cvent.

“It's important to understand the full scope of financing options available for your hotel's funding," he said. "Generally, you have two commercial financing categories when opening your hotel: traditional credit or specialty credit.

With traditional credit lines, you receive financing based on long-term assets. These are things like real estate owned by your hotel as well as cash flow projections and calculations submitted during underwriting. Lenders review these assets before awarding your loan.

With specialty credit, you'll receive financing or credit lines based on near-term assets. This might be hotel equipment or invoices from accounts receivable. The idea is these backings are more liquid than what's needed in traditional lending.

Both traditional and specialty financing are appropriate vehicles for hotels depending on your capital needs. However, the larger and more established your hotel franchise, the more specialty lending could make ongoing sense. This is because large hotels manage significant account receivables operations. 

Consider the amount of credit card transactions that must be administered. Also, hospitality-related vendor operations happening within the establishment. The larger your AR activities, the more something like AR-based asset lending and similar specialty lending might benefit you.”

Step 5: Do your paperwork.

There are many important legal, regulatory, and insurance requirements to fulfill in order to establish any new business. Your hotel business is no different. 

Consult with your legal, insurance, accounting, and operations teams to determine the requirements for your location. At a minimum, you’ll need to set up a business structure and get business insurance. You will also likely need building or renovation permits, hotel licensing, and licensing for serving food and alcoholic beverages. There will also be a number of health and safety requirements as you complete your building or renovation process. 

All of this paperwork is not the motivating factor for getting into the hospitality industry, but it is important. Work with your team to check requirements at the local, state, and federal level. Additionally, keep on top of the process throughout so you don’t have to repair costly mistakes later.

Modern hotel management begins here

Step 6: Hire and train your hotel team.

A business is only as good as the team members that contribute to its success. By hiring great employees at all levels, you’ll set yourself up to deliver value to your guests and become a market leader.

Many hotels opt to hire for executive and departmental positions first, setting the tone and direction. These leaders can then identify what they want to see within their teams and how many staff members they need. Each team should identify the roles and skills they’re looking for, as well as developing a plan to reach and source great new hires.

Make sure that your application and interview processes are easy for candidates so that you don’t introduce needless friction. Find ways to communicate your core mission, values, and approach to this new business throughout the hiring process. This will help you attract candidates who share your vision.

Once you’ve hired a great team, take the time to onboard and train them. This is an incredibly important step that will help everyone in the long run. Any employees who will interact with guests should receive extra training on customer service and guest relations so that they’re ready to lend a helping hand, regardless of whether it’s in their job descriptions.

Focus from the beginning on becoming the employer of choice in your market. You’ll attract a stellar team that’s ready to help you become a market leader.

Step 7: Draft a marketing plan.

You’re now ready to share your hotel concept with the world. Well in advance of opening, you’ll need to spread the word and set yourself up for a profitable launch. 

Your hotel marketing plan is an important part of your overall business strategy. It guides your decision-making on decor, daily operations, communications, customer service, and more. 

Think back to the target audience that you identified in your market research. Using that initial audience, you can now conduct more in-depth customer research to determine who your customers are. Also, where you’ll find them, how you’ll communicate with them, and how they define value.

Hotel marketing made simple

Hotel marketing expert and Co-Founder of Saffron Key, Ben Weagraff, advises that there is no one-size-fits-all plan for new hotel businesses.

“There’s a number of strategies that can work very well,” he told SiteMinder . “But they depend on the hotel itself; its digital properties (including website , email relationships , the strength of social media channels ) and what exactly the hotel is trying to do.”

He goes on to note: “However, generally these techniques present a good repeatable path towards driving high-value customers. The greatest thing about content marketing is that it is low-cost, measurable, repeatable, and it builds upon itself. Once the foundation is in place, customers roll in at increasing rates.”

If you’re looking for ideas for inspiration, check out  Marriott’s marketing strategy . Also, be sure to check out all of Cvent's hotel marketing solutions  to help guide you throughout the process.

Step 8: Launch your hotel business.

At this point, you’ve put in the work to open a profitable and high-quality hotel business for your market. You’ve got the plan and the team to make your vision a reality. Now it’s time to launch.

The goal of your launch is of course to introduce your hotel to guests. But it’s also a great opportunity to introduce yourself to the local community, key stakeholders, influencers, and potential partners. Put your best foot forward with these audiences by planning a grand opening event that reflects your mission and values.

Use event planning and diagramming tools to create your layouts, collaborate with vendors, and assign tasks to team members. As long as you focus on building relationships with your community, investors, and potential clients, your grand opening will be a success. 

Now you know how to start a hotel business using proven strategies from across the industry.

Now that you know how to start a hotel business, it's time to start thinking about reputation. Read on for  hotel reputation management tips every hotelier should know.

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Hotel Business Plan Guide + Sample Plan

July 6, 2023

Adam Hoeksema

The hospitality industry offers immense potential, while some might believe that operating a hotel is straightforward, involving only accommodations and foot traffic, careful planning and meticulous execution are essential for achieving success, hence a well-structured business plan is indispensable.

Our primary expertise lies in hotel financial projection models but we understand that some of our clients require comprehensive business plans. That's why we've taken the initiative to delve into this topic and cover the following:

• Why Write a Business Plan For a Hotel?
• What to Include in a Hotel Business Plan?

Hotel Business Plan Outline

How to select a location for a hotel, how to analyze the competition for a hotel, how to create financial projections for a hotel, example hotel business plan, hotel business plan faqs, why write a business plan for a hotel.

For Hoteliers seeking financial support from investors, banks, or financial institutions, a well-structured business plan is a fundamental prerequisite. Demonstrating a thorough evaluation of the market, a clear and strategic approach, and a thoughtful assessment of potential risks and rewards is paramount to attracting the necessary funding for your venture.'

What to include in a hotel business plan?

A hotel business plan should provide investors and lenders with compelling reasons why guests will choose your hotel, demonstrate why you or your team are the ideal operators for the hotel, and present a financial projection that ensures their investment is secure. Below is a comprehensive outline of our complimentary hotel business plan template .

We suggest the following sections for your Hotel business plan

Executive Summary

Company Description

Market Analysis

Product and Service Offerings

Marketing Plan & Customer Acquisition

Operating Plan

Financial Plan

Choosing the right location for your hotel is a critical step in ensuring its success and captivating your target audience. To help you make the best decision, we present three essential points to consider when selecting a location for your hotel  Local Demand and Visitor Profile: Assess the local demand for hotel accommodations in the area. Analyze the type of visitors who frequently visit the locality, such as tourists, business travelers, or event attendees. Understanding the local visitor profile will help you tailor your hotel's offerings to meet their needs and preferences.

Proximity to Key Points of Interest: Look for a location that is in close proximity to key points of interest within the local area. This could include popular tourist attractions, convention centers, business districts, or entertainment venues. Being near such attractions increases the chances of attracting more guests and ensures a steady flow of potential customers.

Accessibility and Transportation Links : Ensure that the location is easily accessible by various modes of transportation. Consider the distance from major transportation hubs like airports, train stations, and bus terminals. Also, evaluate the availability of public transportation options nearby, as this will make it convenient for guests to travel to and from your hotel.

By focusing on these three points, you can identify a suitable local location for your hotel that caters to the specific needs of the local market and maximizes its potential for success.

There are a couple of tools that I like to use when analyzing the competition in the hotel industry. 

Ahrefs – Ahrefs will allow you to look up a competitor hotel's website, and you can see how much organic traffic they are getting and exactly what keywords are sending that traffic. For example, we can see that the Bottleworks Hotel in Indianapolis is receiving roughly 3,500 monthly visits from organic Google Search.  

We can also see what keywords are sending the most traffic to that page below:

By understanding the SEO strategies and keywords that competitor hotels are targeting, you can develop your content and marketing strategies to compete in the same spaces or identify underserved areas to capitalize on. This can assist in improving your hotel's online presence and attracting more guests through search engines.

TripAdvisor – Although mainly known as a review site, TripAdvisor can be a free and powerful tool for analyzing competition within the hotel industry. You can see guest ratings, read reviews, and understand what customers appreciate or dislike about different hotels in your area. This qualitative information can help you identify where your competitors are succeeding or failing and where you might have an opportunity to differentiate your services.

Just like in any industry, the hotel business has its own unique factors that impact financial projections, such as occupancy rates, room pricing, seasonal demand, and guest service expenditures. Utilizing a hotel financial projection template can simplify the process and increase your confidence. Creating accurate financial projections goes beyond showcasing your hotel venture's ability to generate revenue; it's about illustrating the financial roadmap to profitability and the realization of your hospitality goals.

To develop precise projections, consider the following key steps:

Estimate startup costs for your hotel business, including property acquisition or leasing, renovation or construction, furnishing and decoration, staff training, and initial marketing and branding expenses.

Forecast revenue based on projected occupancy rates, average room prices, ancillary service income (such as restaurants, spas, conference facilities), and potential growth in the customer base.

Project costs related to ongoing operations like housekeeping, food and beverage services, guest amenities, and maintenance.

Estimate operating expenses such as staff salaries, utility costs, property insurance, marketing expenses, guest support, and administrative costs.

Calculate the capital needed to launch and sustain your hotel business, covering initial expenses and providing working capital for continued growth, including funds for unforeseen challenges such as seasonal fluctuations.

While financial projections are a critical component of your hotel business plan, seek guidance from experienced professionals in the hotel industry. Adapt your projections based on real-world insights, leverage industry resources, and stay informed about hospitality trends and evolving consumer behavior to ensure your financial plan aligns with your goals and positions your hotel venture for long-term success.

Explore our Hotel Business Plan, presented below. If you prefer, you can access a downloadable Google Doc version of this hotel business plan template , allowing you to personalize and tailor it to your specific needs. Additionally, a helpful video walkthrough is available, guiding you through the process of customizing the business plan to perfectly align with your unique hotel concept.

Table of Contents

1. executive summary.

1.1 Organization Overview

1.2. Objectives

1.3. Mission Statement

2. Organization Description

2.1. Organization History

2.2. Legal Structure

2.3. Unique Value Proposition

2.4. Target Beneficiaries

3. Market Analysis

3.1. industry overview.

3.2. Collaborator and Competitor Identification

3.3. Target Beneficiaries

Key Point  1

4. Marketing and Fundraising

4.1. Strategic Plan

4.2. Program or Service Offerings:

4.4. Distribution Channels

4.5. Promotions and Fundraising

Key Point  2

5. Organizational Structure and Management

5.1. Organization’s Facility & Location

5.2. Staffing Plan and Volunteer Management

5.3. Governance, Financial Management, and Accountability

Key Point  3

6. financial plan.

6.1. Startup Costs

6.3. Expense Projections

6.4. profit and loss statement, 6.5. cash flow projections, 6.6. break-even analysis, 7. appendix.

7.1. Supporting Documents

7.2. Glossary of Term

7.3. References and Resources

Key Point  5

 1.1. company overview.

Briefly introduce the hotel's background, products or services, and target market.

      -  Example: Seaside Crest is a tropical-themed hotel located in Key West, Florida, offering a unique and luxurious experience for guests seeking a beachfront getaway.

   1.2. Objectives

Outlines the hotel's short-term and long-term goals.

        - Example:  Establish Seaside Crest as the premier destination for tropical hospitality in Key West, providing exceptional service and unforgettable experiences for our guests.

        - Example: Long-term: Expand our presence in other tropical destinations while maintaining our commitment to quality and guest satisfaction.

  1.3. Mission Statement

 Describes the hotel's purpose and core values.

        - Example:  At Seaside Crest, our mission is to create a haven of relaxation and tropical paradise for our guests. We are dedicated to delivering exceptional hospitality, breathtaking surroundings, and personalized service, ensuring that every guest's stay is a memorable one.

  1.4. Keys to Success

Highlights the factors that will contribute to the hotel's growth and success.

        - Example:  The success of Seaside Crest lies in our commitment to creating a tropical ambiance, offering top-notch amenities, providing outstanding customer service, and delivering a seamless guest experience. 

2. Company Description

   2.1. company history.

Provides context on the hotel's background and founding story.

        - Example: Seaside Crest is the brainchild of founder and hotelier, Emily Roberts, who envisioned creating a tropical paradise in Key West, Florida. With a passion for hospitality and a deep love for the coastal beauty of the region, Emily embarked on the journey of bringing Seaside Crest to life.

   2.2. Legal Structure

 Describes the hotel's legal structure (e.g., sole proprietorship, partnership, LLC, corporation).

        - Example: Seaside Crest operates as a limited liability corporation (LLC)

 2.3. Unique Selling Proposition

  Emphasizes the hotel's competitive advantage or unique offerings.

        - Example: Seaside Crest distinguishes itself by offering a one-of-a-kind tropical-themed experience, combining luxurious accommodations, breathtaking beachfront views, vibrant island-inspired decor, and personalized service. 

  2.4. Target Market

Defines the hotel's ideal customer base.

        - Example: Seaside Crest caters to discerning travelers and vacationers who seek an extraordinary beachside retreat in Key West, Florida. 

  Presents a general overview of the industry, its trends, and growth potential.

        - Example: The tropical hotel industry in Key West, Florida, is a thriving sector driven by the city's popularity as a tourist destination, the allure of its tropical climate, and the abundance of natural beauty that surrounds it.

3.2. Competitor Analysis

 Evaluates the hotel's direct and indirect competitors, as well as their strengths and weaknesses.

        - Example: Other hotels and resorts in Key West offering tropical-themed accommodations.

        - Example: Vacation rentals, bed and breakfast establishments, and boutique hotels in the area.

3.3. Target Market Analysis

Explores the hotel's target customers, their demographics, preferences, and pain points.

        - Example: Seaside Crest targets vacationers and travelers seeking a tropical getaway in Key West. Our primary market includes couples, honeymooners, and families looking for luxurious accommodations with a distinct tropical ambiance and proximity to the beach.

3.4. Market Opportunities

Identifies potential opportunities for the hotel to grow within the market.

        - Example: Seaside Crest can capitalize on market opportunities by offering unique amenities and experiences such as beachfront dining, spa services inspired by tropical traditions, and curated excursions to explore the natural wonders of Key West. Collaborations with local businesses for island-inspired dining and entertainment can further enhance the guest experience.

• Example 1: Conduct a survey among tourists in the area to determine their preferences for tropical-themed accommodations and their interest in a hotel with a beachfront location. (e.g., 80% of surveyed tourists express a strong preference for hotels with a tropical theme and direct beach access)
• Example 2: Analyze the occupancy rates and average daily rates of existing hotels in Key West to assess the demand and pricing trends in the market. (e.g., The average occupancy rate in Key West hotels during peak season is 85%, indicating a high demand for accommodations)

4. Marketing and Sales Strategy

4.1. product or service offerings: .

Describes the hotel's products or services in detail.

        - Example: Seaside Crest offers a range of tropical-themed accommodations and amenities, including luxury guest rooms, beachfront dining, spa services, and curated excursions.

4.2. Pricing Strategy

 Outlines the hotel's approach to pricing its products or services.

        - Example: Seaside Crest adopts a competitive pricing strategy, providing value for money while maintaining the exclusivity and high-quality experience associated with a tropical-themed hotel.

4.3. Sales Strategy

  Explains how the hotel plans to generate sales and build customer relationships.

        - Seaside Crest will implement a comprehensive sales strategy that includes online booking platforms, direct marketing to travel agencies, and partnerships with local tour operators to attract and engage potential guests.

 Describes the methods through which the hotel will deliver its products or services to customers.

   - Example: Seaside Crest will primarily distribute its services through online travel agencies, direct bookings through its website, and collaborations with travel agencies specializing in tropical getaways.

4.5. Promotions and Advertising

 Details the hotel's promotional efforts and advertising strategies.

        - Example: Seaside Crest will employ targeted marketing initiatives, utilizing social media and search engine platforms, to enhance brand visibility and attract new guests seeking a tropical-themed hotel experience in Key West..

• Example 1: Collaborate with local travel agencies to offer exclusive vacation packages that include a stay at Seaside Crest, showcasing the unique tropical experience and attracting potential guests. (e.g., 50 vacation packages sold within the first month of collaboration)
• Example 2: Organize a pre-launch event at a popular local venue, inviting travel influencers and bloggers to experience a preview of the hotel's amenities and share their impressions on social media. (e.g., 10 influencers with a combined reach of 500,000 followers attend the event and generate significant online buzz)
• Example 3: Offer a giveaway on social media to build a following

5. Facility Maintenance and Operations Plan:

   5.1. facility location and layout.

 Specify the hotel's physical business location and refer to the internal arrangement and organization of the space.

        - Example:Seaside Crest will secure a prime location in Key West, strategically positioned in close proximity to the beach and popular tourist attractions. The hotel's layout will be designed for optimal guest comfort and convenience, with thoughtfully arranged spaces and amenities.

5.2. Safety and Security:

Cover the hotel's comprehensive approach to safety and security, including surveillance systems, access control measures, etc.

        - Example: Seaside Crest will prioritize the safety and security of our guests and staff. We will implement robust security measures, including surveillance systems, access control, and trained personnel to monitor and respond to any potential threats or emergencies.

5.3. Cleaning and Housekeeping:

  Involves the hotel's procedures to ensure high standards of cleanliness, hygiene, etc.

        - Example: Our dedicated housekeeping staff will maintain the highest standards of cleanliness throughout the hotel, including guest rooms, common areas, and amenities. We will follow strict protocols to ensure a hygienic and pleasant environment for our guests.

• Example: The founding team of Seaside Crest includes Sarah Johnson, a seasoned hotelier with over 10 years of experience in managing luxury beachfront resorts, ensuring a deep understanding of the hotel industry's dynamics and customer expectations.
• Bennet  Leifer a renowned interior designer specializing in tropical-themed hospitality spaces, brings his expertise to Seaside Crest, ensuring the hotel's aesthetics align with the target market's preferences and create a memorable guest experience.

5.4. Energy Efficiency:

Involves energy-efficient practices and technologies to minimize energy consumption, reduce utility costs, and promote sustainability 

        - Example: As a responsible and sustainable hotel, Seaside Crest will strive to minimize energy consumption and reduce our environmental impact. We will implement energy-efficient practices, such as using energy-saving appliances, LED lighting, and smart systems for temperature control.

5.4.  Inventory Management:

includes tracking and controlling supplies, equipment, and amenities to optimize operations.

        - Example: Seaside Crest will employ an efficient inventory management system to track and manage hotel resources, including linens, toiletries, and other supplies. This system will ensure optimal inventory levels, minimize waste, and support smooth day-to-day operations.

All of the unique Hotel projections you see here were generated using ProjectionHub’s Hotel Financial Projection Template. Use PH20BP to enjoy a 20% discount on the template. 

   6.1. Startup Costs

  Provide a detailed breakdown of the total startup costs requirements, and where you plan for those funds to come from. You will also want to break down how the startup costs will be used including working capital to cover losses before the business breaks even.

        - Example: The total startup costs for Seaside Crest are estimated at $7,335,552. The owner plans to secure a business loan of $15,000, with  $7,500,000 contributed through personal funds.

6.2. Revenue Projections

Provide an estimate of the hotel's future revenue based on market research and assumptions.

        - Example:  Seaside Crest projects increasing revenue over the next five years, with $3,282,587 in the first year and reaching $5,938,052 by the fifth year.

Watch how to create financial projections for your Hotel

 Estimates the hotel's future expenses, including fixed and variable costs.

        - Example:  Seaside Crest's expenses include cost of goods sold, operating expenses, and direct labor and supply costs for the hotel, restaurant, spa, and events.

Summarizes the hotel's revenue, expenses, and net income over a specific period.

        - Example: Seaside Crest expects to achieve net income of $375,657 in the first year, growing to $1,845,652 by the fifth year, demonstrating a consistent increase in profitability.

 Outlines the hotel's projected cash inflows and outflows.

        - Example: Cash flow projections for Seaside Crest consider the seasonality of the hotel industry, ensuring effective financial management throughout the year.

  Determines the point at which the hotel's revenue equals its expenses.

        - Example: Seaside Crest anticipates reaching its break-even point within the first year of operation, indicating a strong potential for early profitability in the hotel industry.

Key Point  4

• Example 1: Benchmark financial projections against industry averages, such as the average revenue per available room (RevPAR) and average daily rate (ADR) for hotels in Key West, to ensure realistic revenue forecasts. (e.g., Seaside Crest's projected ADR is $250, in line with the average ADR of comparable beachfront hotels)
• Example 2: Analyze historical data from similar hotels in the area to estimate seasonality and demand fluctuations, accounting for factors like peak tourism seasons and local events. (e.g., Seaside Crest projects a 90% occupancy rate during the winter season based on the historical occupancy rates of nearby beachfront hotels)

   7.1. Supporting Documents

 Includes any relevant documentation that supports the information presented in the business plan, such as resumes, financial projections, market research data, and permits or licenses.

   7.2. Glossary of Term

 Provides definitions for industry-specific terms used throughout the business plan to ensure reader comprehension.

   7.3. References and Resources

Lists any sources or resources referenced during the preparation of the business plan, including industry reports, market research data, and relevant publications.

• Example 1: the owners of Seaside Crest invest a significant portion of their personal savings into the hotel's development and operations, demonstrating their commitment and confidence in the success of the venture. Additionally, they secure a personal guarantee for the hotel's financing, further aligning their interests with lenders and showcasing their willingness to share the risk.

How do I start a hotel business from scratch?

Starting a hotel business from scratch involves several key steps. Begin by conducting market research to identify a suitable location and target market. Develop a detailed business plan that outlines your hotel's concept, services, and financial projections. Secure funding through personal savings, loans, or investors. Obtain necessary permits and licenses and hire staff with hospitality experience.

What type of hotel should I open, and how do I choose a niche?

The type of hotel you open depends on your target market and location. Consider factors such as the level of service, amenities, and price range. Choose a niche that aligns with your interests and the demand in the local market. Options include boutique hotels, budget accommodations, luxury resorts, or themed hotels.

What marketing strategies can I use to promote my hotel?

Use a mix of digital marketing, social media, content marketing, and search engine optimization (SEO) to reach potential guests online. Collaborate with local tourism boards, travel agencies, and event planners to promote your hotel. Encourage positive reviews and testimonials to build credibility.

About the Author

Adam is the Co-founder of ProjectionHub which helps entrepreneurs create financial projections for potential investors, lenders and internal business planning. Since 2012, over 50,000 entrepreneurs from around the world have used ProjectionHub to help create financial projections.

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How to start a successful hotel business: a complete guide

From strategy, to software, to start-up costs: everything a new hotel owner needs to know.

In this guide, we deep dive into how to start a hotel business with step-by-step instructions and actionable tips. Whether you’re new to the hotel game or looking to grow your existing premises – here’s how to run a successful hotel.

In a world where renting out a property is easier than ever – all it takes is an internet connection and a host profile on Airbnb – arguably,  anyone can become a hotelier. But as anyone who’s done it will tell you, owning a hotel business goes far beyond giving people a place to sleep. The most successful hotel businesses take that practical need and turn into an unforgettable experience for their guests. It doesn’t matter whether you’re starting a five-star hotel, a family-friendly resort or budget motel – how you make your guests feel will determine your hotel’s reputation. And with online reviews the lifeblood of the hospitality industry, it’s critical that every guest leaves satisfied.

That’s why we created this guide – to help you dive deep into the crucial elements of starting – and growing – a successful hotel business.

Guide Contents:

• What type of person can run a hotel?

Find your place in the market

• Choosing your hotel identity

Pull it all together: creating a hotel business plan

• Crunch the numbers: the cost of getting started
• Spread the word: develop a marketing plan
• The A-team: hiring and training staff

Smooth operation: implementing systems

• Support for setting up your hotel with Preno

When the first-ever hotel opened in 1768, everything was managed on paper – a huge ledger with guest details painstaking recorded. Computers and spreadsheets made things easier, and more recently, hotel management software streamlined everything from start to finish. 

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Even so, it takes an entrepreneurial mindset and a passion for the business to tap into what is now one of the largest industries in the world. Your drive to serve and delight your guests while managing multiple tasks with grace and dignity will determine the culture and success of your team. 

For your hotel to thrive, you must be willing to step up, work hard and understand that customer experience is everything.      

First, you need to thoroughly understand what it means to own a hotel. Soak up the latest news, thought leadership and best practices from local and international experts – Preno, for example, sends fortnightly industry news. While researching hotels in your area, you might find there’s no demand for your initial idea or that a slight tweak to your plans could prove more profitable.

A strong market analysis will help you decide whether you build or buy, or if adding efficiencies like new technology could streamline operations and improve your bottom line. 

Choose your hotel identity

Your style of hotel will inform several business decisions. It isn’t easy to transition from one type to another, so choose carefully based on your market research.

• Boutique. Often smaller, with unique characteristics, e.g. historic building
• Family-friendly. Larger rooms, extra beds, entertainment facilities and attractions close by, caters to the entire household
• Budget. Lower rates, scaled-back amenities to pass savings on to the customer  
• Luxury. High price tag, top-notch service, access to four or five-star amenities, e.g. spa, concierge, room service

A business plan is critical to laying out the foundations of launching, promoting and operating your business. To secure investment, it’ll be a requirement.

Here’s a summary of what your business plan should include. You’ll find more detail on some of these aspects further in the guide.      

• Executive summary. Give a high-level overview of your hotel business plan – short and concise. Include your mission statement and your objectives.
• Brand positioning. Dive deep into the story of your brand – who you are, your unique selling points and your target audience.
• Market/industry analysis. Demonstrate that you understand the market you’ll be operating in – both from a local standpoint, and a broader look at the industry. This will show investors your potential for growth based on local travel patterns and industry trends.
• Competitor analysis. Highlight your understanding of your competitors, and how your hotel fills a gap in the market. A SWOT (strengths, weaknesses, opportunities, threats) analysis is a good way to do this.
• Customer segmentation. Break down your target market: demographics, location, socioeconomics and behaviours. This is also known as crafting a guest persona. It’s important to understand your primary target market intimately, so you can cater for an experience that meets their needs and expectations.  
• Strategic plan. Cover marketing, distribution and revenue management in this section. This is where you’ll convince investors that you have a sound plan to connect with customers, manage your inventory and maximise your revenue.
• Operations plan. Create a detailed plan that covers staff, operating processes, suppliers and inventory management – everything involved in operating your hotel business. 
• Financial plan. Start talking money. Start-up costs followed by ongoing expenses (payroll, purchases, rent and utilities), forecasts and profit potential. 
• Management team. Introduce the people who will be running your business, their backgrounds and their capabilities.
• Important milestones. Include a timeline of relevant milestones (build, opening, profitability). This gives you progress markers to aim for and will increase your likelihood of success. 
• Appendix. Add additional information or supporting documentation to the appendix. Your business plan should focus on important strategic highlights – everything else you can add at the end.

Crunch the numbers: the costs of getting started

There are several variables that will determine the cost of opening a hotel:

• Location. Tourist hotspots and inner-city hotels will be more expensive than somewhere more regional or rural.
• Quality. Starting a five-star resort will be a lot more expensive than a budget motel.
• Size. Number of rooms and hotel facilities (restaurant, meeting room, spa, gym).

While it’s challenging to pinpoint the cost of setting up a hotel business, there are five areas you’ll need to include in your start-up budget:

• Land. Any real estate fees associated with purchasing land or securing a lease for your hotel site.
• Building and construction. Whether you’re starting from scratch, renovating an existing property or buying into a franchise, this will take up the largest portion of your start-up budget. Hotel owners typically need a lot of capital to get started, but you could secure a construction loan to fund this part of the project. Either way, your building costs will vary depending on your footprint, quality of materials and current building condition.
• Soft costs. Non-construction-related expenses like insurance, architects, consents, permits and taxes, designers and lawyers. 
• Furniture, fixtures and equipment. These are the costs associated with furnishing your hotel – anything that’s moveable, i.e. beds, electronic equipment, tables, chairs and desks.
• Working capital. For hiring staff, paying salaries and any expenses incurred before you open your doors and the cash starts coming in.

Now that you’ve got some numbers down on paper, it’s time to figure out whether your hotel venture is feasible. The numbers will tell you if your capital costs are worth the risk. Estimate key revenue and expenses like room pricing, vacancy rates and revenue per room. Don’t forget ongoing operating expenses like maintenance, wages, advertising, stock (service products and equipment) and utilities.

Run through a handful of scenarios in your forecasting to see how key decisions or events will impact the potential profitability of your business. You can find out more about calculating hotel metrics and conducting a hotel market analysis in this guide:

< How to calculate ADR and other hotel metrics>

Spread the word: developing a marketing plan

You’ve secured financing, the build or renovations are well underway – now you need to share your hotel with the world. Your hotel marketing plan is an important part of your overall business strategy. This is how you’ll communicate with your target audience – using your market research to guide you.

There are lots of ways to market your hotel – be creative and brainstorm ways to make your business stand out. There’s traditional marketing like TV, print and radio, or partnering with a PR agency or travel agent. 

In addition to setting up a well-optimised website and booking engine , here are some digital marketing ideas you’ll want to explore:

• Online travel agents (OTAs)– Think Booking.com, Expedia, TripAdvisor, and others. Most accommodation providers manage this through a channel manager like Preno.
• Social media marketing – Facebook, Instagram and LinkedIn are the big three. Even if you don’t use all platforms straight away, you’ll want to secure as many handles as you can. Here’s a simple guide to creating a social media strategy that works .
• Paid versus organic advertising – Google Ads, boosted Facebook posts and sponsored Instagram posts are all examples of paid marketing. Sharing content like blogs or videos on YouTube through your social media platforms is designed to drive customers organically to your website. 

Want more ideas on how to promote your hotel business online? Read this guide:

<The ins and outs of hotel online marketing>

The A-team: hiring and training hotel staff

Hiring the right team members can make or break your plan to grow a successful hotel business. Most skills and knowledge can be taught but finding people with the right innate characteristics is critical.      

Attracting a stellar team

Before you place any job ads, get clear about the type of people you want to hire – what values, insights and skills will they bring to the team? Clarity here will ensure you attract like-minded people who share your vision. Your employees reflect your brand, so they need to exemplify the character traits you feel are most important to your hotel. 

You’ll then need to figure out a plan: role, requirements, hiring timeline and training. Depending on whether you buy or build, and the size of your hotel business, there will be key team members you’ll need to hire first. These are usually sales and marketing, finance, project management and facilities. 

Onboarding – get to know the team

Once you’ve got the team, the work doesn’t stop. Proper onboarding and training are chances to show people the ropes and give your team time to gel before the big opening day. Extra training for particular roles may be needed.

Before you open your doors, you’ll need to set up hotel systems and software to streamline and automate operations, so you can run your business leaner and more efficiently. Your requirements for user-friendliness and functionality alongside your budget will come into play when choosing the best hotel management system for your property.      

Here are some options you’ll want to consider:

• Hotel management system. This will likely be at the top of your list. Without a system to manage your bookings, you’ll be in the red before you’ve even started. A good system will facilitate management and administrative tasks including front-desk operations, rate and occupancy management and payment processing. It also connects to all the other important tools your hotel uses – like Xero or Lightspeed. 
• Channel manager. Channel managers allow you to automate changing your rates and managing your availability across all your channels – so you don’t have to spend all day doing it. 
• Booking Engine. These help you avoid the 15% fees charged by OTAs like Booking.com and Airbnb by collecting bookings directly via your website. Be sure to pick a booking engine like Preno that is optimised for mobile, and tailored to create easy conversions.
•   Accounting software. Preno’s world-class integration with Xero ensures the two applications work seamlessly together to automate invoicing, bookkeeping and payment processing – making it easy for hoteliers to manage their bookings and accounting in one place. Well-connected systems will give you clearer insights into how your business is performing. 
• Restaurant management software. If your hotel offers food and beverages in a restaurant or similar, you’ll want a Point of Sale (POS) system that connects your restaurant to your hotel management system. This will allow guests to charge back to their room. Preno and Lightspeed Kounta POS enable this type of customer experience.

Time to open the doors: launching your hotel business  

This is when things can get a little scary – but also exciting! You’ve put in the hard work, you’re ready to open the doors – and invite your first guests in. 

Opening events are often well-received and they’re a great chance to connect with your local community and key stakeholders. Put your best foot forward by planning an event that reflects your purpose and values and focus on building relationships. 

Go forth and conquer – you’re ready

The hotel industry is a hyper-competitive environment, and the disruption of Covid-19 in the last year has triggered a fundamental shift in the way accommodation facilities operate. Despite all the change, customer experience is one of the most important elements in determining the success of a new or existing hotel business. If you know what your target hotel guests need, and you can deliver on this, plus more (i.e exceeding customer expectations), your hotel’s reputation – and success – will be off to the best start. It’s a big bet and the risk is high, but careful planning, strategy and empowering your operation with the right technology will set you on course to starting a successful hotel business.

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Need help setting up your hotel?

Try Preno, we offer a fully integrated, cloud-based property management system that simplifies your hotel processes.

Talk to the Preno team about getting set up.  

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Resort Business Plan Template

Written by Dave Lavinsky

Resort Business Plan

You’ve come to the right place to create your Resort business plan.

We have helped over 1,000 entrepreneurs and business owners create business plans and many have used them to start or grow their Resort companies.

Below is a template to help you create each section of your Resort business plan.

Executive Summary

Business overview.

Ocean View Hotel & Resort is a brand-new luxury resort located in beautiful Palm Beach, Florida. Our priority is to provide tourists and guests with a first-class luxurious vacation experience that they can’t find anywhere else in Palm Beach. We offer all the best amenities a resort could have including a full spa, a heated pool, a gym, a golf course, and tennis courts. We are also conveniently located right on the beach, so our guests can easily soak up the sun and enjoy the ocean at their leisure. We are also conveniently located near numerous shopping districts, nightclubs, and popular tourist destinations. Ocean View Hotel & Resort is the perfect resort for anyone looking for the ultimate Palm Beach vacation experience.

Ocean View Hotel & Resort is led by Jacob Ellis who has been in the resort industry for over 20 years. While Jacob has never developed a resort from the ground up, he has worked most recently as a general manager of a large resort, and has held various management-level positions in the industry over the years. Jacob Ellis has a Master’s degree in Hospitality Management and will use his expertise and experience to start his own resort.

Product Offering

Ocean View Hotel & Resort will provide a full suite of luxury resort amenities, all featuring streamlined customer service and convenience.

Some of the amenities we offer include:

• Restaurants
• Golf course
• Tennis Courts
• Heated Swimming Pool

Ocean View Hotel & Resort is located on the beach so guests can enjoy the sun and the ocean at their leisure. The resort is also located near shopping districts, nightclubs, and other popular destinations that our guests can easily access and enjoy.

Customer Focus

Ocean View Hotel & Resort will primarily serve tourists traveling to Palm Beach, Florida. We expect many of our guests to be affluent and have the disposable income needed to pay for the luxurious amenities we offer.

Management Team

Success factors.

Ocean View Hotel & Resort will be able to achieve success by offering the following competitive advantages:

• Location: Ocean View Hotel & Resort’s location provides the best access to the beach, shopping districts, nightclubs, and other amenities. The Company also offers adequate parking (along with valet parking), making it easy for customers to relax upon arrival.
• Luxurious Amenities: The resort will be full of luxurious amenities, including a full spa, gym, heated swimming pool, and golf course.
• Management: The management team has years of resort industry experience that allows the Company to market and serve customers in the same manner as its most sophisticated competitors.
• Relationships: Having visited the community for a number of years, Jacob Ellis knows all of the local leaders, newspapers, and other influences. As such, it will be relatively easy to build brand awareness of the resort.

Financial Highlights

Ocean View Hotel & Resort is currently seeking $7,000,000 to launch. Specifically, these funds will be used as follows:

• Resort design/build: $6,500,000
• Three months of overhead expenses (payroll, rent, utilities): $250,000
• Marketing costs: $100,000
• Working capital: $150,000

Company Overview

Who is ocean view hotel & resort, ocean view hotel & resort history.

After completing a market analysis, Jacob Ellis incorporated Ocean View Hotel & Resort as an S-Corporation on January 2023.

The resort development operations are currently being run out of Jacob Ellis’s home office. Once the land rights have been purchased, operations will be run from an on-site location.

Since incorporation, the Company has achieved the following milestones:

• Found site location and signed the land deed purchasing rights to the land
• Developed the company’s name, logo, and website
• Hired an architecture firm to create a blueprint of the resort
• Started taking bids from construction crews and electrical engineering firms
• Determined equipment leasing and financing requirements
• Began recruiting key employees

Ocean View Hotel & Resort’s Services

Industry analysis.

The global hotel and resort industry is valued at approximately $4.5T with more than 700,000 hotels and resorts operating worldwide. Even with the challenges of the recent pandemic, people are eager to travel and stay in luxury accommodations. According to PR Newswire, the industry is expected to grow substantially throughout the rest of the decade, growing at a CAGR of 17.4% until 2030. This shows that even though the pandemic halted travel temporarily, the industry is bouncing back and resorts are going to see a profitable decade.

Demand determinants for the hotel and resort industry include economic conditions, disposable income levels, and consumer preferences regarding hospitality and leisure spending. Over the past few years, consumer preferences have been shifting significantly. Customers are now looking for more personalized service, business-leisure opportunities, health and wellness accommodations, and digital guest experiences.

The hotel and resort industry is highly fragmented with intense competition from major players to single-location operators. Small resort businesses can compete in a variety of ways, however. Industry operators that offer a unique niche, affordable prices, in-demand locations, and amenities that appeal to the modern consumer can run a competitive resort business.

Customer Analysis

Demographic profile of target market.

Ocean View Hotel & Resort will serve the tourists visiting Palm Beach and its surrounding areas. The community of Palm Beach is a very popular tourist destination. Many of the tourists that visit are affluent or have the disposable income to spend on a luxurious vacation.

Some of our guests may be residents in local communities looking for a great place for a staycation. The demographics of Palm Beach are as follows:

Customer Segmentation

Ocean View Hotel & Resort will primarily target the following customer profiles:

• Local residents
• International tourists
• Domestic tourists

Competitive Analysis

Direct and indirect competitors.

Ocean View Hotel & Resort will face competition from other companies with similar business profiles. A description of each competitor company is below.

Shady Palms Resort

Shady Palms Resort is a hotel in Palm Beach. Shady Palms Resort is a leading hotel and has been in business for over 40 years. The hotel offers a wide array of services and amenities that you typically find at a hotel. Shady Palms Resort offers luxury accommodations and a five-star restaurant and lounge. Shady Palms Resort is the current most popular choice for tourists in the area because of its proximity to the airport and local attractions such as the Fine Art Museum and movie theater.

This hotel does not have full-service resort amenities, however. Nor does it have the latest digital technology for any of its services or room accommodations.

Super Adventure Resort

Super Adventure Resort is a family-oriented resort located 20 miles from Palm Beach. This resort specializes in providing wildlife adventure tours. The property also has a variety of amenities including a hotel, spa, pool, restaurant, bar, and gift shop.

Super Adventure Resort is far from any other local attractions, the airport, or any other modern conveniences such as grocery stores or gas stations, making it an out-of-the-way getaway, but not conveniently located.

Sunny Shores Hotel

Sunny Shores Hotel is a local hotel that has a few resort-style amenities such as a spa, salon, and fitness center in addition to its traditional hotel accommodations, restaurants, bar, lounge, pool, tennis courts, and free transportation to and from the airport. Sunny Shores Hotel is located close to a variety of local attractions and scenic areas. Guests can go hiking or bicycling on trails nearby or easily access public beaches.

While Sunny Shores Hotel has many appealing accommodations, it lacks the modern technology, full-service amenities, and additional attractions Ocean View Hotel & Resort will provide.

Competitive Advantage

Ocean View Hotel & Resort will be able to offer the following advantages over the competition:

Marketing Plan

Brand & value proposition.

Ocean View Hotel & Resort will offer a unique value proposition to its clientele:

• Convenient location close to local attractions and the beach
• Luxurious amenities
• Exceptional personalized customer service

Promotions Strategy

The promotions strategy for Ocean View Hotel & Resort is as follows:

Social Media

Ocean View Hotel & Resort will invest heavily in a social media advertising campaign. The brand manager will create the Company’s social media accounts and invest in ads on all social media platforms. It will use targeted marketing to appeal to the target demographics.

Website/SEO

Ocean View Hotel & Resort will invest heavily in developing a professional website that displays all of the features and benefits of the resort. It will also invest heavily in SEO so that the brand’s website will appear at the top of search engine results.

Advertising

Ocean View Hotel & Resort will initially advertise on travel websites, which are frequently used to book travel due to their ease of use and reviews.

Ongoing Customer Communications

Ocean View Hotel & Resort will publish a monthly email newsletter to tell new and past customers about promotions and events.

Ocean View Hotel & Resort’s pricing will fluctuate based on the season and occupancy percentages. However, we will typically charge similar rates as other luxury resorts in the area.

Operations Plan

The following will be the operations plan for Ocean View Hotel & Resort.

Operation Functions:

• Jacob Ellis will be the owner of the resort and hire the appropriate staff to manage it. He will also act as CEO and manage the overall operation and executive functions of the company.
• Rebecca Ellis will be the Administrative Assistant and assist Jacob with all the administrative tasks for the company.
• David Blyg will act as the Maintenance Engineer and attend to all mechanical and plumbing issues that may arise.
• Jacob will hire a General Manager and Assistant Manager to run the resort.
• Jacob will also hire a full staff of housekeepers, desk attendants, and other employees to run and manage all aspects of the resort (such as the bar, cafe, and spa).

Milestones:

Ocean View Hotel & Resort will have the following milestones completed in the next six months.

• 3/202X Finalize land purchase
• 4/202X Finalize blueprints for the resort
• 5/202X Hire and train initial staff
• 6/202X Kickoff of promotional campaign
• 7/202X Finish building the resort
• 8/202X Launch Ocean View Hotel & Resort

Financial Plan

Key revenue & costs.

Ocean View Hotel & Resort’s revenues will come primarily from booking fees for the resort’s many amenities. The company will charge varying rates per night based on demand and seasonality. Ocean View Hotel & Resort will also sell multiple packages to appeal to a range of guests, such as a health and wellness package and a staycation package.

The land purchase, equipment, supplies, and labor expenses will be the key cost drivers of Ocean View Hotel & Resort. Other cost drivers include marketing expenses, maintenance, and taxes.

Funding Requirements and Use of Funds

Key assumptions.

The following outlines the key assumptions required in order to achieve the revenue and cost numbers in the financials and in order to pay off the startup business loan.

• Average nightly rate: $500
• Year 3: 100
• Year 4: 125
• Year 5: 150

Financial Projections

Income statement, balance sheet, cash flow statement, resort business plan faqs, what is a resort business plan.

A resort business plan is a plan to start and/or grow your resort business. Among other things, it outlines your business concept, identifies your target customers, presents your marketing plan and details your financial projections.

You can easily complete your Resort business plan using our Resort Business Plan Template here .

What are the Main Types of Resort Businesses?

There are a number of different kinds of resort businesses , some examples include: Health Spa Resort, Ski Resort, Eco-tourism Resort, Destination Resort, and All-Inclusive Resort.

How Do You Get Funding for Your Resort Business Plan?

Resort businesses are often funded through small business loans. Personal savings, credit card financing and angel investors are also popular forms of funding.

What are the Steps To Start a Resort Business?

Starting a resort business can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.

1. Develop A Resort Business Plan - The first step in starting a business is to create a detailed resort business plan that outlines all aspects of the venture. This should include potential market size and target customers, the services or products you will offer, pricing strategies and a detailed financial forecast.  

2. Choose Your Legal Structure - It's important to select an appropriate legal entity for your resort business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your resort business is in compliance with local laws.

3. Register Your Resort Business - Once you have chosen a legal structure, the next step is to register your resort business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws. 

4. Identify Financing Options - It’s likely that you’ll need some capital to start your resort business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms. 

5. Choose a Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations. 

6. Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events. 

7. Acquire Necessary Resort Equipment & Supplies - In order to start your resort business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation. 

8. Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your resort business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising.

9 unique hotel amenities that will make your next business trip so much better

Let's face it: Life on the road isn't as glamorous as it seems. Your friends may be jealous of you jetting off to big meetings and conferences all the time, but business travel can quickly take its toll on your physical and mental health.

Thankfully, hotels are stepping up to the plate, offering amenities that make it easier to maintain a healthful routine while traveling — and get down to business, too. Airlines are following suit: Take United's partnership with the Timeshifter app in late 2019, meant to help business travelers beat jet lag, for example.

Ready to travel even better? Check out these nine hotels and hotel brands with business travel amenities that make life on the road a little less painful.

Standing desks at the Sheraton Phoenix Downtown (Phoenix, Arizona)

This isn't your grandma's Sheraton. Marriott has majorly overhauled the tired brand and the result is smart and sophisticated, with amenities galore for business travelers.

Among our favorites is the downtown Phoenix property, the first of many Sheratons to be rebranded. Its in-room hydraulic tables (packed with outlets and USB ports) convert to standing desks, but work equally as well for room service. The hotel also offers long lobby tables with locking drawers to stash laptops and other gear (handy if you have to run out but don't want to move all your stuff while working). Also look for creative studios off the lobby that can be rented by the hour through the Bonvoy app for calls and meetings.

Bluetooth-enabled bathroom mirrors at Cambria Hotels

Cambria hotels are known for integrating local design touches from every city in which they're located, so they don't feel as corporate as a typical business hotel. One of the most clever standard amenities, though, is Bluetooth speakers embedded in the bathroom mirrors of all guest rooms, allowing you to personalize your routine on the road. Prepping for a big meeting or heading to a client dinner? You can brush up on the latest news, listen to a podcast or get pumped up with your favorite tunes while getting ready, with higher-quality sound than your phone speakers.

A private presentation theater at The Beach Club at Charleston Harbor Resort & Marina (Charleston, South Carolina)

For a beach hotel, this 92-room property is pretty dang serious about business. We love the spacious guest rooms and wide desks that provide ample space for working. But the unique feature here is a 33-seat private theater (complete with recliners and surround sound) on the main level that can be used for small-business presentations. It's popular with groups and meetings, but individuals can also take advantage of the space to practice presentations when it's not in use.

Same-day clothing delivery at the Gild Hall, A Thompson Hotel (New York City)

Need a wardrobe refresh on the road, or forgot a crucial part of your outfit at home? Thanks to Gild Hall's partnership with clothing company UNTUCKit, you can get free same-day delivery from the store's Brookfield Place location (and 20 percent off your purchase) when you're staying at the hotel. You've probably seen this brand's ads for menswear all over in-flight magazines, but UNTUCKit also has women's clothing, from classic no-iron button-downs to silk tops and flattering shirtdresses.

In-room Peloton bikes at the Austin Proper Hotel (Austin, Texas)

Business travelers staying at the recently opened, 244-room Austin Proper Hotel can request a Peloton to be delivered directly to their guest room — meaning you can squeeze in a quick spin between meetings or conference calls without leaving your room. If you need a change of scenery (and have the time to sneak away), the hotel's wellness center is impressive, too, with fancy Woodway treadmills, stair climbers, water rowers, Pilates reformers and more Pelotons.

Guest rooms with full fitness capabilities at Hilton Hotels

It might seem weird to sweat in the same space as you sleep, but Hilton's Five Feet to Fitness rooms help you get over it. These are a new type of larger guest room that includes everything you need to get in a full-body workout without straying far from your laptop: Think TRX ropes, sliding disks, yoga mats, weighted balls and more, plus an electronic kiosk with 200 exercise tutorials and 25 classes. Really, you have no excuse to not work out if you're staying in these rooms — a smart way to keep up your fitness routine on the road.

In-room Glam Squad services at the InterContinental New York Barclay (New York City)

Bloomingdale's is literally on speed dial on the guest room phones at this Lower Manhattan hotel — and it will deliver any purchase of $300 or more to your room for free if you're staying at the hotel (plus, guests get 15 percent off purchases). You can also ring NOMI Beauty to call up an on-demand, in-room Glam Squad, who can handle everything from blowouts and updos to makeup application so you look perfect for that big conference gala.

A full board room suite at the InterContinental London Park Lane (London)

A far cry from this Tweet about a "Boardroom Suite" that went viral earlier this month, the new 3,600-square-foot Capital Suite at this London property is all about intelligent design. Ideal for travelers visiting the city on bleisure, the suite has two private en suite bedrooms complemented by interconnected living spaces, as well as its own boardroom, a fully equipped office and an additional meeting room. It's accessible via a private elevator and entrance, creating a blend of working and living space that feels like both your home and office away from home.

Personal butler service at The Spectator Hotel (Charleston, South Carolina)

As the only hotel in the city with personalized butler service, The Spectator is a dream for business travelers. Chat with your butler, who's individually assigned to you, to arrange anything your heart desires while away on business, from pressing suit jackets or dresses to shining shoes, coordinating transportation or even fetching a drink to ease your nerves about that presentation.

Grand Hyatt Jakarta

Luxury 5-Star Hotel in Downtown Jakarta, Indonesia

Located in the iconic landmark complex of Plaza Indonesia on Jalan M.H. Thamrin, Grand Hyatt Jakarta enjoys convenient access to cultural attractions, shopping malls, office buildings, government offices and embassies. The newly renovated hotel conveys timeless luxury and is a sanctuary while traveling.

ROOMS & SUITES

Grand Hyatt Jakarta features 424 luxuriously appointed rooms and suites for business and leisure travellers. Each well-designed space offers the perfect blend of Indonesian elegance and modern comforts.

Room Service

Our in-room dining service offers the ultimate in convenience for a romantic dinner for two or a hospitable gathering. It offers everything from snacks to full‑course meals right in your luxurious room. Call us for all the pampering touches to complete your stay experience.

C's Steak and Seafood

Set in a sophisticated yet relaxed ambience, C's at Grand Hyatt Jakarta presents the freshest selection of seafood and the finest choice of Japanese, Australian and U.S. Prime Beef. The menu at C’s is simple but by no means simplistic. Emphasis is placed on the freshness of all products used. Eight fish tanks ensure that all the seafood meets the highest quality standard before being prepared.

Enjoy dining in a warm Japanese country style house at Sumire. One of the most popular Japanese restaurants in Jakarta, Sumire offers premium-grade sushi and sashimi, seasonal specialties and Japanese favourites with freshly flown ingredient from Japan. A selection of sake is also available.

Le Petit Chef 3

Grand Hyatt Jakarta and Le Petit Chef invite you and the whole family to sample the best of 3D theatre and fun dining in a two-hour immersive culinary adventure. Each presentation is designed to captivate all of your senses, from sight to smell to taste. The world's smallest chef will welcome you into his colourful world using state-of-the-art 3D visual technology. By the end of the tantalising menu, you will seize a chance to present your personalised culinary masterpiece.

Poolside Restaurant

Sate your appetite with comfort food from pizza and pasta to fried rice and burgers. Poolside Restaurant has outdoor and indoor seating areas, perfect to while the hours away and experience the sunset in Jakarta. As part of Grand Hyatt Jakarta’s efforts in improving the services and providing the very best to guests, Poolside Restaurant is closed for renovation until further notice.

Located on the lobby level, Grand Café is an all-day dining restaurant offering a fresh made-to-order buffet that emphasises local flavours and home-style dining with interiors and architecture designed to evoke the feeling of an Indonesian home. Grand Café highlights an Indonesian food adventure straight from the five live-cooking stations. Specialty chefs prepare a multicultural heritage of Indonesian cuisines à la minute at the restaurant’s wok, grill, soup, steam and pastry stations. A few international favourites are also available on special occasions.

Fountain Lounge

Located on the mezzanine level, Fountain Lounge offers afternoon tea sets and light bites, perfect for casual or business meetings. Its prominent location also promises commanding views of the hotel’s grand lobby with a batik painting in the centre, as well as the Welcome Monument or Tugu Selamat Datang, one of Jakarta's most iconic landmarks.

As part of Grand Hyatt Jakarta's efforts in improving the services and providing the very best to guests, the Burgundy bar is currently closed for renovation. Please stay tuned for a whole new bar concept in the new year on the fourth floor of Grand Hyatt Jakarta.

WEDDINGS & MEETINGS

Weddings & celebrations.

Celebrate your wedding at Grand Hyatt Jakarta in one of our flexible event spaces with customized catering, the latest audiovisual technology and an experienced events team to help you plan and deliver the perfect event. 

Meetings & Events

Our luxury hotel in Jakarta provides 2,000 square metres (21,528 square feet) of flexible meeting and event space, including a Grand Ballroom, perfect for any occasion.

Explore Meeting Spaces in a Virtual Tour

Business Services

Digital Check-In

Fitness Center

Free Internet Access

Meeting Facilities

On-Site Restaurant

Accessibility at Our Hotel

We are committed to providing equal access and opportunity for individuals with disabilities. The features also make this hotel more accessible for older individuals with changing abilities to ensure a seamless experience. Our overall goal is to improve usability throughout the hotel for all guests.

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GETTING HERE

Explore jakarta.

Discover everything Jakarta has to offer when you stay at Grand Hyatt Jakarta, conveniently located close to cultural attractions, shopping and family-friendly activities.

2.81 Miles away

Taman Safari

4.33 Miles away

0.24 Miles away

2.56 Miles away

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Reservations are not yet available for Courtyard Danang Han River

Courtyard Danang Han River

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Welcome to Courtyard Danang Han River

The new state-of-the-art lobby at Courtyard provides greater flexibility and choices for our guests. At the center of it all is The Bistro, your destination for a great breakfast, or drinks and dinner during the evening. You'll also enjoy inviting, flexible spaces where you can work or relax, free Wi-Fi throughout and easy access to the latest news, weather and airport conditions via our GoBoard technology. Plus, our well-equipped fitness center, indoor pool and whirlpool will help you stay refreshed and energized. Whether traveling for business or pleasure, your stay at Courtyard is sure to be more comfortable, more productive and more enjoyable than ever before!

Rooms & Suites

Rates vary by date & room type

FEATURED AMENITIES ON-SITE

Hotel information.

Check-in: 3:00 pm

Check-out: 12:00 pm

Pets Welcome

Maximum Pet Weight: 40kgs

Maximum Number of Pets in Room: 2

Complimentary On-Site Parking

All Day Dining

Lobby lounge, more ways to enjoy your stay.

Courtyard Danang Fitness Studio

Rooftop Pool

Getting here.

58 Bach Dang Street, Hai Chau 1 Ward, Hai Chau District, Da Nang, Vietnam, 55000

Property Details

Accepts: Credit Cards

Currency Exchange

Property has elevators

For more information about the physical features of our accessible rooms, common areas or special services relating to a specific disability please call +84 236-3937979

Accessible on-site parking

Service Animals are Welcome

Accessible Entrance to On-Site Pool

Entrance to On-Site Business Center is Accessible

Entrance to On-Site Fitness Center is Accessible

Main Entrance is Accessible

Meeting Spaces are Accessible

On-Site Restaurants are Accessible

Mobility accessible rooms

Roll-in Shower

Frequently Asked Questions

The check-in time at Courtyard Danang Han River is 3:00 pm and the check-out time is 12:00 pm.

The pet policy at Courtyard Danang Han River is:

The parking options at Courtyard Danang Han River are:

The property amenities at Courtyard Danang Han River are:

Yes, Courtyard Danang Han River has free Wi-Fi available to hotel guests.

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58 Bach Dang Street, Hai Chau 1 Ward, Hai Chau District,

Da Nang, Vietnam, 55000

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A company is turning former cruise ships into floating hotels — see inside its largest 'floatel'

• Bridgemans ServicesGroup operates a fleet of former cruise ships turned into hotels. 
• Its "floatels" are designed to house workers during long-term projects.
• See its largest 652-cabin floatel with a game room and buffet.

Some old and unwanted cruise ships meet their demise at ship-breaking yards , where they are disassembled and sold for scrap.

Other vessels find a more fortunate fate, receiving a second chance to do what they already do best: serve as floating hotels.

Canada-based Bridgemans Services Group buys and charters former cruise ships to turn into "floatels," outfitted with standard cruise amenities like daily housekeeping, buffets, and relaxing lounges.

But the ships aren't designed to transport tourists from one destination to another anymore. Instead, companies turn to Bridgeman when they need to house workers for a long-term project, whether it be the construction of an offshore wind farm in Europe or the shooting of a major film in a remote destination.

Floatels can accommodate workers in remote destinations where hotels might not be an option.

In more metropolitan areas, Bridgemans says its ships could lessen the stress an inundation of workers might have on the local housing market.

And once they are no longer needed, the vessels depart and "leave no trace behind," the company said.

Over the last decade, Bridgemans has deployed its ships for 15 projects on every continent, Brian Grange, the company's president, told Business Insider.

Grange said that its deployments — most often for liquified natural gas companies — last for an average of two years.

In the past, it has also provided accommodations for MSC Cruises at its Ocean Cay private island and housing for more than 1,000 workers in the Philippines' on a project for the Manila International Airport during the COVID-19 pandemic.

The company's three ships range from 150 to 652 cabins.

The floatel operator acquired its largest ship, the 561-foot-long MV Isabelle X, in 2023.

In its past life, the 35-year-old vessel sailed around the Baltic Sea as one of Estonia-based Tallink Gruipp's cruise ships.

But gone are its days of leisurely cruising. The 35,000 gross-ton ship is now on its first deployment in Howe Sound, just north of Vancouver, where it's housing more than 600 workers who are building Woodfibre LNG's "net zero" LNG export facility.

Isabelle X underwent a six-month retrofit before it was sent to Howe Sound.

The process included updating the ship's cabins and adding amenities like a game room and an 8,000-square-foot gym.

The latter two are especially important: "We need to make sure we delineate between work and home," Grange told BI. "We have to create a social environment on board these vessels that makes it attractive for workforces around the world."

During their free time, workers can play billiards, relax in the outdoor lounge, or use the ship’s WiFi to catch up on social media.

The sports lounge has large television screens, while the games lounge has darts, ping pong tables, and air hockey.

The 'quiet lounges' are the go-to space for people who need to unwind after a long work day.

Or, they could recharge and catch up on the latest shows in their cabins, which all come with desks, storage, and 32-inch televisions.

Like a typical cruise ship, Bridgemans' vessels have buffets with live cooking stations, a dessert bar, and the occasional themed night.

The ships' chefs tailor their menus to the demographic and dietary restrictions of the workers on board, the company's president told BI.

Residents can expect at least four protein options, plenty of veggies, and handmade bread and desserts.

Unlike most cruise lines, Bridgemans can pre-purchase all the food it needs before deployment.

Grange says this allows the ships to maintain food quality and consistency in remote locations.

Remember that deployment in the Philippines during COVID-19? He said the ship had packed almost 800 tons of food ahead of the project.

He wouldn’t disclose the cost to rent one of Bridgemans’ floatels.

But he did note that the cost of a cabin on the Woodfibre LNG project in Howe Sound is comparable to a hotel room in nearby Vancouver, as is the case with most of its projects near major cities.

The company’s most recent acquisition, the 150-cabin Diamond XI, is currently being retrofitted and would be ready for deployment this year.

According to the company's president, the vessel is small and high-end, likely to be used for sporting events and movie shoots.

It could also be the start of a greater expansion: He hopes to add two or three more vessels to its fleet in the next five years.

"The world has opened up to this as a valued alternative to housing," Grange told BI.

Who knows, the next time you see a cruise ship off the coast, there's a slim but possible chance it could be housing workers — not vacationers.

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