How to start and run a motel: Complete guide for small property operators

Entering into the world of hospitality as a business owner and/or operator is a large but exciting undertaking. It’s not something that can happen instantly.

However, the growth of travel represents some really great opportunities for accommodation managers to create unique experiences for guests and enjoy large revenue income at the same time.

Of course there are always challenges along the way, not least of which will be your competitors and the ever-changing attitudes of consumers, including those from overseas.

To make your journey as a motel operator as rewarding as possible you need to be prepared and you need to understand every aspect of running this type of business.

This blog will explain from the ground up exactly how you can succeed when starting and running a motel. We hope this helps achieve your dream!

Starting a motel

Establishing a motel is an exciting chapter of your life. It’s your own institution with which to house travellers from all around the world and provide hospitality to those who seek it.

It can be a really fun, rewarding way to make a living but it’s hard work. If you don’t get everything right at the kick-off, you could be doomed to fail.

Here’s everything you need to consider.

Blog sections:

Starting a motel business: Is it the right decision?

Since your guests will be under your care, running a motel requires your devoted attention every day, all day. Some may find this commitment quite daunting!

Before you make the leap into the deep end, consider these questions and make sure you can answer yes to all or most of them:

Do you thrive under pressure?
Do you gain energy from being around other people?
Do you enjoy what some would call mundane tasks, such as cleaning or cooking?
Are you an expert on your local area?
Does being self-employed sound good to you?
Do you have a strong support base (family, friends)?
Can you understand and learn from your own mistakes?
Are you a multi-tasker who also enjoys routine?
Are you willing to try new things to achieve success?

It’s vital before setting out that you what to expect from the job.

Build a motel

If you really want to start from scratch you can of course build your own motel!

There are a lot of factors to consider in doing this. Where will you purchase land and how big will the lot be? What plan do you have for the structure?

The amount of guests you want to host, features you want to include, and level of luxury you want to provide are just some of the things that will have a bearing on the structure you build.

Then there’s the matter of actually applying for building permits and building licenses, and getting the site ready in the most economical way possible.

Some might see this as the hard road to take, especially for first-timers but it’s certainly achievable.

How much does it cost to build a motel?

Obviously there is no set cost for building a motel. The capital you need will change depending on a number of influences. Every location will have different fees around permits and construction, health regulations, tax collection etc.

Cost will also be largely dependent on how big your property is and what it will include. For instance, will you be installing a pool, sauna, games room, playground, restaurant etc on top of the main property that includes the rooms and common areas?

The rooms themselves will have varying costs too when you take into account what features they will have and if you’ll have different tiers of room types. Some of the most common popular amenities are en suites so if you’re to include these in your rooms then you need to allow for a higher budget.

Motel construction costs

Construction costs are a serious consideration but you first need to understand if what you’re doing is appropriate for the town you are in. It is very difficult to get a good return on new construction with an economy property in most places. Established properties with less investment will usually be able to comfortably undercut you on price.

So you might need a higher budget to build a property of higher quality. Look at the market in your area and see what potential there is. This will lead you to understand what kind of property you will build and how much it costs.

When thinking about construction, factor in costs for things like:

Interior walls
Exterior walls
Bathrooms and plumbing
Kitchens and cooking facilities
Heating and cooling systems
Bedding and furniture

The cost for all these materials will again vary according to your preference and goals. Will you use architects or rely solely on contractors? This is another influence since using an architectural team will drive up costs.

Ultimately, it’s folly to try to estimate the cost of building a motel until all prior research and planning has been done. One thing is for sure however; you’ll need a significant amount of capital if starting from the ground up.

Buying a motel

Buying an established motel or a property that can be converted to one is another option on the table.

This approach has a number of advantages since a lot of the groundwork has already been done for you. If the property is already a motel, then a revenue stream will be established prior to you taking ownership.

There’s a lot of information you need to look for and understand when purchasing a motel. Look at the following as a starting point:

Current cash flow
Daily operating costs
The existing systems in place
Existing suppliers
Any training/support that will be available after the sale
Legal requirements

All of this information will help you choose the best motel for you; one that will suit the lifestyle you have planned for yourself.

Some other questions to ask yourself:

Do you like the location (and will travellers)?
Is the property size suitable?
What upgrades or renovations are needed (if any)?
What guest segments should you expect?
Is the business seasonal?

More considerations that could influence your decision include why the property/business is being sold in the first place. If the business is losing money and being sold for financial reasons maybe it’s not a sound investment. You don’t want to put yourself at risk.

The best thing you can do is put everything into perspective. Research is vital so you can fully understand the opportunities that exist for you and your potential business.

Motel renovations

Renovations or refurbishments will be necessary at every property, whether you are taking ownership of one or some time in the future after establishing your own.

Guests are starting to expect a higher level of sophistication when they stay at a property, and they won’t mind going elsewhere for a better experience even if they have to pay a little more.

Upgrading your property is a serious undertaking and something you have to get exactly right to avoid wasting money. How and when you should do it are two major considerations.

Before you renovate a motel, consider the following:

Does the current market call for it?
If your destination is undergoing a period of growth and development it could be a very good idea to join in.
Will it help?
Generally, the idea will be to give guests a better experience but also allow you an opportunity to increase rates and revenue. If the market won’t support a rise in prices, maybe you can hold off on refurbishing.
Typical activities
While every property should be treated on its merits, there are some common repairs or upgrades that take place including new furniture, redecoration, new bathrooms, new facilities, new technology, new rooms etc.
Impact on occupancy and revenue
While the work is taking place it’s likely to have some effect on the amount of bookings you can take and revenue you can generate. Do you get it done in stages to keep interruption to a minimum or close the business for a period of time and reopen a fresh property?
The voice of your guests
Feedback is a big indicator of what you need to do to improve your property. If guests make constant remarks that your rooms are dated, maybe they need a makeover.
Budget allocation
It’s great to have a brand new pool at your property but save some money to use on marketing your newly outfitted motel so you can start making the money back that you spent!

Once you’ve completed motel renovations don’t hold back. You need to make sure you capitalise on all the hard work. Be more aggressive with your pricing and promotions to boost bookings, occupancy, and revenue.

Motel planning concepts

The idea of planning a motel business is huge. So much detail has to go into your preparation before you even open your doors to guests.

What exactly do you have to think about when planning your motel business? Well, everything!

Some of the biggest areas to focus on include:

The local market – You simply must have knowledge of your potential guests and how they will be segmented
Financial considerations – How much will it cost you to start and how much will it cost to run each day? Also consider your assets and planned investment, among many others.
Objectives – It’s good to set yourself targets and goals so you can work towards something and understand when you’re making progress or need to improve.
Mission – What does your brand aspire to? Do you want to be the best motel in your destination? Will you differentiate yourself through a particular feature etc?
Services – What exactly will you offer those who stay at your motel?
Competitive edge – Who are your major competitors and how will you set yourself apart from them?
Marketing strategy – What marketing tactics and channels will you employ to bring travellers to your motel?
Sales strategy – Forecasting in particular is important for the success of your business.

Running a small motel

Just because your property is smaller than a large hotel, it doesn’t mean running it is any easier. In fact, it can be harder in some respects due to less access to resources.

Depending on the size of your motel, it’s quite likely it will become too difficult to handle on your own.

Marketing your property, taking reservations, checking guests in and out, perfecting the service you provide, maintaining a strong relationship with your audience, reporting on performance, and budgeting are all the things you’ll need to look at while you go through life as a motel operator. There’s a lot more to it than cooking breakfast and pointing travellers towards the nearest attraction.

When this happens and you need to hire a staff member, you need to find the right person.

Here’s some advice:

Find the skill sets that you do need – Is it bookkeeping, cleaning, or cooking?
Or do you need a multitasker who can do a little bit of everything? Remember that your time is better spent on servicing guests and figuring out how to market your property. Create a detailed job description once you’re sure you know what you need.

The next step is getting your job description out to a talented pool of individuals. Advertise on social media, through family and friends, on association job boards and website forums, and regular job sites.

When you’re interviewing candidates it’s important to quickly uncover if they’re right for the role and also the right fit to work with you personally. Ask open ended questions to reveal their true character, get references from past employers, and even conduct practical tests if need be.

You should only hire people you can trust. Running a good business starts with the people putting in the work!

Motel management tips

Obviously some businesses are more successful than others and there are many reasons for this. However, you can at least eliminate any fault of your own by ticking all the boxes when it comes to best practice management of a motel.

Here’s a list of the best ways you can manage your motel and set yourself up with the best chance of success.

Promote your destination
Guests will be so much more likely to have a great experience when you help them beyond just getting to your property. Travellers want experiences and they are looking for help and guidance on what to see and do locally.
Take your business online
The industry is starting to catch up to the times and you can be sure that your competitors are a part of the group that is going online to find new guests. It’s a must.
Involve associations and organisations
There are so many tools and resources out there to help those that are thinking of owning an inn or bed and breakfast, or have just purchased one. Don’t try to do it alone, there are literally thousands of others who have gone before and are willing to help future and new operators.
Be active on social media
Social media is one of the key windows to the world beyond your motel. It’s a great marketing tool and it can expand your reach with very little financial investment. Today’s travellers, particularly millennials, want to be connected on social media so don’t deny them the option.
Be flexible
While travellers expect traditional check-in times during the late afternoon and check out times in the late morning, this is not always convenient for the modern guest. As a motel operator you have the unique opportunity to offer personalised service and allow guests to select a check-in and check-out time that works for them.
Have extra supplies ready
Busy travellers are bound to forget something, and this can be both frustrating and inconvenient for them. When you have supplies on hand for your guests to use or borrow, you will significantly improve their experience. You may want to consider purchasing extra toothbrushes, toothpaste, deodorant, feminine supplies and phone chargers.
Add local resources to your common areas
Your guests will rely on you for expert dining recommendations, for insight into the best activities and for information on the region’s history. In outdoor gardens and common lounges, you may want to consider adding novels by local authors, tour guides, and brochures that advertise discounts and promotions for nearby activities.
Establish personal routines
To make sure you’re in a position to provide the best service possible, it’s important to look after yourself before you start looking after your guests. It’s useful to plan your day the night before it happens!
Use technology to enhance the guest experience
Technology should not be used to replace personal interaction with your guests, but you can easily invest in technology that complements your B&B management strategy. A property management system that features an online booking engine, for instance, allows your guests to book directly with you online. A mobile app allows your guests to interact with your brand in a way that is convenient and useful. The hospitality industry is an innovative and exciting industry, and there are always new ways to improve your property management strategy.

Motel operations

A single day running your motel could encompass a huge range of tasks.

Generally owner/operators can expect to:

Process reservations and update inventory and pricing
Take payments
Check-in guests
Check-out guests
Cleaning tasks
General customer service
Invoicing and reporting
And more!

Always remember that guests are probably twice as likely to criticise a bad experience as praise a good one so you have to make guest experience one of your main focuses. When you have so much to do, it can be tough to balance everything.

This is why it’s so important to set routines where you can, find as much good help as you can, and use the technology that can make life easier. Automating and streamlining operations will save you a lot of time and effort. Today this can be achieved with cloud-based management systems that can take on a lot of the work when it comes to processing bookings, updating availability, setting rates, and reporting on performance.

Motel room layouts

Designing a motel room and deciding on a layout is obviously very important. To give guests a good impression your property almost has to feel like a home away from home.

Think about the guests you’re most likely to attract and address what these guests will want and expect in their room and during their stay. This will give you a clear sense of direction in how to lay out your room and what features to include. It goes without saying that business travellers will present a different challenge to leisure travellers, and families specifically will be different again. It’s nice to cater to everyone but put special focus on your largest segments.
It might be a good idea to design one room and invite others in to try it out and provide feedback before you go full-scale.

Some good general tips include not including too much unnecessary furniture or breakables. Guests like spacious rooms and you don’t want the hassle of property being damaged.

Budget again plays a role. How much will you spend per room? How big will the room be?

You also need to consider any regulations that may be in place. How many fire alarms, exits, extinguishers, windows etc are required?

Motel marketing

The subject of marketing your motel deserves an entire blog of its own. In fact you can read a comprehensive guide to marketing your small property here.

We’ll include the most pertinent points here.

One of the easiest and most effective ways to market your motel is to partner with online travel agents. It’s a guaranteed way of putting your property in front of more travellers than ever before.

There are always new marketing best practice tips that are released, specifically for hotels, but you will want to identify what works best for your own marketing strategy.

Email marketing continues to be a strong driver for traffic, engagement and bookings.

Considering motel’s don’t have the budget of larger accommodation providers email marketing is an essential part of any small business marketing plan.

Here is when you should start implementing email marketing at your motel…

When you need to drive direct bookings
When you need more reviews
To promote guest loyalty and build brand engagement

Keep in touch with your guests using pre and post stay emails and after they leave ensure you offer them some incentive to return. Here’s how you can put it to work:

Be careful that large images aren’t blocked by email filters
Keep guests updated with clever prose and witty subject lines
Use simple software to help you send and track

Email marketing is a start but there is much more you can do, including using your own guests as marketing tools. Here’s a couple of ways that your guests can provide customer feedback while also promoting your brand online:

Sharing more about their guest experience on popular online review sites
Providing recommendations about their stay to their family members and friends, often through social media

To further encourage guests to leave feedback and submit reviews on your property there’s a few things you can do including sending automatic email requests, offer incentives, or even ask your guests in person.

Marketing on social media

Throughout the last decade, social media networks such as Facebook, Instagram, and Twitter, launched as the latest innovative platforms on the web. In a matter of moments, these sites have become an integral part of our daily lives. Today, travellers use social media to discover new destinations, to connect with other globetrotters and learn more about the places they might stay on their next trip.

Here are some of the most important and current social media trends that you can use at your property:

Increase the frequency of posting videos
Take advantage of live streaming
Offer digital payment platforms on your social networking sites
Utilise the popular messaging apps

Video content is especially useful. This form of marketing is very accessible because small businesses don’t need to hire a production company, all they need to create great social content is a mobile device with a camera. Recognising the popularity of social video content and using it effectively in your B&B advertising strategy will ensure a good return.

It will help you personalise your brand and stay ahead of the competition. A good tip is to keep it short however. In the new digital world our attention spans are shortening, especially online. In a recent study by Google, 53% of visitors viewing a website on a mobile device will leave the page if it takes them more than three seconds to view the fully loaded version. Hoteliers need to create interesting content that conveys the desired message quickly.

Rate marketing at your motel

What is dynamic rate marketing?

For nearly a century, hotels have been using the same forms of rate marketing in order to get guests to book at particular times.

Either hotels describe their rates as “beginning from $100 per night” or giving a rate range such as “ranging from $100 to $300 per night.”

While this has worked for almost 100 years, the interconnected and social travellers of today are looking for more truthful rate marketing. This is where dynamic rate marketing comes into play. Dynamic rate marketing allows hoteliers to use their real-time availability and current pricing to be broadcast into various marketing campaigns.

What are some dynamic rate marketing tactics you can use at your small hotel?

You may argue that you have a limited budget, but there are definitely ways you can start to dynamically market your room rates, like…

Metasearch marketing
Banner advertising
Email promotions
Website promotions

Advertising your bed and breakfast with storytelling

Many people who prefer to stay at motels enjoy the character of the property and the authenticity of the experience. They love the fact that they get to know the person who runs the accommodation, and that they have an opportunity to connect with other guests. Telling your story should be part of your motel marketing strategy, as it allows you to capture the attention of your target market and encourages them to book directly with you.

Here’s why you should use storytelling as part of your B&B branding strategy:

It allows you to convey your motel’s voice and tone
It gives you the opportunity to tell your story using visual elements
It lets you offer insight into the guests you have welcomed
It enables you to connect with your guests on a personal level

Small motel marketing: Focus on the destination

Wherever you are, these destination marketing techniques will help you increase the number of guests visiting your region:

Work with local tourism businesses to identify a target market
Create marketing materials that promote the uniqueness of your destination
Track the results of the destination marketing campaign
Publish blogs providing valuable information about the destination
Create a local guide that guests can access from your mobile app
Offer packages allowing guests to enjoy authentic local experiences

Don’t forget:

Mobile marketing
Mobile marketing strategies often attract travellers who are interested in quick getaways or event-inspired ‘staycations’. There are many travellers who use mobile technology, such as their smartphones and tablets, in order to research upcoming trips.
Holiday marketing
Throughout the calendar year, people take advantage of the extra time off they have during the holidays in order to travel.

Whether it’s a long holiday weekend or week-long stretch between Christmas and New Year’s Day, you can capitalise on increased holiday travel at your own motel.

You can design holiday packages, plan an event, create marketing campaigns, market to local residents, and increase brand visibility.

Motel web design

Web design is another huge concept. Luckily we have a complete guide ready for small property managers like you. You can read it here.

First impressions count; it matters what your website looks like and it matters how it functions. You also have to make sure travellers are finding your website as they research travel.

Travellers are searching for websites that load fast, offer valuable visuals and insightful information, and that give them the opportunity to book quickly and easily online.

Without a user-friendly website, you are not going to be able to compete in the global travel market. And your number one distribution channel should be your motel’s website.

First things first; you need to identify what needs to be improved on your current motel website. There are a lot of basic elements that can make a big difference to a user’s experience.

Functionality is vital. You need to get that right, and then you can introduce more content around your actual brand and property.

Here are three tips to make your website more user friendly:

Create a website filled with valuable content
Make sure your site speed is up to par
Optimise your website for mobile use

The website functionality of your motel website will have a direct impact on the number of bookings that you receive at your property. Today’s travellers are heavily dependent upon technology when it comes to planning and booking their upcoming trips.

Here are some aspects of your website that may need improvement:

Your multimedia and visual elements
Your brand identity
Your content

Motel website design strategy

Your bed and breakfast website design can really help to deliver meaningful results to your business. If you get it right, it becomes a huge part of your overall strategy.

For instance, here’s how to gain more direct bookings through your motel website:

Simplify the online booking process
Prioritise visual elements
Transform your website into a local resource
Create landing pages with creative calls-to-action
Implement a responsive web design

Motel website design best practice

Here’s a list of the top five mistakes you could fall victim to, and the ways that you can avoid making them on your motel website:

Phone number is too hard to find
Taglines are meaningless
You send people away from your site
YouTube videos are embedded poorly
The booking process is cumbersome and difficult

Further tips you should always follow:

Nurture your brand
Appeal to your customers emotional side
Be user-friendly
Optimise your online booking engine
Optimise your SEO
Use stunning imagery
Create an easy path to booking
Make your branding clear
Ensure your website is modern
Keep it updated regularly

Although you don’t have access to the budget that large hotels have, you can still be an ace at online marketing and use it to promote your motel.

There are a lot of factors that your bed and breakfast website design can be informed by.

Some tips and inspiration you might find useful include understanding why people choose you. Is it because of:

Interior design, architecture, or art
The service you offer
Local attractions
Food and culture

You can then prioritise what you feature most strongly on your website.

Motel website templates

There are many hotel website templates available that allow you to create a user-friendly and visually-appealing website – without the frustration and stress of building a custom website yourself from scratch.

A hotel website template and builder is a tool that you can use to create an optimised, user-friendly website in a matter of moments.

Choosing the right hotel website templates is critical for your motel. Here’s a few features that your template should include:

Online booking engine with a visible book now button
Responsive website design (compatible with mobile devices)
Image galleries and high-resolution photos
Accessibility and easy navigation for guests
Simple functionality so booking can be made in a matter of clicks
Customisable design and the ability to personalise

Website template providers make everything easy, ensuring you don’t need to be an expert and can learn quickly how to manage your website properly.

Motel management system

A cloud-based motel management system could represent a perfect solution for your motel to operate a more efficient and more profitable business. Being able to eliminate the dependency you have on slow manual processes is very valuable and it’s something a management system can help with.

A motel management system will automate a number of core tasks at your property, updating information instantly and making sure all your systems are communicating with each other.

A motel management system may be a property management system, or an all-in-one solution that also includes an online booking engine and channel manager:

An online booking engine (or reservation system) will enable your property take commission-free bookings straight from your website and Facebook page.
A channel manager delivers better room distribution by allowing you to sell all your rooms on as many channels as possible, automatically updating your rates and availability.

Motel management software uses

Motel management software has many applications that you can put into practice every day at your property.

These might include:

Taking care of your operational tasks
A simple calendar system to drag and drop reservations, create new reservations, and close rooms
Quickly perform bulk uploads of data
Enable rates and availability to be updated instantly on your website and all your booking channels
Set check-in and check-out times and print a run sheet to stay organised each day
Own the guest relationship with and pre and post-stay emails
Reporting functions to analyse your best performing booking sites, occupancy rates, promotions and more
Make more revenue available to you via the sale of extras and promotions at the time of booking
A mobile app so you can even manage your motel remotely
Payments that are seamless for both you and your guests

These are the most common activities you’re likely to perform at your motel, so being able to introduce automation and increased speed would be a boon for a busy operator. With 101 jobs to do, management software works to lighten the load.

Motel property management system

Think of a PMS as the heart of your property. It stores all of the guest information, it manages check-in and check-out details, and provides you with an opportunity to input special requests or extenuating circumstances. It also records data, manages bookkeeping and allows you to generate reports about your property’s performance.

It will allow you to carry out all the day-to-day operations of your property in one place, such as:

Process reservations (online and POS)
Guest check-ins and check-outs
Guest booking details
Track your inventory and rates
Handle front office accounting
Manage maintenance and housekeeping
Manage guest communications

If you’re opening a new motel or are new to the business, a PMS will make things much easier. Of course, you can operate without one but if you start to notice the following signs, a PMS is worth investigating:

Booking are tedious/difficult for you and your guests to complete
Room inventory becomes hard to manage
Managing your time becomes overwhelming
Communicating with guests is taking too much effort
You’re struggling to visualise what works and what doesn’t work for your business

The reality is without a PMS, you may have to constantly man your front desk or play phone and email tag just to try to communicate with travellers and confirm reservations. This is frustrating and also a waste of time for all parties.

It’s also a huge burden to be suffering from double-bookings, which can happen when you don’t have full control over your inventory management. The time it takes to make sure your back end is in order will really eat into the time that should be spent on customer service.

Motel reservation system

The motel reservation system that you implement at your property plays a significant role in your overall ability to be successful. A reservation system schedules the dates and length of stay for guests as well as taking payments from them.

It enables them to choose their rooms at the time of booking, and more advanced systems even allow customers to select extras such as wine, flowers, fruit or other niceties to be placed in their room at the time of arrival (or later). Guests can book their own stays online via your website, third-party websites, or even Facebook and pay using a secure portal.

A number of benefits your motel can gain from a reservation system include:

Less work in the front office
Reduced chances of losing reservations or making areas
Reduced risk of overbookings
Easily collect data
Simpler administration
Improved guest experience

Your reservation system will automatically update your property management system when bookings are made, providing the two systems are integrated.

A motel reservation system will give your business an advantage over competitors who aren’t using online booking systems. You’ll also become more efficient thanks to your availability being updated immediately across your own system and all booking channels. You’ll also save time on admin tasks.

Key Takeaways

To make your journey as a motel operator as rewarding as possible you need to be prepared and you need to understand every aspect of running this type of business.
Before you make the leap you need to ask yourself a number of questions about what’s required
If you want to start from scratch and build a motel, you need to think about land and construction costs, size, building permits, and many other factors
Costs will be dependent on a number of factors, including location, number of rooms, amenities, etc
Buying an established motel or a property that can be converted to one is another option on the table, though this still requires some close examination
Marketing your property, taking reservations, checking guests in and out, perfecting the service you provide, maintaining a strong relationship with your audience, reporting on performance, and budgeting are all the things you’ll need to look at while you go through life as a motel operator
A single day running your motel could encompass a huge range of tasks
Designing a motel room and deciding on a layout is obviously very important. To give guests a good impression your property almost has to feel like a home away from home
One of the easiest and most effective ways to market your motel is to partner with online travel agents. It’s a guaranteed way of putting your property in front of more travellers than ever before
First impressions count; it matters what your website looks like and it matters how it functions. You also have to make sure travellers are finding your website as they research travel
There are many hotel website templates available that allow you to create a user-friendly and visually-appealing website – without the frustration and stress of building a custom website yourself from scratch
A cloud-based motel management system could represent a perfect solution for your motel to operate a more efficient and more profitable business

The post How to start and run a motel: Complete guide for small property operators appeared first on Front Desk & Reservation System for Small Hotels – Little Hotelier.

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