One of the easiest ways to look at the performance of a bed and breakfast is to check the occupancy rate. This may be a better indicator than revenue alone. The most successful establishments will generally have lots of bookings and be very busy. You should check your rates regularly and keep in mind the time of year and what type of events are on in the local area, as these will have an effect on numbers. A 90% occupancy rate is fantastic at any time of the year, but 60% – 70% means there is work to be done.
There are several factors that will impact your occupancy rate, including the location, the quality of the accommodation, food and service, and the price. Improving these areas can help you to generate more business and result in additional revenue. You could also think about providing special offers, particularly during off peak months when demand is naturally lower. Investing a little more in marketing could help too.
If you are thinking of ways to increase occupancy, you should ensure you do your research and look at past data. The first thing you should be looking at is your target market and what they are looking for in a bed and breakfast. Once you know this you can decide how well you satisfy their needs.
Sometimes creating a strategy to increase occupancy will require an investment, whether it is for new decor, revamping the marketing campaign, or even undertaking a complete renovation of the property. When you think about these factors you should consider where you will get the funds from and the impact this will have. It may be a risk to take out a large, high interest loan if you are already struggling for business.
There are several different types of bed and breakfast finance to choose from. These will differ in terms of the amount of risk and the cost associated with it. If you want a sizeable amount but want to avoid sky high interest rates, you may wish to consider remortgaging the property. If you do this you need to ensure you are clear on the obligations and can meet the repayments.
At Stewart Hindley and Partners LLP we are in a great position to advise bed and breakfast owners of their financial options so they can choose the right one and continue running their bed and breakfast successfully.