Sure, the movies make it look easy. A romantic B & B in a picturesque setting with happy inn-keepers beaming at their bustling business. Back to reality…to operate a successful Bed and Breakfast you’ll need a concrete business plan, a marketing strategy, and a hiring plan, all before you even contact the realtor.
If the idea of moving to a different part of the country and wearing a lot of hats in a brand new business intrigues you, opening a B & B may be the perfect opportunity. But first, know what you are getting into.
Getting Started
First of all you need to decide if you want to buy an existing Bed and Breakfast or find a house and renovate it. Remember, if you plan to renovate an existing home, you need to carefully calculate the potential costs:
- Redecorating. Even if the home you are selecting has enough bedrooms and bathrooms, you’ll want to change the décor and make each room unique for your guests. They’ll expect a certain coziness and charm that ordinary hotels don’t offer.
- Zoning laws. If the property you are interested in is zoned residential, city or county officials may not let you operate a commercial business out of the dwelling.
- Adding On. Chances are the house you are interested in isn't big enough to accomodate a Bed and Breakfast. You'll need additional kitchen space and dining areas as well as more bathrooms and outdoor seating. Get an estimate from several contractors before you make an offer on the property.
If you are planning to purchase an existing B & B, find out everything you can about the business before you sign the dotted line:
- Gross Revenue. Ask for a copy of the current owner’s records for the past five years.
- Occupancy Rate. In some areas the occupancy rate could be as low as twenty five percent. Figure that in, when you consider potential profits.
- Taxes and Insurance. Especially if you’re considering a location that is close to the ocean, insurance and property tax could be a lot higher than what you anticipated.
- Historic Sites. Some B & B’s are considered historic landmarks and you may find restrictions on altering the property in any way.
Property Search
With the Internet, you can locate prospects quickly and easily. Start with B & B for Sale, where you’ll also find seminars listed for potential inn-keepers. They’re offered several times a year in Amelia Island, Florida. Consult professional organizations for advice, like the Professional Association of Innkeepers International. And when you visit B & Bs yourself, talk to the owners. Successful inn-keepers usually love to share their stories and are eager to offer advice.
Finally, negotiate, negotiate, negotiate! The declining housing market affects B & Bs just as much as single family homes. Remember, it's a buyer's market!
Read more about resources to help you start a small business.
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