3 Steps To Turn Around A Distressed Hotel
Bricks-and-mortar have long been the go-to investment for investors that need something tangible. None of that stocks and shares and pieces of paper stuff. It’s why property has always been so favorable. But with landlord taxes set to make this type of investment even more stressful, there is a new kid on the block: investing in the hospitality sector.
And with travel becoming easier than ever, prices being the cheapest they’ve ever been and millennials opting for experiences over things, there has never been a better time to delve into this. But that’s not the only thing that’s fallen in your favor. Wither you are looking for motels for sale, hotels to buy or a guest house to snap up, there are plenty of distressed businesses that are ready for a turnaround. No. It’s not an easy feat. But there are some simple strategies to employ that will help your below-market value purchase a bargain, and see your revenues go up sooner than you believed possible.
Read on to find out more:
1. Get The Momentum Back
No hotel becomes distressed overnight. It’s almost always a slow slip into this state. Profits and culture slowly declining. That’s why you need to pump some life and momentum back in with speed. Re-energize the business and the employees by bringing in a fun culture, motivating them, praising them and looking for some quick wins to make them feel positive again. All of these will get people back on your side as you look to turn the business around, and that’s what you need.
2. Wake Up And Shake-Up
It is all too easy to start firing the team that was there when the business went south. But just because they were privy to that time does not mean it was their fault. No. It’s usually because they were not trained, led or managed effectively. You need to change this and something as simple as leading by example can make that impact. Get stuck in with a smile and show that it can be fun, treat them with respect, usher in a new era, and use their experience and local knowledge to make them feel valued as well as get clued up. Another thing you can do is layout your expectations early doors.
3. Simplicity Always Wins
One of the most overlooked reasons why a business in the hospitality sector fails is to do with the unnecessary complexities. Rate structures, marketing strategies, distribution methods, bookings – it’s all overly complex. This doesn’t just make it time-consuming or hard to manage, it impacts on the customer’s experience. Forget any early bird discounts of 10%, combined with a stay four nights pay for three offer, as well as free breakfast for weekdays for couples only. It’s too complicated and your profit margins will be drastically reduced without you realizing by how much. And if you don’t understand your pricing, how on earth is your customer? Simplicity is the secret to increasing your conversions.
It’s as simple as that.