Do you own a Hotel, Motel, Bed and Breakfast or a Holiday House?
Are you looking to generate more income, more bookings and become a recognised brand in the Accommodation Industry.
Well you can.
Understanding how the Industry works and the secrets behind the industry can give you a strong advantage over your competitors and improve your return on your property investment.
Are you striving to:
|Andrew Kloester Accommodation Consultancy||Mobile : 041232673|
The Operators Guide to
Short Term Accommodation
Tips, Tricks and insights into operating
Hotels, Motels, Guest & Holiday Houses.
By Andrew Kloester
Like many others before me, I started in the hospitality Industry at the age of 18 flipping hamburgers at my local McDonald’s. I stuck this job out for just over 2 years, and while I was not aware of the valuable lessons being taught to me, I later came to realise that much of what I learned would form the foundation stones for my career. Later whilst travelling abroad I came to be a barman, then bar manager in the UK, followed by restaurant manager then General Manager for the Keg and Swan Franchise in South Africa. The owner of this franchise was a man who became my first mentor, his name was Dave Payne and had previously been the CFO of Diners club International in South Africa. At first I thought this man was foolish to think that as an accountant he could step across into a hospitality Industry. But not only was his transition successful, but we soon became the most successful Keg franchise to open its doors in South Africa. So popular was this bar and restaurant that people would queue outside like a night club just to come in and taste the food.
Dave taught me about cost control, stock and inventory, food costings, wages, dealing with difficult clients, and numerous other aspects of successfully operating a restaurant. And lets not forget quality. One of his key quotes was “ if the food is good, they will come and sit on cardboard boxes to eat it. There's a lot of truth in that, in any restaurant food is paramount. You don’t have to be a michelin star restarant to serve high quality food to your guests. Good food can come in all shapes and forms, from Classics to street food in traditional or exotic flavours. I left South Africa with a new appreciation for understanding business procedures and the importance of accounting. So in my mid 30's I completed an “Advance Diploma of Business Accounting” with high distinctions. My experience combined with my accounting skills gave me the dynamics I needed to move ahead in my Industry. At the same time I also worked as an Auditor for a hotel with 230 rooms and later an accountant and Purchasing Officer for another Hotel chain with 160 rooms.
At the age of 36 I renovated a 36 room motel that was run down and was operating at around 15% capacity. I implemented new procedures and upgrades and within 7 weeks we had the motel operating at 100 % capacity.
It was at this point that I saw a niche in the market for online suppliers of accommodation products. Small businesses and investors all over Australia were starting to generate incomes through the short term rental of accommodation properties. This was being buoyed along by the internet making it easier to advertise and manage booking for small and private properties.
My company “Hotel Products Direct” started from home as a mail order business, selling accommodation supplies Australia wide. In that first year we had a total of 75 orders. The second year we went online and turned over 300 orders. Year 3 saw us pack and send 1000 orders which we doubled in our fourth year to 2000 orders. At this point we had been operating from home and I was working as an accountant at a large city hotel from 9-5. I gave up the day job and focused on the online business. Now 14 years down the track we have over 8000 customers Australia wide.
We travel the world and we now manufacture and import many of our own products only recently I attended the International Hotel Expo in Shanghai and travel across countries to locate and source new Industry products. I often spend my time talking to clients who are always seeking guidance and advice. Given my strong and extensive background I felt that I could better serve my clients by putting together a book on my 100 best tips, tricks and insights. I offer consultancy and reviews, this is an industry I love and I enjoy seeing others build their dreams and become a part of the hospitality accommodation and food service Industry.
Sitting back at my desk a new customer enteres my business and starts explaining how she had bought a country pub with onsite accommodation. I asked what was her target market and she said they cater for the weekenders escaping from the city. I asked what do you do for midweek bookings and she explained that they dont have many of them as people have to return to work. The problem with her, as is the case with many accommodation providers is they they only focus on one select group, they literally are wearing blinkers unable to see that other target groups exist and what they could be attracting.
Just because your property is located near a beach, does not mean that you will only get beach goers staying with you. There is a huge array of various possibilities. Virtually all suburbs and country towns have weddings and funerals which draw in relatives and friends at any given moment. Promoting your business through retirement homes and church groups can help fill those empty rooms. likewise there are hiking clubs, cycling clubs, horse clubs and car clubs, all of which organise events. So you should be aware of these. Any accommodation provider needs at least 3 target markets to keep your rooms running at capacity.
However , when deciding on your target market , make sure that group actually exists in sustainable quantitu in your geographical area.You wouldn't find a surf shop located on top of a snowy mountain holiday resort, do not strive to satisfy a market that either does not exist, or is in short supply in their region. The first thing any accommodation property needs to acknowledge is who are your target markets. Knowing who you are appealing to is the first step in the right direction, and it will dictate on how and where you spend not just your marketing dollars but also the type of amenities and services your accommodation property provides.
The second part of the same topic is to ask if the existing market for your target group has been over-catered for. Maybe you are located in a surf beach area, but the sheer quantity of existing accommodation properties means that operating your business at full capacity is unlikely. This often happens close to major city airports, where hotels and motels pop up, each one trying to outdo the existing competition. The end result is a lot of empty rooms with no other local draw card to improve occupancy. As a result the room prices start dropping to a point where all the operators are working at cut throat pricing. This is exactly why it is so important to have multiple target markets. Research and data is the key to knowing and understanding your market, make the most of it and it will pay dividends in the long run.
In the accommodation market, properties come in all shapes and sizes. As a general rule the larger the property the more services they can or will provide. Services such as a swimming pools, gymnasium, valet, in-room dining, massage, hair and beauty just to mention a few. Where they often struggle is with personalised service, and this is especially true in many western countries where wages are high and there is a lower staff / Guest ratio.To compete against the larger accommodation providers the smaller boutique properties, such as private hotels, guesthouses and holiday rental properties will often present a more personalised service. They can offer local knowledge, custom cooked breakfasts and usually offer more upmarket boutique experience by offering high quality products such as Plunger coffee, after-dinner mints on the bed or open fires at night time. What they lack in size, they make up for in quality.
But what I have just mentioned is a general rule, the truth is that at the end of the day, the quality of the property is going to be dictated by the person in charge of operating the business and the decisions they make. I stayed at a guest house one time that declared it was equivalent to a 5 star property, it was a period home with a grand piano in the front sitting room. Beyond that, it was really quite a joke, they did not provide in room tea and coffee, and what they did provide was cheap and nasty. Shampoo and conditioner was byo, just a chunk of soap and some tissues was all you got. I have seen army ration packs with more to offer than that.
On the other side of the scales I have stayed in an accredited 4 star massive hotel who boasted of a pool and gym, only to find that the pool was green and stagnant and the gym was outsourced, so you had to pay $30 entry each day as it was not included in the price.This is where the manager has to stop thinking like an accountant, and imagine what it would be like to be a guest at their establishment. If you find it hard to do that, employ the services of a consultant.
When setting up an accommodation property, make sure you first understand your market needs. The services and products you provide to your guests should match the type of market you are targeting. If your in a snow area you will need a drying room. Beach locations should usually provide barbeques and if it is a fishing location then a place for rods and reels is important. If your targeting more than one market e.g, cycling clubs, then bike stands will be required also. It sounds like common sense, yet so many property providevers believe more is best, and they end up with a hotchpotch of unrelated services.
With the exception of some of the larger properties it is not always a case of more the merrier. If your customer base is corporate functions and business men, then spa massage, child minding services and full buffet breakfasts may have little effect on increasing your bookings. Especially since most business people skip breakfast, grab a coffee and run. Likewise if your located in a spa country region and specialise in couples and romantic getaways, then wood fires, hot spas, soothing massages and general pampering are all winning products on your must have list. This includes serving good quality tea and coffee.
This may sound obvious to some, but remarkably it is probably one of the most ill considered areas in the operation of many accommodation properties. Know your market and align your products and services to match.
In Australia there are six main accommodation categories and the criteria can vary between categories.
To be eligible for Star Ratings your property should meet the following requirements:
* NOTE: full and/or continental breakfast includes:
Whenever I stay at hotels, one of the things I like to do is read through the guest compendium. Mainly because I like to know what facilities and services are on offer. It also often contains relevant information about the local area and surround, but on one such occasion I just about keeled over laughing. This 5 star hotel had solved the solution of guests taking home mementoes like robes, towels even electricals,
On a page of it's own was a message to the guests that read...
Dear Guest, we know how much people love to remember their stay with us, be it the feel of the gowns or the softness of our towels. Please feel free to take any items with you when you leave. Below is an inventory of all the room items and pricing, we will simply charge any items removed directly to your credit card, Enjoy your stay!
Whether the guest reads it or not, the fact is, that it has been stated. What made this even more amusing was that they had even included the mattress and sheets. I tried to visualise a guest attempting to smuggle a mattress down the elevator and across the foyer without being seen. But then again, if you have ever watched "The Hangover" I rest my case!