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Guidelines for hotel business
Guidelines for Bed and Breakfast

Guidelines to Bed & Breakfast Business and Mortgage

Due to the bad experiences many have had with the larger hotel chains, Bed & Breakfasts have become ever more popular. A bed & breakfast is a private home that has extra rooms that the owners rent out for the night, or longer, with a warm breakfast on the table in the morning. This type of lodging is for a guest that is looking for a close knit experience with good conversation and local advice for the sights. Hospitality is expected to be tiptop.

Running a Bed & Breakfast

            When deciding to open a bed & breakfast, the first thing that needs to be done is to consider what type of guests you want to attract. There are two typical types of bed & breakfasts.

The budget bed & breakfast is designed for the people traveling for pleasure or for business, and are looking for a well priced, convenient location and comfort. Some budget bed & breakfasts get referred clients by the Department of Social Security, although this is not a popular option.

The more luxurious bed & breakfasts cater to the upper crusts of travelers. Usually a good place to open this type of business is near tourist areas, such as the cities of Bath and Edinburgh, and the Lake District. These guests will expect a higher level of accommodations and experience.

Purchasing a Bed & Breakfast

            Commercial mortgages are available to purchase a bed & breakfast. With a good business plan and forecast of income, up to 70% of the value of the property may be available to borrow.

            If the bed & breakfast is meant to be run by a couple (most are), the lender will need to feel comfortable with the current financial situation of both applicants. If one of the couple will remain working outside the bed & breakfast this may help lenders to feel more compelled to approve the loan. Current expertise and past employment will play a role in the lenders decision as well. If the property is being run as a bed & breakfast from the current owners, a documentation of recent accounts will need to be seen to confirm the prospect of future profitability.

            Since a bed & breakfast is a business and a home, the condition of the house will be important to the lenders as an aspect of profitability. Homes in damaged condition will need repairs and constant upkeep. Obviously, lenders will want to prove that it is in safe living condition. Condition and maintenance costs should be included in your business plan, as well as costs to meet with current regulations.


Rules & Regulations

            Opening and running a bed & breakfast requires following current governmental regulations, like any business. Permissions must be obtained by the local authority providing proof of adequate access and parking. Then, all environmental and fire safety regulations must be met.

            The Environmental Health Department of the local authority will inspect the kitchen. The kitchen may need additions such as extractor fans, extra sinks, and refrigerators to comply with food hygiene to serve to such a large number of people.

            Since October 2006, all bed & breakfast owners have to get a complete Fire Safety Risk Assessment of their property. This may result in the need to install fire doors, fire escapes, fire extinguishers and anything else the authorities demand.



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