Three Hotel Acquisition Tips

By Mike Handelsman Group General Manager, BizBuySell.com | April 14, 2010

Buying a hotel can be a complicated process, even with previous experience owning and running an establishment. The business-for-sale marketplace is very dynamic - and each hotel is so unique - that both pros and novices alike must do extensive research and preparation before diving into a deal.

How do buyers avoid getting burned and make sure they enter into an acquisition that offers them financial and emotional peace of mind? They have the greatest chance for success by being proactive and well-versed during every step of the purchase process. With the following three tips as starting points, buyers can be sure to find out what they need to know to get well on their way to owning the hotel of their dreams.

1. Understand Your Parameters

One of the biggest mistakes people make when purchasing a business is not having a solid grasp on how it will affect their lives. It's not uncommon for hotel buyers to get so excited by the prospect of owning a new business that they rush into it without asking themselves some very important questions, such as:

Will owning this business lead to a lifestyle that makes me happy? It's no secret that owning a hotel can be a lot of work, but still, many buyers aren't aware of just how life-changing and time-consuming it can be. First-time buyers might have an unrealistic view of what a hotel owner needs to put into the business, believing the staff will be able to do most of what it takes to keep things running smoothly and profitably. Then, when they find themselves doing tasks they never thought they'd have to do, they might become disillusioned and overwhelmed, jeopardizing their health and the health of the business.

Even experienced or repeat buyers can fall into this trap, thinking that since they've already learned the ropes with one purchase, they'll be able to handle another with no problems. This is dangerous thinking, as every business is different and presents unique challenges.

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Coming up in March 2019...

Human Resources: An Era of Transition

Traditionally, the human resource department administers five key areas within a hotel operation - compliance, compensation and benefits, organizational dynamics, selection and retention, and training and development. However, HR professionals are also presently involved in culture-building activities, as well as implementing new employee on-boarding practices and engagement initiatives. As a result, HR professionals have been elevated to senior leadership status, creating value and profit within their organization. Still, they continue to face some intractable issues, including a shrinking talent pool and the need to recruit top-notch employees who are empowered to provide outstanding customer service. In order to attract top-tier talent, one option is to take advantage of recruitment opportunities offered through colleges and universities, especially if they have a hospitality major. This pool of prospective employees is likely to be better educated and more enthusiastic than walk-in hires. Also, once hired, there could be additional training and development opportunities that stem from an association with a college or university. Continuing education courses, business conferences, seminars and online instruction - all can be a valuable source of employee development opportunities. In addition to meeting recruitment demands in the present, HR professionals must also be forward-thinking, anticipating the skills that will be needed in the future to meet guest expectations. One such skill that is becoming increasingly valued is “resilience”, the ability to “go with the flow” and not become overwhelmed by the disruptive influences  of change and reinvention. In an era of transition—new technologies, expanding markets, consolidation of brands and businesses, and modifications in people's values and lifestyles - the capacity to remain flexible, nimble and resilient is a valuable skill to possess. The March Hotel Business Review will examine some of the strategies that HR professionals are employing to ensure that their hotel operations continue to thrive.