Starting a guest house business
MORE investments and money opportunities for those looking to venture into business. Monday will never be complete ,9(1 the many attractive places in Eswatini and the need for affordable tourist destinations, opening a guest house is very profitable.
As both domestic and international tourism increases, the demand for accommodation will likely increase as well. Being one of the world’s most popular destinations the hospitality sector has been growing over the years. More than 10 million people visit South Africa every year.
The hospitality and tourism sector generates about 5 00 billion annual ly. This sector is no doubt one of the country’s economy drivers. As more people, both local and international, travel to see the wildlife, scenic beauty and to experience the warm climate the demand for accommodation ser vices including guest houses will keep increasing. Given that accommodation is directly linked to tourism whatever happens to the tourism sector will directly and indirectly influence the accommodation sector.
Thus, the high demand for tourism services will translate to a high de mand for accommodation. This article will outline how to start a guest house business, and the guest house business plan – PDF, Word and Excel.
A guest house is a lucrative business providing income for thousands of en trepreneurs, but there are some essen tial factors you need to consider before you venture into this type of business. You need to decide on the size of your guest house the location, the various rooms and amenities you intend on offering and your target market. These factors will be affected by the amount of capital you have. Thus, you should carry out a feasibility study, market research and have a good guest house business plan before you venture into this business.
LOCATION & PREMISES
For your guest house to be successful you should ensure that it is in the right location to attract clients. This is an important decision to make before you run a guest house. It is important that you locate your guest house close to your target market.
Consider the amount of road traffic, and find an easily accessible location where people can stop and quickly get accommodation services. The best places to locate your guest house in clude city centres, surburbs and close to tourist attractions.
That way anyone who visits the area without the countless business opportunities that are presented in this section.
Top of the list is a charming guest house located in the Manzini can easily locate your guest house. There are plenty of popular tourist at tractions that you can choose to place your guest house.
Also, it is important to be strategic about your neighbouring businesses because you are more than likely go ing to feed into each other instead of competing. If you open a guest house in an overly saturated area, the likeli hood that your business will succeed will be very low.
The guest house business plan should cater for the costs of building or renting the premises.
EQUIPMENT FOR A GUEST HOUSE
The kind of equipment you require for a guest house is not complicated. You will require furniture including the beds, essentials for your guests such as towels, robes, and catering facilities if you decide to offer meals as part of your stay packages. The equipment and facilities you need will depend on the size of your guest house and the kind of products and services you will offer. You may need to buy vehicles for shuttle services for your guests. Your guest house busi ness plan should cater for these and other costs including the equipment you will need for your business.
PRODUCTS AND SERVICES
The products and services your
Central Business District (CBD). On top of being situated in an ideal location, the business is fully-fitted. It is being sold with all its assets and the asking price guest house will offer will be deter mined by your target market. Most guest houses offer different packages at different rates. The basic and more affordable package can be a single regular sized bed with access to Wi Fi and not many amenities whereas a premium stay package can be a large room with a king sized bed plus room service.
These packages will differ with each accommodation service. Guest houses can also offer meals. It is advisable to have various kinds of amenities and complementary servic es for your guest house to attract as many customers’ as possible. Another essential factor in running a guest house is selecting the right staff for your guest house. Consider people who can provide efficient and qual ity services consistently. Your guest house business plan should outline the various products and services you will provide and take the costs of these services into account.
STAFF & MANAGEMENT
As a customer centric guest house, it is important that you hire employ ees that are friendly efficient and hardworking. The best employees for a guest house are those that are passionate about hospitality.
If you want to hit the ground run ning it is better to hire a team of people who already have experience
CONTENTS OF THE GUEST HOUSE BUSINESS PLAN (PDF, WORD AND EXCEL)
The business plan includes, but not limited to:
Market analysis
Industry analysis
Five-year automated financial statements [ Income statements, cash flow statements, balance sheets, monthly cash flow projections (three years monthly cash flow projections, the remaining two years annually),break even analysis, payback period analysis, start-up costs, financial graphs, revenue and expenses, bank loan Amortisation] Marketing strategy is negotiable.
As usual, there are also tips and today’s focus is on those selling their businesses during this COVID-19 era. in this business. Your staff members should know how to treat customers and maintain an accommodating environment. For a guest house to be successful your customers ser vice must be on point on a regu lar basis. Any inexperienced staff members will need to get extensive training before they can be given important tasks. There is a need to ensure a safe environment for both your staff and guests.
The kitchens, rooms and common areas must be clean and safe from harm. Depending on the size of your guest house, the actual number of your staff will vary, however, you will need cleaners, cooks, housekeepers, security as well as management. Your guest house business plan should clearly cater for the salaries and day to day expenses of your employees.
MARKET
There is a huge demand for guest houses. More than 10 million people visit South Africa every year, which create a strong demand for accommo dation services. There is also a huge local demand from individuals, cou ples, companies, business people and local tourists. South Africa is known to have some of the best accommo dation and entertainment services, so tourists all over the world will expect world class services.
All visitors seek to experience the diverse cultures, the scenic beauty, and the adventurous opportunities the country has to offer. As more people seek less of buying expen sive tangible items and seek to have more of experiences as their income grows, the demand for accommo dation services driven by tourism is likely going to continue on an upward trend. Your guest house busi ness plan should include a proper marketing strategy.
IS A GUEST HOUSE A GOOD INVESTMENT?
Building your own guest house brand from scratch can be rewarding given that accommodation is an im portant part of tourism. If done well, investing in a guest house can be a profitable venture, but obviously, this will depend on many factors such as your target market.
You can easily start by putting up a room on Airbnb if you decide to start small and eventually operate a full guest house from your returns. Thus, it is possible to make reason able profit margins from running an
Risk analysis
SWOT & PEST analysis
Operational requirements
Operational strategy
Why some people in the guest house business fail, so that you can avoid their mistakes
Ways to raise capital to start your guest house business
The Guest House Business Plan package consist of four files
Guest House Business Plan – PDF file (Comprehensive – 78 pages)
Guest House Business Plan – Editable
You will again be spoilt for choice, as you make another informed choice. Do not forget to send feedback on 7627 9456 or at business@times.co.sz
USES OF THE GUEST HOUSE BUSINESS PLAN (PDF, WORD AND EXCEL)
THE GUEST HOUSE BUSINESS PLAN CAN BE USED FOR MANY PURPOSES INCLUDING:
Raising capital from investors/ friends/relatives.
Applying for a bank loan. Start-up guide to launch your guest house business.
As a guest house business project proposal.
Assessing profitability of the guest house business.
Finding a business partner. Assessing the initial start-up costs so that you know how much to save.
Manual for current business owners to help in business and strategy formulation.
accommodation business. Apart from the obvious advantages of becoming financially independent and becom ing your own boss, running a guest house can be a rewarding way of uplifting your community.
The hospitality sector has been growing steadily and will likely continue to grow in the coming years, thus opening a guest house can be a good investment.
Whether you are a young entrepre neur, a professional seeking to start your own business or someone who needs a retirement plan, investing in a guest house is something worth considering.
2ne thing that can set you apart before investing in any venture is developing a business plan. A well thought out business plan will help you in both the short term and long term. There are various risks asso ciated with running a guest house like any other venture, so your guest house business plan should clearly outline these risks and the different ways you will minimise them.
For an in depth analysis of the guest house business, purchase our guest house business plan. We decided to introduce the business plans after not ing that many people were venturing into the guest house business without a full understanding of the industry, market, how to run the business, the risks involved, profitability of the business and the costs involved, leading to a high failure rate of their businesses.
2ur business plan will make it eas ier for you to launch and run a guest house business successfully, fully knowing what you are going into, and what’s needed to succeed in the business. It will be easier to plan and budget, as the guest house business plan will lay out all the costs involved in setting up and running the guest house business.
Word File (Comprehensive – 78 pages) Guest House Business Plan Funding Version – Editable Word File (Short version for applying for a loan – 49 pages)
Guest House Business Plan Automated Financial Statements – (Editable Excel file)
The financial statements are automated. This implies that you can change eg the price per room, salaries etc, and all the other financial statements will automatically adjust to reflect the change.