The hospitality sector is one that appears to be set up for success. After all, hotels are always likely to be in demand to some extent. Consequently, when mulling over businesses for sale, an accommodation-centric business is likely to come up as a viable prospect.
However, if you don't have a huge amount of experience in the industry, it can be tough to differentiate a good investment from a great one. To that end, if you're looking to find the perfect hotel as part of your next business ownership endeavour, here are three questions to ask:
As touched on, the hotels market can be increasingly competitive. This is a particularly pronounced issue if you're looking to buy in an area that traditionally caters for tourists. Consequently, asking about competition is a must before signing on the dotted line.
If there's a huge amount of rival businesses in the area, it may be tough to stay profitable regardless of your long-term plans for the hotel.
This may be relatively obvious before you first discuss things with the existing owner, but it's important to establish the precise market the hotel currently caters to. There are a raft of different types of boutique, high-end and budget hotels, so working out where yours will fit into the market is a necessity.
Once this is done, it will become much easier to learn more about the profitability of the endeavour in the long term based on the amount of customers you'll likely expect.
This question should be top of your list if you're planning on taking a hands-off approach once you become the figurehead of the hotel. Having a strong structure in place to support the business will aid its success, so asking where the existing owners have invested their time and effort in terms of personnel can offer a better overall guide of the endeavour's value.