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How to Build A Hotel Cheaper In Nigeria

How to build a hotel

Hotel business is profitable when you start it well. And it starts from knowing how to build a hotel that works. You need to understand what are more important if you must get it right. Especially how many rooms your small hotel need. I have outlined some of the most important steps for you to take.

One thing you must avoid when you want to build a hotel is taking advise from your friends who are not experts in hotel building. A lot of young investors do this often. They listen to what their friends, old school classmates, neighbors and beer parlor friends has to say.

It’s not every advise that’s worth the risk when you are investing millions into a project. Especially for business that may not be corrected when the mistake has been made.

Think of how to build a hotel as treating a patient who’s sick of a contagious aliment. You have to follow a particular prescription to get the right result. Also, only a trained physician should handle such sick person. The same way, when you want to build a hotel, use only qualified professionals.

For example, in building construction, their are construction engineers that specializes and understand how to build hotels. You should not use just any engineer to build a hotel.

Steps to Build A Hotel

When building a hotel, the first consideration is to know how big is your hotel market. How many hotels are already operating there? Who are their target customers? How well are they serving the market? Could you find an untapped customer segment there?

No matter what type of hotel you want to build the approach is the same. If you don’t apply the right approach your result maybe skewed. And in this article, I have laid out in a simple way how you can build a hotel from scratch.

However, the concern of most people who want to venture into hotel business is that there are too many hotels already. How true is that? Let’s have a look at some of statistics of some of the states and topmost destinations hotels in the country. I have the top five below:

  1. Lagos has 25 five star hotels and 2,500 other hotels
  2. Abuja has about 10 five star hotels and 700 plus other hotels
  3. Port Harcourt has about 5 five star hotels and over 400 other hotels
  4. Ibadan has about 3 five star hotels and over 350 other hotels
  5. Calabar has about 3 five star hotels with over 250 other hotels

You can see that Lagos has the highest, with over 25 five star hotels, and about 2,500 other hotels in the state. If you pitch that to the over 20 million population in Lagos state, then, we still have huge gap for hotel business in the state.

The same goes for the other top four destinations for hotel business. And if we review all the other states in the country you will realize that there are actually less hotels in the country than most people think. There’s still huge investment potential in hotel business.

Tips to Build A Hotel Cost-Effectively

If you intend to invest in hotel business, don’t listen to side talks. Build a hotel if you want to. The business is still very much viable, and it’s not saturated as many people think.

If you have doubt, make enquiry from the hotel licensing authority in your state to get the full picture of current number of hotels in your state. Hotels renew their license every year. The licensing board would give you an idea of functional hotels. And most of these hotels are just chalets, not full fledge hotels.

There is really not so much hotels as some people think. That’s why I broke it down for you above. In fact, most states don’t have five star or four star hotels. Even if you think others are already saturated, what of four and five star hotels.

I have carefully compiled some tips to help you build a hotel of any size in Nigeria. Let’s take them one after the other.

Package A Hotel Business Plan

To build a hotel, its most advisable to have a hotel business plan. Don’t assume you know all the details you need in the hotel or what you want to build. It may be clear in your head but not to someone else.

A hotel business plan would help you understand the right kind of hotel to build in a target location. It will identify the market, customers, demand, service expectations and estimated cost of investment.

You should not build a hotel without first packaging a proper hotel business plan. And it has to be done by a hotel consultant. A proper understanding of hotel business is required in packaging a hotel business plan that covers all the important elements of building a hotel.

Another factor that’s important in packaging a hotel business plan is funding. Finding the right investors or accessing financial institutions with investment interest in hotel and hospitality business is part of what the business plan will help to sort out. So, your hotel business plan should also be helpful in finding the money to build a hotel.

Find The Right Size Of Land

The next step in building a hotel of any type is to find the right size of land. Hotel business is a location based business, therefore, you need a land where to build a hotel. Inasmuch as the location of the land is important, the right size of land for the type of hotel you want to build is equally more important.

If possible, work on the design first before acquiring the land size to accommodate the design plan. But the only reason it’s better to acquire the land before design plan is to enable the architect design the hotel based on the shape and topography of the land.

The right land size takes into account all the elemental features of the hotel. For example, if the hotel is going to have a swimming pool, what land size should the pool take? The size of land and it’s topography can affect the design.

Another important element of the land size decision is the car park. How many cars can park inside the hotel premises? This can take considerable amount of land space, based on the number of rooms and guests expected at the hotel at any given time.

 

 

How Feasible Is The Location?

After you have found the land, don’t just start to build a hotel without assessing the viability of that location. One thing you should know about business is that any business is profitable based on two important factors. One is demand and the other is accessibility.

Ones you identify demand in any business, make sure you make it easily accessible to the target customers. And that’s where location comes in. The viability of your location is determined by the demand and accessibility.

Although, business is not a good friend of assumption, you have to conduct a proper feasibility study to ensure proper analysis of the demand and accessibility for your target customers.

That’s why some hotels locate close to airports. The idea is to target those coming into the country or the city through the airports. If you noticed, customers who use the airports are often in need of a hotel for lodging. And to build a hotel close to the airport is to make it easily accessible.

The bottom line here is for you to priorities location assessment when you want to build a hotel. Don’t ignore it. Hire a hotel consultant to conduct the assessment for you. It can cost between N500,000 to N1,500,000 for a proper location viability assessment report.

Draw A Hotel Building Plan

You can’t build a hotel without a building plan. Hotel business is built based on classification. You have to know which class of hotel you want to build before you start building.

You can read all about the different hotel ratings and classifications here: How To Start Hotel Business In Nigeria

Once you have decided the classification of hotel to build, the design drawing should be next, to put that idea into a practical design. The architect should be experienced in hotel design.

Some architects specialize on homes and office buildings. Some are good with churches and mosque design. While some are just good with bridge and monumental buildings. A hotel design architect should understand the different classes of hotel buildings.

You build a hotel based on the class of the hotel. And for each class the cost of building, amenities to be provided and decoration is what determines the cost of building. So, pick wisely and design based on your hotel class.

However, depending on the class of hotel the cost of drawing a hotel plan also differs. You can get a hotel building plan drawn for the cost of N1,500,000 to N5,000,000 within Nigeria. If you want foreign architects to be involved it might cost over N20,000,000 fondue to exchange rate disparity.

Cost of Hotel Building Materials

Cost is a very important element when you want to build a hotel. Avoid this madness in using estimates. Don’t try to surprise yourself with wrong estimates. Also, if a contractor brings you a rough estimate, just know that you are going to lose millions that should have been saved.

The right way is to get the building plan costed by an experienced engineer. Costing looks into some many factors like, the numbers of blocks required, cement quantity needed, exact number of roofing sheets, flooring cost based on thickness and mass of gravel required.

I’m giving you an insight just for you to know that estimate and costing are not the same. Costing would give you like exact number of blocks required and cost of each block. While estimate would give you an approximate number of blocks required.

Both are not the same. You should go for proper costing to get the exact idea. Moreover, you don’t need additional cost to get the cost of building a hotel. It should come together with the design plan.

Any good design should come with cost of building together. A building plan without costing is just a drawing. And probably the architect doesn’t know his job. Or you paid for a drawing and not a building plan, which can be cheap too.

Hiring A Construction Company

To build a hotel you will need a building contractor. It’s usually advisable to use an established hotel building/construction company. This kind of companies should have everything you need to build a hotel.

It also saves you cost of building. If you use different people or contractors for different aspect of the hotel, each one of them will be looking for higher profit. But when one company is doing everything the cost is lower since the markup is determined by one factor.

One major problem with hiring a qualified hotel construction company is that very few has done hotel jobs before. Some experienced ones may have done some partial hotel building jobs or just knowledgeable about furnishing.

You will need a hotel consultant to help pick a good construction company to handle your hotel. Don’t use just any contractor to build a hotel. You won’t get the best. It’s in this same light that a Mercedes mechanic should not be used to fix a Toyota vehicle.

Furnishing The Hotel

Furthermore, hotel furnishing is just as important as the design. Furnishing a hotel also follows the classification for that hotel. There are basic requirements for a two-star hotel, different from that of a three-star.

Just as it would be wrong to furnish a two-star hotel as though it’s a three-start hotel. The way you furnish your hotel is important, even as it saves cost.

However, quality is another factor in consideration. Hotel is for public use, therefore wear and tear is expected. The cost of maintenance is huge and should be an important consideration from inception.

One way to combat this issue of maintenance is by using the best quality furnishing materials. It would cost more but pays up at long run. You don’t build a hotel furniture like home furniture. Hotels are built for luxury and luxury must have class and quality.

Hiring And Training Hotel Workers

No matter how good the hotel design is, the workers are what makes it a good hotel. You should hire and train workers properly. The kind of workers you employ would depend on the class of hotel.

That would also determine the salary scale. The truth about salary is that if you want the best customer service at your hotel, pay higher salaries to attract the right kind of workers for the job.

You cannot pay low salaries and expect professionals to be employed in your hotel. That’s why I recommend that you hire based on your class of hotel. For example, the kind of workers in a two-star hotel shouldn’t be the same in a three-star hotel.

And their salary scale shouldn’t be the same either. However, when you hire, train them to fit into your hotel service culture. Every hotel has its service culture. While you train your workers on hotel business from time to time, equally train them frequently on your hotel service culture.

Plan To Launch The Hotel

We are now at the launch plan. I’m not actually explaining how to preparing to launch a hotel. I’m only pointing out that planning a hotel launch is important in hotel business. You should make it the biggest and news worthy in your city.

The strategies you adopt should be one that inspires news stories. Remember, if your hotel appears on the news it’s free advertising that would reach more potential customers for you.

That’s a big way to launch a new hotel. Although, I’m not revealing any launch strategy here, but if you hire me for your hotel launch, we would work out a perfect news worthy launch idea for your hotel.

Test Running Your Hotel Operations

This part is another strategy of launching a hotel. It’s like test driving a car. The idea is not common among hotel entrepreneurs. However, it’s my unique way to build up word of mouth publicity for a hotel launch.

It’s not cheap to do this either, but it’s a great way to attract your target customers, host them with bunch of huge discounts and freebies for a whole week or a period of time. That way you may get to fill up your hotel, test your services and get valuable feedback from actual customers.

Also, I’m not going to reveal the strategy here. It’s something that each hotel should implement with the right strategy that would work for them. I’m available to help out with the planning if you need my services.

Hotel Opening Day

The last of the tips on how to build a hotel that works is about the hotel opening day. From the day you began to build a hotel, there is a picture of the opening day on your mind. This is actually the real launch.

But I don’t recommend opening day with a test run. You should test run for a week or more depending on your launch plan. Some launch plan can last over a month period or even three months.

Whatever you do, make the opening day unique and invite journalists, hotel bloggers, food bloggers, and anyone that can help promote your hotel. Also use hotel marketplaces like hotels.ng, booking.com and others.

Conclusion

If you want to build a hotel, you may be wondering what class of hotel that doesn’t have much competition. One class of hotel that stands out in the country as having less competition is five-star and Seven-star hotels. There are very few of them in the country. In fact, Nigeria has only one seven-star hotel built around 2018 in Abuja, the countries capital.

However, whether it’s a five-star or three-star or even one-star, if you follow my guidelines here you will build a hotel that works. Even if you already have an existing hotel, you can still relaunch or re-market your hotel.

One thing hoteliers should constantly do is explore the advantage of fresh ideas to compete in the hotel space. Frequently using the services of a consultant would help turn the fortunes of your hotel around. One simple idea can make all the difference in your hotel revenue.

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Business Travel

How to Rebrand Your Hotel For Profit

Do you want to change the fortunes of your hotel in Nigeria? Is your hotel not doing profitably as you would want it to be? Are you struggling to put guests in your hotel? Maybe it’s time for you to rebrand your hotel for profit.

If your hotel is not achieving regular guest hosting of between 50 to 80 percent, your hotel will be struggling to even cover your cost. Most likely, you may have downgraded all your services in order to reduce cost and to be able to stay afloat.

But that shouldn’t be the case. For a hotel to maintain profitability it should already fill up 50 percent of its rooms. That should at least help you cover most of recurrent costs like fuel or diesel cost, staff salaries, electricity bills, generator maintenance cost, equipment repairs, fixing and replacements, transportation costs, and other miscellaneous expenses a hotel incurs daily or monthly.

Why Rebrand Your Hotel?

The power of branding is visible in every business entity, whether or not you actually set out to brand your business initially. The truth is that everything you do when you started your business is part of branding. And most businesses have actually branded their business poorly without knowing they were de-marketing their brand.

Branding is anything you do that creates impression to promote your business to your audience. If you are not doing branding consciously you might be harming your business or product. And rebranding is a change in branding to either upgrade, reposition or retarget your market.

Wikipedia defines rebranding as a marketing strategy in which a new name, term, symbol, design, concept or combination thereof is created for an established brand with the intention of developing a new, differentiated identity in the minds of consumers, investors, competitors, and other stakeholders.

However, not all rebranding requires the change of a name. You can do color rebranding or logo or design, or whatever that suits you, with the intention to impress and improve patronage. It’s important you actually set in motion the process of branding your hotel, rather than ignore or overlook it. Planning and thinking through the processes you engage in marketing your hotel will help you avoid demarketing your hotel brand.

So, how you create marketing materials, promote your hotel and serve your customers are setting the brand image of your hotel. You are either selling your hotel brand short or you are increasing your hotel brand equity.

Don’t Make Mistakes With Rebranding

If you had made mistakes with branding in the past then you really need to start rebranding your hotel now. Branding can work for you or against you. You are better off making branding work for you. And to correct the mistakes of your past branding, you should start rebranding your hotel.

First, you need to identify the main areas of your branding problems. If you don’t really know, get the services of a consultant. Although, it’s advisable to use a brand consultant throughout the process of your branding stages. Just as you can’t self medicate, don’t rebrand your hotel yourself unless you are a brand expert.

Anything you do in business just because you want to avoid spending money will eventually cost you more money. Just spend wisely and not lavishly. And plan your cost in relation to your return on investment. Understand that if you don’t invest properly in your brand marketing, you will not get the best benefits.

READ ALSO: 10 Simple Steps To Brand Your Business

Tips To Rebrand Your Hotel

Here are tips that would help you in your re-branding process. Although, I don’t advice that you embark on this without the services of a brand consultant.

For instance, without understanding what areas of your hotel rebranding would impact on your profit, don’t just spend money on rebranding. There’s difference between rebranding and renovation. You can renovate your hotel any time you chose. It may or may not impact on your profit. But if you are renovating as part of your rebranding process, it’s also different. The renovation will follow branding guidelines and will not just be the sole work of a civil engineer but with inputs and designs from a brand consultant.

These 7 points can help you Rebrand your hotel business. Once you identify areas you need major improvements, get help to rebrand it. Don’t self medicate in this kind of situation, since it’s already a problem you probably created yourself.

{1} Rebrand Your Hotel Image

This may not necessarily be the first rebranding strategy, but it’s important when you want to change the face and feel of your hotel generally. This might also be the most important when it matters the most, if getting attention of customers in your location is key to the rebranding.

This may involve change of name, lots of renovation work, repairs and services of major infrastructures of the hotel. Most especially the look and feel of your hotel brand. You need to know what customers have been complaining about your hotel. Your hotel image is important. I always recommend not just what customers could see, as in image but what they could feel, like the cool environment and steady electricity.

The main focus of rebranding your hotel image is to give customers the right perception that when they lodge with you, they will be paying a fair value for the luxury and comfort you provide them. So, when it has to do with image, don’t comprise with your hotel. People remember more what they saw with their eyes. Take that seriously in how you rebrand your hotel.

{2} Rebrand Your Hotel Services

If your hotel service is not topnotch, you are probably not competitive enough in the market. Always measure your service level based on your hotel type and customers satisfaction. If you really know what your hotel was setup to offer potential customers, it’s easier to know when you are failing in that promise or doing well at it.

Customer satisfaction shouldn’t be an empty promise. Itemize what your service promises are and publicize it in all your rooms. That would give customers an idea of what level of service they can get from you. It helps to keep their expectation within a defined level. People really like to know what they are getting and not to be allowed to operate on assumption.

And if you make a promise, let it bind on your hotel and train your staff to provide those promises excellently. Let your hotel be known for your services. That way customers will know what to talk about that you do in your hotel. That’s a good way to rebrand your hotel.

RELATED POST: How To Start Hotel Business In Nigeria For Beginners

{3} Rebrand Your Hotel Rooms

In hotel business the rooms holds all the magic. That’s where the customers make their final decision to lodge in your hotel. So, your best magic should be done in the rooms. Your can sell your hotel short or better with your rooms. If you are already in hotel business you would have known what customers are saying about your rooms firsthand.

And in the room, the bed is something else. Some hotels play the scheme of small size, queen size and king size beds. Depending on how this works for you, playing the bed game is a poor hotel marketing strategy. It means you don’t have better room deals that you have to use beds to create different packages. This kind of strategy sell your hotel short.

Hotel is luxury business and anything you do should be to give customers luxury. If the luxury is cut down the satisfaction is reduced. The rooms should be exquisite in beauty and the beds a touch of comfort. If you are not selling this kind of room and hospitality, even if you seem to be doing well because you have some monopoly of your location, some one may soon undercut your advantage.

{4} Rebrand Your Hotel Foods

Food is an important hotel service. When people come to lodge in your hotel, they don’t have a different plan of how they are going to eat. But most hotels fail their hosts when it comes to food. It’s either the food are not as tasteful and low class, or that it’s overpriced and discouraged lodgers from buying foods from you.

When rebranding a hotel, don’t miss the food. Even if your foods are selling and customers don’t mind, still rebrand the food. Its either you are adding more food options, or you are increasing the taste level. Foods are an integral part of hotel stories. If they foods are not good the customers notice.

Although, most lodgers have written off hotel foods for two reasons; for their bad taste and high prices. This areas should form major part of your food rebranding process. Don’t push your lodgers into eating outside your hotel, and then, only to return to order water from you. Push food as an integral service of your hotel and encourage customers to eat food while they are lodging in your hotel. Moreover, see food just as an extra revenue source. Don’t put all your revenue burden on the food price.

 

 

{5} Rebrand Your Hotel Bar

That also includes the bar section. You shouldn’t make drinking at your hotel a financial problem. Some hotels markup their drinks higher than regulated retail price. That’s not entirely bad but don’t overdo anything in hotel business. Anything you do gives the lodger an impression of your brand. Sometimes high price is misconstrued as extortion. You don’t want your customers thinking that you are extorting them.

Think reasonably when pricing your drinks. I once bought a bottle of red label drink from a hotel bar for N7,000. This same drink is sold in Shoprite for N3,999. I paid extra N3,000 for the same drink and end up paying that much for a knock-off version, when the original is sold at N3,999.

Although, not every hotel has a large open bar. Whatever bar you have, try to make it as reasonable as possible for your customers. I have seen guys leave their hotel to go drink in a nearby bar because the price is cheaper. If you know you target customers and how they think, try and align your prices to match their expectation.

{6} Rebrand Your Hotel for Marketing

Marketing should be at the heart of rebranding your hotel. How you get customers daily to your hotel is important. And how many channels of marketing you have is equally important. Also, you need to identify which of them are generating revenue and how much? This kind of assessment is important to how you brand your hotel.

If more customers are not walking into your hotel daily, you are actually not running a profitable hotel business. A good hotel should be having problem of over booking or being fully booked to rejecting new bookings. If you are not having that kind of problem then you are having the other kind of problem, which is not good for your bottom line.

Your marketing should focus on every area that has the potential to get you new customers daily. Imagine if you have 5 channels and each one can get you 7 new customers everyday; that’s 35 new customers daily. This excludes returning customers and walking customers, whom you may not have control over their patronage. And if you have 50 rooms hotel, you have already solved much of your problem by attracting 35 new customers everyday.

But how do you go about building your channels? You can decide to have an in-house marketing staff. That’s good but may not be effective if your hire is limited in their knowledge on hotel marketing. You can also outsource this to a third party, which is better but may not be cost effective.

Some smart hotels also use their empty rooms as a marketing strategy to attract new customers. You should explore how to turn your empty hotel rooms into a trap to get new customers.

READ ALSO: How Marketing Works For Beginners

{7} Rebrand Your Hotel For Competition

Do you know what your competitions are doing to get more customers than what you are getting? You cannot be competing with rival brands and be ignorant of what they are doing. There’s nothing wrong in businesses spying on each other. It’s what many businesses do normally, spying on their competition. And you should be doing that too.

And if you don’t know how to spy on your competitors, hire a business consultant. It’s safer you hire a consultant that’s experienced in business, branding or marketing and strategies as well. That way you have an expert who really know how best to spy on your competition. Remember, you are not spying on them for negative reasons. You are looking for what they are doing so well that could help you boost your own business.

Do you even know what’s your competitors unique selling proposition? You can learn a lot from the competition if only you know what drives their hotel business. Sometimes the secret you are looking for is in the open. Who they are, what they do and how they do it are as simple as a USP.

Conclusion

The biggest problem for hotels is unsatisfied customers. Sometimes your staff can so displease customers and put your business is grave danger. In the past that could be easily overlooked but not anymore. One displeased customer can wreck your hotel business. So, you dare not ignore your customers anymore.

The internet is another aspect of your hotel business that you should take seriously. It’s either you are working the internet to your advantage or the internet could be working against your hotel business. Even one bad customer review can take away customers from your hotel. And the customer might not even be right, but merely angry at the way he or she was treated the last time they visited your hotel.

Finally, hotel business is to provide relaxation, comfort and luxury. Stop seeing your hotel business as a rental business. It doesn’t matter how small your hotel is, don’t ever compromise or miss your purpose. Some hotels have derailed to just rental business. But hotel business is not a rental business.

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How To Start Exclusive Boutique Hotel

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Business Travel

How to Setup Boutique Hotel In Nigeria

Do you want to start your own hotel? Do you know that its lucrative to operate a boutique hotel anywhere in Nigeria? If you live in a small city for example, these cities have limited number of hotels. And most of the hotels are also low class, and are old, lacking the needed amenities that depicts luxury.

Boutique hotel provides option for startup investors to go into luxury hotel without investing huge sums of money. It’s not like people have not been investing in small ways in Hotel business, but boutique hotel provides a modern way to startup and attract the right kind of paying customers.

You can Start Your Own simple hotel now in the city of your choice. The same way you can invest in real estate properties, you can build good boutique hotels in choice locations and earn huge income than you would from flats, duplexes and condos.

Also, you can convert an existing real estate property and redesign it into a luxury hotel. Imagine a story building in a highbrow area with four flats can be converted into ten or more rooms hotel.

Boutique hotels are the new real estate trend in Nigeria. They are not only faster to build, they are also cost effective to manage. Managing a 20 rooms hotel would require less workforce. That also means less salaries, and expenditures. But that doesn’t mean boutique hotels are in the affordable hotel range.

What’s A Boutique Hotel?

A boutique Hotel is a small size hotel with stylish design décor, having a personal note, with sense of intimacy and privacy. Although, it’s usually not defined by any specific hotel category, rather a boutique hotel is defined by its characteristics.

A boutique hotel is a class of hotel with 10 or 100 rooms . And it’s the trending hotel in Nigeria now. It’s easy to finance, manage and also recoup the investment within the shortest possible time. It’s also the best form of real estate investment with high return on your investment.

Instead of building 3 bed room flats and renting them out for annual rents, one can build a boutique hotel and rent out the rooms daily with high percentage returns than flats.

Related: How to Start Hotel Business In Nigeria 

How Boutique Hotel Works

Boutique hotels are typically a small kind of hotel, and are better situated in the very heart of any city. That makes them hot spots for travelers and city crawlers. It’s a hotel that has between 10 and 100 rooms in unique settings, upscale accommodations and individualized unique selling points.

The difference between small and boutique is in the customer experience. However, it may sound like anyone can do that, but you need to follow the prescribed process and standard if you want to achieve success. There are several factors that makes a boutique hotel successful.

Successful boutique hotels are built to target high-end customers, who require some privacy and a luxuries hospitality that is usually provided by big brand five star hotels. But these customers would like the publicity of big brand hotel names.

Characteristics Of A Boutique Hotel

When building your own boutique hotel here are the key features to implement. However, using a hotel design specialist would be the ideal strategy. Although there are very few boutique hotel specialists in Nigeria. But finding one is your best investment.

  1. Size is a key factor
  2. Individuality is very important
  3. Design is the heart of its beauty
  4. Character is the style décor
  5. Location is the brand
  6. Culture is in it’s humor
  7. Service is its personality
  8. Local Foods is chic
  9. Customers are the essentials

These nine feature will define your good boutique hotels. You must focus on delivery these key characteristics in your boutique hotel. In size you must maintain that culture of minimum of 10 rooms and maximum of 100. However, a 10 to 20 rooms hotel is on the budget side.

The ideal boutique hotel is one that seeks to offer individual taste and experience. That means even from your design you are looking at rooms with varying designs, décor, color and even amenities.

 

 

Cost Of Boutique Hotel

After reading through this explosive article, the most important question would be how much would it cost to build a boutique hotel. However, the answer doesn’t really exist but we can explore options to arrive at a cost estimation.

Because, no two boutique hotels are the same, and therefore cost cannot be generalized. There several elements to look at when building a boutique hotel. Things like:

  1. Cost of land property
  2. Building or renovation cost
  3. Cost of labor in the city
  4. Cost of Government approvals
  5. And other minor or miscellaneous costs

These factors can define the actual cost of starting a hotel. And it would be wrong to give an estimated cost without personalizing these factors to your target city.

This design prototype cost between N500,000 to N1,000,000 and includes site visit, conduct space management plan, the beautiful design prototype and actual cost estimate. And the cost estimates would look into both materials and labor cost. That would give you an entire overview of all that it would cost you to build your dream hotel.

Difference Between Regular Hotel Versus Boutique Hotel

Boutique hotel is not the same with regular hotels. The main difference with regular hotel is that no two boutique hotels are alike. Unlike the traditional hotels that are usually chains, boutique hotels are usually smaller and they cannot accommodate as many people as regular hotels. And the focus of boutique hotel is to create a lot more intimacy.

However, there are three important reasons why Boutique Hotels are better.

  1. Intimate Atmosphere: Boutique hotels are built with fewer rooms to allow for a more intimate and sensual experience. The fewer rooms means fewer guests as well. And that is opportunity for the hotel to provide personal touch, thereby making guests feel special and not like just another customer on the list.
  2. Location Environment: Boutique hotels are built around push, trending or highbrow locations. It gives the hotel a high class image and branding that attracts high value customers. Even the building is in modern style and beauty.
  3. Modern Interiors And Amenities: the rooms are squally well designed interiors, and with changing designs as the owner seem fit. Also, the amenities are squally top notch. The idea is to give guests the best experience in private relaxation.

Boutique Hotel Design

Your dream of starting a hotel has to follow some predefined steps. A hotel might be made up of beautiful rooms but boutique hotels are more than rooms. First, it doesn’t even need to have a lot of rooms. Secondly, your location gives it brand image that it’s not just an ordinary hotel.

But let’s look at some of the important tips to plan, build and decorate your own boutique hotels.

Planning A Boutique Hotel

The first step in starting a boutique hotel is planning. Although having a business plan is a key part of starting any business, but for hotels is not just important, it’s too important.

It’s essential to have a proper feasibility study before setting up your boutique hotel in any city. Remember that location is one of the characteristics of boutique hotels. And don’t. do this with reservation. Get the best consultant to handle this job.

Don’t even consider cost because if you miss it in your location you have probably missed it in its entirety. If it would cost millions to get the best feasibility study done, then don’t settle for less. A feasibility study is not just a report, it’s an actual research on the viability of the business in a specific location.

Choosing The Best Location

That brings us to the issue again, which is location. There is no substitute for location when it comes to boutique hotels. It’s either you have the right location or you don’t even venture into this business.

And it’s not like finding a location is any mystery. I have already told you it’s best in highbrow areas. But that doesn’t mean there is no technicality involved as well. It’s best to allow the right people do the job of finding a suitable location for you than doing trail and error.

Choosing A Design And Construction Company

But when it comes to choosing a design and construction company, this could mar the whole dream if your selection is wrong. One of the things I always consider in hotel business is the fact that it’s luxury business.

And luxury has a feel. If that feeling is not felt in everything about your boutique hotel, you have missed the mark. Believe me, it’s marked to fail. You cannot substitute luxury. It can only be luxury to be felt as luxury.

Using an experienced hotel designer and construction company to build your hotel business cannot be overemphasized. It’s the best or nothing. You shouldn’t just use any construction engineer.

If you don’t have an idea how to find the right company to build your hotel, I have also made provision for phone contact at the end of this article in case you need help getting your hands on an experienced hotel construction company.

Top-Notch Interior Décor & Luxurious Amenities

Finishing is the art of beauty. Anything can attempt to look beautiful until its beauty is tested with time. Fake beauty fades away with time. Luxurious beauty is the brand of boutique hotels.

It must be top notch to pass off as luxury. Any designer can claim to offer luxurious finishing but looking like luxury and being luxury itself is not the same thing. Even though nothing last forever, luxury has a way of sustaining its beauty forever and with little maintenance luxury can shine forever.

Staffing And Exclusive Marketing Strategy

Culture is at the heart of boutique hotel. The people you hire to work for you and your marketing strategies can define your hotel business. Create the right hotel culture from the beginning and stick with it.

You will equally need to hire experienced staff members. Depending on your number of rooms, hire enough staff workers to reduce service time and offer personalized services to guests.

Conclusion

Now that you have decided to start your own boutique hotel, you need to know what to do and how to do it. You should never hire just any construction engineer to build your boutique hotel. The whole idea of boutique hotel is not just a beautiful design. There is the individuality, culture and character that goes into the building itself.

It’s only a qualified and experienced hotel consultant that would give you the real touch and class that is required. And all these elements can’t go without the location, décor and powerful design of boutique hotels.

Everything starts from the planning, location, design, building, decoration to management style. If it fails to follow the pattern, it may be a hotel but it’s not a boutique hotel.

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Business Travel

How to Start Hotel Business In Nigeria

Do you know that some states in Nigeria has less than 10 good hotels? There is so much money to make from hotel business in Nigeria if you know how to start one. If you want to go into hotel business or build your own dream hotel, here is a guide you can follow.

The profit potentials in hotel business is so huge. Although some hotels are struggling to get customers. That’s because customers patronize good hotels only. While the bad ones are struggling, the good hotels are turning away customers.

Imagine filling a hotel of 90 rooms everyday or most days in the week with customers. A typical good hotel can be filled most weekends beginning from Thursday until Monday morning. That’s like 4 nights out of 7 nights in a week.

If you calculate those 4 nights at a budget rate of N10,000 per night that would be N900,000 income from rooms per day. And N3,600,000 per weekend. In one month that is N14,400,000. It doesn’t include food, drinks and hall rental if you provide other hotel services. And good hotels also charge more than N10,000 per room.

How Nigerian Hotel Business Work

Hotel business is very lucrative. Hotels make money selling out their rooms for a minimum of 24 hour use. This revenue is more than what some home rentals charge in one month. Also, hotels make money through other additional services like selling foods, drinks and conference and meeting rooms.

And there are factors that affects hotel business revenue. Most of which includes, domestic trips and total nights spent away from home. Consumer index, consumer spending and inbound trips by non-residents of that city. All that can influence, increase or decrease in hotel patronage.

There are over 17,560 hotels in Nigeria. Most of which are located in cities like Lagos, Abuja and Port Harcourt. Other cities share just about less percentage of the entire hotels in the country.

Even though hotel business is lucrative, most people still fail in hotel business. The reason is not understanding the business and lack of management. You cannot expect to make good money from any business you don’t understand how it works.

Moreover, hotel business is hospitality. If you have more hospitable options more customers would come to you. You must understand that most of your customers are those living in that city, and they all have residence.

But all that won’t even make any difference if you didn’t start your own hotel business. So, you need to know how to start your own hotel business. This report is a step-by-step guide you can follow. I also provided options to connect with a reputable luxury and hospitality design and construction company to help you get the best from startup to finish.

Steps to Starting a Hotel Business

If you want to start a hotel, there are important decisions to make. It will help you decide important actions towards starting your hotel business. These considerations would determine both what kind of hotel business to start, like how many rooms, whether luxury or affordable hotels. Including the target market and choosing your profitable location.

Some of these steps to consider include:

  • Choosing your type of hotel business to start. Like, how many rooms, whether luxury or just an affordable hotel.
  • Selecting the right location to build your hotel business
  • Choosing whether to build from scratch or buy an existing hotel
  • Consulting with experts in hotel design and building to determine cost implications
  • Consulting government to understand necessary approvals and permits
  • Packaging your hotel business plan to explain your strategy, plans and financial requirements.
  • Prepare your funding plan to include reaching out to investors and banks to raise the funding required
  • Start Building or renovating your hotel
  • Hiring and training qualified hotel staff
  • Acquiring the required software systems (e.g., reservation system, accounting software, etc.) to effectively manage your hotel business.
  • Strategies to launch your pre-opening hotel marketing plan
  • And finally to open your hotel to the public

Choosing Your Hotel Business Idea

There are different types of hotels. And if you want to start a hotel business you need to understand which class of hotel is meant for your target customers. Building a hotel without knowing the class of customers that would use that hotel is a big mistake.

It will also affect your hotel design, building quality, finishing style, interior decor and management style. And since most hotel owners don’t even know this, they make mistakes from design and choosing the wrong company to build their hotel. Some even hire just any contractor to build a hotel.

Hotels are not built by just any building contractor. It’s not just a house. It’s a hotel business. You need the right designers, builders and decorators with vast hotel building experience. If you get things right this way, you will save lots of waste and get better luxury hotel for the class of customers you are targeting.

The moment you decide to build your own hotel, stop looking for cheap options. The idea of hospitality is to offer luxurious lifestyle. The reason hotels fail is because they are built with cheap products. And hotel maintenance is more important than building the hotel itself.

Cheap products requires more maintenance than high end luxurious products. And if your hotel is cheap, it also attracts the wrong kind of customers. Hotel business is for the rich and those who want to feel rich. It’s not a service to everyone.

Your customers are exclusive and they want luxury that’s the major reason they would leave their homes to sleep in hotels.

Different Classes Of Hotel Business

When starting a hotel business, it’s important you decide the class of hotel you want to build. It’s different from hotel ratings. These classifications takes several criterion. We have classifications based on locations, sizes, by service standard, ownership and affiliation.

These classification takes into account target market. While small hotels does not target elite customers, it’s ideal market is budget customers. The same way large hotels target elite customers with both semi and full luxury amenities. So, in building your hotel business, it must be based on the target market, and that is directly connected to your building budget as well.

Generally, hotels are classified and built with this general classification in mind. Your dream hotel can fall into any of this hotel business class.

Here is the general hotel business classification:

  • Commercial Hotels
  • Airport Hotels
  • Suite Hotels
  • Extended Stay Hotel
  • Bed & Breakfast Hotel
  • Residential Hotel
  • Resort Hotel
  • Casino Hotels
  • Conference Hotels
  • Convention Hotels

While Hotels that are classified on the basis of location includes:

  • Airport Hotel
  • Resort Hotel
  • Country Hotel
  • City Center Hotel, etc.

Another classification are those by sizes, which includes:

  • Small Hotel
  • Medium Hotel
  • Large Hotel
  • Major Hotel

But this class of hotels have two separate classifications based on U.K types and typical class. The U.K. Class is also what often obtain here in Nigeria. So, you can classify Nigerian hotels based on the U.K class and you will be right. But that’s not to mean that some Nigerian hotels are not in the typical class. It’s just that Nigeria doesn’t have a standard class rating of its own.

 

 

U.K. Hotel Classifications are:

  • Small Hotel: Fewer than 25 Rooms
  • Medium Hotel: Around 25 to 99 Rooms
  • Large Hotel: Around 100 to 299 Rooms
  • Major Hotel: More than 300 Rooms

While the typical hotels are classified as:

  • Small: Nor more than 150 Rooms
  • Medium: 151 to 299 Rooms
  • Large: 300 to 600 Rooms
  • Major: More than 600 Rooms

Also, we have hotels classified based on their service standard, and they are as follows:

  • World Class Service Hotel
  • Mid-Range Service Hotel
  • Economy or Limited or Budget Hotel

The last but not the least are hotels classified by ownership and Affiliation, which are just 2 major groups:

  • Independent Hotel
  • And Chain Hotel

Different Hotel Star Ratings

Although in Nigeria, most hotels are not recognized by customers by their ratings but all hotel’s fall within their rating of course. While some are internationally rated hotels like Sheraton, Protea and Western hotels, etcetera, others are either self rated or rated by online sites, which are not officially approved.

Nigeria doesn’t have any such rating body for hotels in the country. Most of what is used to rate hotels are the brand popularity and number of rooms. However, we will examine how hotels are generally rated so you can understand how to build the kind of hotel rating you want.

Hotel business is rated based on the amenities and luxury it provides. It’s different from hotel classification, where it’s based on the target market.

According to reports, the original star rating was started by Forbes magazine in the 1950s. Although, many other bodies now rates hotels in the US, but Forbes remain the number one star rating body in the US and globally too.

Below are the different ratings for hotels:

  • 1-Star Hotel
  • 2-Star Hotel
  • 3-Star Hotel
  • 4-Star Hotel
  • 5-Star Hotel

1-Star Hotel:

It’s the lowest level of hospitality, where you may not get a TV, telephone or even daily house keep services. It’s just basic rooms of a bed and table. Bathroom may likely be shared with others. There is probably no on-site facilities and it’s usually not opened 24 hours.

2-Star Hotel:

This kind of hotels don’t provide many services either, but you might get a breakfast. You will get a private bathroom with probably shower but not a bathtub. It’s just an upgrade of 1-star hotel with probably cloth racks, telephones and TVs, but don’t expect a flat screen. And the reception desk is likely to be opened 24 hours daily.

3-Star Hotel:

This one is just right in many ways. Buts it isn’t too cheap, neither too fancy. It’s the most top hotels you find in most small cities in Nigeria. It typically has a restaurant, a bar on-site, as some has butlers to take your luggage to the rooms. The idea is to make guests feel relaxed and comfortable without spending too much money. It equally has larger rooms, more comfort with more furniture.

4-Star Hotel:

This hotel rating is more relaxing than 3 star. The rooms are bigger and more beautiful, and with large beds, mini bar, including bathrobes, workstation and modern television. Plus valet parking, gym, pool, spa, etcetera. Most importantly, a 4-star hotel is extremely nice and you should be able to notice the difference from the lobby from their fancy decor.

5-Star Hotel:

The highest hotel rating is 5-star rating. Although, some still claim there is 7-star rating, but no hotel is currently rated that high. However, 5-star is the luxury hospitality of hotels. It should have all the amenities one requires in a luxury hotel and even more. Everything about 5-star hotel is luxury. It’s not actually so different than 4-star but it offers more luxury in every way.

Most exclusive 5-star hotels includes golf courses, tennis courts, health clubs with trainers and even child care services. It’s the best comfort one can find in hospitality with gigantic lobbies. A typical 5-star room has oversized bathrooms that’s lined with marble counters, large vanity laden with high-end toiletries.

Launching A New Hotel Business

Starting a hotel business requires you follow some important steps in achieving your dream. Although, if you don’t know much about hotel business, you will still need the services of a consultant to help you with the plan, design, building and furnishing your hotel.

But the main idea of this post is to help you get it right from the beginning. That’s how to make hotel business work, from the beginning. If you don’t get it right from start, you may never get it right again.

And it’s not about just building the hotel. There is a way a hotel is built for its class of target customers. It saves time and money. Don’t build a high-end hotel only to have low-end customers patronizing it. If you don’t make enough money to maintain the hotel it will close down in no time.

Step One: Determine Your Hotel Classification

Your first step is to determine what class of hotel you want to build. In order words, determine who your target customers should be. What kind of customers do you want your hotel business to serve? Once you get this right, you won’t have a problem deciding the right location for your hotel business.

If you don’t know what customer base to target, maybe you should start by consulting an expert by sharing your hotel business dreams and let him help you target the business rightly.

Step Two: Choosing the Best Location

Choosing a hotel location is like asking where can I setup my hotel that is convenient for the right kind of customers? Who your customers are would determine the location for your hotel. If they are elite customers or budget customers, it’s important you know first, before deciding on the location.

The right location would always be the right place that your target customers would find most convenient to come. If you noticed, motels are mostly built along highways. The reason is because their target customers are usually road travelers.

However, if you are going to invest tens of millions and above into your hotel business, don’t just assume the location is right for your target customers. Going into hotel business is enough risk on its own. So don’t multiply that risk by making wide guesses. Use experts to conduct feasibility study on any proposed location or to find you the right location for your target customer.

If you make mistake of a wrong location your hotel business is doomed from day one. The wise thing to do is to avoid early mistakes like this, it may not be easily corrected anytime in the future. The money you spent on feasibility study is a wise investment. So, don’t ignore it for any reason.

Step Three: Plan for Capital

It doesn’t matter whether you buy an existing hotel or start a new hotel from scratch; even if you choose to renovate a building into a hotel, everything is about money. And it can cost in the millions or billions of naira to build one. And if you don’t have the money readily available, you will need to seek bank loans or get from investors.

Step Four: Package a Business Plan

A hotel business plan is not just a document to help you get loans from the bank. It’s a simple, clear, but persuasive plan that is required throughout the building and management of your hotel business.

It should communicates the vision, mission and focus of the hotel business. And’ defines who should work in the hotel, what qualification they should possess and also their roles and daily work functions.

A good hotel business plan should also look into the staff training requirements and service manual to help it achieve a better customer service experience required of a hospitality brand.

It’s ideal to package both hotel business plan with feasibility study report together for seamless idea management. However, don’t start looking for a cheap business plan package. You need a workable plan and not cut and paste hotel business plan. And expert feasibility study report to cost more.

Step Five: Design, Build And Furnish Your Hotel

Use only the best company to plan, design, build and furnish your hotel. A hotel is more than a fine building. So much goes into the building of a hotel. Firstly, the class of hotel business is a major criteria when designing a hotel.

A builder who doesn’t understand the different class of hotels won’t get it right. And when you understand the class of hotel to build, it helps you come up with a feasible budget and save you cost from adding amenities that doesn’t belong with that classification.

Also, hotel furnishing is an important aspect of hospitality. You want customers to satisfy their fantasy which includes luxury beyond what they have and experience at home. Whether you want to build a 1-star or 5-star hotel, you need an experienced company to build your hotel.

If you are new in hotel business then you should be talking to us about designing and building your hotel. Here is what you should do now. Call or WhatsApp: 08139006120 or 07087770518.

Step Six: Offer Satisfactory Services

Whatever your offer let it be satisfactory to your target customers. One of the key benefits of knowing your customers is to be able to provide them with the best services that exceeds their expectations.

That way, even your staff are trained to know what your customers want and how to satisfy them. Sometimes, it could means being courteous, capable of resolving issues that arise promptly or even as simple as remembering the names and preferences of repeat guests and giving advice about what’s new and better for them.

Step Seven: Implement a Smart E-commerce Strategy

Most hotel rooms are sold online than through walk-in customers. A good hotel should be able to sell at least 60 percent of its room via online hotel booking portals. Apart from hosting your own booking portals, you should also list your hotels with every popular hotel marketplace online.

You should take advantage of social media platforms to promote offers and sell more hotel rooms. Your marketing strategy should be such that encourages the sales of more rooms. Even if it includes using price point to lure online customers.

Step Eight: Structure a Smart Hotel Pricing Strategy

Sometimes, a little bit higher than normal price could bring you more customers than an average price or cheaper deals. Be smart and learn smart hotel pricing strategy. It will help you increase number of rooms you sale per day.

However, you should learn to determine room rate based on your cost and market research. You may have relatively high cost than a competing hotel. Selling lower than them may be costing you good revenue.

Price factors should include the following:

  • Cost of Staffing
  • Room category and amenities
  • Average Time and length of stay
  • Cost of Maintenance
  • And your Competitors pricing

Step Nine: Make Flexible Decisions

Hotel customers are the most difficult set of customers to deal with. And that’s because they are rich or are willing to spend more for luxury and comfort. That means they are also loud and braggadocios.

They want everything, even beyond what they can afford. Sometimes you need to make decisions that is not in the hotel manual, your hotel management needs to be flexible enough to decide on every issue to improve customer satisfactory report.

Also, you should know that a single bad customer review online can destroy your hotel business than a thousands good reviews can do. So, paying close attention to what customers may say about you should help you decide faster on every customer request.

Step Ten: Differentiate And Target Repeat Customers

Customers would remember their experience more than the ambience of your hotel. Offer them better experience to help them choose your hotel against the competitors. Rather than try to do too many things, focus on significant areas of hospitality and do it much better than hotels around you.

Also, you should create the kind of products that other hotels don’t have. That way you win a significant numbers of repeat customers who would come to your hotel because you offer what’s not available elsewhere.

Step Eleven: Focus on Quality Management

Providing quality services at any hotel is not just about the value customers derive from the products. Most times it’s often the way the values are being presented. Having an inspired workforce is better than building the best looking hotel in town.

If your workforce are happy working in your hotel they would in turn express it in the way they serve those who come to the hotel. Primary because they want to continue to work here and not because they are afraid to be sacked.

Focus on employees satisfaction as much as you want customers satisfied by the employees. Factor a good pay and free times for workers into your management style. Don’t treat workers as slaves, because they will express slave mentality in their service delivery.

Step Twelve: Plan For Strategic Marketing

Don’t be the kind of hotel people would discover by chance. Be popular in your market. That’s the way to grow hotel business. If people don’t know your hotel exist they wouldn’t recommend you to anyone.

Create marketing that encourages more new customers. The more new customers you make the better your long time success strategy. Also, discover programs and events that bring more people to your city and tap into them.

It might be churches, government or organizations. Partner with them and create special price package to lure them to use your hotel for their events. Do everything to be the hotel of choice by most event organizers in your city.

Conclusion

Hotel business is location base. The first thing you must get right is your location, using your hotel classification and target customers as a yardstick to determine where to locate your hotel business. And getting your hotel location right should not be a guess job. Neither does it require a magic wand.

What you need is a professionally done feasibility study to determine the possible profitability of your hotel business in your chosen location. And if the right location meets the target customers with the right hotel classification building, your hotel business will be an instance success.

Note the three key points: location, target customer base and the right hotel classification building. These three things would require the best hotel consulting experts to handle it for you. Don’t throw away your hard earned money in ignorance and ‘over-sabi’ mentality.

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