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Inn Consulting Partners

Inn Consulting Partners - Inns For Sale - 877-957-2360

Posts Tagged ‘Innkeeping’

A Call to Action

Friday, February 5th, 2010 by Bill Oates

Since the President’s State of the Union address, we’ve heard a great deal about making financing available to small business.  The truth is, that excellent financing has been readily available all along in our domain. Community Banks (who do not lend to Bezerkistan) have money to lend, and interest rates, usually fixed for 5 years, remain at historic lows.

In addition two programs of the Small Business Administration (SBA) have been beefed up with special terms for businesses like Inns and Bed & Breakfasts. The SBA 7a Loan Guarantee Program will guarantee 95% of a bank’s loan and waive most fees. The SBA 504 Loan Program funds 85 to 90% of an Inn purchase at even lower interest rates, with a significant portion at fixed rates for 20 years.

The banks and the SBA programs are strongly oriented toward the purchase of a going concern and their focus is in the ability of the business to generate cash flow to support the debt service.

Conventional wisdom says that banks are not lending and at some level much larger than the typical Inn business, that is true. But, if the Inn is a viable business, excellent financing is available.

If you are on the cusp of action, this may be an excellent time for making a move.  There is a surfeit of owners ready to sell and local banks ready to lend.  The career you save may be your own.

Bill Oates

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Posted in Inn Financing, Inn for Sale, Seminar for Future Innkeepers, Uncategorized | No Comments »

Help for Future Innkeepers

Tuesday, December 1st, 2009 by Bill Oates

HELP FOR FUTURE INNKEEPERS

Several excellent educational opportunities are coming up in the first part of 2010 that should be of interest to serious future Innkeepers.  They are as follows:

  1. Mid Atlantic Innkeepers Trade Show & Conference January 10-13 at the Homestead in Hot Springs, VA:
  2. Inn Consulting Partners Seminar for Future Innkeepers; February 19-21, Arrowhead Inn, Durham, NC
  3. Innkeeping Conference and Trade Show, hosted by PAII, March 8-11, 2010, Austin Texas.

Each has its value. The Mid Atlantic Innkeepers Trade Show & Conference and PAII’s Innkeeping Conference and Trade Show are aimed at existing Innkeepers, but the information is applicable to future Innkeepers as well.  The trade shows are a separate and very valuable addition.  The Mid Atlantic show is much smaller, but the trade show is still excellent and the intimacy enables future Innkeepers more opportunity to network with real Innkeepers.

Both shows have a lead-in seminar for “Aspiring” (Read perspiring) Innkeepers.  While informative, they lack a real focus on providing the tools a future Innkeeper really needs.  We are prejudiced but we believe our three day seminar focused on providing the analytical tools and the personal perspective is much more valuable. (Psst.. it is also less expensive!).

We have observed a seemingly logical, but very misplaced belief that the internet, and in particular the listings of Inns for Sale, will somehow provide the insight needed to make a decision that will profoundly affect your future life.  A corollary to this is the belief that if I look at enough Inns for sale, “I will know it when I see it.”

Another danger area for future Innkeepers is the certainty that, in order for it to be mine, I have to build it from scratch, or at least renovate that Victorian monster in my home town.

Whether you are thinking about it or have made the commitment, you need to utilize the information tools that are available to you.  We suggest that one of the Innkeeper conferences, combined with our seminar will take you a long way toward making right decisions about whether to and how to.

By the way, if our February seminar is not convenient, we offer it throughout the year and all over the country.  Check it out at our website, www.innpartners.com.

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Posted in Inn Valuation, Inn for Sale, Inns Sold, Uncategorized | No Comments »

Inn Evaluations are very different from Valuations

Tuesday, September 22nd, 2009 by Bill Oates

Bill and Heide have recently traveled to several fine Inns to undertake Evaluations.  While there is only one additional letter, Evaluations are very different from Valuations of which we also do many.  A Valuation establishes a value of the Inn based on a comprehensive review of six factors affecting the worth of the property.

An Evaluation is a critique of all aspects of an Inn’s operations: marketing, staffing, housekeeping, food service, guest relations, website and web presence, grounds maintenance, and overall condition of the Inn.  It also includes suggestions for improvements as necessary and focuses especially on items to improve the bottom line.

Some Inns, especially those contemplating a transfer, should think about a Valuation.  We do believe most Inns will benefit financially and otherwise is excess of the modest cost of an Evaluation.  Most Innkeepers are too busy running their Inns to pay much attention to events and changes in the larger hospitality business.  That is our job and we bring that knowledge to an Evaluation.

If you would like more details, contact Bill at bill@innpartners.com or 802.257.2360.

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Creative Financing

Tuesday, September 8th, 2009 by Bill Oates

On July 31, 2009 Ed and Jen Dorta Duque completed a journey they began five years ago when they leased with an option to purchase the Three Mountain Inn in Jamaica, Vermont. The process was a true win-win situation. For the owners it was a relief from operations to pursue other interests and an important tax advantage.

For Ed and Jen it was an opportunity to run and eventually buy a larger Inn than an outright purchase would have allowed. An option payment gave them an exclusive right for five years to purchase the Inn.

As the five year date loomed, the economy was not cooperating. However, with compromise from both sides, a local bank and an SBA 504 loan, the deal was struck.

Three Mountain Inn is a 15 room village Inn. In addition to the rooms the Inn provides fine dining to guests and the general public. The Inn is a member of the prestigious Select Registry; Distinguished Inn of North America. AAA has bestowed a rare 4 diamond rating to the restaurant; one of only seven in Vermont.

Check out this fine Inn (and make a reservation) at www.threemountaininn.com. To learn more about lease options and/or Small Business Administration loan opportunities, contact Bill Oates at bill@innpartners.com or by phone at 802.257.2360 (toll free at 877.957.2360).

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Posted in Inn Financing, Inn for Sale, Innkeeping Trends, Inns Sold, Uncategorized | 1 Comment »

Make the unlikely happen…

Thursday, July 16th, 2009 by Bill Oates

Just two weeks ago Michael Converse and Patrick Wadsworth became the Innkeepers and operators of the Ravenwood Castle Inn in New Plymouth, Ohio.  This is an Inn in the Hocking Hills area of Ohio, a strong regional tourist destination for a wide area of mid Western population centers.  The main Inn building is an authentic 1991 Castle, with restaurant, common areas, Innkeeper quarters and 7 guest rooms.  The castle village has 8 year-round cottages and there are 7 seasonal accommodations appealing to families.

Patrick and Michael attended our “How to” seminar for future Innkeepers thinking their resources limited them to a five or six room Bed and Breakfast.
Indeed their resources were limited, and what they did have was illiquid in today’s market. However, what they had in abundance was a desire to have an Inn and the business skills and service acumen to make them successful.

What to do?

The seminar helped them to understand that a six room Inn rarely was a viable business.  They realized they needed a larger Inn.  But their resources appeared to remove them further from the reality of having an Inn.  Still, they made the trip to Brattleboro to talk to Heide and me, to make plans for some future purchase.  It just happened that Bill and Heide had a transfer client in Ohio, just about an hour from their base in Columbus.  We knew they had the ability and seemed to have the desire.

Fortunately, the owner was able to forgo any upfront payment and after a couple of meetings with Michael and Patrick, felt comfortable with them taking over the Inn.  The result?  Michael and Patrick entered into a five year lease with an option to purchase at a fixed price. The monthly payments will include a sum to be credited to the eventual purchase of the Inn.  Currently the cash flow from the business will supply the necessary cash to meet the monthly payments, but Michael will continue in his job, based in Columbus, as insurance.

We are proud of the role we played in arranging this transfer.  However, the real message for Future Innkeepers is that desire coupled with some creative thinking can make the unlikely happen.  If you have that flame in your gut, get moving. Perhaps we can also help you.

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Personalization

Thursday, May 21st, 2009 by Bill Oates

Our technology seems to accelerate the pace of change in our marketing.  While you are just about to grasp the significance of the Web 2.0; consumer generated content (Trip Advisor) Web 3.0 burst upon the scene.  Peer networking and referrals; Facebook and heavens forefend, Twitter.

Hurry up, for Web 4.0 cannot be far away.  I think I have found a hint of it in the latest buzzword: (defined as seeing the word used three times).  The word is personalization and it can have a profound impact on the products we develop for the next generation of guests.

Most of us have grasped the importance of “packaging” as an effective tool.  But our potential guests are beginning to reject the standard off-the-shelf package.  They want a unique experience built around their specific desires.

This is not about heroic efforts to fulfill outrageous demands.  It is rather putting the guest in the center of the experience.  A few well-directed inquiries in advance of arrival often goes a long way in defining that particular guest (or usually couple’s) desires.

Fortunately, Inns are well suited to provide the personalization of the guest experience.  We have the ability due to our size and interrelationships in our communities to put together unique experiences for our guests.  Personalization almost by definition requires an interactive relationship between Innkeepers and guest.

Bill Oates

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