How to write a persuasive hotel business plan

By Patrick Landman OK, so you have decided to realise your dream and open your own hotel. You have thought out an amazing concept, delivering unparalleled guest service. The...

By Patrick Landman

OK, so you have decided to realise
your dream and open your own
hotel. 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, this is where most
entrepreneurs get stuck.
It’s really not that difficult to make
a good hotel business plan. It’s 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.
They 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.
One of the main challenges is that after
reading the first page most business I 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.
We have put together a guideline with 10
critical points you must include in your hotel
business plan;
1. Executive Summary
This exists of two parts:
• Mission Statement: Intro: a 1 line
company description only the essence of
your hotel (not two lines or a paragraph).
It explains why you are in business or
which huge need you are filling 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.
4. Customer Analysis
In-depth information on your target
market, including geographic, demographic,
socio-economic, psycho-graphic, behavioural
segmentation details. Which are the types
of guests who will mostly stay at your hotel?
Explain how your hotel will meet the needs
of these main segments in terms of location,
amenities and services. Basically, how will
consumers answer this question ‘Why my
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?
6. Strategic Plan
This comprises three 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 is the plan for your hotel website,
SEO, SEM and SMM? Will you do offline
• Distribution: Which third party channels
will you use and how will you manage
availability? What technology will you
• Revenue Management: What pricing and
yield techniques will you use? What will
your payment and cancellation policies be?
7. Operations Plan
How will you run the hotel? How many
members of staff and supervisors will you
need? What are their job descriptions/
responsibilities? What background and
By Patrick Landman
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
8. Management Team
Include the bias of your team. Focus on
what uniquely qualifies you to make your
hotel such a success.
9. Financial Plan
Provide the start-up costs of the hotel
(capital investment), the ingoing business
costs, operational expenses and revenue
projections for the next five years. Include
KPI like 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 of:
1. Location selection
2. Permits & Licenses
3. Build-out / Construction of the Hotel
4. Staffing and Training
5. Opening
6. GOP Break-even
7. NOI Break-even
8. 10% Ebitda
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.
Follow your dreams and go for it!

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