Hotel Business Plan
Hotel Business Plan
Hotel Business Plan
Columbia College
Principles of Marketing
Management 130
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Irwin’s Inn and sister Properties
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Irwin’s Inn and sister Properties
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Irwin’s Inn and sister Properties
1.0.1 Mission
The Irwin’s Mountain Inn intends to provide a serene setting for our guests to enjoy the
much splendour of the beautiful Banff Mountains. Each guest will be treated with the
kind of attention that is reserved for family. When our guests arrive we want them to
leave their troubles at the door and step into a world of luxury and rest. As owners we
intend to see that attention to detail and service will be followed by a staff dedicated to
each guest.
The Irwin’s Mountain Inn is a beautiful a family owned and operated Banff hotel. The
Irwin’s mountain Inn is an ideal choice for accommodation in the Canadian Rockies. The
Inn offers 65 individually furnished rooms, each with its own antique theme. We are a
complete bed and breakfast Inn with a full complementary breakfast served each morning
to our guests. Irwin’s target market strategy is based on becoming a destination of choice
for tourists, and couples in the beautiful area of Banff, The great national park of Canada
who are looking for a place to relax and recharge. We will also advertise to the newly
married couple who is looking for that special get away. It will be important for us to be
visible to those potential guests who are traveling on Highway 1 around from Canada to
Banff.
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The Irwin will have an eye catching sign that will alert potential customers and drop-ins
of our existence. We will use the Yellow Pages to market our Inn, as well as a Web page
on the Internet which will focus on the features the Inn has to offer. Each room will be
displayed with its unique decor, as well the outside of the Inn showing the beautiful
gardens and views of the Banff. Attractions within 30 miles of the Inn will be displayed
with information about our shuttle service, room rates and directions. The Irwin is
confident that it will not take long to build a following that will put us at full capacity
within the next year. The Inn would like to see steady growth with an average of over
90% capacity for Year 1, with profits also growing at a rate of 20%.
Banff is 100 kilometres west of Calgary and sits in the first range of the Eastern Slope
Rocky Mountains. The landscape is rugged, consisting of towering black mountains, deep
blue and white glaciers and alpine tundra. The valley bottoms are densely carpeted with
spruce and pine trees, and fast-flowing rivers churn through their centers.
The city of Banff is relatively tiny, squeezed into a narrow mountain valley and bisected
by the Bow River. Nearly all the restaurants and businesses in town are crammed into
three blocks of Sukiyaki House Banff, which makes for a densely packed market
atmosphere. South of the Bow River is the legendary and magnificent Fairmont Banff
Springs, and the Upper Hot Springs. Several kilometres to the west of town is the Cave
and Basin National Historic Site, and to the west is the Golf Course Road, which is
flanked by verdant fairways and greens.
Lodgings are abundant in Banff. The winter season is quite busy however, so it is best to
make reservations at least a month in advance. Accommodation choices run the range
from the famous hotels and lodges to five star hotels.
For the very best in Banff living quarters, hotels has been around longer than the park or
even the town itself, and played a crucial role in the development of both. The springs are
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Irwin’s Inn and sister Properties
quite expensive and always in high demand; reservations should be made up to six
months in advance. With several restaurants and lounges, ballrooms, a spa, and many
other entertainment choices, it is possible to stay quite busy in Banff and never leave the
hotel.
Here is a variety of hotels, motels and lodges in Banff ranges from CAD $ 150 to 600 to
spend on a bed for the night; one of the downtown hotels might suit well. Lining
Sukiyaki House Banff for almost a kilometre, the hotel strip represents most upper-end
chains, as well as a host of independent local operators. Most of these hotels have rooms
in the CAD150-CAD600 price range. There are also a couple of inexpensive motels
tucked away in the woods at the very north end of town, where a room can be had for less
than CAD90 per night depends on the quality and customer service.
While harder to find than the big hotels, there are dozens of bed and breakfasts and small
lodges scattered throughout the residential districts of Banff and Canmore. These run the
gauntlet from one-bedroom units to fully appointed luxury suites. Depending on the
location and quality of service, they can either be very expensive (up to CAD300 per
night) or very reasonable (less than CAD50 per night) in the off season. Staying at a
B&B also has its advantages in that you get to personally know your hosts, who will give
you advice on the best deals and entertainment options available in town. If you find
yourself strapped for cash or cannot get a reservation in time, there are two hostels in
town. The Banff Y Mountain Lodge at the south end of the bridge over the Bow River
has 300 beds available to all manner of travellers. The Banff Alpine Center has 260 beds,
as well as an excellent restaurant and information center.
There are several government and privately-operated campgrounds in the park as well. If
you plan on staying in a campground, make sure to visit the Banff Information Center,
which is located half-way down Sukiyaki House Banff, to inquire as to the latest
campground conditions and to reserve a space.
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Irwin’s Inn and sister Properties
In this competitive hotel business atmosphere we are committed to provide high quality
bed and breakfast facility to our customers in affordable price.
Typically in this industry the consumer is someone who is not just looking for a room to
sleep in, but a facility that provides a homespun touch and a place that is unique and
offers more personalized customer service. Because each Inn is offering something
unique to the guest, customer service and quality to the facilities are at the forefront of
importance. Location is also important and those inns with a mountain or ocean view
have an advantage, but with the limited number of room at inns in the area there are
enough customers to match the supply. Irwin with other sister properties will be
competing on price and quality. Guests at Irwin are paying for more than just a room;
they are paying for an oasis away from their hectic world.
Although Irwin`s started its Bed & Breakfast business 5 years ago but we are in critical
situation because of recent recession and competitors. Marketing is critical to its success
and future profitability. The Irwin`s offers an exquisite country setting B&B, in Banff
downtown. The basic market need is a delightful B&B serving the area. The physical
structure that houses the B&B has been specially engineered to please the most
discriminating travelers.
The Irwin`s Bed & Breakfast possesses good information about the market and knows a
great deal about the common attributes of the most prized and loyal customers. The
Irwin`s Mountain Inn will leverage this information to better understand who is served,
their specific needs, and how The Irwin`s can better communicate with them.
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Irwin’s Inn and sister Properties
During the initial phases of the marketing plan development, several focus groups were
held to gain insight into a variety of B&B patrons. These focus groups provided useful
information into the decision making processes of consumers.
An additional source of dynamic market research is a feedback mechanism based on a
suggestion card system. The suggestion card has several statements that patrons are asked
to rate in terms of a given scale. There are also several open ended questions that allow
the customer to freely offer constructive criticism or praise. The Irwin will work hard to
implement reasonable suggestions in order to improve their services as well as show their
commitment to the customer that their suggestions are valued.
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Irwin’s Inn and sister Properties
The target markets are separated into five segments; "Vacationers," "Honeymooners,"
"Drop-ins," "Travellers" and, "U of C" students. The primary marketing opportunity is
selling to these accessible target market segments that focus on vacation and recreational
needs.
3.0.1 Vacationers:
The most dominant segment of the five is comprised of the Banff and surrounding area.
Calgary is 1 and half hour drive while it is an approximately a 35 minute drive for
Canmore residents. Banff seems like a different world and this is attractive for those
people who have the need to get away but do not have the time to go far.
3.0.2 Honeymooners:
Because of the beauty and location of our Inn, we will be a very attractive choice for
people looking for a honeymoon location.
3.0.3 Drop-ins:
When rooms are available we will welcome the drop-in customer who is looking for a
place to stay for the night. Our sign can be seen from highway 1 and we expect to get
quite a few drop-ins.
3.0.4 Travelers:
These people are passing through United States of America and Mexico prefers to stay in
a hotel/motel.
The University of Calgary brings a large number of students and they believe that a good
portion of their road trips will be from the university. Occasions include parent’s
weekend, orientation, parents visiting, and graduation. Lastly, the university will often set
up rooms for administrative visitors.
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The primary sales and marketing strategy for Magnolia includes these factors:
• To offer a bed and breakfast facility that will appeal to the busy professional.
• To provide unmatched customer service to our guests.
• To concentrate our marketing in the greater San Francisco Bay area.
The sales forecast table is broken down into two main revenue streams: Reservations and
Drop-ins. The sales forecast for the upcoming year is based on a 10% growth rate for
direct sales. The Irwin’s has 65 rooms to offer its guests at a rate of $125.00 per night.
We expect the rate of rooms occupied to increase as the year progresses. In spite of the
economic unpredictability we are experiencing, these projections appear attainable and
take the increasing base into consideration. Growth rates for the years 2007 and 2008 are
based on percentage increases as follows:
• Reservations: 10% growth rate per year.
• Drop-ins: 10% growth rate per year.
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12,000
Sales Monthly
10,500
9,000
7,500
Sales
Volume 6,000
4,500
3,000
1,500
-
January February March April May June July August September October November December
Months
Reservations Dropins
4.0.1 Strengths:
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4.0.2 Weaknesses:
4.0.3 Opportunities:
4.0.4 Threats:
1. Government tax policies
2. Significant over capacity in hotel industry
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3. Competitors
4. Higher safety standards
5. Educated and highly paid staff
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Vacationers
Travellers
Honeymooners
Drop-ins
U of C
6.0.1 Pricing:
The pricing scheme is based on a room rate. The rate is arrived at in terms of by its
market value.
6.0.2 Distribution:
All services will be provided at the Inn.
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Generally there are many marketing channels but we decided to select some of them to
make our plan work and practical. Personalize method of marketing and promotion of our
facilities we select direct and email marketing method.
The most successful traditional advertising will be with the Inn association. Developing
strategic alliances with the university is a non-traditional method of marketing, but it will
be quite efficient. The website will also be used in marketing activities.
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with changes in the marketing situation, thus impacting the marketing strategy and the
marketing mix.
The product revenue and profits can be plotted as a function of the life-cycle stages as
shown in the graph below:
In the introduction stage, the firm seeks to build product awareness and develop a market
for the product. The impact on the marketing mix is as follows:
• Product branding and quality level is established and intellectual property
protection such as patents and trademarks are obtained.
• Pricing may be low penetration pricing to build market share rapidly, or high
skim pricing to recover development costs.
• Distribution is selective until consumers show acceptance of the product.
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Once the sales growth slowdowns, the product enters a maturity stage. This stage is
usually longer than previous stages but the competition is higher with similar products,
with prices cuts and more sales promotions. To stay alive, companies need to increase
consumption and attract new users. Therefore, they have to innovate in the market
(repositioning the brand), modify the product and modify the marketing mix
Competition may appear. The primary objective at this point is to defend market share
while maximizing profit.
• Product features may be enhanced to differentiate the product from that of
competitors.
• Pricing may be lower because of the new competition.
• Distribution becomes more intensive and incentives may be offered to encourage
preference over competing products.
• Promotion emphasizes product differentiation.
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The Maturity Stage is, perhaps, the most common stage for all markets. It is in this stage
that competition is most intense as companies fight to maintain their market share. Here,
both marketing and finance become key activities. Marketing spend has to be monitored
carefully, since any significant moves are likely to be copied by competitors. The
Maturity Stage is the time when most profit is earned by the market as a whole.
Any expenditure on research and development is likely to be restricted to product
modification and improvement and perhaps to improve production efficiency and quality.
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Product Lifecycle Management’s objectives are to improve and accelerate time to money
and promote innovation at both the product and process levels. These results in a
noticeable improvement in market acceptance of products and the revenue they can
generate.
PLM provide solutions e.g.:
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Irwin’s Inn and sister Properties
Five years ago when Irwin started Bed & Breakfast business in Banff market there were
many hotels of customer’s choice in the market range from $75 two star facilities to $
500 with five star facilities. Irwin properties were between these facilities from 3 Star to
3.5 Star facilities with price range $100 to $175 with best service in town (That we have
adjusted from $100 - $125 according to the current market situation). But as Banff
market grows rapidly for visitors and tourists’ competitors came into the market with
entirely new style and marketing strategies. Last three years were tough in the hospitality
market in Banff but Irwin properties market share was extremely high because of its
goodwill and best customer service in town. Irwin properties market share is still better in
the market but the core problem is recent recession that hearts the hospitality business
like all other businesses in Canada and United States. Company is trying to modify its
marketing strategies to gain its market share in Banff.
The product life cycle does not entirely depend on time but some other parameters such
as management policy, company strategic decisions and market trends. These parameters
are difficult to be pinpointed and so are not included in the product life cycle as suggested
by Donald Clifford in 1965, which follows.
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be in the range of 4:1 in the beginning to 7:1 at the stage where the product
reaches maturity.
On the above mentioned parameters and elements there could be one or more factors of
these:
People are not trained sufficiently
Standard not adhered to
Communication problems
Customers needs were misunderstood
Ineffective safety programs
Cultural non acceptance
Informal decision-making
Ineffective management
The Irwin’s sets itself apart from similar competition in the following ways.
• Location: The sheer beauty of our setting is a huge plus. Nestled on a bluff with a
panoramic view of the Bow rive the Irwin is the ideal place to take in Mother
Nature. Beautiful Irwin trees and a garden area make this setting a truly
magnificent place.
• Our rooms: Each room is individually decorated with antiques that are tasteful
but comfortable. You feel as if you have stepped back in time, as luxury is present
at every turn.
• Customer service: Customer service is our number one priority. Irwin will treat
each guest as if they are family.
The start-up costs will come to $32,000 (including cash required at start-up) which will
be primarily financed by owners. The costs of improvements to the building totalled
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$32,000. Owners purchased the property 5 years ago with the intent of renovating and
opening the business.
Start-up
Requirements
Start-up Expenses
Legal $500
Stationery etc. $500
Insurance $500
Improvements to Inn $30,000
Flowers $500
Total Start-up Expenses $32,000
Start-up Assets
Cash Required $6,000
Other Current Assets $10,000
Long-term Assets $100,000
Total Assets $286,000
Because Irwin properties reached on its maturity level and our profits got stagnant at this
point and as an action plan or product repositioning we suggest following:
Renovations of all facilities with entirely new look
Add new dishes in complimentary breakfast
Raise in marketing finance 20%
More customer care
Redesign customer survey form and request to fill with prepaid post stamp
Lower room rates with best customer service
Multi-channel marketing promotion
Gifts for customers
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8.0 Controls
Mr. and Mrs. Hanani will (property owners) will handle and control all financial matters.
This marketing plan also suggests that in Irwin Mountain Inn and sister properties
management will also measure performance and profitability factors. For this purpose
management promoted Mr. John from manager to General Manager of management
systems to look after all three facilities overall and report top management. For this
purpose we suggest Five Star Hotel Management Software to cover all these areas of our
business. Hotel and front office management, internet reservations, employee’s
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performance, call accounting, budgeting and interfaces. Management can check all data
reports with graphic interface ratios from their desks any time. This software will also
measure our properties performance in the marketplace, and will evaluate the causes of
any differences between expected and actual performance.
Management will also check the operating control including ongoing performance against
the annual plan and will take corrective actions to ensure that company achieves the
sales, profits, and other goals that we set out in our annual plan.
Our strategic control is to look at whether the company’s basic strategies are well
matched to its opportunities. Marketing strategies and programs can quickly become
outdated, so that company should periodically reassess its overall approach to the market
place.
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References
Kottler, Philip, Cunningham, P., & Armstrong G. (7th Canadian ed.) Principles of
Marketing, Pearson Prentice Hall Inc. Toronto, ON
Irwin Mountain Inn (2009). Company Official Website, Retrieved June, 01, from
http://www.irwinsmountaininn.com/
Banff High County Inn (2009). Company Official Website, Retrieved June, 03, from
http://www.banffhighcountryinn.com/
Banff Red Carpet Inn (2009). Company Official Website, Retrieved June, 03, from
http://www.banffredcarpet.com/
Rundle Stone Lodge (2009). Company Official Website, Retrieved May, 29, from
http://www.rundlestone.com/
MacArthur, P.J., Crosslin, R.L., and Warren, J.R. (1994) A Strategy for Evaluating
Alternative Information System Designs for Business Process Reengineering.
International Journal of Information Management, 14 (4),pp. 237-251.
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