Cant sell my hotel

GDB2222

There was an interesting article in Saturday's Times about Blackpool regenerating itself. Very optimistic.

http://business.timesonline.co.uk/tol/business/economics/article6685027.ece

Errata

Maybe it's because I'm a toffee-nosed southerner, but I have never come across a hotel in the UK as cheap as £15 per night!

Maybe it's because you've never looked for one. There are hundreds on smoothhound.

hethmar

Blimey, I didnt know it was £15 a night, wow, no I havent heard that sort of price in about 25 years (another southerner, pleased to have found £100 a night room b and b for a weekend in the west country in September)

chickmug

You get the door knockers that go from hotel to hotel asking the rate. When they are told £15 they knock on the next one and say can you beat £15 and usually find they can get cheaper.

This is the problem and very common with so many owners who are poor at this side of the business and end up with extremely low room rates.

chickmug

hethmar wrote: »

Blimey, I didnt know it was £15 a night, wow, no I havent heard that sort of price in about 25 years (another southerner, pleased to have found £100 a night room b and b for a weekend in the west country in September)

Tell us where that is £100 sounds like it may be very special?

suisidevw

Isn't £100 a night relatively standard for a nice b and b?! (again, from a 'southerner'!)

hethmar

Nothing that special, as suiside says, pretty standard for a three star.(oh and two dogs free to stay with us)


Last year, son and I went to visit an elderly rellie down in somerset, thought we try to do it a bit cheaper as it would be two rooms. Found a place for £50 a night each. My god, it was a doss house. Son moved his bed and found a mouse trap under it. Luckily with no occupant at that time! LOL, in the morning as we were eating breakfast, mine host came over to speak to us - he leaned on the next table and it collapsed AND, the cutlery was all odds and sods. Oh yes, just remembered, I got locked in my room because the lock on the door dropped and the key wouldnt go in. The owner had to come up with a screw driver to release me.

pmsl, just thought, OP could rent those rooms out as dog boarding at that price! Make more money than humans, cheaper to feed, less fussy.

Radiantsoul

This is an interesting thread. I think you are going to struggle to sell for 5 times the turn over. The business is probably worth more on a bricks and mortar basis than as a going concern.

Clearly in order to sell at a decent price you need to raise your turnover. But you also need to increase your occupancy rates, whilst you are correct that the money is in food and drink your occupancy rates will give an indication of the size of this potential market. I would suggest an element of price discrimination(offering cheap rooms in advance for example).

The photos are great but a business person is likely to be more interested in the figures anyway. My guess is your occupancy rates must be about 30%(£30/night*35weeks*7days*36rooms=c£80k). The problem is you are paying fixed costs on 36 rooms but only receiving money on 11. Your goal must be to hit 65% occupancy and to increase your prices by £5 per night. That will give your a £200k turnover on rooms alone - and your £400k valuation.

In terms of selling might be worth hiring a marketing manager to grow and market the business first.

Radiantsoul

chickmug wrote: »

You get the door knockers that go from hotel to hotel asking the rate. When they are told £15 they knock on the next one and say can you beat £15 and usually find they can get cheaper.

This is the problem and very common with so many owners who are poor at this side of the business and end up with extremely low room rates.

Well it it is £15 per night or nothing then it is perhaps worth it(as there is little benefit in an empty room and a limited marginal cost). However because it is benefical to sell the cheapest room at £15 does not mean the average room should cost £15!

hethmar

Non pc here, but to be honest, OP would make a lot more offering to take in homeless people/immigrants - as so many hotels in Dover and Great Yarmouth have.