Another considering purchasing an inn thread

[Rook217]

If family will be helping with day to day operations, on site, make sure you have enough space to get away from each other!
Given you need to support so many extra people you'll need a much larger property than 10 rooms.
Have fun looking!.

One of the properties we are looking at is 10 guest rooms (one is a small villa), 2 pools, small managers house, and two restaurants. My family would only come down to help during the busy time or if we want a break. So durring the busy time we would rent a house or apartment for 4 - 6 months.
I am considering changing most of the space that is restaurants into more guestrooms and just having a lounge and breakfast area. Running a restaurant would be too much risk.
.

I am considering changing most of the space that is restaurants into more guestrooms and just having a lounge and breakfast area. Running a restaurant would be too much risk.
THAT is good thinking. The profit on booze probably beats the heck on food profits and a lot less waste. Also will take less staff & work.
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Thats what I was thinking. Booze sales should be good around the pools during the day and then sunsets on the roof.
The only problem with the bar part is getting software for bar sales that will work with the PMS. I will need to wait and see what they are currently using. Friday can't come soon enough.
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why do you need bar software that works with PMS? For such a small property get a small Inn system and then get a small POS for the restaurant like Nurol POS, the cost of having an interface is just not feasible on such a small location and even if you had the initial outlay, the cost of mantaining the interface is very expensive. In the case the someone who is staying at the Inn wants to do a "room charge", you close out the check in the POS and then transfer the amount to the guest hotel bill.
Or, much easier, you just don't do room charges from the restaurant/ bar, it is not "required" or even expected in small locations
Having installed front office systems and the POS interfaces I think I am missing the logic/need?
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You are right I probably do not need one but if the price was right it would be nice to have. (less errors and easily do itemized bills)
I assumed that being able to do room charges would be a convenience for guests and might result in more sales.

 

[gillumhouse]

If family will be helping with day to day operations, on site, make sure you have enough space to get away from each other!
Given you need to support so many extra people you'll need a much larger property than 10 rooms.
Have fun looking!.

One of the properties we are looking at is 10 guest rooms (one is a small villa), 2 pools, small managers house, and two restaurants. My family would only come down to help during the busy time or if we want a break. So durring the busy time we would rent a house or apartment for 4 - 6 months.
I am considering changing most of the space that is restaurants into more guestrooms and just having a lounge and breakfast area. Running a restaurant would be too much risk.
.

I am considering changing most of the space that is restaurants into more guestrooms and just having a lounge and breakfast area. Running a restaurant would be too much risk.
THAT is good thinking. The profit on booze probably beats the heck on food profits and a lot less waste. Also will take less staff & work.
.

Thats what I was thinking. Booze sales should be good around the pools during the day and then sunsets on the roof.
The only problem with the bar part is getting software for bar sales that will work with the PMS. I will need to wait and see what they are currently using. Friday can't come soon enough.
.

why do you need bar software that works with PMS? For such a small property get a small Inn system and then get a small POS for the restaurant like Nurol POS, the cost of having an interface is just not feasible on such a small location and even if you had the initial outlay, the cost of mantaining the interface is very expensive. In the case the someone who is staying at the Inn wants to do a "room charge", you close out the check in the POS and then transfer the amount to the guest hotel bill.
Or, much easier, you just don't do room charges from the restaurant/ bar, it is not "required" or even expected in small locations
Having installed front office systems and the POS interfaces I think I am missing the logic/need?
.

You are right I probably do not need one but if the price was right it would be nice to have. (less errors and easily do itemized bills)
I assumed that being able to do room charges would be a convenience for guests and might result in more sales.
.

I know you will not be on that scale, but the Hyatt Regency Hotels had a system back circa1971 that was (and in the days of punched cards at that!) that generated room charges, bar charges, restaurant charges etc that transmitted to cards in the computer room to create the itemized bill. If that could be done back then, there should most certainly be something today that will do all of that that. I KNOW they had it because I worked in the computer room. Got to meet Henny Youngman, Jan Murray, Flip Wilson...

 

[Rook217]

Occupancy rates are not the important thing, you can have 10% occupancy with a Revpar of $2..... which is not good, you need to look at occupancy together with ADR and most importantly REVPAR, I see Inns for sale that say they are doing 60-70% occupancy - that means nothing ...or very little unless combined with other factors .. costs for one thing. Taking on an Inn AND restaurants is a HUGE project especially with no hospitality (hotel/inn/restaurant) experience mentioned - yes of course your accounting and maintenance experience helps but with an operation of that scale that is just a little bit of it..

Great ideas agoodman.
I have been using ADR in my estimates. REVPAR is a new formula name for me since it is hotel industry specific but revenue per available room is pretty easy to figure out. It is useful when having different rates but does it matter if you were to have the same rate for all rooms?
I would think expenses are just as important as revenue since it seems like that can be the biggest reason for failure. I plan on having a breakeven point including a salary for us around 30%.
We do not plan on running restaurants and an inn there is no way we could do it. I would want to just have breakfast and maybe basic lunch onsite or box lunches for people going to the beaches. The restaurant space would be converted to breakfast/lounge area and rooms.

 

[Rook217]

Occupancy rates are not the important thing, you can have 10% occupancy with a Revpar of $2..... which is not good, you need to look at occupancy together with ADR and most importantly REVPAR, I see Inns for sale that say they are doing 60-70% occupancy - that means nothing ...or very little unless combined with other factors .. costs for one thing. Taking on an Inn AND restaurants is a HUGE project especially with no hospitality (hotel/inn/restaurant) experience mentioned - yes of course your accounting and maintenance experience helps but with an operation of that scale that is just a little bit of it..

I guess i have been using ADR and REVPAR some what incorrectly. But the most important thing is total revenue minus variable expenses minus fixed expenses.
It seems like ADR and REVPAR are not as useful when using estimated numbers. I have been using the total rate of all rooms times occupany % to get revenue estimates. Is there a better way to do future Revenue estimates?

 

[Don Draper]

Occupancy rates are not the important thing, you can have 10% occupancy with a Revpar of $2..... which is not good, you need to look at occupancy together with ADR and most importantly REVPAR, I see Inns for sale that say they are doing 60-70% occupancy - that means nothing ...or very little unless combined with other factors .. costs for one thing. Taking on an Inn AND restaurants is a HUGE project especially with no hospitality (hotel/inn/restaurant) experience mentioned - yes of course your accounting and maintenance experience helps but with an operation of that scale that is just a little bit of it..

I guess i have been using ADR and REVPAR some what incorrectly. But the most important thing is total revenue minus variable expenses minus fixed expenses.
It seems like ADR and REVPAR are not as useful when using estimated numbers. I have been using the total rate of all rooms times occupany % to get revenue estimates. Is there a better way to do future Revenue estimates?
.

You can assume a certain percentage increase for both revenues and expenses over time. This is where working with a local commercial realtor should be very helpful...they should have a knowledge of "the season" and a good formula for projecting cash flows.

 

[agoodman]

Gillum it absolultey can and is done now but the cost for an interfaced POS/PMS is probably in the starting range of 65K, before annual maintenance and interface costs.

 

[Rook217]

Gillum it absolultey can and is done now but the cost for an interfaced POS/PMS is probably in the starting range of 65K, before annual maintenance and interface costs..

Has anyone had experience with eZee Technosys Pvt they offer eZee FrontDesk and eZee Burrp (POS)? I haven't gotten a quote or anything but prices shown on non-related websites show starting prices of $300 for PMS and $600 for POS plus equipment.

 

[agoodman]

never heard of it and I installed PMS systems for years .... you know the old saying, you get what you pay for ..

 

[Rook217]

never heard of it and I installed PMS systems for years .... you know the old saying, you get what you pay for ...

I think they are a scam company or something. This is based on basic internet research and gut feeling. I don't need to worry about this for while anyways.

 

[agoodman]

Occupancy rates are not the important thing, you can have 10% occupancy with a Revpar of $2..... which is not good, you need to look at occupancy together with ADR and most importantly REVPAR, I see Inns for sale that say they are doing 60-70% occupancy - that means nothing ...or very little unless combined with other factors .. costs for one thing. Taking on an Inn AND restaurants is a HUGE project especially with no hospitality (hotel/inn/restaurant) experience mentioned - yes of course your accounting and maintenance experience helps but with an operation of that scale that is just a little bit of it..

I guess i have been using ADR and REVPAR some what incorrectly. But the most important thing is total revenue minus variable expenses minus fixed expenses.
It seems like ADR and REVPAR are not as useful when using estimated numbers. I have been using the total rate of all rooms times occupany % to get revenue estimates. Is there a better way to do future Revenue estimates?
.

Total RATE of all rooms x occupancy?? Unless you are getting rack rate on every res you will be sadly disappointed
If you have one room occupied 30 nights a month at rack the seller may tell you the the ADR is 100% whatever the rate is, however if it's only one room out of 4, 5, or 20 that number is useless

 

[Copperhead]

Rock, I have some info you may find helpful but due to privacy issues would prefer to provide via email. Please contact me off forum.

 

[toddburme]

One thing we always used to run into when buying a new venture was that who ever was in charge would want to change perfectly good stuff just to change it. Sort of like when you get a new dog in the back yard. They have to mark it. Anyways this marking costs a fair amount of $$$ and time. So it is pretty cool if you can avoid it.

 

[Morticia]

One thing we always used to run into when buying a new venture was that who ever was in charge would want to change perfectly good stuff just to change it. Sort of like when you get a new dog in the back yard. They have to mark it. Anyways this marking costs a fair amount of $$$ and time. So it is pretty cool if you can avoid it..

One thing we always used to run into when buying a new venture was that who ever was in charge would want to change perfectly good stuff just to change it. Sort of like when you get a new dog in the back yard. They have to mark it. Anyways this marking costs a fair amount of $$$ and time. So it is pretty cool if you can avoid it.

We waited a year before doing anything. Found out we didn't need to do as much as I wanted to. Saved us a fortune.

 

[Joey Camb]

I think it is a case of doing an inventry of each room with 3 colums ie fine, change when we have time/money, despirate must go now! but it is a case of think twice cut once and not changing things simply for the sake of changing them ie a cracked sink is one thing slightly ugly drapes are another. Plus it is important not to get caught up in changing the little things and loosing sight of the bigger picture.

 

[Rook217]

One thing we always used to run into when buying a new venture was that who ever was in charge would want to change perfectly good stuff just to change it. Sort of like when you get a new dog in the back yard. They have to mark it. Anyways this marking costs a fair amount of $$$ and time. So it is pretty cool if you can avoid it..

One thing we always used to run into when buying a new venture was that who ever was in charge would want to change perfectly good stuff just to change it. Sort of like when you get a new dog in the back yard. They have to mark it. Anyways this marking costs a fair amount of $$$ and time. So it is pretty cool if you can avoid it.

We waited a year before doing anything. Found out we didn't need to do as much as I wanted to. Saved us a fortune.
.

This is a good thing to mention since I am sure most people want to put their personal touch on things right away and spend alot of money on things they don't need to.
I have no need to put a personal touch on whatever we decide to do just to make it feel like mine. The only changes I plan on doing the first years is if something needs to be replaced or upgraded. On the other hand the websites of most places we have looked at could use an update.