New Business Insights: From Home to Hotel

December 18, 2020
CambridgeEntrepreneurAcademy

New Business Insights: From Home to Hotel

In a little over a decade, Airbnb has grown from a small business in San Francisco to a 30 billion-dollar global enterprise. There are several reasons for this. First, convenience and ease of transportation have led to an increase in the number of travelers worldwide. Second, Airbnb is comparatively cheaper than staying in a hotel. Third, Airbnb offers a win-win business model benefiting travelers, starting entrepreneurs, and the company itself.

For property owners, hosting their homes provides many advantages. Those who own more than one home can earn a stable income requiring minimal effort and time. Individual home-owners can rent out their places while on vacations, business trips, family events, etc. As a result, they are getting reimbursed for the money they are spending almost in real-time. As I pay to stay somewhere else, another person is paying to stay at my place.

It’s not all rainbows and roses, though, as extreme growth has led to never-before-seen levels of competition. As such, per-night fees are fast decreasing, and some hosts are struggling to stay afloat. But it’s still a giant pie, one you can get a piece of.

Before embarking on your property-hosting business, there are a few things you should consider.

First Things First

For first-time hosts, it is best not to manage the property yourself. Instead, you should secure the services of a property management franchise. Doing so will allow you to ease your way into the business, expand your customer base, gain valuable experience in the industry, and avoid mistakes. Other tips include:

  • Study the local market. If your property is too expensive, it will not be popular among travelers. Some hosts also make the mistake of charging too low. They think that price is the only deciding factor when choosing a place to stay. That is not the case. A cheap place is many times synonymous with bad quality, lack of safety, and inconvenience.

living room of a modern apartment

  • Make sure your property is properly outfitted. A stable internet connection, a washing machine, and a TV are a must. Other electronic appliances, including coffee makers, microwaves, rice-cookers, and irons, will benefit your place as well. Remember, your guests have a choice. They also have the power of word of mouth. In the travel accommodation business, this goes a long way.
  • Verify that all utilities are functional and bills are paid. There’s nothing worse for a guest than to find out the lights don’t work or there is no water.

The Power of Good Service

Maybe your place is not the best. It could be a bit too old or in a relatively bad location. Yet, there is no excuse for it not being clean. Exceptional customer service is the biggest weapon you can have in your arsenal. Be attentive to your guests’ needs. If they send you a message, don’t wait until the next day to reply. If they ask for extra towels or a blanket, give it to them as soon as you can.

The best customer service exceeds expectations. It provides everything the customer wants plus a few added surprises. A short, hand-written thank you note leaves a lasting impression on a guest. So does an extra toothbrush, a brochure on sightseeing spots in your town, and some chocolate.

Promotion

A great place with excellent service will promote itself. But there are other things you can do. Instead of only promoting your place, you can also promote experiences. One idea is starting a Facebook or Instagram page. Another is creating a Twitter feed with dining tips for visitors or top recommendations for places of interest. You could also provide transportation services for your guests or specialized assistance.

Property hosting is an excellent business to get into. But don’t just jump into it, do it well. Make sure your place is ready for occupancy. Once you have guests, provide them with outstanding service. And never stop looking for ways to promote it better. If you do this, it will be a great business experience and maximize your chances of success.

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