How to start a Bed and Breakfast Business

Thinking about running a B&B or earning money renting out a room? We’re about to put all your questions to bed.

Is being a host right for you?

If you like the idea of running a business from home, this could be a great business option for you. The Bed and Breakfast Association claims Britain’s B&Bs generate total revenue of £2bn per year and that the B&B industry is currently 28% larger than budget hotels sector. A well-run B&B can be a homely, comfortable and relaxing place for weary travellers and there’s the opportunity to make a healthy income from home. However, blurring the lines between home and business, not to mention opening your home to strangers, is a big decision and something that you should be confident about before you commit.

David Weston, chief executive of the Bed and Breakfast Association says: “You’ve got to consider if you’re the right type of person to run a B&B because you’re allowing strangers to come into your home. You also need to be someone who pays attention to detail, is house proud and keeps the place welcoming. If you’re not very neat and tidy it’s probably not a good business to get in to.”

A good host must be more than just willing to open their home, this profession is creative one, so you must enjoy cooking, building relationships with people and decorating (a good B&B is oozing with person style and character). The most important thing to consider how much you want to blur the line of your home and your B&B.

Different kinds of B&B

Detached – many Air B&B property offer a detached B&B.  No communal spaces, no making breakfast and no (or little) chat.  If you’re not a massively chatty person or you feel like opening your personal space to strangers is a step too far, this is a perfect option for you. Set up the space, arrange a company to handle change overs and run the rest remotely.

Semi-detached – If your property will lend itself to being split then you could have a B&B in your home and not have to share any of your space. Section off a bedroom, kitchen and dining area and an en-suite and you’ll get the best of both worlds. You can save some money by doing the cleaning yourself and if your guests have an issue, you’re just seconds away from helping.

Traditional B&B – Love people, can’t wait to share breakfast with your guests and hear all about their travels, then invite them in. You’ll have peace of mind knowing that your home is safe with you still there. Just be mindful of your own wellbeing, booking yourself a holiday will be vital (just make sure your website shows you booked not away).

Rules and Regulations

Although you don’t need a specific licence or qualification to open or run a B&B, there are some legal areas you’ll want to consider.

  • Registering with HMRC – for tax purposes ensure you register as self-employed within 100 days of starting to trade. Keep meticulous records of your business-related income and outgoings.
  • Insurance – consider this carefully if you’re running a home-based business. Business liability insurance can protect your home and business, as well as the people that are staying with you. Consider potential situations that you will need protection from; accidental damage, key loss, home emergency and even malicious damage.
  • Fire regulations – you’ll need to carry out a Fire Risk Assessment and may need to make some adjustments to the property as a result.
  • Food safety – if you plan to cook for your guests you will need to follow rules on food safety. Get the environmental health officer round to inspect your kitchen early in the planning process. You can do a food hygiene course, but if not, you can find most of the information you need from the Food Standards Agency.
  • Local authority planning office – Before you set any plans in stone, it’s wise to consult with your local authority planning office. You may need to for a change of use of your property if you’re planning to have more than three guest rooms, or don’t plan to live at the B&B yourself. Defiantly check this from the get-go, you don’t want to pour money into a project that your local council will never agree to.

Making your B&B a success

When planning your B&B you’ll need to be clear about your costs and potential earnings. In terms of upfront costs, make sure to consider any alterations you’ll need to make to the rooms; for example, most guests will expect an en-suite even at a cheap rate. You’ll need to account for any furniture that needs updating, especially a good quality mattress and new bedding. If renovations need to be done, or your purchasing a new property its essential that you have a clear business plan and ensure that this plan makes viable financial sense.

While you’re in the research phase of your business, check the rates of other similar or local establishments to estimate your potential earnings. Take the time to get to know your local B&B’s. Firstly, are there any? If not, this might be a red flag. This could mean that there is no demand in your area, although on the other hand maybe no competition is a plus. If there are plenty around, make sure you talk with them. Find out how busy they are, and then factor this in to your business plan. If they are struggling maybe this another warning sign.

When making your plan its vital to consider your occupancy rates, if you need guests 80% of the time just to break even, that’s a little worrying. It might be a good idea to work out how busy you need to be to get by.

Some kind of web presence and marketing is essential for a successful B&B. Some options include using Air B and B or signing up to an organisation like Visit Britain for an annual fee. A site like Visit Britain is another expense but it may well prove worth it as they provide a rating and a reputable platform for marketing your property. Invest in some professional photos of your B&B, these will pay for themselves in no time.