South Africa has the top tourist destinations on African soil, and that is convincing enough to make a profit out of the hospitality industry, so in today’s guide, we are going to provide our readers with the necessary information on how to start a hotel business in South Africa.
Therefore, we strongly recommend you to keep reading because the next chapters of this guide contain a discussion of how to start your hotel business.
South Africa sees a rise in the hospitality industry every year, and as tourist keeps trooping in and out of the country, there have to be enough hotels to host tourist.
So, it’s never a wrong decision to make to venture into the hotel business because it has a higher demand when it meets the standard to welcome and host guests around the world.
It’s time to start our hotel business journey in South Africa.
Table of Contents
What You Need To Start A Hotel Business In South Africa
To start preparation on commencing your hotel business plans, the following are some requirements:
1. Business Plan: your business plan is the basic foundation that determines your success and your failure, therefore building a good business plan that meets your financial capabilities is important
2. Location: your hotel location is key to your business success. Guests love a more central location, with easy access to transportation and other facilities
3. Business Registration: there’s the need to consult your local government to be briefed about zoning permits and building codes for hospitality
4. Target Market: try to understand what is making the successful hotel business players thrive high in the hospitality industry, get to know what customers want, and meet their satisfaction
5. Market Research: make intense market research by visiting successful hotel businesses around you, study what they are doing different, don’t copy what they do, try to formulate a new service out of theirs to be unique
6. Hotel Structure: think about your startup capital. After realizing your financial capability, go on to imagine the types of structure you can afford from the start.
Always think about starting small and growing big. It doesn’t take you to build a luxury hotel to be successful. Learning from your small hotel business can help you break into the luxury side of the business.
The number of rooms and its affordability are key in choosing a building structure for your hotel business.
7. Find an Architect: a good architect can give you a structured plan which is affordable but looks luxurious.
Let your architect know your financial capability to provide a building plan that you are capable of putting into existence.
8. Branding: build good branding. Your brand will sell your business whenever the word hotel pops up in mind because your brand is well known to the public with the kind of offers and services you provide
9. Staff Hiring: hire staff with good hospitality skill and knowledge to make your guests feel at home, even away from home
10. Staff Training: provide quality training for your staff, ensure that they can satisfy your guests at all costs. This is because your staff holds the key to determine whether your guests will keep coming for your services or recommend your business to friends and families
11. Pricing: strategize your pricing well. A high or low booking rate will affect business and can shut down your hotel for running at a loss and finding it difficult to manage the hotel.
It is advisable to visit other hotels that fall within the range of your service, get to know their pricing differences, and you’ll understand where to place your price to gain more customers and profit.
12. Unique Value Preparation (UVP): create a good UVP that speaks about why your prospective customers much choose your business in 10 – 20 words
13. Advertisement: draw a good advertising strategy for your hotel business, choose effective advertising platforms such as building a hotel website, social media handles, local newspaper advertising space, and many others
How Much Does It Cost To Start A Hotel Business In South Africa
The cost of establishing a hotel business differs depending on the kind of hotel structure and services you choose to offer, but the hotel business startup cost can range from R1.5 – 10M.
Is The Hotel Business Profitable In South Africa
South Africa has the top tourist destination on the African continent, attracting millions of tourists into the country annually. Therefore choosing the right location, good staffing, quality services, and good management can make your business a profitable venture.
In 2018 the revenue generated from the hotel business in South Africa was approximately R16.71 billion, and this figure is a prove of how profitable the business is, and there’s no turning back for choosing to go on the hotel business journey.
Best Places To Set Up A Hotel Business In South Africa
Below are some of the best places to set up your hotel business in South Africa:
1. Communities with tourist sites
2. In cities
3. Near business centers
4. Industrial areas
5. Near regional airports
How To Make A Hotel Business Successful In South Africa
Below are some of the factors to consider to help make your hotel business a successful venture:
1. A good UVP is required to attract customers
2. Create playspaces
3. Create an activity that involves the whole family
4. Plan for holiday programs that will keep kids entertained with their stay at your hotel
5. Include kids menu to make them feel involved in the hotel services
6. Cleanliness is vital
7. Hire helpful staff
8. Quality staff and customer relationship
9. Affordable pricing
10. The desire to serve guests to their maximum satisfaction
11. Quality and effective hotel services
Challenges In The Hotel Business In South Africa
The following are some of the challenges in the hotel business in South Africa:
1. Cost of maintenance
2. Rude guests
3. Capital intensive to establish
4. Bad hotel service
5. Wrong staffing
Benefits Of Setting Up Hotel Business In South Africa
Below are some of the benefits of setting up a hotel business in South Africa:
1. The business comes with an overwhelming profit to investors and employees
2. Job creation
3. Generates revenue for the government
4. Serves as a home when away from home
5. Improved the hospitality industry
That is the information we can provide on how to start a hotel business in South Africa.