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Boutique Hotel Business Plan Blueprint: Complete Guide

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  • January 3, 2023
  • Hospitality

how to write a business plan for a boutique hotel

Whether you’re looking to raise funding from private investors or to get a loan from a bank (like a SBA loan) for your boutique hotel, you will need to prepare a solid business plan.

In this article we go through, step-by-step, all the different sections you need in the business plan of your boutique hotel. Use this template to create a complete, clear and solid business plan that get you funded.

1. Boutique Hotel Executive Summary

Though the executive summary is the first and the most important section, it should normally be the last section you write because it will have the summary of different sections included in the entire plan.

Why do you need a business plan for a boutique hotel?

The purpose of a business plan is to secure funding through one of the following channels:

  • Obtain bank financing or secure a loan from other lenders (such as a SBA loan )
  • Obtain private investments from investment funds, angel investors, etc.
  • Obtain a public or a private grant

How to write your boutique hotel’s executive summary?

Provide a precise and high-level summary of every section that you have included in your business plan. The information and the data you include in this segment should grab the attention of potential investors and lenders immediately.

Also make sure that the executive summary doesn’t exceed 2 pages in total: it’s supposed to be a summary for investors and lenders who don’t have time to scroll through 40-50 pages, so keep it short and brief.

The executive summary usually consists of 5 major sub-sections:

  • Business overview : explain what is the concept of your hotel, whom it targets (business travelers vs. tourists), where it’s located, its size and any other amenities and services you offer
  • Market & competitive overview : start by describing the state of the hotel industry in your area (the city or region where you plan to open yours). Also explain here the level of competition you expect from similar establishments. Finally, mention who are your target customers (your ideal customers) ie. their age, gender, disposable income as well as their preferences
  • Sales & marketing strategy : describe how you plan to acquire new customers, outlining the exact marketing channels you intend to use and your overall budget
  • Management & People : this section should provide information about the leadership hierarchy, highlighting the roles and responsibilities of every team member and their experience
  • Financial plan : how much profit and revenue do you expect in the next 5 years? When will you reach the break-even point and start making profits? You can include here a chart depicting your key financials such as revenue, gross profits, and net profit
  • Funding ask : what loan/investment/grant are you seeking? How much are you raising ? How long will this last?

how to write a business plan for a boutique hotel

Hotel Financial Model

Download an expert-built 5-year Excel financial model for your business plan

2. Boutique Hotel Business Overview

This is the section where you will provide details about your boutique hotel and its concept. You must address some important questions that lenders and/or investors generally ask.

Here is a quick list of some of those questions you must address:

  • What is the rationale behind you opening this type of hotel today?
  • What’s the location of the hotel and why did you select that location?
  • What hospitality services and products will you provide? Will you offer any special services (massage, gym, etc.)? 
  • Will there be a restaurant?
  • How many employees will you need to run the hotel?
  •  How many rooms will you have to accommodate your guests?
  • What types of rooms will you offer your customers? At what rates?
  • What will be the legal structure of your company?

a) History of the Project

Any business must have two components:

  • Passion & experience of the business owner
  • Rationale behind starting this type of business today

Passion & experience

Starting a huge investment like a boutique hotel requires much more than just capital. It also needs the relevant background experience in the hospitality industry.

Typically, many individuals creating their own boutique hotel will have a long-standing passion and track record for the hospitality industry. Yet, if you lack the experience, it probably isn’t the right time to start your boutique hotel. Instead, you can choose a franchising option and work with an established hotel franchise.

What motivates you to start a boutique hotel in the region today? Unlike some other businesses, a boutique hotel requires a lot of financial and human capital investment.

So, before taking your first steps in this field, provide enough reasons to justify your decision to venture into the business. For instance, if there’s a scarcity of stylish boutique hotels targeting tourists in the region, you can use that to justify your reasons for starting one.

how to write a business plan for a boutique hotel

b) Hotel Concept

Describe your boutique hotel’s concept. Here are a few questions you may answer here:

  • Will you target a specific market (all-inclusive vs. tourists, business travelers, etc.)? 
  • What types of rooms will you have (midscale, upscale, luxury?)
  • What amenities will you offer your guests? A restaurant, rooftop bar, a SPA, a conference/meeting room? See more on amenities in the next section
  • What will be the hotel’s design, layout and surface?
  • Where will the boutique hotel be located? Is this next to a busy street, an airport, a tourist attraction or a corporate center?

c) Services & Facilities 

Prioritize the most sought-after services in the region. While many boutique hotels offer the same services, you may want to differentiate yourself vs. competitors to attract guests.

Below are a few examples of the guest services you can provide depending on your target audience:

Boutique Hotel Services 

  • Bar / Restaurant
  • Event management (weddings, conferences, etc.)

Boutique Hotel Facilities 

  • Swimming pool / Jacuzzi 
  • Business center
  • Summer terrace
  • Smoking rooms
  • Fitness room
  • Conference room

how to write a business plan for a boutique hotel

d) Room Rates

Next, describe your pricing strategy. Indeed, designing a pricing list for a boutique hotel isn’t the easiest thing to do. So, you can rely on information from some of your biggest competitors in the region to help you set standard rates. 

Make sure to have a clear table with the different room categories and their daily rate. If you have off-peak vs. peak rates, make sure to include it too here. It doesn’t need to be exact (as the rates will likely change over time), so use price ranges instead.

e) Legal Structure

Finally, your business overview section should specify what type of business structure you want:

  • Is this a corporation or a partnership (LLC)?
  • Who are the investors? How much equity percentage do they own?
  • Is there a Board of Directors? If so, whom? Do they have experience in the industry?

3. Boutique Hotel Market Overview

Provide comprehensive information about your market. You will want to tailor your services to suit the target audience. And that means you will need accurate information about the hospitality industry in your region:

  • Industry size & growth : how big is the boutique hotel industry in your area? Is it growing / declining, and what are the factors contributing to its growth/decline?
  • Competition overview : how many competitors are there? How do they compare vs. your hotel? Are they franchises or independent boutique hotels? Do they target the same guests as you do? How can you differentiate yourself from them? 
  • Customer analysis: who is your target market? Are they business travelers or tourists, single travelers, couples or families? How often do they travel and need an hotel? How much do they spend on average on hotel stays?

a) Boutique Hotel Industry Size & Growth

How big is the boutique hotel industry in the us.

The market size of boutique hotels in the US is estimated to be $16.9 billion in 2022.

Also, there are about 5,500 boutique hotel businesses in the country, meaning the annual turnover for each boutique hotel is around $3,000,000.

Another source estimated there were 4,600 boutique hotels in the US in 2021 and defines them as a high-end, independent hotel with less than 100 rooms and a unique design. The same source reported that boutique hotels accounted for 3.2% of total hotel rooms in the US in 2017, yet but 5.6% of the US hotel room revenue.

how to write a business plan for a boutique hotel

How big is the boutique hotel industry in your area?

After getting a clear picture of the boutique hotel industry in the US as a whole, narrow down to your location. Yet, you may not find this information anywhere (at least not for free). In that case, you can use our guide to estimate the TAM, SAM, and SOM for your business. Here is an example of how to do it:

We know the average annual turnover per boutique hotel is $3 million. Therefore, if the area where you want to open your hotel has 30 competitors (say, in a 30-mile radius), you can assume the boutique hotel industry in your area is worth $90 million .

How fast is the boutique hotel industry growing in your city?

The US boutique industry has suffered an unprecedented decline due to the pandemic. Indeed, it decreased from its peak at $20.6 billion in 2019 to $16.9 billion 2022, despite some recovery from its through.

But what about where you live? US national averages can be a great addition to your business plan, yet they don’t necessarily help to assess the boutique hotel industry where you want to open your own boutique hotel.

Instead, you can use the number of hotels as a proxy for market growth. For instance, if there were 28 boutique hotels in the region in 2020 and 30 in 2022, you can safely assume that the average annual growth rate is ~3% in your area.

The estimation above isn’t perfect as it disregard the occupancy rate. For example, if the 28 hotels had an occupancy rate of 20% in 2020, up to 50% in 2022, the market growth rate would actually be much higher i.e. 60% CAGR from 2020-22.

how to write a business plan for a boutique hotel

b) Competition Overview 

This sub-section focuses on crucial information about your main competitors. Take a closer look at the hospitality services and products offered by other boutique hotels in the region. And while at it, analyze their marketing strategies, pricing structure, and anything you can do to stand out from the competition.

Don’t forget to include a comparative table, highlighting every piece of information the lenders may need when analyzing your business. 

Here is a sample table that you can use:

c) Customer Analysis

Customer analysis is all about knowing your ideal guests: who exactly are you targeting?

You can narrow it down with the following questions:

  • Demographics (age, gender, single vs. couples, etc.)
  • Frequency of visits (how often do they need such services?)
  • Average disposable income
  • Average spend per stay (hotel, restaurant, other)
  • Favorite services (e.g. gyms, spas, etc.)

how to write a business plan for a boutique hotel

4. Sales & Marketing Strategy

This section should highlight the strategies you have in place to attract potential clients. Try to answer the following questions:

  • What are your unique selling points (USPs)?
  • Which marketing strategies will you use to attract new clients? 
  • How will you track the success of your marketing strategy? 
  • What is your customer acquisition cost (CAC)? 
  • What is your marketing budget? 
  • Will you consider any offers or promotions to attract new clients? 

What marketing channels do boutique hotels use?

Like any new business, a boutique hotel requires comprehensive marketing during the first months to attract potential clients.

You can resort to the following channels to help you get new clients, even from your main competitors:

  • Online local listing (Google reviews)
  • Online booking platforms (Booking.com, Tripadvisor, etc.)
  • Social media content & ads: for example encourage your guests to post on social media and / or hire a social media content manager who will create daily posts and manage your social media presence
  • PPC ads ( Google Ads )
  • Word of mouth, recommendations 

how to write a business plan for a boutique hotel

What are your Unique Selling Points (USPs)?

In other words, how do you differentiate yourself vs. competitors? This is very important as you might need to win customers from competitors. A few examples of USPs are; 

  • Quality of services : you may offer high-quality services (e.g. luxury suites, fine dining restaurant, etc.)
  • Pricing: your boutique hotel may be cheaper vs. competitors for the same quality of service
  • Location : setting up your boutique hotel near your target market gives you the upper hand
  • Amenities : you may be the only boutique hotel in the area offering a health SPA, a separate event center for weddings, etc.

5. Management & People

You must address 2 things here:

  • The management team and their experience
  • The organizational structure : different team members and who reports to whom

Small businesses often fail because of managerial weaknesses. Thus, having a strong management team is vital. Highlight the experience and education of senior managers that you intend to hire to oversee your hotel business.

First, describe their duties, responsibilities, and roles. Also, highlight their previous experience and explain how they succeeded in their previous roles.

Organization Structure

Even if you haven’t already hired a general manager, administrative staff, receptionists, chefs, and other relevant staff members, you must provide a chart of the organizational structure defining hierarchy and reporting lines.

how to write a business plan for a boutique hotel

6. Financial Plan

The financial plan is perhaps, with the executive summary, the most important section of any business plan for a boutique hotel.

Indeed, a solid financial plan tells lenders that your business is viable and can repay the loan you need from them. If you’re looking to raise equity from private investors, a solid financial plan will prove them your boutique hotel is an attractive investment.

There should be 2 sections to your financial plan section:

  • The startup costs of your project (if you plan to start a new hotel, renovate your hotel, adding rooms, etc.)
  • The 5-year financial projections of your boutique hotel

a) Startup Costs

Before we expand on 5-year financial projections in the following section, it’s always best practice to start with listing the startup costs of your project. For a boutique hotel, startup costs are all the expenses you incur before you open your hotel and receive your first guests. These expenses typically are:

  • The leasing deposit (if you rent) or the cost to buy the building (if you buy)
  • Renovations and improvements
  • Equipment & appliances
  • Furniture & tableware

Of course, the startup costs depend on a number of factors, like the size of your hotel, its location, the facilities, etc.

On average, it costs $8,400,000 to $10,800,000 to build and open a small boutique hotel with 20 rooms (assuming you decide to build the hotel from scratch).

Note that these costs are for illustrative purposes and may not be fully relevant for your business. For more information on how much it costs to open and run a boutique hotel, read our article here .

b) Financial Projections

In addition to startup costs, you will also need to build a solid 5-year financial model for your boutique hotel business plan.

Note that your financial projections should be built using a spreadsheet (e.g. Excel or Google Sheets) and presented in the form of tables and charts in your business plan.

As usual, keep it concise here and save details (for example detailed financial statements, financial metrics , key assumptions used for the projections) for the appendix instead.

Your financial projections should answer at least the following questions:

  • How much revenue do you expect to generate over the next 5 years?
  • When do you expect to break even ?
  • How much cash will you burn until you get there?
  • What’s the impact of a change in pricing (say 15%) on your margins?
  • What is your average customer acquisition cost ?

You should include here your 3 financial statements (income statement, balance sheet and cash flow statement). This means you must forecast:

  • The number of nights booked over time ;
  • Your expected revenue ;
  • Operating costs to run the business ;
  • The construction costs and FF&E expenses

When projecting your revenue, make sure to sensitize pricing, the expenses (salaries, utilities, supplies, etc.) and the number of stays (or booked nights). Indeed, a small change in these assumptions may have a significant impact on your revenues and profits .

how to write a business plan for a boutique hotel

7. Use of Funds

This is the last section of the business plan of your boutique hotel. Now that we have explained what your boutique hotel’s concept is, the amenities it offers, your marketing strategy, etc., this section must now answer the following questions:

  • How much funding do you need?
  • What financial instrument(s) do you need: is this equity or debt, both?
  • How long will this funding last?
  • Where else does the money come from? If you apply for a SBA loan for example, where does the other part of the investment come from (your own capital, private investors?)

If you raise debt:

  • What percentage of the total funding the loan represents?
  • What is the corresponding Debt Service Coverage Ratio ?

If you raise equity

  • What percentage ownership are you selling as part of this funding round?
  • What is the corresponding valuation of your business?

Use of Funds

Any business plan for a boutique hotel should include a clear use of funds section. This is where you explain how the money will be spent.

Will you spend most of the loan / investment in paying for construction costs? Or will it cover mostly renovation and furniture costs?

For the use of funds, we also recommend using a pie chart like the one we have in our financial model template where we outline the main expenses categories as shown below.

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Lana Cook

By Lana Cook

Do you love connecting with people from all over the world who share your passion for travel? Don’t want to work a typical 9-5 job and instead want to build a business where every day is different, and you own your schedule?

Starting a hotel business is a dream many entrepreneurs have, but it can be a daunting venture to start. A hotel business plan is a critical first step for business owners to turn their dreams into reality. A strategic plan allows one to study the hotel industry, identify their hotel’s unique point of view, and outline how exactly they will reach their goals.

Read on to learn more about the ten sections to include in your hotel business plan, tips for creating an effective plan, and key things you need to start your new hotel business.

Ready to get started creating your plan? Download our hotel business plan template.

What is a hotel business plan?

A hotel business plan is a detailed document that identifies your business’s goals, objectives, and strategies for success. It includes market research and a roadmap for building and operating your business.

how to write a business plan for a boutique hotel

Why do you need a hotel business plan?

Studies show that entrepreneurs who finished their business plan were twice as likely to succeed in growing their business than those with no plan. A hotel business plan:

  • Helps you identify whether you have a viable business idea
  • Provides a detailed roadmap on what you need to accomplish and why
  • Gives potential investors insight into your business idea and confidence that you can be successful
  • Keeps you on track as you start to execute the different tactics outlined in your plan
  • Identifies critical milestones for you and your team to reach

Your plan does not have to be static and should change over time as your business grows and evolves. Your first draft is a starting point to help guide your strategy and instill confidence in potential investors.

10 sections to include in your hotel business plan

Whether you’re starting a small boutique hotel, a cozy B&B, or a 5-star resort, you will need to address the following sections in your hotel business plan.

1. Executive summary

An executive summary is the most essential part of your business plan. It should concisely explain the purpose of your business and why it will be a success.

Include your mission statement explaining why your hotel exists and its overall goal. For example, Capella Hotels & Resorts ’ mission is to combine tradition, discovery, individuality, and twist of the unexpected to create the perfect stay for each guest.

You should also include your vision statement that clearly describes your hotel’s purpose for being in a single sentence. For Capella Hotels, its vision is to embody excellence in the craft of hospitality.

We recommend writing your executive summary as the final stage, as it should summarize the goals and objectives laid out in your plan.

2. Company analysis

Your company analysis is where you can dive into your hotel’s competitive advantage. Ask yourself what makes your hotel unique . Why would guests want to stay with you instead of your competitors?

In this section, identify your brand’s identity and the goals and objectives you want to accomplish. Outline how many rooms and room categories your property will have. For example, will you offer a hybrid hospitality model with dorms, single rooms, and suites? Explain what ancillary revenue sources you’ll offer, like in-room food and beverage options, welcome drinks, or airport shuttles.

Use storytelling to communicate your excitement and passion and make it clear what your hotel will bring to the hospitality industry that hasn’t been done before.

3. Industry analysis

As a business owner, you must be prepared for forces outside your control. You will need to conduct a market analysis that looks at the hospitality industry to identify micro and macro trends that may impact your business. Look at:

  • Economic trends
  • Environmental trends
  • Political trends
  • Global health trends
  • Technology trends

For each trend, identify how it will impact your business and ways to mitigate risk or take advantage of opportunities.

For example, digital check-in technology has increased across the hotel industry with the rise of tech-savvy guests, new innovative software providers, and labor challenges. Therefore, consider what guest experience solution you’ll include at your hotel.

In addition to trends, look at the history of the hospitality industry, its current size, and how it’s expected to grow in the short and long term. This research will impact the rest of your plan, especially your marketing and financials.

4. Customer analysis

What type of hotel guests do you want to attract? It’s impossible to please every kind of guest, which is why it’s important to identify your target market . Once you know who you want to stay at your property, you can develop amenities, services, and marketing materials to attract these guests and deliver exceptional experiences .

Ask yourself:

  • What type of guests do I want? Business or leisure travelers? Retirees or Gen-Z?
  • What demographics? Age, gender, marital status, etc.
  • What are my target market’s interests? Water sports, hiking, relaxation, museums, etc.
  • What does my target market value? Sustainability, contactless technology, personalized service, localized experiences, etc.

This section will help you formulate the guest experience to ensure that expectations meet reality .

5. Competitive analysis

The competition you face will vary depending on where your hotel is located. In this section, you should conduct in-depth competitor research to understand how your hotel will compare. Identify your five major competitors — ideally, three direct competitors you will be competing with upon opening and two aspirational competitors you can emulate as you grow your business.

Conduct a SWOT analysis based on your competitors to look at:

  • Strengths . Where does your property excel in comparison to competitors? Why would travelers pick you? Price, amenities, location, technology, etc.
  • Weaknesses . Where does your property fall short in comparison to competitors? Price, amenities, location, technology, etc.
  • Opportunities . What industry trends can you take advantage of? What local events or partnerships can you capitalize on?
  • Threats . What are the biggest threats facing your property? War, travel restrictions, recession, etc.

A thorough analysis can help solidify your competitive advantage and develop a contingency plan for how you will deal with your weaknesses and threats.

6. Marketing plan

Without demand, there is no business. A hotel marketing plan outlines the channels you’ll use to reach your target audience to drive bookings. Your marketing strategy should include three key channels:

1) Paid media . Paid advertising to promote your property and drive bookings. This includes online travel agencies (OTAs) , search engine marketing (SEM), retargeting, and metasearch advertising.

2) Owned media. The content  you create, like your hotel website , social media channels, blog posts, and SEO.

3) Earned media. User-generated content created by third parties like media coverage or online reviews.

Hotel marketing plan templates

7. Operations plan

How do you plan to run your day-to-day operations? This section of your plan will outline all of the key tasks and responsibilities of your team and what exactly your hotel will offer. Consider:

  • The number of staff and supervisors required
  • Job descriptions and responsibilities
  • Your service standards (check out our downloadable SOPs for some inspiration)
  • How you’ll manage your inventory
  • What hotel technology solutions will you need? PMS, channel manager, booking engine, payment terminal, revenue management tools, guest engagement software, etc.
  • What services and amenities do you want to offer? Room service, bar, restaurant, pool, spa, wellness center, etc. 

Detail your short and long-term operational plans and the stakeholders involved for each area.

8. Management team

Whether or not you’ve hired your team yet, this is one of the most important sections potential investors will look at. Make sure to outline the key personnel you will require and their roles. 

In general, these are the following roles you’ll want to outline:

  • Hotel management (general manager, front office manager, housekeeping manager, maintenance manager, revenue manager)
  • Hotel sales team
  • Housekeeping staff
  • Front office staff
  • Maintenance

Depending on the size of your hotel, your team will vary. Identify the team members you need to open and your hiring plans over the next five years.

9. Strategic plan

Hoteliers must be strategic in optimizing occupancy rates across seasons to maintain revenue. As part of your strategic plan, identify how you will manage:

  • Pricing – what room types will you offer, and how will the pricing vary?
  • How will you maintain consistent occupancy throughout the high and low seasons? Will you adapt your pricing and marketing strategies?
  • How will you conduct revenue management ? What type of rules/alerts will you use to adjust rates? Will you use technology to help with revenue management?
  • What will your online reputation management strategy be? How will you collect and respond to online reviews?
  • What will your distribution mix look like? How will you drive reservations across a variety of channels?

10. Financial plan

Your financial projections are the most challenging but arguably the most crucial part of your hotel business plan. In this section, you should include the following:

  • Start-up costs. How much money will you need from lenders to operate your hotel? Consider business licenses, furniture, down payments, etc.
  • Operating costs . How much money will you need to keep your business running? Consider staffing costs, guest acquisition costs, mortgage payments, utilities, SaaS payments, etc.
  • Income statement . What will your revenue, expenses, and profit be over the first 3-5 years of business?
  • Cash flow projections . How will cash flow in and out of your business? Show what capital investment you’ll need to start.
  • Balance sheet . Identify your assets, liabilities, and equity.

If you’re looking for a potential investor, your financial plan will be the section they care about most. Here, you must prove how your business will provide a return on investment. Don’t forget to include an Appendix that shows more detailed reporting and financial figures.

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8 tips for creating an effective plan

1. Start with the section that excites you the most! Covering all the topics outlined above can feel overwhelming, so don’t feel pressured to go in order.

2. Reach out to a business owner you admire. No matter what type of business you’re starting, getting advice from another business owner is always helpful. Reach out to a successful local business owner to see if they’d be willing to share some insights they learned along the way.

3. Be concise. While there’s a lot to cover, you must be concise in each section of your plan. Include any additional research or documentation in the appendix to keep your business plan clean.

4. Try to avoid industry jargon. Depending on what type of investor is reading your plan, they may find jargon irrelevant and distracting.

5. Ensure you have a clear competitive advantage. You should be able to state in one sentence what makes your property unique. This unique selling point (USP) will be prominent in all of your marketing materials.

6. Set SMART goals. Setting specific, measurable, achievable, relevant, and time-bound goals is important to stay organized and on track to reach milestones.

7. Don’t forget about your plan. You will have spent hours developing your plan, so make sure you use it! Reference your plan as you build and grow your business , and remember that it’s ok if things change.

8. Illustrate your passion. Communicate why you want to be a part of the hospitality industry. Passion is contagious and gives investors more confidence that you will work hard to achieve your dreams.

how to write a business plan for a boutique hotel

What do you need to start a hotel business?

Ok, so you’ve read through this article and are now wondering — what’s next? Ensure you have the following items on your radar to start your business.

  • A vision. Know exactly what kind of business you want to build (a quaint bed and breakfast is very different from a large-scale resort).
  • A business plan. Stay on track with a well-developed business plan.
  • A location. Decide if you want to build a new property or renovate an existing hotel.
  • Capital. Do you need to raise an upfront capital investment? Remember that new businesses usually aren’t profitable for the first few years and will need cash flow to pay for expenses.
  • Business licenses & permits. Depending on the type of property and its services, you’ll need an occupancy permit, alcohol license, food service license, sales tax license, etc.
  • Technology. Choose technology to help streamline operations and earn more revenue.
  • Furniture & equipment. You must furnish your property with the proper furniture, electronics, appliances, etc.
  • Staff. Take time hiring staff you can trust and who understand your hotel’s brand and vision.

Final thoughts

Your business plan provides the foundation for your new business and outlines the next steps in the journey. Ensure you fully understand the market and competitive landscape to enter the industry prepared for the future. Start slow and invest in the right people and technology to support the growth of your business.

Looking to start a hotel? Download the technology guide. Download now

About Lana Cook

Lana Cook is a Content Writer at Cloudbeds where she is able to combine her love of writing and passion for travel. She has spent the last few years writing about all things technology and the ways in which it can be used to help businesses thrive. When she’s not busy writing, you can find her checking out the latest movie or searching for a new TV show to binge.

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how to write a business plan for a boutique hotel

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Hotel Business Plan Template

Written by Dave Lavinsky

Hotel Business Plan

You’ve come to the right place to create your hotel business plan.

We have helped over 100,000 entrepreneurs and business owners create business plans and many have used them to start or grow their hotel companies.

Below is a template to help you create each section of your Hotel Business Plan:

Executive Summary

Business overview.

Pegasus Hotel is a startup full-service independent luxury hotel in Austin, Texas. Owned by two local businessmen, Frank Girard and Miles Butler, it will serve the new up and coming district of the outskirts of Austin and cater to the locals and travelers who crave a luxurious and relaxing atmosphere. Pegasus Hotel will be a 10-story, 360-room hotel with a five-star restaurant and bar, relaxing pool and spa, 20,00 square feet of meeting and event space, a spacious and fully-equipped fitness center, and a view of scenic Austin. Pegasus Hotel will hold weddings and events, meetings, retreats, and those looking to unwind and be pampered while staying at the hotel. The service and amenities will be first class and the concierge will treat guests with extreme care and ensure guest satisfaction is held at an exceptional standard..

Service Offering

The following are the services and amenities that Pegasus Hotel will provide:

  • 354 luxury rooms, two presidential suites, and four parlor suites
  • Olympic size pool with adjacent hot tubs and surrounding cabanas
  • First-class full-service spa
  • First-class restaurant and bar
  • Spacious fitness center
  • Over 20,000 square feet of attractive meeting space for events
  • Concierge and butler service
  • Complimentary wifi
  • Valet service
  • Laundry service
  • Business center

Customer Focus

Pegasus Hotel will target the population of Austin, Texas, its surrounding communities, and travelers visiting Austin for work or play. Guests will be mid to high level income, enjoy traveling, enjoy visiting spas and high-end restaurants, and work in the corporate or government sector.

Management Team

Pegasus Hotel will be owned by Frank Girard and Miles Butler. They will act in an Owner capacity, and will not be involved in the day to day operations of the hotel. Frank and Miles will hire the appropriate staff to ensure Pegasus Hotel is a profitable and successful business.

Lorenzo Falucci, General Manager, has over twenty years of experience in the hotel industry. He has most recently managed another independent boutique hotel in New York and was excited to be recruited by Frank and Miles to operate the Pegasus Hotel.

Lorenzo will hire Lisa Montgomery as the Director of Sales and David Jimenez as the Assistant General Manager. Lorenzo, Lisa, and David will be the senior management team of Pegasus Hotel. They will oversee all other department managers – Maintenance, Housekeeping, Front Desk/Guest Relations, and Food and Beverage. Each department manager will oversee various employees in their respective department and role. The Pegasus Hotel will have a large and sophisticated operation as each department is integral in the success of the hotel.

Success Factors

Pegasus Hotel will be able to achieve success by offering the following competitive advantages:

  • Friendly, attentive, and highly responsive staff that caters to each guest and will be able to provide the best guest experience possible.
  • Luxurious amenities throughout the hotel that will make each guest feel pampered.
  • Modern and contemporary designed hotel tucked against a beautiful Texas landscape perfectly suited to host any event.
  • Competitive rates and frequent guest discounts.

Financial Highlights

Pegasus Hotel is seeking $10,000,000 in debt financing to begin constructing the hotel and commence operations of the business. The funding will be dedicated towards securing the land lease and the hotel build-out and design. Funding will also be dedicated towards three months of overhead costs to include payroll of the staff, furniture, fixtures, and equipment, initial inventory, and working capital. The breakout of the funding is below:

  • Secure the land lot, architecture, build-out, and design: $6,000,000
  • Hotel furniture, fixtures, and equipment: $2,000,000
  • Initial inventory: $750,000
  • Three months of overhead expenses (payroll, rent, utilities): $1,000,000
  • Marketing & advertising: $150,000
  • Working capital: $100,000

The following graph below outlines the pro forma financial projections for Pegasus Hotel.

how to write a business plan for a boutique hotel

Company Overview

Who is pegasus hotel.

Pegasus Hotel is a startup full-service independent luxury hotel in Austin, Texas. Owned by two local businessmen, Frank Girard and Miles Butler, it will serve the new up and coming district of the outskirts of Austin and cater to the locals and travelers who crave a luxurious and relaxing atmosphere. Pegasus Hotel will be a 10-story, 360-room hotel with a five-star restaurant and bar, relaxing pool and spa, 20,00 square feet of meeting and event space, and a view of scenic Austin. Pegasus Hotel will hold weddings and events, meetings, retreats, and those looking to unwind and be pampered while staying at the hotel. The mission statement of the hotel is to provide first class service and amenities.

The guests rooms will include luxury beds and bedding with best-in-class furniture and bathroom fixtures. Pegasus Hotel will also have a full-service spa that will be able to provide massages, facials, makeup and/or hair service, steam rooms, and a sauna. The Olympic-sized pool will have adjacent hot tubs with a swim-up bar and surrounding cabanas. Pegasus Hotel will be equipped with state-of-the-art fitness equipment in its spacious gym. The restaurant will be a high-end steakhouse that will feature entrees from a world-renowned chef and a wine list cultivated by the area’s most respected sommelier. There will also be over 20,000 square feet of meeting space that will hold weddings, bat mitzvahs, reunions, galas, and any special event.

Pegasus Hotel will be independently owned and operated and will feature its own reservation system and operational software. Each employee will be expertly trained and vetted to pass luxury industry standards of guest service. Pegasus Hotel is committed to providing the best guest experience possible while maintaining a profitable hotel. Pegasus Hotel aims to be a step above the rest and be an unforgettable experience for all who step foot into the hotel.

Pegasus Hotel History

Pegasus Hotel is owned by two local businessmen, Frank Girard and Miles Butler. Frank and Miles have been friends and business associates for over thirty years. They became friends in college while attending The University of Texas at Austin. Frank is a real estate developer specializing in commercial real estate and multi-use land projects. Miles is a software engineer who has built multitudes of software programs for various companies. They have both been extremely successful in their careers and want to divest their investments in a large-scale full-service hotel in Austin, Texas.

Since incorporation, Pegasus Hotel has achieved the following milestones:

  • Acquired a 40-acre lot on the outskirts of Austin, Texas.
  • Registered Pegasus Hotel, LLC to do business in the State of Texas.
  • Hired a consultant to conduct a feasibility study for a full-service hotel in Austin.
  • Began developing reservation and operational management software for use at the hotel.
  • Began the branding image, logo, website, and social media accounts for the staffing agency.
  • Applied for a liquor and mixed beverage permit with the Texas Alcoholic Beverage Commission.
  • Hired an architect to begin the design phase of the hotel.

Pegasus Hotel Services

The following will be the services and amenities Pegasus Hotel will provide:

Industry Analysis

The hotel industry is expected to increase to a $133 billion in the next five years. The hospitality industry will benefit from increases in travel spending, corporate profit and general consumer spending.

As consumers earn higher incomes and businesses replenish their budgets, travel spending is projected to increase over the next five years. Inbound trips by non-US residents are anticipated to rise 22% over next the five years, while domestic travel is expected to grow 9% during the same period.

The industry will see particularly strong growth in extended-stay hotels, boutique hotels, spa and health retreats and resorts segments. As demand for these auxiliary services picks up, industry employment is anticipated to recover and increase over the next five years. Industry players are also expected to continue expanding abroad into emerging economies, such as Asia, Eastern Europe and South America. These foreign markets are expected to somewhat detract from domestic investment, as they offer higher growth prospects for industry operators.

Customer Analysis

Demographic profile of target market.

The precise demographics for Austin, Texas are:

Customer Segmentation

Pegasus Hotel will primarily target the following customer profiles:

  • Individuals and families who have disposable income (mid to high level)
  • Frequent travelers
  • Individuals who dine out and visit spas frequently
  • White collar workers (corporate or government office)

Competitive Analysis

Direct and indirect competitors.

Pegasus Hotel will face competition from other companies with similar business profiles. A description of each competitor company is below.

Hotel Ella is a historic boutique hotel located in Austin, Texas. Located in downtown Austin and walking distance to the University of Texas campus, Hotel Ella is a stylish boutique hotel housed in the historic Goodall Wooten House, one of Austin’s original landmark estates. Constructed in 1900, the Greek revival-style mansion underwent an extensive renovation in 2013, and now offers the perfect balance between modernity and a rich history rooted in the fabric of the neighborhood and the university. Hotel Ella has 47 guest rooms, a cabana-lined pool, and a wrap-around veranda overlooking the front lawn. Hotel Ella features beautifully designed outdoor and indoor spaces perfectly suited for a vacation, wedding, or corporate event. The hotel also features a diverse collection of Texas Modernist works around the hotel grounds.

All guests of Hotel Ella are treated to warm southern hospitality and superior personalized service during their stay. The historic property is appointed with a variety of elegant 21st century amenities. Hotel Ella also offers the following amenities and guest services:

  • Complimentary 24-hour guest services
  • Complimentary high-speed wi-fi access
  • Complimentary electric car charging station
  • Complimentary morning newspapers available in the historic mansion
  • Complimentary coffee stations from 5am – 11am
  • Twice-daily housekeeping service
  • Cabana-lined outdoor pool
  • Fitness center
  • Same-day valet laundry services
  • In-room dining by Goodall’s
  • Business services: photocopying, printing, postal services, and supplies

Hotel Ella also welcomes dogs of all sizes at no additional fee.

Kimber Modern

Kimber Modern is located in the hip SoCo district of Austin and is intended to draw in the independent urban traveler seeking a unique escape. It is architecturally designed with clean lines and abundant light filtered through canopies of oaks in an artfully landscaped Courtyard. The hotel also encompasses absolute comfort and attention to detail while providing technologically sophisticated rooms in their boutique guest rooms. Guests booking at Kimber Modern will receive complimentary beverages, parking, and WiFi.

Kimber Modern offers the following hotel amenities to its guests:

  • Off street covered parking
  • Electric car charging station
  • Keyless entry
  • Complimentary WiFi throughout the hotel
  • Multi-level courtyard with a 25-foot glass water feature with multiple areas to lounge
  • Jura self-serve coffee system featuring a variety of coffee drinks 24/7
  • Beverage bar 24/7
  • Gourmet teas
  • Virtual concierge – computer, printer, and copier
  • Meeting space available for groups
  • 3pm check-in and noon check-out

Guests are also available to book the entire hotel for their group.

The Cat Noir Hotel

The Cat Noir Hotel is an award-winning 14-room boutique hotel located in the heart of Austin’s east side. The European-styled boutique hotel includes a restaurant and bar partner, Uncle Nicky’s Italian Specialties. Uncle Nicky’s offers a relaxed all-day dining experience that is themed after cafes in northern Italy. The Cat Noir Hotel opened in 2016 and has been ranked #2 by Travel + Leisure’s World’s Best Awards and Top 20 Best Hotels in Texas by Conde Nast Traveler.

The Cat Noir Hotel’s contemporary design maintains a sense of warmth and a unique aesthetic that is felt through the lobby, outdoor spaces, and each of the unique guest rooms. In addition to the design elements, The Cat Noir Hotel boasts the following features:

  • Private roof deck for guests to enjoy the stunning views of downtown, the Texas Capitol, and the University of Texas
  • Outdoor patio and courtyard areas on all levels
  • Artwork from local artists

Each of the guest rooms include Juliet balconies with neighborhood views, fine linens, and Simmons luxury plush mattresses.

Competitive Advantage

Pegasus Hotel will be able to offer the following advantages over their competition:

Marketing Plan

Brand & value proposition.

Pegasus Hotel will offer the unique value proposition to its target market:

  • Professional and attentive staff dedicated to ensure complete guest satisfaction.
  • Various amenities throughout the hotel for any guest to enjoy.
  • Modern and contemporary design with beautiful Texas views throughout the entire hotel.
  • Competitive rates.

Promotions Strategy

The promotions strategy for Pegasus Hotel is as follows:

Social Media

Pegasus Hotel will invest in advertising the hotel on social media platforms Facebook, Instagram, LinkedIn, and Twitter. By using targeted social media marketing, Pegasus Hotel will be able to reach those who frequent nice restaurants and spas and travel frequently.

Website/SEO Marketing

Pegasus Hotel will invest in a strong SEO presence so that when someone enters “Austin boutique hotel” or “first class hotel near me” in their Google or Bing search bar, Pegasus Hotel is at the top of the list. Their website will feature photos of the guest rooms, meeting areas, pool, spa, fitness center, and restaurant/bar. Future guests will be able to make a reservation to book their future stay on the website and access contact information for either a Director of Sales or General Manager of the property.

Pegasus Hotel will request all requests for news stories regarding the development of the hotel, owner/developer information, opening dates, etc. By accommodating the press’ requests for stories, it will also be free advertising for the public to learn about the new up and coming luxury hotel.

Frank and Miles will invest in a billboard in downtown Austin where the mid to upper class of residents frequent. The hotel will be minimalistic but eye-catching. It will feature an attractive rendering of the hotel along with the website. Curious passersby will be directed to visit the hotel’s website for information.

Third Party Booking Websites

Once the hotel is nearing 60 days towards opening, all of the third party booking websites will feature Pegasus Hotel so that travelers visiting Austin will be able to see it listed as an option for Austin hotels.

Bridal Shows and Wedding Industry Events

Pegasus Hotel will have a table at all of Austin’s bridal shows and wedding industry events. It will attract those couples searching for a venue to accommodate their special day.

The pricing of Pegasus Hotel will be moderate and on par with competitors so customers feel they receive value when purchasing its guest rooms and services.

Operations Plan

The following will be the operations plan for Pegasus Hotel.

Operation Functions:

  • Frank and Miles will be the owners of the hotel and hire the appropriate staff to manage the hotel. Frank will act as CFO of the hotel and Miles will be in charge of the reservation system and operations software. Miles developed the software and will focus on making sure it’s always functional and efficient.
  • General Manager will be hired to oversee the entire staff and operations of the hotel to include guest satisfaction, oversee vendor contracts, events, and making sure that each department is running effectively and efficiently.
  • Assistant General Manager to assist the General Manager with overseeing the staff, with particular attention to guest satisfaction and front desk operations.
  • Director of Sales will be hired to sell events, corporate accounts, and group bookings for the hotel.
  • Maintenance Engineer will be hired to attend to all mechanical and plumbing issues that may arise.
  • Executive Housekeeper will be hired to lead the team of housekeepers to make sure all areas of the hotel are being cleaned to Pegasus Hotel standards and that each guest is receiving all accommodations to their requested schedule.

Milestones:

Pegasus Hotel will have the following milestones completed in the next six months.

8/1/202X – Purchase land lot and break ground on new hotel.

8/15/202X – Finalize architectural renderings and hire a General Contractor to build the hotel.

9/1/202X – Finalize contract with advertising company for them to design the branding image of the hotel, logo, website, billboard, and social media accounts.

9/15/202X – Begin social media and website advertising campaign. Billboard with a teaser of ‘Coming Soon’ will go up in downtown Austin.

10/5/202X – Hire General Manager and Director of Sales.

10/15/202X – Attend annual Wedding Industry Event with a table to begin advertising Pegasus Hotel.

11/1/202X – Pegasus Hotel will go live on third party booking websites.

11/15/202X – Remainder of staff will be hired to begin training program.

11/30/202X – Final walk-thru of newly constructed Pegasus Hotel.

12/15/202X – Begin furnishing and interior design of the hotel.

1/1/202X – Grand Opening of Pegasus Hotel.

Lorenzo will hire Lisa Montgomery as the Director of Sales and David Jimenez as the Assistant General Manager. After an exhaustive search, Lorenzo believes has found the next two senior management positions to ensure the success of the hotel. Each comes with an impressive resume of prior hotel sales and operational experience.

Lorenzo, Lisa, and David will be the senior management team of Pegasus Hotel. They will oversee all other department managers – Maintenance, Housekeeping, Front Desk/Guest Relations, and Food and Beverage. Each department manager will oversee various employees in their respective department and role. The Pegasus Hotel will have a large and sophisticated operation as each department is integral in the success of the hotel.

Lorenzo, Lisa, and David will meet with Frank and Miles monthly to update them on progress and overall operations and sales efforts of the Pegasus Hotel.

Financial Plan

Key revenue & costs.

The revenue drivers for Pegasus Hotel are the revenues it will collect when guests book a reservation at the hotel. The hotel will also collect revenues from its restaurant and bar, spa, and events it will host.

The cost drivers will be the payroll and overhead costs to staff the hotel. Other costs will involve the land lease, utilities, marketing costs, and technology fees. There will also be costs associated with the maintenance of the hotel, food and beverage inventory, spa inventory, and hotel guest room supplies.

Funding Requirements and Use of Funds

Key assumptions.

The following outlines the key assumptions required in order to achieve the revenue and cost numbers in the financials and in order to pay off the startup business loan.

  • Initial Number of Room Nights Sold per Month: 8,000
  • Number of Events per Month: 30
  • Land Lease per Year: $1,500,000

Financial Projections

Income statement, balance sheet, cash flow statement, hotel business plan faqs, what is a hotel business plan.

A hotel business plan is a plan to start and/or grow your hotel business. Among other things, it outlines your business concept, identifies your target customers, presents your marketing plan and details your financial projections.

You can  easily complete your hotel business plan using our Hotel Business Plan Template here .

What Are the Main Types of Hotel Companies?

There are many types of hotel companies. Most hotels are affiliated with a hotel franchise company. Other hotel companies distinguish themselves by star level-  4 to 5-star hotels are on the higher end of rate and amenity offerings, whereas 2 to 3-star hotels cater more towards the everyday business travelers and families.

What Are the Main Sources of Revenue and Expenses for a Hotel Business?

The primary source of revenue for a hotel business are the room fees it charges each guest to stay at the hotel. Revenues are also collected for different amenity offerings, such as room service,  restaurant and bar revenue, spa revenues, and guest shop revenue.

The key expenses for a hotel business are the costs for inventory, maintenance, supplies, furniture, fixtures, and equipment, technology, and payroll of the staff. Other expenses will be the rent, utilities, and overhead costs, if applicable.

How Do You Get Funding For Your Hotel Business Plan?

Hotel businesses are most likely to receive funding from banks. Typically you will find a local bank and present your business plan to them. Angel investors and other types of capital-raising such as crowdfunding  are other common funding sources. This is true for a business plan for a hotel, a resort or a boutique hotel business plan.

What are the Steps To Start a Hotel Business?

Starting a hotel business can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.

1. Develop A Hotel Business Plan - The first step in starting a business is to create a detailed hotel business plan that outlines all aspects of the venture. This should include potential market size and target customers, the services or products you will offer, pricing strategies and a detailed financial forecast.  

2. Choose Your Legal Structure - It's important to select an appropriate legal entity for your hotel business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your hotel business is in compliance with local laws.

3. Register Your Hotel Business - Once you have chosen a legal structure, the next step is to register your hotel business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws. 

4. Identify Financing Options - It’s likely that you’ll need some capital to start your hotel business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms. 

5. Choose a Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations. 

6. Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events. 

7. Acquire Necessary Hotel Equipment & Supplies - In order to start your hotel business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation. 

8. Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your hotel business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising. 

Learn more about how to start a successful hotel business:

  • How to Start a Hotel Business

Where Can I Get an Example Hotel Business Plan PDF?

You can download our example hotel business plan PDF template here . This is a business plan template you can use in PDF format.

Other Helpful Business Plan Templates

Franchise Business Plan Template Resort Business Plan Template Bed and Breakfast Business Plan Template

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How to Start a Hotel Business

How to start a hotel business - XOTELS

For many people, it is a dream to open their own  boutique hotel or luxury bed and breakfast, but the big question is how to start a hotel business? Opening a boutique hotel business , just like any new company, is more difficult than it might seem at first sight.

Particularly if you have never worked in the international hotel industry, you will be faced with many things you might have not considered or imagined before. The hotel business is highly competitive and achieving good financial results is not as easy as it seems.

In my experience at XOTELS in dealing with entrepreneurs and investors, I have found that there is no shortage of creative ideas for innovative hotel concepts. The challenge, however, lies more in the strategic and organizational areas of the business.

The Hotel Dream… Where it all Starts

Where to get started with opening your own hotel? What kind of hotel should it be? How does location influence my business? How to attract guests? How to control operational costs and run a profitable business? These are all crucial questions that should be dealt with prior to getting into the business.

In this article, we will discuss tips on starting your own hotel:

  • What it takes to be a Hotel Manager – Skillset

Experience Vs No Experience

Strategy & execution.

  • Hotel Market Size and Opportunities

Hotel Segment Opportunities

External factors in the hotel industry.

  • Independent vs Franchise
  • 11 Steps for Starting a Boutique Hotel
  • Opening a Hotel Business From Start to Finish

What it Takes to be a Hotel Manager – The Skillset

The stereotype is clear: many hours of hard work when everybody else is off…

Everything is true, and even more when you’re in charge of a hotel. So, why might anyone want to open a new hotel? There is only one answer to this question: it is because we love it. It is definitely one of the most rewarding jobs when it comes creating moments that will make people happy.

What does this mean for someone who wants to open a hotel? Although you might not be in direct contact with guests for most of the time (depending on the type hotel you choose), there are certain personality traits that will help you open a hotel business. We consider the following characteristics to be of great help:

  • Guest first mentality & proactiveness, meaning always thinking of how the guest feels around your hotel and what can be done about it to improve their experience. Either taking action (according to feedback or your own observance) before service failure occurs will greatly improve guest satisfaction and therefore resulting in higher review scores.
  • Open minded to feedback. Becoming a great hotel does not happen overnight. Adapting and evolving according to feedback comes before everything else in this process. Guests can always bring out points of improvement, and acting on it will definitely put you ahead of the game. Just think how many times you have been able to make suggestions to hotel staff/owners, making the real question how effectively you will be dealing with the comments.
  • Proactive, taking actions proactively will prevent your hotel and staff performance from getting sidetracked. Of course, following KPIs (key performance indicators) will give you some degree of insight, but stepping beyond and letting your creativity help drive revenue and guest experience will enable your hotel to be successful.
  • Perseverance. Hospitality is not always the easiest industry to work in, especially when times get though. However, with the right amount of perseverance you will be able to pull through and enjoy the fruits of your labor.
  • Multi-tasking. Being a jack of all trades and a good multitasker definitely helps in following the many different processes happening around the hotel. One second you might be doing administrative work – the other – helping out with housekeeping getting rooms ready for the next arrivals.
  • Communication, being able to communicate your goals and how the hotel is performing is crucial to the development of your business. Involving your staff with the right communication puts everyone on the same page: the one for success.

Experience versus no experience makes a difference when starting a new hotel business

Having hospitality experience prior to opening a hotel can definitely put you a step ahead. The speed and effectiveness with which you will build your concept will likely coincide with the level of your industry know-how. Below we will give you some examples of where you might face challenges.

Skill Sets Explained

General knowledge.

Knowing the service standards might be the most important of general hospitality knowledge. Without this knowledge, it will be difficult to maintain standards and motivate staff to improve their overall performance.

Room Division Experience

Running front of the house can be challenging even for the more seasoned hospitality professionals mainly due to the myriad of processes running all at the same time. Other issues can occur with the alignment of services between other departments such as F&B.

F&B Experience

If you do not have any prior experience in developing and running the F&B side of a hotel, we advise you to be careful with extensive F&B concepts, avoiding risks such as:

  • Etiquettes can certainly be learned, but often work differently in practice. Learning what works well and what can be applied can be quite tricky.
  • Food and service standards. Running a professional kitchen is totally different from anything you might have seen before. Putting out quality food requires well thought through menus and efficient workflows to ensure speed of service is maintained whilst delivering quality dishes.
  • Purchasing, maintaining consistent food quality while keeping food-cost low will be challenging without prior knowledge of handling, preparation, and storage of food in a professional kitchen.
  • Concept development covers not only how your hotel will look like, but also how services and facilities align with the operational logistics in the hotel. Making any mistakes here could cost you money, time and loss of operational efficiency.

Revenue Management Experience

Essential to any hotel opening is a solid revenue management strategy. At the core of any successful pre-opening phase are well-thought-through elements of product pricing and positioning such as:

  • Room type strategy (e.g. supplement strategy, promoting differentiation between rooms)
  • Distribution (e.g. contracting online travel agents, channel mapping in your PMS)
  • Competitive positioning (how do you competitively price yourself in the market, evaluating your value-add and weighing it against your competitors)
  • Promotions (when and what kind of promotions will you run, including negotiation and contracting of partners)

Consider if you are capable of developing and executing revenue management strategies and operations. Missing any of the above elements of managing revenue will guarantee a loss of revenue opportunities directly impacting your cash flow.

Marketing Experience

Coming up with a marketing strategy might look simple, but coming up with something exceptional is a different story. If you do not have the needed experience you might lack essential points in your marketing plan causing a significant loss of business opportunity . Also, do you have your planning front of mind? Launching a new hotel requires some serious time to plan, with particular activities that should be on the way one or two years ahead of the opening date, such as the website and distribution contracting.

Any of the above gaps in experience can be filled in by outsourcing the development and support of hotel opening and management services. The most important is to understand exactly where you might be lacking background knowledge to reach a solid business plan and execution.

What Does It Take To Open a Hotel Business?

What goes into designing and creating an outstanding hotel concept when opening a new hotel business.

Becoming a great hotel goes beyond just offering great facilities and service. Everything needs to be aimed towards providing guests something special and creating unique experiences.

How to Start a Hotel Business? 5 Steps for Success

First, it is important to settle on the points you really want to stand out. Here it is all about the quality and differentiation of your facilities, staff and service, technological features, and more…

Following the below steps will help you settle on your decision.

Customer Centered Services

Guests crave unique experiences and expectations keep on rising. Offerings should facilitate customer experiences helping you to stand out from the crowd. Think ahead what features and activities can be implemented to excel in your service delivery. Great moments to interact with guests can be simple, such as time for guests to enjoy a complimentary drink and snack on the house.

Another point to consider is how you will be personalizing the way your services are delivered and products are presented through marketing. Customer loyalty is dependent on the way products are marketed towards customers’ needs, with 25% of consumers (Netimperative) indicating to be more loyal to a travel brand that shows an understanding of their needs through marketing.

This is equally important to how services delivery takes place, as customers are open to switching to their choice if they find services better catering to their needs (80% of consumers, Qubit).

We cover this further in our hotel trends article diving deeper into personalization in hospitality.

Tailoring your facilities to the needs and wants of your target group will be essential. A great example of this are business travellers, who require work related amenities to get their job done. Aim to apply the same thought process behind how your hotel’s public areas and rooms can be decked out with essential features ready to be marketed towards this segment.

Where you choose to locate your property has proven to be critical in the way your hotel can be positioned in the market, and how guests can be drawn to book your hotel. Exactly what will be driving your demand?

  • Area features: bars, restaurants, shopping districts
  • Transportation: connectivity to any major traffic arteries, train stations, airports, subway stations, bicycle routes etc.
  • Other demand generators: proximity to a business area, tourist attractions, industrial park, universities

Besides demand driving factors, you should think about:

  • How does the location fit your concept / does it complement your idea of what the hotel should radiate to your target audience
  • Can I add something new to the market in this location – or – is there already a similar concept next door

Learn everything you need to know on this topic in our article about hotel site selection .

Many hoteliers underestimate how much planning and thought should be going into your hotel opening. Making sure you have planned enough time to think everything through, covering every single thing you can possibly think of will give you a competitive advantage.

Developing Your Concept and Design

How can you develop, design and open a beautiful and successful hotel business

Coming up with an idea solely relying on your instinct and personal design preference would be a mistake. So what should you consider?

Hotel Market Size & Opportunities

Despite it being a tough year for the hospitality industry, hotel project development and openings continue to unfold all across the globe, with stunning 775 hotels and 147,316 rooms planned to open for the second half of 2020 ( Tophotelprojects, 2020 ).

Opportunities will always continue to linger around the corner. Not knowing when we recover might be a difficult variable to consider, but we know recovery lies somewhere around the road ahead. Considering the significant amount of time it takes to open a hotel, and emerging opportunities due to Covid-19, we think it is still the right time to open a new hotel.

When it comes to favourable circumstances, we could definitely name a few:

  • More room in the job market, making it easier to procure qualified staff. Something that before the crises could not be taking for granted
  • Closures of competition, sadly, many hotels businesses have had to pull the plug. This means less competition in a market which was previously getting highly competitive in specific markets.
  • Subsequently, this means there are real estate deals out there, ready to be picked up for new hotels to step in

Much can be gained when diving thoroughly into opportunities that segmentation provides. Be as specific as possible. You should really want to be aware of which hotel market segments can drive revenue in fine detail as far ahead of opening as possible. With this knowledge, you can focus marketing and sales efforts specifically towards these segments. Without any understanding of these groups, it will be hard to create appealing offers.

With proper hotel segmentation you will be able to:

  • Increase attractability across each segment with a focussed approach and initiatives for each group
  • Measuring per segment leads to more actionable insights
  • More historic data will be available for trend analysis in the future

Hospitality is typically one of the first industries to be impacted by macro economic factors. Considering how the following external factors could be affecting the market is therefore vital:

  • Domestic travel, whether larger or smaller markets, domestic travel can contribute highly to your performance. Keep an eye on how your market is performing by looking into pulling data from your municipality as well as market data that can be provided by OTAs .
  • The same applies to Non-domestic travel. Be aware of your largest feeder markets/countries of which you will be relying on.
  • GDP, historically, hotel demand and GDP go hand in hand showing a strong correlation between the two metrics.
  • Consumer Confidence Index, describes the optimism on the economy expressed through activities of savings and spending by consumers.

The best places to find travel statistics are your municipality/regional databases as well as OTAs, which also have an abundance of data at their disposal when it comes to feeder markets.

Independent Hotels vs Franchised Hotels

Perhaps one of the biggest questions to be answered..

We believe in the power of independent hotels, more freedom to create a hotel to your liking, less restrictions, and far lower cost not having to pay to the franchise owner.

Still considering to go for a franchise? Be prepared to add the following fees to your budget:

  • Initial fee
  • Royalty fees
  • Marketing fee
  • Sales reservation fees
  • Loyalty / frequent traveller programs fees
  • Miscellaneous fees

Streamline Your Hotel Operations

We guide hotels and resorts toward unparalleled success, positioning them as market leaders.

how to write a business plan for a boutique hotel

Pulling Everything Together: The Hotel Business Plan

Here is a short list of how your hotel business plan should look like. If you would like a more detailed checklist, be sure to check out our free hotel business plan template .

1. Executive summary

This part should include two main parts, one being the mission statement, and the other are your objectives. Keep this part short, concise and grab the attention of the reader.

2. Company Analysis

This is the part where you dive deeper into your company’s USPs (unique selling points). Basically, explaining what the concept entails.

3. Industry Analysis

Investors want to know if you properly understand the market you are going to operate in. This also forms the foundation of which trends and developments you will be building your brand on.

4. Customer Analysis

This part focuses on breaking down your target market. Think of factors such as:

  • Geographics
  • Demographics
  • Socio-economics
  • Psycho-graphics
  • Behavioral segmentation

Imagine the type of guests which will be likely to visit your hotel. Painting a picture of guest types will give you the insight needed to evaluate how value can be provided to your customers.

5. Competitive Analysis

Of course, studying local competition is essential to highlight your strengths and weaknesses, as well as weighing those of the competition against your own. This can also be defined as a SWOT analysis, which investors use to see how you differentiate and stand out from the crowd.

6. Strategic Plan

The strategic plan consists of three important parts covering marketing, distribution and revenue management. Further down we have listed a time-based planning covering these topics.

7. Operations Plan

This is all about the details when it comes to running your operations smoothly. Do not make the mistake of not diving deep enough here, so make sure to include the following:

  • Staff, anyone from lower level staff to managers should all be quantified.
  • Operating processes, how/when/what you will be developing manuals for. Make sure to set your service standards.
  • Suppliers, which/and what will you be needing suppliers for (linnen, food, drinks, office supplies etc.)
  • How will your inventory be managed?

8. Management Team

Who will be running your business, and what makes them unique and capable of creating a great hotel that stands out. Explain your team’s backgrounds will give insight into this.

9. Financial Plan

How much money will be needed to fulfill your needs. Start with the capital investment (start-up costs of the hotel), followed by ongoing business costs and operational expenses:

  • Rent and Utilities
  • Other Expenses (franchise fees, marketing expenses, maintenance costs etc.)

10. Key Milestones

Setting milestones will increase the likelihood of success. The risk for lenders or investors decreases each time a milestone is achieved, reaching high chances of success once the last milestones are in sight. Important milestones include:

  • Location selection
  • Permits & Licenses
  • Build-out / Construction of the Hotel
  • Staffing and Training
  • GOP Break-even
  • NOI Break-even

11. Appendix

All other content less relevant to getting your important message across belongs in the appendix. Try keeping your plan as concise and straight to the point as possible, referring to the appendix when needed to avoid an over cluttered appearance to the investors.

Do not be Too Late: Start on Time

Beginning on time is not only essential to your success, but it can save you a lot of money. Consider the below timeframes to give you an idea of when to start your business processes.

The Planning: From Start to Finish

0-1 months:.

Grand Opening:

  • Do not put your entire marketing budget in the grand opening. This is just one day, and it will be impossible to reach enough potential business to fill your hotel in the long run. View marketing as a constant long term effort instead.

Soft opening:

  • Final finetuning and testing for the staff and systems before official opening Great opportunity to take press and industry bloggers on a tour of the hotel without the burden of operational pressure of a full hotel. Reporters really appreciate all the help you can give them with preparing a story on this new hotspot in town. Invite corporate decision makers to test the hotel. Treat them like VIP’s. Wine and dine them, and turn them into ambassadors of your business. Impressing them with an unforgettable experience will start spreading word-of-mouth for you.

Open for sales on your own website and OTAs etc.

Reservations:

  • Prior to this it is possible to have staff taking inquiry and answering questions with scheduled callbacks at a later stage once everything is organized. However, from 3 months prior to the opening the reservations call center needs to be up and running.

System selection

  • MS, Web Booking Engine, CRS, GDS, Channel Manager, Rate Shopper, CRM. These all need to be selected, purchased and installed between 6 to 3 months prior to the opening.
  • Schedule visits daily with decision makers of companies from 9 months prior to the opening trying to win them over from the competition.

Website live

  • Websites page/history is a strong factor in ranking on google, so launching your website as earlier as possible would be the best. This will also ensure your website is properly indexed on search engines
  • Preferably, 18 months prior, but certainly no later than 12 months prior to the opening. Even if it is with temporary images and content.

Revenue Management

  • This might be the point where most hotel owners miss the boat when it comes to maximizing their potential. It starts to get complicated when thinking about using different pricing techniques (covering both opening prices as well as long term rates) across multiple scenarios and room types, as well as setting your mind on payment and cancellation policies.
  • Budgets, forecasts, rate strategy, room type strategy, packages, distribution strategy (covering everything from direct sales to promotions)
  • Choosing here to outsource revenue management can bring a strategic advantage, both when establishing your business plan and the execution of your plans.

Distribution

  • Eventually your rooms will have to be sold somewhere right? Which 3rd party distribution partners will you contract, and what technology will be necessary to facilitate all this.
  • On the marketing side, questions such as how you will be attracting customers, how you will be positioning your hotel, what message will be delivered across different segments, and how your website will be planned out when it comes to SEO, SEM, SMM, social media, and blogging. Having the right strategies will help driving direct sales to your hotel
  • Sales strategy should be ready to set into action. Think of tools, templates and how you will be executing visits and follow-ups.
  • We tend to overestimate how easy it is to find a good management team. Experience has taught owners opening hotels it is not. Moreover finding a highly qualified pre-opening team that has develop, implement and execute your strategies is even more difficult. You will need to start recruiting this team 2 years before the opening to be able to find the right people for the job, and have them start in time.
  • Be precise in what their responsibilities are and where they overlap with other departments. Considering the needed experience here is important as well, since it will help make the staff budget and hiring process. Lastly, make a planning according to your pre-opening phases to decide on when everyone should start (think as far ahead as possible).

Promotion/PR

  • ‘Coming soon’ Put up a big sign ‘Coming soon’ with some breathtaking images of what you are building to attract the attention of people walking and driving by. This should start the day the first construction is initiated.
  • Local media, keep them in the loop on developments (even let them visit your construction site)
  • Regular press releases up until the opening (construction progress, interesting anecdotes, mission statements, sneakpeaks from the rooms etc.). Combine everything in a well curated social media that attracts attention. Make anyone feel the need to follow how the final product will look like.

Financial Plan

  • Covering this will be the revenue projections for the next five years. Important metrics to follow are your expected occupancy rates, ADR (average daily rate) and RevPAR (revenue per available room). This should give you the outline of how much money will need to be raised, giving you the start of how much will need to be raised (internally or externally) and when you will be needing it (investors need to know when lenders will get paid as well to secure their own return on investment).

Interested in Taking Your Plans to the Next Level?

Think you are ready? Below we have linked to more of our articles providing all the knowledge you need to take your plans to the next level!

  • Hotel Business Plan
  • Hotel Market Research
  • Hotel Feasibility Study
  • Common Mistaked made in the Pre-opening Phase of Hotels .

On a last note, it will be extremely important you prepare yourself well, do a lot of research and develop a detailed business plan to ensure success. It is not as simple as ‘If you build it, they will come’, for if you have watched Field of Dreams with Kevin Costner.

Unfortunately, our hotel consultants and I still see too many hotel startups fail due to little planning.

I hope these tips will help fellow entrepreneurs start successful new hotel businesses!

Cheers, Patrick Landman

PS. Any doubts or uncertainties about your ideas and planning? Contact us for hotel consulting or hotel management services to help build out your concept and run your business most effectively as possible.

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Home » Hospitality

How to Start a Boutique Hotel [Business Plan]

Boutique Hotel Business

A boutique hotel is a smaller, upscale, luxury hotel with less than 100 rooms that offers a distinct personality, intimate experience, and personalized service. Generally, boutique hotels tend to be located in trendy neighborhoods in large cities, have luxury amenities, and have unique, modern designs.

The market size of the boutique hotel industry in the United States was forecast to reach 12.39 billion U.S. dollars, following a drop in 2020 due to reductions in travel during the coronavirus pandemic.

According to Fortune Business Insights™, the global luxury hotel market size is projected to reach USD 238.49 billion by 2028, exhibiting a CAGR of 10.4% during the forecast period. The report also states that the market value stood at USD 93.43 billion in 2020.

Steps on How to Start a Boutique Hotel Business

Conduct market research.

Conducting market research before starting any business is key to the success of the business hence you must not start a boutique hotel business without conducting market research. Market research provides critical information about your market and your business landscape.

It can tell you how your business is perceived by the target customers you want to reach. It can help you determine who and where your customers are, and which customers are most likely to do business with you. Thorough market research will help you understand how your target customers think and adapt to their needs to turn them into regular customers and brand advocates.

a. Who is the Target Market for Boutique Hotel Business?

  • Celebrities and artists
  • Expatriates
  • International businessmen and women

b. Is Boutique Hotel Business a Profitable Business?

Yes, the boutique hotel business is quite profitable. In the United States, the industry is projected to be worth $12.39 billion.

c. Are There Existing Niches in the Industry?

No, there are no existing niches when it comes to the boutique hotel business because a boutique hotel is a niche idea in the hotel industry.

d. Who are the Major Competitors?

  • The Inn & Club at Harbour Town – The Sea Pines Resort
  • The Little Nell
  • The Spectator Hotel
  • The Jefferson, Washington, DC
  • French Quarter Inn
  • The Chatwal, a Luxury Collection Hotel, New York City
  • Stephanie Inn
  • Wentworth Mansion
  • The Inn at Little Washington
  • Montage Laguna Beach
  • The Lowell Hotel New York
  • The Inn of the Five Graces
  • Williamsburg Inn
  • Solage, Auberge Resorts Collection
  • The Canyon Suites at The Phoenician, A Luxury Collection
  • Mayflower Inn & Spa, Auberge Resorts Collection
  • HarbourView Inn
  • Hotel Jerome, Auberge Resorts Collection
  • Auberge Du Soleil
  • The Rittenhouse.

e. Are There County or State Regulations or Zoning Laws for Boutique Hotel Business?

Yes, and zoning laws require boutique hotel operators to follow specific rules and regulations, including some that apply only to players in the industry. Please note that in many communities, zoning laws require boutique hotels to apply for a permit from the city.

This application process allows the city’s zoning department to determine whether the boutique hotel meets the zoning rules for the community. Permits also ensure that all boutique hotels are properly licensed by county or state agencies.

f. Is There a Franchise for Boutique Hotel Business?

Yes, there are franchise opportunities for the boutique hotel business. Here are some of them;

  • Curio by Hilton (initial investment of between £2,960,000 and £76,820,500)
  • Master Hosts Inns (Initial Investment – $1,376,100)
  • Hotel Indigo by IHG (invest between £13,142,000 and £29,388,00)
  • Red Roof Inn (Initial Investment – $195,500 – $5,099,000)
  • Hilton Garden Inn (Initial Investment – $12,058,450 – $23,182,650)
  • Baymont Inn (Initial Investment – $214,679 – $6,918,952)
  • Ascend Hotel Collection (Single Unit Total Investment – $133,950.00 to $1,697,199.00)
  • Candlewood Suites (Initial Investment – $8,951,340 – $12,256,515)
  • Staybridge Suites (Initial Investment – $11,211,090 – $15,396,430)
  • Park Inns & Suites (Initial Investment – $1,682,240-$4,753,320)

g. What Do You Need to Start Boutique Hotel Business?

  • A Feasibility Report
  • Business and Marketing Plans
  • Business Licenses and Permits
  • A well-designed, well-furnished, well-equipped, and construction facility
  • EIN (Employer Identification Number) / Federal Tax ID Number.
  • A Corporate Bank Account
  • Startup Capital

Choose a Memorable Business Name

When looking to start a business, before you can begin to file the necessary documents with the constituted authorities or start your website, it is necessary that you come up with a name that you will be recognized with. It is essential that the name you come up with can easily be pronounced, is unique and easily memorable.

Some of the catchy business name ideas suitable for a boutique hotel business are;

Creative Boutique Hotel Business Name ideas

  • Red Roof® Boutique Hotel, Inc.
  • Barrow Villas® Boutique hotel, LLC
  • House Top© Boutique Hotel, Inc.
  • Grace Inn® Boutique Hotel, Inc.
  • Lugard Lodge™ Boutique Hotel, Inc.
  • Harmony Lodge™ Boutique Hotel, LLC.
  • Sharon Inn© Boutique Hotel, LLC
  • Rose and Raul® Boutique Hotel, Inc.
  • Lilly Villas© Boutique Hotel, Inc.
  • Nevada Inns© Boutique Hotel, Inc.
  • Purple by Mack® Boutique Hotel, LLC
  • Golden Heritage® Boutique Hotel, LLC
  • Tony Martins™ Boutique Hotel, LLC
  • Clara Davidson© Boutique Hotel, Inc.
  • Rainbow Inn® Boutique Hotel, Inc.
  • RR Inn™ Boutique Hotel, Inc.
  • Rosette Inn™ Boutique Hotel, Inc.
  • Shavonne Inn© Boutique Hotel, Inc.
  • Ocean View® Boutique Hotel, LLC
  • Mountain View™ Boutique Hotel, Inc.

Register Your Business

A. what type of business structure is best for boutique hotel business.

The truth is that you have several options when it comes to the business structure of a boutique hotel business, but the one that most players in this line of business consider is an LLC. It is common to consider an LLC because providers want to protect themselves from lawsuits.

Please note that an LLC will need an EIN if it has employees or if it will be required to file any of the excise tax forms listed below.

b. Steps to Form an LLC

  • Choose a Name for Your LLC.
  • File Articles of Organization.
  • Choose a registered agent.
  • Decide on member vs. manager management.
  • Create an LLC operating agreement.
  • Comply with other tax and regulatory requirements.
  • File annual reports.

c. What Type of License is Needed to Start Boutique Hotel Business?

  • General Business License
  • Zonal Permits
  • Signage Permit
  • Operational State Facility Inspections

d. What Type of Certification is Needed to Start Boutique Hotel Business?

In reality, you don’t need any special certification to start a boutique hotel business.

e. What Documents are Needed to Start Boutique Hotel Business?

  • Business and liability insurance
  • Federal Tax Payer’s ID
  • State Permit and Building Approval
  • Certificate of Incorporation
  • Business License
  • Business Plan
  • Employment Agreement (offer letters)
  • Operating Agreement for LLCs
  • Insurance Policy
  • Online Terms of Use
  • Online Privacy Policy Document
  • Contract Document
  • Company Bylaws
  • Memorandum of Understanding (MoU)

f. Do You Need a Trademark, Copyright, or Patent?

If you are considering starting a boutique hotel business, usually you may not have any need to file for intellectual property protection or trademark. This is so because the nature of the business makes it possible for you to successfully run it without having any cause to challenge anybody in court for illegally making use of your company’s intellectual properties.

Cost Analysis and Budgeting

A. how much does it cost to start boutique hotel business.

The cost required to start a boutique hotel business may vary significantly, but on average, you can budget over a million dollars to start your boutique hotel business.

b. What are the Costs Involved in Starting a Boutique Hotel Business?

  • Business Registration Fees – $750.
  • Legal expenses for obtaining licenses and permits – $7,300.
  • Marketing, Branding, and Promotions – $5,000.
  • Business Consultant Fee – $7,500.
  • Insurance – $5,400.
  • A well-designed, well-furnished, and well-equipped facility – $3 million
  • Other start-up expenses include commercial satellite TV subscriptions, and phone and utility deposits ($2,800).
  • Operational Cost (salaries of employees, payments of bills et al) – $60,000
  • Start-up inventory – $55,000
  • Counter area equipment (countertop, sink, ice machine, etc.) – $29,500
  • Store Equipment (cash register, security, ventilation, signage) – $14,750
  • Website: $1,500
  • Opening party: $10,000
  • Miscellaneous: $20,000

c. What Factors Determine the Cost of Starting Boutique Hotel Business?

  • The size of the boutique hotel business
  • The choice of locations
  • The required licenses and permits
  • The type of facilities (rental or owned)
  • The type of additional services offerings
  • The cost of hiring and paying a business consultant and attorney
  • The cost for branding, promotion, and marketing of the boutique hotel business
  • The cost of furnishing and equipping the boutique hotel
  • The cost of insurance policy covers
  • The cost of registering the business
  • Cost of recruiting and training your staff
  • The cost for the purchase and customizing of uniforms
  • The cost for the grand opening of the boutique hotel business

d. Do You Need to Build a Facility? If YES, How Much Will It Cost?

Ideally, you build a new facility for your boutique hotel business and it will cost you several million dollars depending on the number of rooms, type of facility, and the location.

e. What are the Ongoing Expenses of Boutique Hotel Business?

  • Cost of stocking up supplies such as toiletries, beddings, towels, drinks, water, and food ingredients
  • Utility bills (gas, internet, phone bills, signage and sewage et al)
  • Maintenance of facility
  • Salaries of employees

f. What is the Average Salary of your Staff?

  • Chief Executive Officer (Owner) – $75,000 per year
  • Hotel Manager – $38,000 per year
  • Accountant/Cashier – $35,0000
  • Marketing and Sales Officer – $35,000 per year
  • Attendants (Staff like House Keepers, Concierge, Cook, and Hostess) (5) – $35,000 per year
  • Cleaners – $25,000 per year
  • Security Officers – $24,150 per year

g. How Do You Get Funding to Start Boutique Hotel Business?

  • Raising money from personal savings and sale of personal stocks and properties
  • Raising money from investors and business partners
  • Sell shares to interested investors
  • Applying for a loan from your bank/banks
  • Source for soft loans from your family members and friends.

Write a Business Plan

A. executive summary.

House Nation© Boutique Hotel, Inc. is a luxurious home base for leisure travelers. Our lobby is lavish yet homey, complete with a fireplace and cozy furniture, and upon entering, guests are greeted with complimentary champagne.

The spacious guest rooms are equally as comfortable with features such as carved beds, 40-inch flat-screen TVs, Blu-ray DVD players, free wireless internet, and a private veranda (in some rooms). Additionally, House Nation© Boutique Hotel, Inc. offers complimentary breakfast and a variety of free snacks (like a bedtime plate of cookies and milk) throughout the day.

Our accommodations also come equipped with minifridges, coffee makers, complimentary Wi-Fi access, and personal butlers. House Nation© Boutique hotel, Inc. will ensure that all our properties meet international standards.

b. Products and Service

  • Spa, salon, and wellness services
  • Meals (local delicacies, Chinese cuisines, and intercontinental cuisines et al)
  • Drinks (wines, beers, distilled spirits, martinis, beverages, and non–alcoholic drinks)
  • Self–service laundry room
  • Business center
  • Conference room
  • Banquet venue
  • Shuttle service

c. Mission Statement

Our mission is to establish a boutique hotel business that will provide top-notch and safe luxury lodgings to both individual and corporate clients in the United States.

Vision Statement

Our vision is to establish a standard boutique hotel business that will be become one of the leading brands in the industry in the whole of New York, and also to be amongst the top 20 boutique hotels in the United States of America within the first 20 years of operation.

d. Goals and Objectives

The goals and objectives of a boutique hotel business are to provide a smaller, upscale, luxury hotel that offers a distinct personality, intimate experience, and personalized service to clients.

e. Organizational Structure

  • Chief Executive Officer (Owner)
  • Hotel Manager
  • Accountant/Cashier
  • Marketing and Sales Officer
  • Attendants (Staff like House Keepers, Concierge, Cook, and Hostess) (5)
  • Security Officers

Marketing Plan

A. swot analysis.

  • Ideal Location for a boutique hotel
  • Highly Experienced and Qualified Employees and Management
  • Excellent facility
  • Top-notch customer services and experience
  • Financial constraints may restrict the business from building new facilities in key cities
  • A new business that will be competing with well-established hotels and other players in the industry.
  • Inability to retain our highly experienced and qualified employees longer than we want during the teething stage of the business.

Opportunities:

  • A rise in the number of travelers
  • Unique and customized services will push people to choose boutique hotels over regular hotels
  • Online market, new services, new technology, and of course the starting of new markets.
  • The arrival of new boutique hotels within our market space
  • Low demand during the pandemic will reduce industry profitability.
  • Economic uncertainty
  • Liability problems
  • The government could change its regulatory status and decide to enforce strict regulations that can strangulate new businesses like ours.

b. How Do Boutique Hotels Make Money?

Boutique hotels make money by renting out smaller, upscale, luxury hotel rooms that offer a distinct personality, intimate experience, and personalized service to clients.

c. Payment Options

  • Payment via bank transfer
  • Payment with cash
  • Payment via credit cards
  • Payment via online bank transfer
  • Payment via check
  • Payment via mobile money transfer

d. Sales & Advertising Strategies

  • Introduce your boutique hotel business by sending introductory letters alongside your brochure to corporate organizations, travel and tour agencies, and other key stakeholders throughout the city where your boutique hotel business is located.
  • Advertise on the internet on blogs and forums, and also on social media like Twitter, Facebook, LinkedIn to get your message across
  • Create a basic website for your business to give your business an online presence
  • Directly market your boutique hotel
  • Advertise our business in travel and tours\ magazines, community-based newspapers, local TV and radio stations
  • List your business on yellow pages ads (local directories)
  • Encourage the use of word-of-mouth marketing (referrals)

Financial Projection

A. how much should you charge for your product/service.

The amount boutique hotels charge their clients depends on the type of facility, the number of days the client wants to lodge and of course, the services rendered. However, boutique hotels charge between $520 to $2,000 per night.

b. How Much Profit Do Boutique hotel business Owners Make a Year?

It depends, but the available report shows that on average, within the industry, a small to medium-sized boutique hotel business owner can earn anywhere from $60,000 to $200,000 and more in personal income for the boutique hotel business owner.

c. What Factors Determine the Amount of Profit to Be Made?

  • The capacity of the boutique hotel business
  • The types of additional services offered
  • The locations of the boutique hotel business
  • The management style of the boutique hotel business
  • The business approach of the boutique hotel business
  • The advertising and marketing strategies adopted by the boutique hotel business.
  • The number of years the boutique hotel is in business

d. What is the Profit Margin of a Boutique Hotel Business Product/Service?

The profit margin of a boutique hotel business is not fixed. It could range from 4.5 percent to 15 percent depending on some unique factors.

e. What is the Sales Forecast?

Below is the sales forecast for a boutique hotel business. It is based on the location of the business and other factors as it relates to such startups in the United States;

  • First Fiscal Year (FY1): $1.2 million
  • Second Fiscal Year (FY2): $2.4 million
  • Third Fiscal Year (FY3): $5.2 million

Set Up your Office

A. how do you choose a perfect location for boutique hotel business.

  • The demography of the location especially as it relates to people who travel and lodge regularly
  • Accessibility of the location
  • The number of boutique hotels and regular hotels in the location
  • The local laws and regulations in the community/state
  • Traffic, parking and security et al

b. What State and City are Best to Start a Boutique Hotel Business?

  • Las Vegas, Nevada
  • Los Angeles, California
  • Miami, Florida
  • Dallas, Texas
  • Silver Spring, Maryland
  • Rowland Heights, California
  • Portland, Oregon
  • Oak Lawn, Illinois
  • Charleston, South Carolina
  • New York City, New York

c. What Equipment is Needed to Operate a Boutique Hotel Business?

  • Furniture and Home Appliances
  • Gym and Spa Equipment
  • Booking software
  • Computers and laptops
  • Fax machine.

Hire Employees

When it comes to hiring employees for a standard boutique hotel business, you should make plans to hire a competent chief executive officer (you can occupy this position), hotel manager, accountant, attendants (staff like housekeepers, concierge, cook, and hostess), cleaners and security guards.

Launch the Business Proper

In recent times, no boutique hotel business opens its door for business without first organizing an opening party to officially launch the business. You can choose to do a soft opening or you can go for a grand opening party,\. The bottom line is that with a proper launching of the boutique hotel business, you will officially inform people in your city that your boutique hotel is open for business.

a. What Makes Boutique Hotel Business Successful?

  • Choose good locations and standard facilities to launch the business
  • Make sure your partner with key stakeholders and offer a wide range of services (give your customers options)
  • Throw an open house grand party before officially starting the boutique hotel business
  • Be deliberate with your marketing sales approach
  • Encourage the use of word of mouth to promote your boutique hotel business
  • Leverage all available online and offline platforms to promote your boutique hotel business

b. What Happens During a Typical Day at a Boutique Hotel Business?

  • The business is open for the day
  • All the rooms are cleaned and ready to welcome guests
  • Guests are welcomed and ushered to their rooms
  • Administrative work is done concurrently
  • The cooks and other staff members execute their job description
  • Stocking of toiletries, cooking ingredients, and other supplies is done
  • Maintenance of the properties is carried out when due
  • The facility is administratively closed for the day.

c. What Skills and Experience Do You Need to Build Boutique Hotel Business?

  • Excellent facility management skills
  • Excellent customer services skills
  • Interpersonal skill
  • Accounting and bookkeeping skills
  • Business management skills
  • Bargaining skill
  • Work experience in the hotel and resort industry
  • Experience in managing people
  • Experience in business administration
  • Experience in handling different types of booking software.

More on Hospitality

How to write a stellar business plan for a hotel

hotel business plan

Do you think life is best lived in the lap of luxury, comfort and convenience? If so, you may have decided to open a hotel. 

Whether you're already an experienced hotelier or not, starting up a new hotel business is a journey that's invigorating, but with lots of hurdles along the way. 

And that's why we're here - to help lead you through each step. In this guide, we'll take you through the process of writing a business plan for a hotel - from what it should contain, to practical solutions you can use to draft it up.

On the menu:

Business plan by hotel type

Start by envisioning the concept of your hotel.

  • Define the type of guests you want to attract

Turn your dream into reality by writing a hotel business plan

Why the business plan for a hotel is essential, how to write the business plan for a hotel: the financial forecast, how might the editorial section of your hotel business plan look, feeling lost let our business plan software guide you.

  • Three things you should know before creating a hotel business plan

Depending on your budget, location and skill set, you could choose to open one of several types of hotels.

The beauty is that regardless of which hotel concept you go for, the structure of your business plan will remain the same.

Below are the six key types of hotels that you could draw up a business plan for:

A hotel chain

A hotel chain includes multiple hotels that are part of a single brand.

As a small or medium business owner, this isn't practical in the short run but you can join an already-established brand by becoming a franchisee.

You'll receive training and advice but the start-up fee is likely to be significant.

This model usually caters for short stays and is a lot smaller in terms of the number of rooms it offers.

It offers a great option for tourists or motorists and a well-designed structure with a good location can bring in a constant stream of revenue.

A hotel resort

Depending on your location, you could choose to open up a hotel resort. 

These are generally situated near tourist attractions such as ski parks or historic sites.

It could be a viable option as a part-time business, during the peak ski season for example.

An extended-stay hotel

Unlike motels, these offer long-term accommodation to guests. This usually means seven or more days.

If you choose this model, you could attract a wide target audience. Businesspeople, families or even students who are holidaying are all potential marketing targets.

This means that you'll need to have a strong marketing plan that caters for multiple groups.

Eco-friendly hotel

A unique, new model that has become popular in recent times.

Guests stay in accommodations that are considered favourable to the environment.

This model may be costly to initially build but can bring in considerable revenue if there is demand for such hotels in the catchment area.

Business hotel suites

This model caters for businesspeople predominantly and offers reasonable prices to stay overnight.

Such hotels are usually located near event hubs or business districts.

If you choose to operate using this model, you'll likely need to invest in business equipment such as printing facilities, seminar seating and online access.

hotel business plan

First things first, you need to have a clear vision of exactly the type of hotel you want to open. This is your dream project, so it's important to mould it in such a way that makes you feel proud and, most importantly, motivated to continue playing an active role in it.

Start by taking stock of your career background, your skills, your areas of expertise and your own desires when thinking about your hotel business plan - whilst listing everything you lack in terms of hospitality training and financial resources. By doing so, you'll be able to build a business that is suited to your ambitions and unique way of working. 

You could also opt to take over an existing hotel. To learn more about this process, check out our guide on how to take over a hotel .

Define the type of guests you want to attract 

To paint a more accurate picture of your hotel, you need to consider your clientele. A hotel should offer a break from reality and be indicative of its guest's aspirations (whether they're looking for a fun city break or a calming spa retreat) so set aside time to draw up their profile.

For this, you'll need to find out their age, where they come from, their average budget, job status and what they're looking for in a hotel. This will all go in your hotel's business plan as well. 

Once you've gotten to know a little more about your future customers, you can sharpen the vision for opening your hotel. For example, if a sizeable chunk of your target market is made up of parents, you're most likely going to include play facilities or a kids club. The idea is to mirror everything your guests are looking for in a weekend or holiday break. 

Dreams are all well and good, but to truly put your plan into motion, you'll need to get your head out of the clouds and focus on the planning stage. 

This is where the business plan for your hotel comes in. Whether you're launching a restaurant, clothes shop or hotel, writing a business plan is an integral step for any entrepreneur starting a new company.

Create your hotel business plan online!

Think your hotel could be profitable? Find out how with a business plan!

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To put it simply, a business plan for a hotel is a document in which you lay out the details for your project, the objectives you have for your business, and the steps you'll need to take to ensure it's a success. 

Writing a business plan for your hotel also means having to carry out market research for a hotel to familiarise yourself with the hotel market in the town or city in which you'd like to base your business, as well as the strengths and weaknesses of nearby competitors. 

The prices you set will depend on your business model and where you're based. From there, you can draw up a financial forecast for a hotel to integrate into your business plan.

Writing a business plan for a hotel not only enables you to check whether your hotel is likely to be profitable but also plays an essential role in presenting it to potential investors in the hope they'll provide funding to help get it off the ground. 

It's therefore essential to have a solid, comprehensive business plan to prove your dedication and credibility as an entrepreneur. 

The hotel business plan is also useful if you plan to apply for a loan or other forms of financial aid to help you open your hotel. To find out more about the funding solutions available to entrepreneurs, read our practical guide to hotel funding .

The financial forecast of a hotel consists of four main tables. These tables are presented in more detail below.

The projected profit and loss statement

The P&L statement makes it possible to assess the company's sales growth, monitor changes in the cost structure and thus evaluate its profitability (gross margin, EBITDA, net income).

Your gross margin (sales revenue - the cost of goods sold) must be sufficient to cover your overheads. 

hotel business plan profit and loss statement

By then subtracting general expenses (administrative, commercial and payroll expenses) to the gross profit, you will obtain EBITDA. It corresponds to the company's cash operating income. If it is positive, the activity is profitable.

The P&L statement is not sufficient to understand the overall financial situation of the company. It's best to analyse it in conjunction with other tables in the financial forecast.

Forecasted cash flow statement

hotel business plan cash flow forecast

With this chart, you'll be able to understand how cash is consumed and generated within the business.

This statement will allow you to realise whether or not you require external financing (as a result of insufficient cash flow). 

Forecasted balance sheet

hotel business plan balance sheet

This table provides a view of the company's assets at the end of the year.

The forecasted balance sheet is made up of two parts: assets and liabilities. The assets represent the company's resources, while liabilities correspond to the company's debts.

From a financial point of view, this table makes it possible to evaluate the financial structure of your business, i.e. the breakdown between the company's equity and financial debts.

It, therefore, allows you to verify whether or not debt levels are reasonable and evaluate the company's liquidity, i.e. it's capacity to honour its short-term commercial, tax and financial debts).

Initial financing plan

The initial financing plan shows how the company's initial investment is financed.

hotel business plan initial financing plan

This table is also useful for estimating the distribution of risk at the beginning of activity between the shareholders and the lenders.

There are two sides to this table:

  • Sources (capital contributions, loans etc.), i.e. the money available to the business
  • Uses (equipment, start-up costs, etc.) i.e. how this money is used at the launch of the business

Ideally, the cash position shown in the initial financing plan should be sufficient to keep the business afloat until you reach your break-even point if your business takes longer than expected to start up.

The written part of your business plan is as important as your financial forecast. It meticulously highlights each section of the business and aims to convince banks or financial institutions that your venture is feasible.

This section will also be an opportunity to explain the assumptions made in the financial forecast section in greater detail.

Contextualising your assumptions via your market research also allows you to determine whether or not they are realistic.

The essential written parts of the business plan include: 

The executive summary

This section provides a brief overview of the entire business plan, illustrating both the purpose of the company and its key goals. The aim is to outline the key details, in the hope of persuading the reader to want to know more.

The company summary

In this part, you should aim to present the administrative details of the company including:

  • The number of partners
  • The legal structure
  • Percentage ownership
  • Head office
  • Where the premises are located

hotel business plan company description

Products and services

You should aim to describe the services that your hotel offers in detail while explaining how your hotel will be competitive in the market (unique selling points such as fast and efficient room service or a cosy bar etc.).

You may also address any intellectual property rights such as trademarks or copyright.

Market research

Use this section to show that there is a gap in the market for your goods or services (for e.g a need for additional hotel rooms). It should also include analysis of the local market, any trends, competition and regulations in the area.

The next step in our guide on how to write the business plan for a hotel involves a strategic outlook.

Inform the reader about how each of your services (including the guest rooms) will be priced. For example, how might prices vary based on the number of nights that guests decide to stay at the hotel? Are there any offers in the bar?

Yield management is a popular strategy used by hoteliers - it involves adjusting the price of rooms based on the level of demand observed on the market in order to maximise the occupancy rate of the hotel.

Since there are two perceived seasons for hotels - peak season and off-peak season, yield management allows hotel managers to balance their revenue stream throughout the year.

Higher prices can be charged when occupancy levels are high and a combination of lower prices/promotion ideas can be used when occupancy levels are low.

You should also present your marketing strategies in detail (including your use of social media, digital advertising, newsletters, etc.).

List any potential risks to your hotel and how you plan to address them, such as getting fire insurance cover and installing a security alarm.

Here you will highlight the organization of the company. This should include the opening hours of the business, the staff (directors and employees), any key assets that you plan to hold and the suppliers that you might be working with.

Financial plan of the hotel

In this section, you will present your financial forecast and explain the assumptions made in your calculations.

Two key tips for preparing a hotel business plan:

  • Be sure to address customer payment terms: clients can pay either when they check-in or check-out depending on the hotel policy. This will impact your cash flow.
  • Explain any business jargon used in detail, so that the reader does not get confused with industry terms they might not be familiar with.

If drafting up a business plan for a hotel on your own feels a little too complicated, then you've come to the right place.

Our online business plan software makes it easy for you. Designed specifically for entrepreneurs who've never written a business plan before, it will guide you step by step through the process - so you don't get lost in between the many different stages. 

hotel business plan contents page

It will also make creating a financial forecast a breeze - leaving you with a clear, well-presented, and professional document with which you can confidently showcase your business idea to investors. 

If you're still not sure, why not dip your toe and test our business plan software for free? Click here to try it out and let us know how you get on.

What you should know before creating a hotel business plan

We recommend taking into account seasonality as one of your risks and mitigants.

A wet or cold summer could lead to a sharp fall in the number of tourists in the area where you are planning to situate your hotel.

Would you have special leeway just in case? Is it possible to maintain a cash reserve to deal with a poor season?

That's it for this time, we hope this article has helped you better understand how to write a business plan for a hotel. If you have any questions related to launching your business, please don't hesitate to get in touch with our team. 

See also on The Business Plan Shop

  • Business plan template for a hotel
  • How to buy a hotel with no money
  • How to open a bed and breakfast

Know someone who might be interested in this article? Share it with just one click!

Guillaume Le Brouster

Founder & CEO at The Business Plan Shop Ltd

Guillaume Le Brouster is a seasoned entrepreneur and financier.

Guillaume has been an entrepreneur for more than a decade and has first-hand experience of starting, running, and growing a successful business.

Prior to being a business owner, Guillaume worked in investment banking and private equity, where he spent most of his time creating complex financial forecasts, writing business plans, and analysing financial statements to make financing and investment decisions.

Guillaume holds a Master's Degree in Finance from ESCP Business School and a Bachelor of Science in Business & Management from Paris Dauphine University.

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How To Write a Business Plan for Boutique Spa Hotel in 9 Steps: Checklist

By henry sheykin, resources on boutique spa hotel.

  • Financial Model
  • Business Plan
  • Value Proposition
  • One-Page Business Plan

Welcome to our blog post on how to write a business plan for a boutique spa hotel in just 9 simple steps! If you're considering venturing into the luxury experience model with your hotel, you're in the right place. This business model is in high demand, and the US hotel industry is thriving. In fact, according to the latest statistics, the US hotel industry revenue reached over $200 billion in 2019 and is projected to continue growing + . So, let's dive in and start planning your successful boutique spa hotel!

Step 1: Conduct market research

The first step in writing a business plan for your boutique spa hotel is to gather valuable insights through market research. Identify the current trends, customer preferences, and market competition to position your hotel effectively.

Step 2: Identify target market

Next, narrow down your target market by considering factors such as demographics, psychographics, and location. A clear understanding of your target audience will help you tailor your services and marketing efforts to attract the right clientele .

Step 3: Determine unique selling proposition

What sets your boutique spa hotel apart from the competition? Define your unique selling proposition (USP) – the special features, amenities, or experiences that make your hotel stand out. This will be a key selling point in your marketing efforts .

Step 4: Define business goals and objectives

Set clear business goals and objectives for your boutique spa hotel. Are you aiming for a certain occupancy rate, revenue target, or customer satisfaction level? Defining these goals will help you stay focused and measure your success .

Step 5: Analyze competition

Take a close look at your competitors. Understand their strengths and weaknesses, pricing strategies, and marketing tactics. This analysis will allow you to differentiate your boutique spa hotel and identify areas for improvement .

Step 6: Develop a pricing strategy

Determine the pricing strategy for your boutique spa hotel. Consider factors such as your operating costs, target market, and competitors' pricing. Aim for a balance between profitability and affordability for your guests .

Step 7: Create a marketing and advertising plan

Devise a comprehensive marketing and advertising plan to promote your boutique spa hotel. Utilize various channels such as social media, online travel agencies, and partnerships with local attractions. Highlight your unique selling proposition and target your desired clientele through tailored messaging .

Step 8: Establish financial projections

Forecast your costs, revenues, and profits for your boutique spa hotel. This will help you understand the financial viability of your business and make informed decisions. Seek professional assistance if needed .

Step 9: Gather necessary permits and licenses

Ensure that you have obtained all the necessary permits and licenses required to operate a boutique spa hotel. This includes business licenses, health and safety certifications, and any specific permits needed for spa services or food and beverage operations .

By following these 9 steps, you'll be well on your way to creating a successful business plan for your boutique spa hotel. Remember, the luxury experience model thrives on providing exceptional service and personalized experiences, so make sure to keep these elements at the forefront of your planning !

Conduct Market Research

Conducting thorough market research is a crucial first step in developing a business plan for a boutique spa hotel. This research will provide valuable insights into the current market conditions, the target audience, and the competition. It will help you make informed decisions and develop strategies that align with the market demands.

  • Identify current market trends: Research the latest trends in the hospitality industry, specifically in the boutique spa hotel sector. This includes understanding the demand for luxury experiences, the preferences of high-end clientele, and emerging market opportunities.
  • Segment your target audience: Identify the specific groups within the market that are most likely to be interested in a boutique spa hotel experience. Consider factors such as demographics, psychographics, and geographic location.
  • Analyze customer preferences: Gain an understanding of what potential customers look for in a boutique spa hotel. This could include amenities, services, location, or any other factors that may influence their decision to choose your hotel over competitors.
  • Assess the competition: Identify and analyze existing boutique spa hotels in your target market. Evaluate their strengths, weaknesses, pricing strategies, and marketing efforts. This will help you differentiate your hotel and identify opportunities to stand out in the market.

Tips for Conducting Market Research:

  • Use online resources, industry reports, and market research companies for comprehensive data.
  • Consider conducting surveys or focus groups to gather direct customer feedback.
  • Visit competitor locations to gain first-hand experience of their services and offerings.
  • Stay updated with industry trends by attending conferences, trade shows, and networking events.

Identify Target Market

Identifying your target market is a crucial step in developing a successful business plan for your boutique spa hotel. By understanding the needs, preferences, and demographics of your potential clientele, you can tailor your offerings and marketing strategies to effectively reach and attract your target audience. Here are some important factors to consider when identifying your target market:

  • Demographics: Start by collecting information about the age, gender, income level, and occupation of your target market. This data will help you understand who is most likely to be interested in the luxury experience your boutique spa hotel has to offer.
  • Psychographics: Go beyond demographics and dig deeper into the psychographics of your target market. Consider their lifestyle, values, interests, and motivations. Understanding their desires and aspirations will allow you to create a truly personalized experience that resonates with them.
  • Market Segmentation: Within the luxury hotel industry, there are various market segments that you can potentially target. It could be honeymooners, business travelers, wellness enthusiasts, or even affluent families. Determine which segment aligns best with your boutique spa hotel concept and concentrate your efforts on attracting that specific segment.
  • Conduct surveys, interviews, or focus groups to gather insights directly from your target audience.
  • Study your competitors and identify the gaps in the market that you can tap into.
  • Consider partnering with local influencers or organizations that appeal to your target market to increase your visibility and reach.

Remember, knowing your target market inside out will help you develop marketing campaigns, create personalized experiences, and ultimately attract the high-end clientele your boutique spa hotel aims to serve.

Determine Unique Selling Proposition

When creating a business plan for a boutique spa hotel, it is essential to determine your unique selling proposition (USP) – the aspect that sets your hotel apart from the competition and makes it irresistible to potential guests. Your USP is the foundation of your marketing strategy and will drive your efforts to attract and retain a high-end clientele.

To determine your USP, start by analyzing the market and identifying the main features and services offered by your competitors. Take note of what they do well, as well as any gaps or areas for improvement. This analysis will help you identify opportunities to differentiate your boutique spa hotel.

Next, consider what you can offer that no other hotel can. Is it your breathtaking location near a stunning natural landscape? Is it your seamless integration of wellness and luxury? Is it your exceptional customer service or unique amenities? Whatever it may be, your USP should be something that resonates with your target market and aligns with their desires and preferences.

Once you have identified your USP, it is crucial to articulate it clearly and consistently throughout all aspects of your business, from your branding and marketing materials to your staff training and guest experiences. This will ensure that your unique value proposition is effectively communicated to potential guests and distinguishes your boutique spa hotel from the competition.

Tips for Determining Your Unique Selling Proposition:

  • Research your target market thoroughly to understand their preferences and needs.
  • Identify what your competitors are offering and find ways to differentiate yourself.
  • Focus on aspects that are difficult for competitors to replicate.
  • Consider the emotional and experiential value you can provide to guests.
  • Continuously evaluate and evolve your USP to stay ahead in the market.

Define Business Goals And Objectives

Defining clear business goals and objectives is crucial for the success of a boutique spa hotel. These goals provide clarity and direction, guiding every decision and action taken by the hotel. Here are the key steps to define business goals and objectives for your boutique spa hotel:

  • Identify the purpose of your hotel: Determine the overall purpose and mission of your hotel. What do you aim to achieve with your boutique spa hotel? Your purpose should go beyond simply making a profit and instead focus on delivering a unique and luxurious experience to your guests.
  • Establish measurable goals: Set specific and measurable goals that can be tracked and evaluated over time. These goals should align with your hotel's purpose and can include targets for occupancy rates, revenue, customer satisfaction, and employee retention.
  • Break down goals into objectives: Break down each goal into smaller, actionable objectives. These objectives should be specific and time-bound, with clear steps that need to be taken to achieve them. For example, if your goal is to increase occupancy rates, your objectives could include improving online visibility, offering special promotions, and enhancing guest satisfaction.
  • Keep your goals realistic and attainable, considering factors such as market conditions and resources available.
  • Regularly review and update your goals and objectives to stay relevant and adaptable to changing circumstances.
  • Involve key stakeholders, such as your management team and employees, in the goal-setting process to foster buy-in and alignment.

Defining clear business goals and objectives is an essential step in creating a solid foundation for your boutique spa hotel. By setting clear targets and creating actionable plans to achieve them, you can effectively steer your business towards success in the competitive luxury experience model.

Analyze Competition

When starting a boutique spa hotel, it is crucial to analyze the competition in your target market. Understanding your competitors will help you identify their strengths and weaknesses, allowing you to differentiate your hotel and develop strategies to attract your desired clientele.

Here are some important steps to consider when analyzing the competition:

  • Research and identify direct competitors in your area. Look for boutique spa hotels that offer similar amenities, accommodations, and services.
  • Evaluate their unique selling propositions (USPs) and identify how they differentiate themselves from other hotels. This will help you understand what makes them successful and what aspects you can improve upon.
  • Assess their pricing strategy. Determine if they are targeting the same high-end clientele or if there is an opportunity to offer competitive pricing while maintaining a luxury experience.
  • Study their online presence, including their website, social media platforms, and online reviews. This will give you insights into their branding, customer feedback, and overall reputation.
  • Visit their physical locations if possible. Experiencing firsthand the ambiance, facilities, and customer service of your competitors will help you benchmark your own hotel and identify areas for improvement.

Tips for analyzing competition:

  • Regularly monitor your competitors' websites and social media to stay updated on any changes or promotions they may be offering.
  • Consider conducting mystery shopping to gain a better understanding of the customer experience at your competitors' hotels.
  • Network with industry professionals and attend industry events to stay informed about the latest trends and best practices in the boutique spa hotel sector.

By thoroughly analyzing the competition, you will be equipped with valuable insights that will enable you to position your boutique spa hotel effectively in the market and make strategic decisions that set you apart from your competitors.

Develop A Pricing Strategy

Developing a pricing strategy for your boutique spa hotel is crucial for achieving profitability and attracting the desired clientele. To determine the right pricing strategy, consider the following factors:

  • Cost Analysis: Begin by conducting a thorough cost analysis to understand all the expenses involved in running your hotel. This includes fixed costs like rent, utilities, and salaries, as well as variable costs such as inventory and guest amenities.
  • Competitor Analysis: Research and analyze the pricing strategies of your competitors in the luxury hotel market. Study their rates, packages, and promotions to gain insights into how they position themselves and attract customers.
  • Target Market: Identify your target market and consider their purchasing power, preferences, and expectations. Tailor your pricing strategy to align with the perceived value and willingness to pay of your target customers.
  • Value Proposition: Determine your unique selling proposition and emphasize the value-added services and experiences that differentiate your boutique spa hotel from competitors. Price your offerings accordingly to reflect this added value.
  • Revenue Goals: Set clear revenue goals for your hotel and establish a pricing structure that allows you to achieve these objectives. Consider revenue targets for different seasons, weekdays versus weekends, and any special events or packages offered.
  • Discounts and Promotions: Develop a strategy for discounts and promotions to attract customers during slow periods or to incentivize repeat business. Determine the appropriate discount percentages or promotional offers that maintain profitability while enticing guests.
  • Flexibility: Consider the level of flexibility you want to offer in your pricing strategy. Decide if you want to have fixed rates or dynamic pricing that fluctuates based on demand and other market factors.

Tips for Developing a Pricing Strategy:

  • Regularly review and adjust your pricing strategy based on market trends, customer feedback, and performance metrics.
  • Consider the cost of providing personalized services and amenities when setting your prices.
  • Offer various packages and add-ons to cater to different budget preferences and enhance the overall guest experience.
  • Use revenue management software or consult with industry experts to optimize your pricing strategy.

Create A Marketing And Advertising Plan

Once you have identified your target market and analyzed your competition, it is time to create a comprehensive marketing and advertising plan for your boutique spa hotel. This plan will outline the strategies and tactics you will use to attract your desired clientele and promote your unique offerings.

First and foremost, identify the key marketing channels that will allow you to reach your target market effectively. This may include digital platforms such as social media, search engine optimization (SEO), and online advertisements, as well as traditional channels such as print media, radio, and television.

Develop a brand identity that reflects the luxury and uniqueness of your boutique spa hotel. This includes creating a visually appealing logo, selecting a color palette that aligns with your brand image, and crafting a compelling brand story that communicates your hotel's values and promises.

Next, craft your messaging to resonate with your target market. Highlight the exclusive amenities, personalized services, and luxurious accommodations that set your hotel apart from the competition. Emphasize the unique experiences and transformative benefits that your guests can expect when they choose to stay at your boutique spa hotel.

  • Utilize high-quality visual content, such as professional photographs and videos, to showcase the beauty and elegance of your hotel. This will help prospective guests visualize themselves enjoying the luxury experience you offer.
  • Consider partnering with influential bloggers, social media influencers, and local celebrities to promote your boutique spa hotel. Their endorsement can help elevate your brand's reputation and attract a wider audience.
  • Offer special promotions, packages, or loyalty programs to incentivize repeat business and generate word-of-mouth referrals.
  • Monitor and analyze the performance of your marketing and advertising efforts regularly. Adjust your strategies as necessary based on customer feedback, market trends, and the effectiveness of different marketing channels.
  • Use storytelling in your advertisements and social media posts to engage your audience emotionally and build a connection with them.
  • Regularly update and maintain your website and social media profiles with fresh content to keep your audience engaged and informed about your boutique spa hotel.
  • Consider partnering with local businesses, such as spas, restaurants, or tourist attractions, to create cross-promotional opportunities and increase your visibility within the local community.

Establish Financial Projections

Establishing financial projections is a crucial step in creating a business plan for a boutique spa hotel. It allows you to forecast the potential revenue, expenses, and profitability of your business over a specific period, typically three to five years. Financial projections provide a roadmap for managing your finances, making informed decisions, and securing funding if needed.

To establish financial projections for your boutique spa hotel, consider the following:

  • Revenue Projections: Begin by estimating your potential revenue sources, such as room rates, spa services, restaurant and bar sales, and any other revenue streams. Research industry benchmarks and consider factors like occupancy rates, average spending per guest, and any seasonal fluctuations that may impact your business.
  • Expense Projections: A comprehensive analysis of your fixed and variable expenses is essential to determine your profitability. Fixed expenses include items like rent, insurance, utilities, and salaries, while variable expenses include costs directly linked to guest occupancy, such as housekeeping supplies or food and beverage inventory. Don't forget to factor in marketing and advertising expenses as well.
  • Profit and Loss Statement: Creating a projected profit and loss statement will help you understand your anticipated cash flow and profitability. This statement should include revenue, expenses, and calculate your net income or loss. Regularly reviewing and updating this statement can provide insights into your business's financial health, enabling you to make necessary adjustments as needed.
  • Break-Even Analysis: Conducting a break-even analysis is crucial to determine the point at which your business becomes profitable. It helps you understand how much revenue you need to cover your expenses and reach a favorable financial position. This analysis is particularly useful in identifying areas where you can reduce costs or increase revenue to improve your profitability.

Tips for Establishing Financial Projections:

  • Be realistic in your revenue projections and avoid overestimating potential income.
  • Consider different scenarios and prepare projections for best-case and worst-case scenarios.
  • Seek guidance from financial professionals or consultants if you're unfamiliar with financial forecasting.
  • Regularly monitor and review your financial projections, updating them as needed to reflect changing market conditions or business circumstances.
  • Remember that financial projections are not set in stone and can be adjusted as your business evolves.

By establishing financial projections for your boutique spa hotel, you gain a clear understanding of your financial position, enabling you to make informed decisions and strategies for the success of your business.

Gather Necessary Permits And Licenses

When starting a boutique spa hotel, it is vital to ensure that you have obtained all the necessary permits and licenses required by local and state regulations. This step is crucial to ensure that your business operates legally and avoids any potential legal penalties or disruptions to your operations.

To begin, research the specific permits and licenses required for operating a boutique spa hotel in your desired location. This may include permits for building construction, zoning regulations, health and safety inspections, liquor licenses, and more. Contact your local government offices or consult with a legal professional to determine the exact requirements.

Once you have identified the necessary permits and licenses, gather all the required documentation and application forms. Fill out the applications accurately and provide any supporting documents or information as requested. Remember to double-check that all the necessary paperwork is complete and submit it within the designated timelines.

Applying for permits and licenses can be a time-consuming process, so it is advisable to start this step well in advance to avoid any delays in opening your boutique spa hotel. Be prepared to pay any associated fees, as these can vary depending on the permits and licenses required.

  • Keep a checklist of all the permits and licenses needed, so you can track your progress and ensure that nothing is overlooked.
  • Engage with local business associations or hospitality industry organizations to gather insights and advice on navigating the permit and licensing process.
  • Consider hiring a legal professional or consultant specializing in hotel operations to guide you through the complexities of obtaining permits and licenses.
  • Stay updated on any changes to regulations or new requirements that may arise during the application process.

In conclusion, developing a successful business plan for a boutique spa hotel in the luxury experience model requires careful consideration and thorough planning. By following the nine steps outlined in this checklist, entrepreneurs can ensure they have a solid foundation for their business and are prepared to meet the high expectations of their target market.

Conducting market research is essential to understand the current demand and potential competition in the market. Identifying the target market allows the hotel to tailor its services and amenities to meet their preferences and needs. Determining a unique selling proposition helps differentiate the hotel from competitors and attract the desired clientele.

Setting clear business goals and objectives provides a roadmap for success and guides decision-making throughout the process. Analyzing the competition allows the hotel to identify opportunities and potential threats in the market. Developing a pricing strategy ensures the hotel can maximize profits while remaining competitive.

Create a comprehensive marketing and advertising plan to effectively reach the target market and promote the unique offerings of the hotel. Establishing financial projections helps determine whether the business is financially viable and can guide budgeting and resource allocation. Lastly, gathering the necessary permits and licenses ensures compliance with legal requirements and allows the hotel to operate smoothly.

By following these steps and investing in exceptional customer service, a boutique spa hotel in the luxury experience model can create a memorable and fulfilling experience for guests, leading to repeat business and positive recommendations. With the right planning and execution, entrepreneurs can position themselves for success in the competitive hospitality industry.

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Hotel Business Plans

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Motel - Hunting Lodge Business Plan

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Writing your business plan doesn’t have to be a chore. Just check out these sample business plans for hotels and motels to get some ideas and inspiration.

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how to write a business plan for a boutique hotel

ProfitableVenture

Hotel Business Plan [Sample Template]

By: Author Tony Martins Ajaero

Home » Business ideas » Hospitality, Travel & Tourism » Hotel

Hotel Business

Are you about to start a hotel and hospitality business? If YES, here is a complete sample hotel business plan template & feasibility report you can use for FREE .

Okay, so we have considered all the requirements for starting a hotel business . We also took it further by analyzing and drafting a sample hotel marketing plan template backed up by actionable guerrilla marketing ideas for hotel businesses.

So let’s proceed to the business planning section. All over the world, the hospitality business is being seen as a very serious trade and the reason for this cannot be farfetched.

The reason the hospitality business – especially the hotel business is being taken seriously is because of its relationship with the tourism industry. Starting a hotel business could eventually be one of the best things to attain for yourself. This is because of the lucrative nature and prosperity involved in this industry.

Every day foreigners, as well as local migrants and business people, travel from one point or the other and the option they are faced with is staying in hotels. It is pertinent to note that there are different categories of hotels, like 5-star, 4-star or even 3-star hotels.

One of the essential things that are unique to each category of the hotel is the facilities that make up each. Whatever type of hotel category you may have in view, there is always the most important step to take in making your business stand out, as well as succeed in the long run.

What can this be? Well, that is the hurdle of writing a business plan. You too have the wherewithal to do so, as a well put together business plan is available to you below.

A Sample Hotel Business Plan Template

1. industry overview.

The hospitality industry has been in existence from time immemorial and it is still waxing strong simply because people can’t do away with the services they offer. When you talk about a hotel, you are talking about an establishment that provides lodging for guests/travelers, tourists, visitors et al, on a short-term basis with a fee.

When people lodge in hotels, they have the option of subscribing to other services the hotel offers; services as feeding, drinks, laundry, fitness center, swimming pool, conference room, and business room, amongst others.

As a matter of fact, the facilities provided by some hotels may range from a basic bed and storage wardrobe to luxury features such as en-suite bathrooms, mini parlor et al. It is the norm for big hotels to provide additional guest facilities like a swimming pool, conference center, business center, childcare, self-service laundry, fitness center, and social function services.

In some countries, hotels are required by law to serve food and drinks to all their clients that are lodged in their facility while in some countries, you would have to choose the additional services you want from the hotel. The bottom line is the higher the amount you pay in hotels, the more the services you are entitled to.

Starting a hotel business is capital intensive and it is considered a long-term investment because it takes a while for the owners to break even and start making profits. No doubt it takes a big-time investor to consider starting his or her own hotel business, which is why loads of hotels are owned by groups of investors.

One good thing about the hotel business is that the business can grow so big that it will not only have an active presence in key cities in the country where it started from but in major cities on all the continents of the world. It is important to state that hotel operations vary in size, function, and cost which is why hotels are classified into different grades (two-star hotels, five-star hotels, seven-star hotels et al).

2. Executive Summary

Sean and Sharon Hotel will be located in the heart of Las Vegas less than 20-minute drive from McCarran International Airport in Las Vegas, and a few minutes drive from Mandalay Bay Event Center. We are conveniently located in the world’s headquarters for casinos and games; a commercial center.

Sean & Sharon Hotel believes in the passionate pursuit of excellence and financial success with uncompromising services and integrity, which is why we have decided to venture into the hospitality industry by establishing our own hotel.

We are certain that our values will help us drive the business to enviable heights and also help us attract the number of clients that will make our hotel fully booked all through the year.

We are going to be a customer-centric hotel with a service culture that will be deeply rooted in the fabric of our organizational structure and indeed at all levels of the organization. With that, we know that we will be able to consistently achieve our set business goals, increase our profitability and reinforce our positive long-term relationships with our clientele, partners, and all our employees as well.

Our hotel facility will be decorated in an exquisite and elegant facade, so much so that it will be a conspicuous edifice in the city where it is located. Sean & Sharon Hotel will provide a conducive spot for our customers to take a break from their various busy schedules, to a place where they can find comfort and luxury.

Sean and Sharon’s hotel will be equipped with a business center and a VIP lounge, as well as a Fitness room and self-service laundry which will be made available for resident guests at no extra cost.

We will also install free Wi-Fi that will enable our guests to surf the internet with their laptops in the hotel room free of charge, and there will be wireless access in all the public areas in the hotel; we will also provide mobile phones for a loan to business travelers for their convenience so as to enable them to stay in – touch with their family members, friends, and business partners.

No doubt our business class guest rooms will provide our customers with a warm and comfortable home away-from home experience, a large banquet venue, as well as Chinese and Intercontinental cuisine. We are set to give our esteemed guests an unforgettable experience whenever they patronize our hotel.

Sean and Sharon Hotel is owned by Sean Glacier, Sharon Glacier, and other investors whose names can’t be mentioned in this business plan for obvious reasons. The owners and board members of Sean and Sharon hotel are big-time investors in the hospitality industry.

Sharon Glacier has well over 20 years of experience in hotel management and she has a Master’s Degree in Hotel Management. She will be bringing her wealth of experience to the table to make Sean and Sharon Hotel the number one choice in Las Vegas.

Over and above we are building a hotel business that will be the cynosure of all eyes. One that competes favorably with other hotels that are in existence in Las Vegas. We plan to do this bearing in mind that it would take hard work, loads of financial commitment, as well as well-trained employees who can be indoctrinated in the quest for building a top-notch hotel in Las Vegas city.

3. Our Products and Services

Sean and Sharon Hotel is set to operate a standard hotel service in Las Vegas, Nevada. The point that we want to become a force to reckon with in the hospitality industry means that we will provide our guests with a fitness room, social room, self-service laundry room, and business center; for the purpose of business or leisure and more.

In all that we do, we will ensure that our guests leave with an unforgettable experience that will make them want to come back as well as recommend our hotel to their friends, family members, and business partners. These are the services and amenities that will be made available to our guests;

  • Meals (Local Delicacies, Chinese cuisines, and intercontinental cuisines et al)
  • Drinks (wines, beers, distilled spirits, martinis, beverages, and non–alcoholic drinks)
  • Swimming pool
  • Self – service laundry room
  • Business center
  • Conference room
  • Banquet venue
  • Shuttle service

4. Our Mission and Vision Statement

  • Our vision is to open a standard hotel that will become the number one choice in Las Vegas
  • Our mission is to deliver reliable, genuine, caring, and excellent service superior to what our competition can offer in any location where our hotel will be situated and to ensure that our hotel enjoys over 90 percent occupancy in most parts of the calendar year.

Our Business Structure

The success of any business is to a larger extent dependent on the business structure of the organization and the people who occupy the available role. Sean and Sharon Hotel will work with a business structure that will give room to employees to explore their creativity, give a sense of belonging, as well as grow through the corporate ladder of the organization.

We will work hard to ensure that we only recruit the right set of people with the right mindset to help us achieve our business goals and objectives in record time. We intend to build Sean and Sharon Hotel on this structure;

  • Chief Executive Officer (Owner)
  • Hotel Manager

Human Resources and Administrative Manager

  • Bartender/Baristas
  • Accountants/Cashiers

Facility/Maintenance Manager

  • Marketing Officer
  • Front Desk Officer
  • Cleaners/Washer men

Security Officers

5. Job Roles and Responsibilities

Chief Executive Officer – CEO:

  • Responsible for providing direction for the business
  • Creates, communicates, and implements the organization’s vision, mission, and overall direction – i.e. leading the development and implementation of the overall organization’s strategy.
  • Responsible for fixing prices and signing business deals
  • Responsible for recruitment
  • Responsible for payment of salaries
  • Responsible for signing checks and documents on behalf of the company
  • Evaluates the success of the organization

Hotel Manager:

  • Responsible for managing the daily activities in the hotel
  • Ensures that the facility is in tip-top shape and conducive enough to welcome customers
  • Interfaces with vendors
  • Reports to the Chief Executive Officer
  • Attends to Customer complaints and inquiries
  • Prepares budget and reports for the organization
  • Responsible for Training and Development in the organization
  • Handles procurement
  • Handles any other duty as assigned by the CEO
  • Responsible for overseeing the smooth running of HR and administrative tasks for the organization
  • Defines job positions for recruitment and managing interviewing process
  • Carries out staff induction for new team members
  • Responsible for training, evaluation, and assessment of employees
  • Responsible for arranging travel, meetings, and appointments
  • Oversees the smooth running of daily office activities.

Marketing Officer (2)

  • Develops, executes and evaluates new plans for expanding increase sales
  • Documents all customer contact and information.
  • Represents the company in strategic meetings
  • Helps increase sales and growth for the company
  • Identifies, prioritizes, and reaches out to new partners, and business opportunities et al
  • Responsible for planning and overseeing building work/renovation
  • Responsible for allocating and managing space within buildings
  • Responsible for managing building maintenance activities
  • Responsible for coordinating cleaning, catering, and parking services
  • Responsible for organizing security and general administrative services
  • Ensures that facilities meet government regulations and environmental, health and security standards
  • Advise on energy efficiency and cost-effectiveness
  • Supervises multi-disciplinary teams of staff including maintenance, grounds, and custodial workers

Bartender / Baristas (4):

  • Interacts with customers, takes orders for drinks, food, and snacks.
  • Plans and presents bar menu.
  • Checks identification of the guest to make sure they meet age requirements for purchase of alcohol and tobacco products.
  • Mixes ingredients to prepare cocktails and other drinks.
  • Mixes drinks, cocktails, and other bar beverages as ordered and in compliance with hotel standard drink recipes.
  • Prepares alcohol or non-alcohol beverages.
  • Services Wine and Beer to guests.
  • Arranges bottles and glasses to make attractive displays.
  • Assesses customer’s needs and preferences and makes recommendations
  • Makes lists of supplies in conjunction with the bar manager/management
  • Prepares inventory or purchase requisitions as needed to replenish supplies.
  • Ensures that the assigned bar area is fully equipped with tools and products needed for Mixing beverages and serving guests.

Accountant/Cashier:

  • Collect payment for drinks served and balance all receipts.
  • Prepare a financial report at the end of every working week
  • Handles all financial transactions on behalf of the company
  • Interfaces with our bankers
  • Responsible for payment of tax, levies, and utility bills
  • Handle any other duty as assigned by the CEO/microbrewery manager

Front Desk Officer (2)

  • Ensures that customers feel relaxed and at home
  • Handles customers inquiries
  • Ability to Sell or influence others for up selling and suggestive selling.
  • Provides recommendations and suggestions to guest for choosing Drinks, food, and Snacks.
  • Serve customers in a friendly and helpful manner.
  • Provides guidance to guests on resort activities, dining options, and general resort and Regional information.
  • Demonstrates a thorough knowledge of food and beverage products, menus, and Promotions
  • Handles any other duty as assigned by the bar manager

  Cleaners/Washerman (6):

  • Handles and moves objects, such as glasses, dish,es and bottles, using hands and arms.
  • Cleans up after customers and cleans work area.
  • Clears ashtrays as and when required.
  • Washes glassware and utensils after each use.
  • Maintains a clean working area by sweeping, vacuuming, dusting, cleaning of glass doors and windows, etc. if required.
  • Ensures that toiletries and supplies don’t run out of stock
  • Responsible for handling laundry
  • Handles any other duty as assigned by the restaurant manager,
  • Ensures that the facility is secured at all time
  • Controls traffic and organizes parking
  • Gives security tips to staff members from time to time
  • Patrols around the building on a 24 hours basis
  • Submits security reports weekly
  • Any other duty as assigned by the restaurant manager

6. SWOT Analysis

Sean and Sharon Hotel is fully aware that they are coming into an industry that can be highly competitive which is why they have decided to pay attention to the SWOT analysis for the organization.

We know that once we are able to identify our strengths, our weaknesses, our threats, and the opportunities that are available to us, we will be able to come up with good business strategies that will help us achieve all our business goals and objectives.

We know too well that one of the ways to build a successful business in the long run is the ability to glean some lessons from the weak points we have found ourselves in and convert them into an area of strength. In a case where there is little or nothing that can be done, we may also work so hard so that our areas of strength blossoms more, so that are weak area is very less visible.

Here is a of the result we got from the SWOT analysis that was conducted on behalf of Sean and Sharon Hotel Las Vegas, Nevada;

Our area of strength cannot be farfetched; the location of our hotel is perfect for such business, our management team has robust experience in the industry, our customer services are second to none in the whole of Las Vegas and our facility is top notch

Our perceived weakness could be that we are a new business, and we may not have the financial muscle to sustain the kind of publicity we want to give our business.

  • Opportunities:

We are in one of the cities in the world that never goes to bed, plus the fact that Las Vegas is regarded as the world headquarters as far as the casino business is concerned.

It means that loads of tourists, business executives, and travelers would want to visit Las Vegas and we are well positioned to welcome them because our hotel facility is just about 20-minute drive from McCarran International Airport in Las Vegas, and a few minutes drive from Mandalay Bay Event Center.

One of the threats that are likely going to confront us is; unfavorable government policies, the downturn in the economy which is likely going to affect sales, and perhaps the emergence of new hotels (competitors) within the same location where our hotel is located.

7. MARKET ANALYSIS

  • Market Trends

The trend in the hospitality industry is such that there are peak periods and off-peak periods. Thus, hoteliers know this and have been able to make provisions to properly handle the change in season.

For example; during summer or during any major sporting event or business summit, most hotels in Las Vegas are almost fully booked. As a matter of fact, that is the period that some hotels make the money that will sustain the business for the rest of the year.

Be that as it may, some hotels are well positioned and they enjoy rich patronage all through the 12 calendar months of the year. Another trending feature in the hotel industry is that it is profitable to build your brand and then venture into the sale of franchises if you know you don’t have the capacity to manage various branches of your hotel.

Over and above, hoteliers are quite aware that they are in the industry not for quick returns on their investments, but to steadily build a brand that can become a global brand while growing their profits year in and year out.

8. Our Target Market

Sean and Sharon conducted her feasibility studies and market survey and we were able to identify those who we expect will eventually become our loyal customers.

We do not intend to waste our time on activities that would yield us nothing, which is why we invested time to create a hotel marketing plan to help us do only the most needful things. These are the category of people that we intend to market our hotel to;

  • Corporate Executives
  • Business People
  • Sports Men and Women
  • Government Officials
  • College Students
  • Traveling Agencies
  • Event Managers
  • Religious Organizations

Our Competitive Advantage

The competitive edge of Sean and Sharon Hotel Las Vegas, Nevada is the excellent and customized service that we offer to all our guests irrespective of their status. We can boldly say that the location of our hotel is going to give us an edge over our competitors in Las Vegas.

We are in the middle of the happening city in Nevada. From the location of our hotel, you can connect to any part of the city with little or no stress.

Another significant competitive advantage that we are bringing to the industry is the robust experience of our management team. We have a team that has a combination of 40 years of experience in the hospitality industry in the united states and Canada. They are considered core professionals in their own right.

9. SALES AND MARKETING STRATEGY

  • Sources of Income

Sean and Sharon Hotel will generate income from the following service offerings;

  • Laundry service

10. Sales Forecast

It is important to state that our sales forecast is based on the data gathered during our feasibility studies and also some of the assumptions readily available in the field. Below is the sales projection for Sean and Sharon Hotel, it is based on the location of our hotel and the services and products that we will be offering;

  • First Year-:  $600,000
  • Second Year-: $900,000
  • Third Year-: $1, 500,000

N.B -: This projection is done based on what is obtainable in the industry and with the assumption that there wouldn’t be any unfavorable government policy.

  • Marketing Strategy and Sales Strategy

We will adopt the following means to attract the kind of people that we want in our hotel per – the time: The model of the bar we intend to run is a neighborhood type of bar, hence, we are not going to rely only on the conventional ways of marketing.

We don’t have the plans to run paid adverts on Local TV stations, local radio stations, or even local newspapers but we will sure maximize every other available means to promote our business.

Our unique selling proposition is that we have a collection of almost all brands of beers produced in America in our bar, we have assorted drinks and tobaccos et al. In view of that, we are going to adopt the following strategies to ensure that we do not only attract customers but generate repeated sales from them; Parts of the marketing and sales strategies that we will adopt are;

  • Open our hotel in a grand style with a party for all.
  • Advertise our hotel brand in travel and tours magazines, national newspapers, Satellite TV stations, and Radio station
  • Promote our business online via our official website and all available social media platform
  • Continuously Improve the performance of our brands
  • Hire the services of experts to make our brands the first choice for guests
  • Deliver consistent customer experiences to all our guests; making our first impression count positively
  • Continuously Improve the efficiency of our hotels and operating processes
  • Ensure that we Put our market scale and knowledge to good use
  • Using our worldwide scale and experience to convert more hotels to our brands
  • Make the most of our global presence – guests choose brands they know when they travel
  • Build strong partnerships within our own company and with our stakeholders across the world
  • Make use of attractive handbills to create awareness and also to give direction to our bar
  • Position our signage/Flexi banners at strategic places
  • Position our greeters to welcome and direct potential customers
  • Create a loyalty plan that will enable us to reward our regular customers
  • Engage in road shows within our neighborhood to create awareness for our hotel.

11. Publicity and Advertising Strategy

Sean and Sharon Hotel is in the hospitality business to make a profit and we can only make a profit if we steadily increase our customer base. No doubt, in order to remain relevant in the hospitality industry as a hotelier in Las Vegas, you should be able to continue to create hype around your hotel brand and that is exactly the publicity and advertising strategy that we will adopt.

We will ensure that we leverage all conventional and non – conventional publicity and advertising techniques to promote our hotel brand.

Although our hotel is located in Las Vegas, the scope of our market is global which is why we choose to make use of best practices as far as publicity and advertisement are concerned in the hotel business. Here are the platforms we intend leveraging on to promote and advertise Sean and Sharon Hotel, Las Vegas;

  • Encourage our loyal customers to help us use Word of Mouth (referrals)
  • Advertise our hotel brand in travel and tours magazines, national dailies, Satellite TV stations, and Radio station
  • Promote our business online via our official website
  • Sponsor relevant community programs
  • Leverage the internet and social media platforms like; Instagram, Facebook, Twitter, et al to promote our brand
  • Install our Bill Boards on strategic locations
  • Engage in road shows from time to time
  • Distribute our fliers and handbills in target areas

12. Our Pricing Strategy

Our pricing system is going to be based on what is obtainable in the industry, we don’t intend to charge more (except for premium and customized services) and we don’t intend to charge less than our competitors are offering in Las Vegas.

Be that as it may, we have put plans in place to discount our products and services once in a while and also to reward our loyal customers.

  • Payment Options

Our payment policy is all-inclusive because we are quite aware that different people prefer different payment options as it suits them. Here are the payment options that will be available in every of our pubs;

  • Payment by cash
  • Payment via Point of Sale (POS) Machine
  • Payment via online bank transfer (online payment portal)
  • Payment via Mobile money

In view of the above, we have chosen banking platforms that will help us achieve our payment plans without any difficulty.

13. Startup Expenditure (Budget)

These is the key areas where we will spend our start–up capital on;

  • Legal expenses for obtaining licenses and permits: $1,500.
  • The Total Fee for Registering the Business in Las Vegas, Nevada: $750.
  • Marketing promotion expenses (2,000 flyers at $0.04 per copy) for the total amount of $3,580.
  • Cost for hiring Consultant – $5,000.
  • Insurance (general liability, workers’ compensation, and property casualty) coverage at a total premium – $30,800.
  • Cost of accounting software, CRM software, and Payroll Software – $15,000
  • Cost for acquiring facility for the hotel: $500,000.
  • Cost for facility remodeling – $100,000.
  • Other start-up expenses including stationery – $1000)
  • Phone and utility deposits ( $3,500 ).
  • Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $60,000
  • The cost for Start-up inventory – $35,000
  • Storage hardware (bins, utensil rack, shelves, glasses case) – $3,720
  • The cost for counter area equipment (counter top, sink, ice machine, etc.) – $9,500
  • Cost for serving area equipment ( glasses, flatware) – $5,000
  • Cost for store equipment (cash register, security, ventilation, signage) – $13,750
  • Office equipment and furniture – $3,600
  • The cost for the purchase of furniture and gadgets (Computers, Printers, Telephone, TVs, Sound systems, tables and chairs et al): $4,000.
  • The cost of Launching a Website: $600
  • The cost for our grand opening party: $5,000
  • Miscellaneous: $2,500

We would need an estimate of $3.5M to successfully launch Sean and Sharon Hotel in Las Vegas, Nevada.

Generating Funding/Startup Capital for Our Hotel

Sean and Sharon Hotel will be financed by Sean and Sharon Glaciers and their business partners. Part of the start–up capital will also be raised as a loan facility from the bank in the United States. These are the areas where we intend sourcing for funds for Sean and Sharon Hotel.

  • Generate part of the start–up capital from personal savings and the sale of his stocks (Sean and Sharon Glaciers)
  • Generate part of the start–up capital from our business partners
  • Generate a larger chunk of the startup capital from the bank.

N.B: Please note that Sean and Sharon Glaciers want to retain the lion’s share of the business shares hence they both are investing a total of 1 million USD. They will also secure a mortgage to purchase the property for the hotel.

14. Sustainability and Expansion Strategy

Part of the grand plan of sustaining Sean and Sharon’s hotel is to ensure that we provide the best training for our employees, put a succession plan in place, and will not relent in marketing and promoting our hotel brand.

From our findings, another factor that kills new businesses is financial leakages. In order to plug financial leakages, the management of Sean and Sharon Hotel will adopt the use of payment machines and accounting software to run the business.

In the bid to build a successful business, we will ensure that all our employees are comfortable and we will provide them with the best facilities and welfare package that will help them achieve peak performance in all their duties and in turn help the organization achieve its goals and business objectives.

Check List / Milestone

  • Business Name Availability Check: Completed
  • Business Registration: Completed
  • Opening of Corporate Bank Accounts: Completed
  • Securing Point of Sales (POS) Machines: Completed
  • Opening Mobile Money Accounts: Completed
  • Opening Online Payment Platforms: Completed
  • Application and Obtaining Tax Payer’s ID: In Progress
  • Application for business license and permit: Completed
  • Purchase of Insurance for the Business: Completed
  • Acquiring facility and remodeling the facility: In Progress
  • Conducting Feasibility Studies: Completed
  • Generating capital from family members: Completed
  • Applications for Loan from the bank: In Progress
  • Writing of Business Plan: Completed
  • Drafting of Employee’s Handbook: Completed
  • Drafting of Contract Documents and other relevant Legal Documents: In Progress
  • Design of The Company’s Logo: Completed
  • Graphic Designs and Printing of Packaging Marketing/Promotional Materials: In Progress
  • Recruitment of employees: In Progress
  • Purchase of the Needed furniture, electronic appliances, office appliances, and bar accessories: In progress
  • Creating Official Website for the Company: Completed
  • Creating Awareness for the business both online and in the neighborhood: In Progress
  • Health and Safety and Fire Safety Arrangement (License): Secured
  • Opening party / launching party planning: In Progress
  • Establishing business relationship with vendors – suppliers of all our needed food ingredients, drinks, tobacco, and snacks: In Progress

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Resort Business Plan Template

Written by Dave Lavinsky

resort business plan

Resort Business Plan

Over the past 20+ years, we have helped over 500 entrepreneurs and business owners create business plans to start and grow their resorts.

If you’re unfamiliar with creating a resort business plan, you may think creating one will be a time-consuming and frustrating process. For most entrepreneurs it is, but for you, it won’t be since we’re here to help. We have the experience, resources, and knowledge to help you create a great business plan.

In this article, you will learn some background information on why business planning is important. Then, you will learn how to write a resort business plan step-by-step so you can create your plan today.

Download our Ultimate Resort Business Plan Template here >

What Is a Business Plan?

A business plan provides a snapshot of your resort as it stands today, and lays out your growth plan for the next five years. It explains your business goals and your strategies for reaching them. It also includes market research to support your plans.

Why You Need a Business Plan

If you’re looking to start a resort or grow your existing resort company, you need a business plan. A business plan will help you raise funding, if needed, and plan out the growth of your resort to improve your chances of success. Your resort business plan is a living document that should be updated annually as your company grows and changes.

Sources of Funding for Resort Businesses

With regards to funding, the main sources of funding for a resort are personal savings, credit cards, bank loans, and angel investors. When it comes to bank loans, banks will want to review your business plan and gain confidence that you will be able to repay your loan and interest. To acquire this confidence, the loan officer will not only want to ensure that your financials are reasonable, but they will also want to see a professional plan. Such a plan will give them the confidence that you can successfully and professionally operate a business. Personal savings and bank loans are the most common funding paths for resort companies.

Finish Your Business Plan Today!

How to write a business plan for a resort business.

If you want to start a resort or expand your current one, you need a business plan. The guide below details the necessary information for how to write each essential component of your resort business plan.

Executive Summary

Your executive summary provides an introduction to your business plan, but it is normally the last section you write because it provides a summary of each key section of your plan.

The goal of your executive summary is to quickly engage the reader. Explain to them the kind of resort you are running and the status. For example, are you a startup, do you have a resort that you would like to grow, or are you operating a chain of resorts?

Next, provide an overview of each of the subsequent sections of your plan.

  • Give a brief overview of the resort industry.
  • Discuss the type of resort you are operating.
  • Detail your direct competitors. Give an overview of your target customers.
  • Provide a snapshot of your marketing strategy. Identify the key members of your team.
  • Offer an overview of your financial plan.

Company Overview

In your company overview, you will detail the type of resort you are operating.

For example, you might specialize in one of the following types of resorts:

  • Health Spa Resort : this type of resort provides individual spa services and helps visitors develop health habits.
  • Ski Resort: this type of resort includes downhill, cross-country, or similar skiing areas with ski lifts and tows. These resorts often provide food and beverages, equipment rentals, and ski instruction, as well as accommodation.
  • Eco-tourism Resort: this type of resort focuses on environmental sustainability, offering programs to minimize their eco footprint. Some eco-tourism resorts offer an immersive experience such as living among animals in a jungle.
  • Destination Resort: this type of resort contains everything needed, such as accommodation, food service, attractions, shopping, etc.
  • All-Inclusive Resort : this type of resort charges one fixed price that includes lodging, unlimited food, drink and sports activities, and entertainment.

In addition to explaining the type of resort you will operate, the company overview needs to provide background on the business.

Include answers to questions such as:

  • When and why did you start the business?
  • What milestones have you achieved to date? Milestones could include the number of overnight guests, the number of conventions hosted, reaching and/or maintaining X percent occupancy rate, etc.
  • Your legal business Are you incorporated as an S-Corp? An LLC? A sole proprietorship? Explain your legal structure here.

Industry Analysis

In your industry or market analysis, you need to provide an overview of the resort industry.

While this may seem unnecessary, it serves multiple purposes.

First, researching the resort industry educates you. It helps you understand the market in which you are operating.

Secondly, market research can improve your marketing strategy, particularly if your analysis identifies market trends.

The third reason is to prove to readers that you are an expert in your industry. By conducting the research and presenting it in your plan, you achieve just that.

The following questions should be answered in the industry analysis section of your resort business plan:

  • How big is the resort industry (in dollars)?
  • Is the market declining or increasing?
  • Who are the key competitors in the market?
  • Who are the key suppliers in the market?
  • What trends are affecting the industry?
  • What is the industry’s growth forecast over the next 5 – 10 years?
  • What is the relevant market size? That is, how big is the potential target market for your resort? You can extrapolate such a figure by assessing the size of the market in the entire country and then applying that figure to your local population.

Customer Analysis

The customer analysis section of your resort business plan must detail the customers you serve and/or expect to serve.

The following are examples of customer segments: domestic leisure travelers, international leisure travelers, business travelers, etc.

As you can imagine, the customer segment(s) you choose will have a great impact on the type of resort you operate. Clearly, business travelers would respond to different marketing promotions than international leisure travelers, for example.

Try to break out your target customers in terms of their demographic and psychographic profiles. With regards to demographics, including a discussion of the ages, genders, locations, and income levels of the potential customers you seek to serve.

Psychographic profiles explain the wants and needs of your target customers. The more you can recognize and define these needs, the better you will do in attracting and retaining your customers.

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Competitive Analysis

Your competitive analysis should identify the indirect and direct competitors your business faces and then focus on the latter.

Direct competitors are other resorts.

Indirect competitors are other options that customers have to purchase from that aren’t directly competing with your product or service. This includes hotels, short-term rentals, or even relatives who live in the area. You need to mention such competition as well.

For each such competitor, provide an overview of their business and document their strengths and weaknesses. Unless you once worked at your competitors’ businesses, it will be impossible to know everything about them. But you should be able to find out key things about them such as

  • What types of customers do they serve?
  • What type of resort do they operate?
  • What is their pricing (premium, low, etc.)?
  • What are they good at?
  • What are their weaknesses?

With regards to the last two questions, think about your answers from the customers’ perspective. And don’t be afraid to ask your competitors’ customers what they like most and least about them.

The final part of your competitive analysis section is to document your areas of competitive advantage. For example:

  • Will you provide extended stay options?
  • Will you offer amenities or services that your competition doesn’t?
  • Will you provide better customer service?
  • Will you offer better pricing?

Think about ways you will outperform your competition and document them in this section of your plan.  

Marketing Plan

Traditionally, a marketing plan includes the four P’s: Product, Price, Place, and Promotion. For a resort business plan, your marketing strategy should include the following:

Product : In the product section, you should reiterate the type of resort company that you documented in your company overview. Then, detail the specific products or services you will be offering. For example, will you provide accommodation-only options, all-inclusive packages, accommodation/service packages, day visitor packages, etc.?

Price : Document the prices you will offer and how they compare to your competitors. Essentially in the product and price sub-sections of your plan, you are presenting the products and/or services you offer and their prices.

Place : Place refers to the site of your resort. Document where your resort is situated and mention how the site will impact your success. For example, is your resort located in a busy tourist town, near a tourist attraction, or is it a remote destination? Discuss how your site might be the ideal location for your customers.

Promotions : The final part of your resort marketing plan is where you will document how you will drive potential customers to your location(s). The following are some promotional methods you might consider:

  • Advertise in local papers, radio stations and/or magazines
  • Advertise in trade publications or on national TV
  • Reach out to websites
  • Distribute flyers
  • Engage in email marketing
  • Advertise on social media platforms
  • Improve the SEO (search engine optimization) on your website for targeted keywords

Operations Plan

While the earlier sections of your business plan explained your goals, your operations plan describes how you will meet them. Your operations plan should have two distinct sections as follows.

Everyday short-term processes include all of the tasks involved in running your resort, including answering calls, booking rooms and services, cleaning between guests, providing concierge services, customer service, etc.

Long-term goals are the milestones you hope to achieve. These could include the dates when you expect to book your Xth guest, or when you hope to reach $X in revenue. It could also be when you expect to expand your resort to a new city.  

Management Team

To demonstrate your resort’s potential to succeed, a strong management team is essential. Highlight your key players’ backgrounds, emphasizing those skills and experiences that prove their ability to grow a company.

Ideally, you and/or your team members have direct experience in managing resorts. If so, highlight this experience and expertise. But also highlight any experience that you think will help your business succeed.

If your team is lacking, consider assembling an advisory board. An advisory board would include 2 to 8 individuals who would act as mentors to your business. They would help answer questions and provide strategic guidance. If needed, look for advisory board members with experience in managing a resort or successfully running a boutique hotel.  

Financial Plan

Your financial plan should include your 5-year financial statement broken out both monthly or quarterly for the first year and then annually. Your financial statements include your income statement, balance sheet, and cash flow statements.

Income Statement

An income statement is more commonly called a Profit and Loss statement or P&L. It shows your revenue and then subtracts your costs to show whether you turned a profit or not.

In developing your income statement, you need to devise assumptions. For example, will you have 25 or 100 guest rooms? And will sales grow by 2% or 10% per year? As you can imagine, your choice of assumptions will greatly impact the financial forecasts for your business. As much as possible, conduct research to try to root your assumptions in reality.

Balance Sheets

Balance sheets show your assets and liabilities. While balance sheets can include much information, try to simplify them to the key items you need to know about. For instance, if you spend $50,000 on building out your resort, this will not give you immediate profits. Rather it is an asset that will hopefully help you generate profits for years to come. Likewise, if a lender writes you a check for $50,000, you don’t need to pay it back immediately. Rather, that is a liability you will pay back over time.

Cash Flow Statement

Your cash flow statement will help determine how much money you need to start or grow your business, and ensure you never run out of money. What most entrepreneurs and business owners don’t realize is that you can turn a profit but run out of money and go bankrupt.

When creating your Income Statement and Balance Sheets be sure to include several of the key costs needed in starting or growing a resort:

  • Cost of furnishing each guest room
  • Cost of building out common areas and/or service facilities (spa treatment rooms, etc.)
  • Payroll or salaries paid to staff
  • Business insurance
  • Other start-up expenses (if you’re a new business) like legal expenses, permits, computer software, and equipment

Attach your full financial projections in the appendix of your plan along with any supporting documents that make your plan more compelling. For example, you might include your resort blueprint or a list of amenities and services you offer.  

Writing a business plan for your resort is a worthwhile endeavor. If you follow the template above, by the time you are done, you will truly be an expert. You will understand the resort industry, your competition, and your customers. You will develop a marketing strategy and will understand what it takes to launch and grow a successful resort.  

Resort Business Plan Template FAQs

What is the easiest way to complete my resort business plan.

Growthink's Ultimate Resort Business Plan Template allows you to quickly and easily write your resort business plan.

How Do You Start a Resort Business?

Starting a resort business is easy with these 14 steps:

  • Choose the Name for Your Resort Business
  • Create Your Resort Business Plan
  • Choose the Legal Structure for Your Resort Business
  • Secure Startup Funding for Your Resort Business (If Needed)
  • Secure a Location for Your Business
  • Register Your Resort Business with the IRS
  • Open a Business Bank Account
  • Get a Business Credit Card
  • Get the Required Business Licenses and Permits
  • Get Business Insurance for Your Resort Business
  • Buy or Lease the Right Resort Business Equipment
  • Develop Your Resort Business Marketing Materials
  • Purchase and Setup the Software Needed to Run Your Resort Business
  • Open for Business

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