Setting up a Small Hotel Business– 5 Essential Tips for Success

Deciding to set up a small hotel – whether that’s a B&B, boutique hotel or inn – is an exciting prospect, and one that requires a lot of thought and planning. It’s not just the decor and food you have to think about – there’s also the promotion, the protection and the properly-prepared staff. How clients view your hotel, and the ways in which you treat them is far more important than whether the colour schemes match or if there’s a phone in every room. To help you get on track, we have created a top tips list of things you should consider before launching your new hotel.


1. Think about your target audience


What kind of clientele are you hoping to attract when launching your new hotel? This is an important question to think about as trying to appeal to too many types of people runs the risk of alienating them all. There’s a massive difference between the draws of a hotel attracting families and one designed mainly for business clients. Especially for a small hotel, it’s vital to be clear on the key target audience from the get go.


To attract a corporate client base, important factors to consider include proximity to the airport and commercial centres, business-friendly facilities in the rooms such as desks, plenty of plugs, fast Wi-Fi and multi-line telephones. Families will be looking for the likes of spacious rooms with comfortable spare beds, a restaurant catering for youngsters, car parking facilities and closeness to family-friendly sights. Pairing the nature of the location with the right target audience is essential. Families won’t want to stay somewhere with several loud clubs across the street, yet this would appeal to young couples, groups of friends and hen and stag parties.


2. Focus on ratings


Ratings have the power to make or break a hotel’s reputation. Receiving those first few five-star ratings has a great bearing on whether or not you’re likely to get more customers. Excellent standards of customer service, immaculate rooms and facilities and generally going above and beyond to help guests is of course the ideal way to make a lasting impression. However, don’t forget to remind customers to take the time to leave a review. Handing out business cards when they checkout with details of how to leave a Trip Advisor review, along with links to your website and social media accounts is one way to increase the chances of getting those ratings rolling in.


3. Get the right people on board


When running a hotel, every member of staff is representative of your business. Taking the time to recruit quality candidates with the right skills and attitude is a key element in success. From the hotel receptionist and restaurant staff to the chambermaids and management team, having friendly, motivated and capable employees ensures everything runs as smoothly as possible. Creating an environment where staff are treated well and feel valued helps towards getting the most out of a workforce.


4. Ensure your business is adequately protected


Along with meeting rapidly changing consumer demand and the need for excellent customer service due to customer ratings and review sites, there are numerous risk factors that need to be considered, and suitably prepared for, when it comes to running your hotel. Our Hotel Insurance is a great place to start, and can help protect you against the following risks:


  1. Guest Behaviour: Guests and clients may be the lifeline of your business, but they can also be a threat to future success. Lawsuits from people who get injured, suffer food poisoning or have their personal belongings damaged is not only an expensive endeavour, but can badly damage your reputation.  Hotels should ensure their health and safety codes are up to scratch, but also consider the importance of public and product liability for the situations which they can’t always control. 
  2. Staff: Just because you operate within the hospitality industry doesn’t always mean your staff will be hospitable. Property theft is a big issue at many hospitality companies, but also, staff may take you to court if they suffer physical or mental health issues as a result of working for your hotel. In fact, by law, if you have 1 or more employees working for you, then you are required to have Employer’s Liability Insurance, to cover any damages. Contents cover is also a good shout, should any of your hotel’s property go missing.
  3. Business Interruption: Unforeseen events, such as flooding, fires and electrical faults, can really limit what your hotel can offer clientele, with profitability taking a hit too. You may think these events may never happen to you, but nothing in life is certain, and is that thought really worth the risk of thousands of pounds of damage? Business Interruption Insurance can help to cover you for revenue lost during your closure period, which is a great relief to many of our clients.
  4. Fixtures & Fittings: Remember those stylish tables you loved that your children kicked in at home? How about those mirrors that accidentally fell off the walls and shattered? In a hotel, there’s plenty of opportunities for damage, but it doesn’t mean you should have to pay the price for it. With cover for your fixtures and fittings, damage can become decor that’s just as beautiful as what was there previously.

If you’re considering hotel insurance and the aspects you need to cover, please don’t hesitate to contact The Insurance Octopus today for helpful information and guidance.


5. Don’t scrimp on marketing


You could run the most amazing hotel in the area, but not many people are going to know about it unless you stay on top of marketing. Besides having a quality website and social media presence, another way to increase the hotel’s visibility on the web and attract new customers is to create a branded blog that’s regularly updated with news and special offers of interest to both current clients and potential new ones. Keep regulars engaged by prompting them to sign-up to a newsletter so you can easily inform them of any deals they might be interested in, get involved in community events to raise your profile and invest in targeted traditional and multimedia advertising to stir up fresh business.


Find out more about specialised hotel insurance packages by getting in touch with The Insurance Octopus today.