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Through Apr. 30


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7 Day Turnaround

All Purchased Plans
Are Updated for 2017

Bed and Breakfast SWOT Analysis

 

Strengths

 

People are always going to travel, and many people do not enjoy staying in large hotels. As such, bed and breakfasts have become a staple of American travel. The gross margins for a bed and breakfast are very high, as the primary expense related to providing services is simply to charge a person's credit card and provide them with a meal. The barriers to entry for starting a new bed and breakfast are considered low given that most residential properties can be converted for this purpose. Generally, a bed and breakfast can be started for as little as $150,000 ranging to several millions of dollars depending on the type of property to be purchased. Since the advent of the internet, the occupancy rates of bed and breakfast facilities has increased given that people can place reservations on the internet. Websites like AirBnB.com have allowed owners of these facilities to increase their reach.

 

Weaknesses

 

The internet has caused occupancy rates to increase among bed and breakfast facilities, but it has also created a tremendous amount of competition as many people now rent their own apartments and homes as if they were hotel rooms. This trend is expected to continue in perpetuity given the ease in which people can generate income from their properties. The operating costs of a bed and breakfast are considered high as a full residential facility must be maintained.

 

Opportunities

 

The opportunities for a bed and breakfast are limited outside of acquiring additional properties that can be used for these purposes. Adding amenities does allow a bed and breakfast to charge more for their services. However, this works only up until a certain point. As such, most people that are looking to expand their bed and breakfast businesses usually do so by establishing additional locations.


Threats


Competitive threats are really the only main issue faced by bed and breakfast facilities. These companies have operate in the same capacity for hundreds of years, and they will continue to do so regardless of changes in the economy and technology. The demand, assuming the economy remains stable, is expected to grow at the rate of inflation.

 


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