Hotel Owner Mistakes You Don’t Want to Make

In Hospitality, Hotel Management, Hotel Marketing by HMG Hospitality Team

It’s no easy path being a hotel owner. The hospitality industry is fiercely competitive, and constantly changing to meet the needs of the customers. Yet, there are great opportunities for financial rewards if success is achieved. With the New Year rapidly approaching, there’s no better time to take a look at some of the biggest hotel owner mistakes made. By contemplating mistakes you might have made, or hope not to make, you can arm yourself with the best weapon of all – knowledge. Here are our top 5 hotel owner mistakes you don’t want to make:

Base Rates on Competition Rather Than Value

justify the value the customer receives. If your hotel doesn’t have a pool or jacuzzi, and all the other competing hotels do, then a guest surely won’t expect to pay the same rate at your hotel. If your hotel does, in fact, have rates that are higher than the value, business will be hurt by a lack of return guests. Don’t expect positive reviews, or even guest recommendations. Price must always reflect perceived value. Be sure to audit your rates annually and adjust them to reflect the experience and value offered.

Adding Gimmicks When The Basics Are a Mess

When attempting to be competitive, many hotels forget what’s most important and opt for gimmicks instead. At the end of the day, the purpose of a hotel is to provide a comfortable and clean living environment for persons in need of one. How can a hotel expect to be successful if those basic needs aren’t addressed?

What we mean is, first and foremost a hotel must be clean and everything needs to work – air conditioning, furniture, appliances, sink, toilet, shower, etc. If amenities such as the pool, gym, golf course, etc. are offered – those must be operational as well. The hotel team must be friendly and helpful. These are the basics of a functioning hotel. Often times, though, hotels who are lacking in these basic necessities try to distract the guests by offering gimmicks. Gimmicks can be anything from offering complimentary drink vouchers, candy or chocolate on hotel pillows, extra furniture or play structures for children, etc. Regardless, this tactic doesn’t work. Hammer out the basics first, and then, down the line, maybe you’ll have the funds and reputation to begin to offer more amenities.

Staff Exploitation

The staff can make or break a hotel. It’s that simple. Happy and satisfied staff will strive to do the best possible job. On the flip side, unhappy and mistreated staff may adopt attitudes of apathy, or even purposefully sabotage operations to a certain degree. If a guest has a negative, or less than positive, interaction with a team member, you can bet that a negative review will materialize.

How does exploitation occur? Many ways. It could be as simple as staff being underpaid or as complex as management systemically preventing adequate training and promoting. There are a few key ways to help ensure the team is happy and satisfied. 1. Pay staff a competitive rate, pay them what they’re worth. 2. Institutionalize training systems that, if employed well, may lead to promotions. 3. Always work towards creating a warm, friendly and welcoming company culture with open lines of communication.

Ignore Reviews

For whatever reason, many are convinced that ignoring reviews on third-party sites like Yelp is OK. This is entirely not true and one of the biggest hotel owner mistakes you can make. We can all agree that there will be the occasional whiny guest that simply enjoys complaining and causing trouble. Yet, the vast majority of reviews are from regular people who experienced something negative, minor or otherwise.

Every review must be attended to. This is your chance to get free insight. To find out what needs improving so that your hotel can be as successful as possible. If and when positive reviews surface – celebrate! Use positive reviews to help promote your hotel and strengthen hotel guest relations. This is a simple task – do not ignore reviews. Read them, respond to them, take action, and move forward.

Going With The Wrong Brand

You can’t do it alone, and you shouldn’t have to. Finding the best fit for your hotel in terms of a brand is instrumental in your hotel’s success. The biggest mistake hotel owners make in this department is not shopping around enough. Your hotel operator or brand is like your significant other in many respects. You need to have open communication, respect one another’s opinions, experiences, and visions, and at the end of the day – you need to make one another better.

Don’t go with the first brand that schmoozes you, shop around. A bit of healthy competition for your hotel is a good thing and will help afford you the time and clarity to make a good choice. Typically, everything else will fall into place as long as you entrust your hotel to capable hands.

Hotel owner mistakes can result in a great financial loss, which is why it’s imperative to understand what those mistakes are. Your hotel can be every bit as successful as you envision it to be, as long as you work diligently to avoid making the above mistakes.

There is plenty of help and advice to be had if you so desire. Here at HMG Hospitality, we pride ourselves on decades of expertise in the hospitality industry and will be happy to help guide you and your hotel to financial success. Contact us to learn more.

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