The purchase of any business including accommodation businesses is predominantly a financial decision as opposed to an emotive one. When buying a house, the decision is more likely the opposite, largely emotive rather than financial. Yes, there is a hope that the value of the property...
Read MoreSome like to have a “little flutter” now and then and others like to have a “serious punt”. Whether it be a high stakes game of poker or flipping a coin to determine who is right or wrong. Either way, it’s a gamble. One possible definition of the word ga...
Read MoreThe 2024 mid year market update is a bit like Christmas in July if you are wanting to sell an accommodation business such as a motel or caravan park. To clarify, there has been a marked increase in those contacting me enquiring on the state of the motel, caravan park and accommodation industry m...
Read MoreAs a flashback to last month’s issue, we examined that the day to day operations of every business can easily consume most of the owner or manager’s time. When trading is strong, operating costs are not an issue and are far from the forefront of the mind. However, when tra...
Read MoreThere is an old saying, with multiple versions available, that goes something like this, “if you take care of the top line, the bottom line will take care of itself”. The meaning here is that if you focus your attention on a business’ Sales Revenue, the Net Profit will aut...
Read MoreAnyone who has ever needed one, knows good quality motel managers are a commodity that are highly sort after. The value of a good manager to the performance of any motel business should never be downplayed. Business owners often choose not to operate their own motels for many differen...
Read MoreIt’s the dream of everyone to get a good night’s sleep and therefore be fresh for the new day ahead. For some its easy, not so for others. Travelling is often a time that people struggle to get a good night’s sleep. Whether it’s outside noise, thinking ab...
Read MorePeople often focus on the negative or pessimistic side of things and in this case that would be selling in a quiet market. However, let’s take a brief look at the more positive and optimistic side of things, selling in a buoyant or busy market.Markets fluctuate up and down most of the...
Read MoreWhen it’s time to sell, what is a reasonable timeframe to expect a motel to sell within? The variables that go into determining the answer are many, however price and market sentiment are two of the major contributors that play a role in how long the process may take. However, t...
Read MoreWhen considering any business acquisition there are always buying motives that are particular to each individual, with different matters and items more important to one person over another. When the most suitable motel is being considered, it will be a combination of many factors that will come t...
Read MoreIt’s that time of the year again where we take a moment to look back on how the motel and accommodation market performed throughout the course of the year. If there is one thing we can say year on year is, how quickly the year went. I guess if there is a second thing we say, it ...
Read MoreAny business survives (or thrives) when it produces a strong profit. Whether it’s a sole trading hairdresser or a listed public company such as one of the Big Four banks. The fundamentals are the same, produce a strong profit and those profits ensure the survival of that busines...
Read MoreThere is not a week that goes by that I am not asked the question, where is the best place to buy a motel? Whether it be the broader question of inland, coastal, north, south, or the more specific question of which is the best town to buy a motel? Next is, what is the best position to...
Read MoreWith the sale of any business all the assets owned by the business are transferred to the buyer at settlement. One of the most important assets of any business is the employees. At the best of times the importance of good quality employees is something that cannot be overlooked in any...
Read MoreIt was only a short fourteen months ago that I wrote about how there were many excellent buying opportunities available in the motel and accommodation sector and how the demand and the appetite from those already in the industry was very strong. At that time there were many good quality mot...
Read MoreA part of the purchase process of a motel that commences well before settlement date includes laying out a plan for the future. This may not necessarily be written down, but can be simply a consideration of the future even before signing on the bottom line. It may be a few dot points ...
Read MoreThere must be thousands of examples over the years that I have witnessed whilst waiting in a motel reception for a guest to check in or out. Examples of customers walking out happy with a smile on their face. I cannot help but think, another satisfies customer, they will be back again...
Read MoreTo quote the late Bruce Lee, martial artist, actor philosopher and filmmaker, “Empty your mind. Be formless. Shapeless. Like water. You put water into a cup, it becomes the cup. You put water into a bottle, it becomes the bottle. You put water in a teapot, it becomes...
Read MoreIf a motels average occupancy rate is sitting at 50% there is clearly upside opportunity available. Half the rooms are not being filled over the course of a year. How do we find potential guests to fill these unoccupied units? By throwing unlimited funds into advertising? Absolu...
Read MoreIt doesn’t matter what is being sold, we want to know what it is worth. After listening to the advice of others and completing one’s own research, if the correct decision to sell is going to be made, then one needs to determine for themselves what they realistically believe the ...
Read MoreWhether we a talking about a Lessee or Lessor, having a long term lease in place is generally beneficial for all involved. Long term leases provide security and surety of occupation for one, and well, the same for the other. What is a long term lease, and why in addition to the above, is i...
Read MoreWhen it comes to the operation of any business, being able to access financial data is paramount. How can a business owner know what is happening within the business if information is not available or it is unknown how to access it from the system? It may be the case where the system being...
Read MoreFlexibility in the workplace has changed over recent years and may well change again over the next couple of years. Whether the “workplace” (in general terms) tightens or loosens its stance on flexibility, either with flexible hours or a flexible location to work from, motels ha...
Read MoreWell how quickly 2022 has come and gone! As always at times everything was hustle and bustle and at other times it was quiet and everything in between! Each year we do a short but direct examination of how the motel and accommodation industry in general performed throughout the past 12 mon...
Read MoreThere are many reasons why leasehold motel tenure has been such a successful business option for thousands of everyday people for the past 35 years or more. Although around well beforehand, this business model gained much popularity and interest from those already within the industry and th...
Read MoreMany businesses across all industries have struggled with changes that they have been forced to incur over the past couple of years. Changes in the way they do business, changes with demand for their product or service, changes in dealing with their employees and changes with their clientel...
Read MoreIt seems appropriate based on the strength of the current market for this tenure of motel ownership to revisit it and consider the many reasons for the current and continued strong attraction in owning and operating a freehold motel. Not having to answer to anyone or having anyone else invo...
Read MoreWhy do investors get together to form an ownership structure such as a partnership? Why do they not just go out and do it themselves? The pooling of resources is one answer to these questions, being one of the main benefits of the partnership arrangement. These resources referred ...
Read MoreTrying to find the elusive passive investment motel that is for sale is no easy feat. So why are motels with a lease in place so popular as passive investments? Well, over 30 years ago the benefits that a motel under lease offered really started to be identified. Those in the in...
Read MoreWhen I hear the word goodwill, I think of two things, goodwill towards your fellow man and the goodwill component of a business. Both are directly related to the other. Building the goodwill of a business creates a feeling of positivity for all involved. It involves building rel...
Read MoreProfit may not be what a business is all about, but it is what it survives upon. No profit means no business. It simply cannot survive. Any business owner or operator knows what is needed to achieve a profit beyond the breakeven point. When a product or service is offered for s...
Read MoreThis has never been a phrase I have felt the need to use in the past, however as time goes on I have found that one can find themselves thinking it and it is an easy trap to fall into. It is a very common phrase that people often use simply as an excuse. A reason to talk themselves ou...
Read MoreWhether buying or selling a business of any kind, the most important matter that takes precedence over all else, is the financial data. Yes, physical presentation and everything else play a role, but the first consideration is always, how the financial data looks. Historical data is w...
Read MoreThere are always a lot of questions that need to be answered when considering buying a business. The answers are generally revealed throughout the process of looking for and finding the right business to suit one’s circumstances. The search for the right motel includes considering th...
Read MoreAnother interesting and exciting year has gone by in the blink of an eye. At the end of each year we cast our thoughts back as to how the industry performed throughout the past 12 months. Did our predictions play out as planned, or did we get it completely wrong? Again, I repeat what...
Read MoreThere have been many changes to the way motels operate over the last 20 - 30 years, particularly regarding their income sources. Looking back, the food and beverage side of a motel business was an extremely busy and lucrative side of the motel package. At night, travellers for busines...
Read MoreWhy do people keep coming back to motels? Those who have been there before very often return after some time away. There are many reasons for this and the benefits that motel ownership offer are what keep people coming back to the industry. More than ever, current and former mot...
Read MoreAs with many professions demand for people to fill positions fluctuates with how the industry is performing. A timely example, increased demand for fresh fruit and vegetables, combined with fewer overseas workers, means a higher demand for pickers and workers in the agriculture industry.&nb...
Read MoreWhenever starting something new we always kick off with such gusto and enthusiasm. Whether it is a new gym membership and we attend three times a week, eager and ready to go, until the enthusiasm drops off and that slows to two sessions, then to one, then we stop going altogether. Unl...
Read MoreAny genuine seller who has ever had a Contract of Sale collapse on them will tell you it is no fun, especially the closer to settlement it gets. Therefore, minimising the risk of a contract being terminated by the Buyer is worth seeking professional advice on and doing whatever one can to p...
Read MoreIn uncertain times people look for security. Whether that means where to park money, what to invest in or where do they want to live that will make them feel secure. Secure in their personal wellbeing or secure in their financial position. The reasons for the strong attractio...
Read MoreAs a quick look back on the previous issue, we considered that day to day operations engulf every business owner’s time. When things are good, operating costs are not an issue. However, when activity decreases, the opportunity to look closely at excessive operating costs and how...
Read MoreOften business operators get caught up in the day to day running of their business with marketing, cost minimisation and other important matters get pushed aside under the belief that one is too busy. It is common that only in tough times (such as now), that we stop for a minute and conside...
Read MoreWhat do people seeking and staying in accommodation want? How can accommodation providers give that potential guest what they want and need, to satisfy their requirements? Answering these questions forms the foundation for winning any new or existing business. Gaining the bookin...
Read MoreMotel leases can be looked at in some ways as a mix of commercial, retail and residential leases all built into one all “accommodating” document. The challenges within the accommodation industry over recent months cannot be understated, and the same goes for many other industries also...
Read MoreAt times the market is a slow moving beast, like a bus trying to complete a U turn. Other times it moves faster than Usain Bolt in the 100m sprint. Why is this? Human sentiment is ultimately the answer. But what affects human sentiment enough to change such huge things as ...
Read MoreThis topic was originally looked at in back in 2013 when comparing it against 1995, and twenty-five years on from then the fundamentals remain relevant. All the way back to 1995 I was told about the “best motel in town” that ran at an occupancy rate in excess of 90%. Being inex...
Read MoreThe sale of any business is a process. In this issue we consider a snapshot of a few parts in this process, including the initial enquiry, qualification of that enquiry and the physical property inspection. Enquiry and Qualification The initial enquiry for a motel business...
Read MoreFurther to last month’s column “What is a Long Term Lease”, this issue we look at extending existing leases. The extension of motel lease terms is such a hot topic that every week it comes up in discussion with people in the motel industry and those looking to enter. ...
Read MoreHaving been in the industry as an accommodation business broker for 25 years you experience all the ups and downs. If you think you have seen it all, to that I say “this has been a new one for me!” At the end of each year we take a look back at how things unfolded and w...
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