If you’ve been working in the hospitality industry for some time, you might just feel you've got the skills and experience to launch your own business in the sector. Whether you see yourself opening a neighbourhood café, launching the next buzzy restaurant, or welcoming guests to a B&B, running a hospitality business can be very rewarding.
With the economy re-opening, now is a great time to consider starting a hospitality business yourself. You’ll be set to tap into some seriously pent-up demand; research shows that visiting cafes, restaurants and pubs are some of the activities people missed most during lockdown.
However, it’s no secret that hotel, events and food business management is hard work. So, it's important to go in with your eyes open about the challenges involved. Hospitality businesses are operating in a very different world now compared to before the pandemic. The following five tips will help you to navigate this landscape:
1. Write a business plan
A business plan is a document describing what your business is, who your customers are, how you plan to make money and what your expected costs and profits will be.
It's especially important to have a business plan in the hospitality sector, since most owners will need finance when starting up. You'll therefore need to create a credible business plan which will show the lender that you will be able to repay a loan.
It should include:
- A precise description of what you plan to do: Are you setting up a high-end restaurant? A pop-up? A budget youth hostel?
- An executive summary: This should be an explanation of what the business is and why it’s unique – be that a surf-themed burger bar or a luxury campsite for retirees.
- Background of the business and owners: Who are you, and why should you open this business? Perhaps you’re opening a craft beer pub. What makes you qualified to do this? What experience and knowledge of craft beer do you have?
- Marketing plans: Explain how you’ll promote the business. Detail your social media strategy, paid advertising in local news outlets, special promotions and the costs of any influencer marketing you may wish to invest in.
- Your offering: Put together a full list of products and services you’ll offer and what they’ll cost. If you’re opening a wine bar, you need an explanation of which wines you’ll sell, where you’ll source them from and what mark-up you’ll apply.
- Your team and resources: Who will you need to hire to make this business a success? Outline expected salaries, skills and qualifications. Websites like Glassdoor can give you an insight into average salaries for chefs, waiters and cleaners in your area.
- Financial projections: Calculate your outgoings and expected income to work out how long it will be before you can ‘break even’ and then start turning a profit.
2. Adapt to changing customer lifestyles
The pandemic has changed the way we live permanently. And that, in turn, will change how people eat, drink and travel. This means that hospitality businesses can’t just follow the same business models that worked before the pandemic. Instead, it’s about monitoring what is happening in the wider economy and thinking about how your business can meet people’s changing habits. For example:
- Work from home changes city centre dining: Hundreds of thousands of office workers will spend more time working from home after the pandemic – some academics suggest two days per week at home and three days in the office might become the norm for ‘hybrid’ working. This revolution will have a profound effect on how town centre eateries function. Businesses should expect lower lunchtime footfall. That said, with people eating at home more often, they may wish to ‘splash out’ on more exciting lunches when they come into their HQs. It's important to monitor and capitalize on these trends as they form.
- Neighbourhood restaurants: The other side of the coin is that with many more people working from home, suburban and neighbourhood restaurants could see a boom. While making your own sandwiches in the kitchen is fine at first, many professionals may begin seeking out good food and coffee near their home offices.
- The delivery revolution: While home food delivery was already very popular before the pandemic, it’s now completely ingrained in British culture. Restaurants, cafes and even pubs that can offer home delivery services that meet this demand are sure to tap into growing markets.
- Working holidays will change the hotel industry: Working from home showed millions of people that you didn’t need to be in an office to be productive. This means that many professional workers are increasingly considering various types of 'workations', where they travel somewhere different to do their jobs. B&Bs, hotels and holiday apartment businesses that can tap into this demand will benefit. By creating remote working office spaces, guaranteeing quality internet, and providing conference call rooms, you might be able to attract a new set of guests.
3. Don't scrimp on marketing and branding
While offering top quality service and products is, of course, vital to any hospitality business, branding and promotion are non-negotiables too - especially when your business is new. Working with a branding and marketing agency could be a good investment here. They’ll help you design a logo, produce marketing materials, develop your website and help you produce everything from menus to colour palettes in your rooms.
4. Get the right staff
Finding friendly, efficient and dedicated staff is invaluable when working in the hospitality industry. If your employees can give your customers the best experience, this will lead to good reviews, word of mouth recommendations and customer loyalty.
In the aftermath of the pandemic, it really is a buyer’s market for employers - many hospitality workers were laid off last year so you can expect high numbers of applications for your positions. But be quick - as competition is already heating up. The latest statistics on job ads show that postings for catering and hospitality positions have accelerated faster than other sectors since the start of the year.
5. Embrace digital
There’s no way of getting around it - digital technology is absolutely essential to modern hospitality.
At the very least, you will need to promote your products and services on social media, run a website and make sure you are registered on all popular online tools such as Google My Business, booking.com and OpenTable, among other specialist hospitality websites.
You might also save yourself time and money by investing in a variety of cutting-edge technologies:
- Chatbots: Chatbots are becoming increasingly popular on hotel and restaurant websites. They help guests book rooms and tables and make special requests without needing to call you directly and take up your time.
- Personalization: Technology allows for more personalized customer experiences. For instance, email marketing software can now automatically send out highly personalized messages. A café customer who always buys a vegan cake when visiting your location might be interested in receiving an email about a new vegan pastry you’ve decided to trial too. Modern email marketing makes it much easier to send these sorts of communications.
- Staff apps: Managing staff rotas can be very time-consuming in the hospitality business. But by investing in modern staff management technology (which can be downloaded to people’s phones), you might find it much easier to communicate with staff, rotate shifts and track how many hours everyone has worked.
While we can’t rule out any more bumps in the road, post-lockdown recovery is looking increasingly positive for the industry. Despite the uncertainty ahead, following these steps and using data, tech, and user needs to guide your decisions is a must.
About the Author
Stacey McIntosh is the editor of Sage Advice UK. He has more than 15 years of editorial, PR and social media experience, and has worked across print and online for national newspapers, magazines, PR and marketing agencies.
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