Key financials for busy B&B owners
A common theme amongst B&B owners that I’ve noticed recently is that they are not sure if they’re making any money or not. Many people who open a B&B are not business people and are running a kind of hobby business, but still I believe it’s necessary to know where you are financially, if only for your own peace of mind. After all, this business is demanding and sometimes stressful, so you wouldn’t want to be doing it for nothing, would you?
Here’s what I believe to be the key financials
- Income and expenditure statement, compared to last year. I give this template to all my mentoring clients and they usually have an eye-opening moment when they start to use it.
- Weekly bookings taken, compared to last year to know if your business is growing, stagnating or dying.
- Occupancy rates by room, to see which rooms are the most popular and where to invest any of your hard-earned cash. There’s not much point in doing a total make-over, if hardly anyone books one of your rooms.
Another reason for getting it all down on paper, is that one day, you may want to get some help from the bank for a major refurb project, and they’ll be really impressed with your grasp of the financials. It will also help you to know how many more rooms you’ll need to sell to pay the loan repayments. All very useful stuff indeed.
What do you think?