THE IMPORTANCE OF HAVING A PRE-OPENING BUDGET BEFORE OPENING A NEW HOTEL

From conception to putting your ideas to reality and finally ribbon-cutting, the process of developing, running, and managing a hotel demands thoughtful planning and a clear vision. There is not even a single hotel success story without planning, expenses, and some blood, sweat, and tears. Our goal, of course, is to help you manage those hotel investments and expenses by investing in the right things at the right times.

A pre-opening budget, or POB, is a detailed document that reflects anticipated expenses associated with the hospitality industry. It covers everything ranging from major operational activities required to prepare for a hotel’s opening, to minor pre-opening expenses.

If you have decided to open a new hotel and make a hotel investment, it is imperative to understand beforehand, how much will it cost you and what all expenses will you have to face. Among other services, we will help you implement strategies to manage all the expenses and turn your hotel dream into a success story. 

What does a pre-opening budget include?

At IHCS, we are a team of experts in developing and managing a pre-opening budget for your hotel. Avail our services and steer yourself towards the right decisions. Here are a few things to include in your preliminary pre-opening budget.

• Hotel pre-opening expenses.
• Executive hiring and relocation expenses.
• Staff recruiting and training expenses.
• Marketing and advertising expenses.
• Regulatory expenses.
• Temporary office space and equipment expenses.

Reasons to have a pre-opening budget:

Regardless of the idea and approach of your hotel, you need to think of the process in a few distinct parts and all the components should be part of the preopening budget. This is why you should have a pre-opening budget.

A benchmark for future expansion:

Having a pre-opening budget before opening a new hotel, allow you to get a fair idea of what it costs to open and run a new location. In addition to that, it offers an excellent benchmark for the future expansion of your hotel.

A tool to measure performance:

The development and success of a hotel demand a commitment of capital by the owner if he expects a potential profit. A pre-opening budget will assist you with internal analytics and comparisons used to measure performance, to ensure a return on the investment.

Increases predictability:

A Hotel constructed with thoughtful planning, close coordination, and good budget control will have predictable costs in the future for maintenance, operation, and renovation.

What do we offer?

At IHCS, we not only assist you to develop a pre-opening budget for your hotel project but also help you critically assess and re-evaluate it against the market realities to mitigate potential cost issues. We offer you close coordination with our experts to make strategic decisions and monitor the pre-opening budget against anticipated costs. IHCS also seeks to offer ways to ensure that overruns in certain departments do not detract the hotel management from the expenditures that are critical to the future performance of your hotel.