Innkeepers teach course in B&B realities Classes: Two California women offer instruction on such topics as financing, marketing, buying equipment, decorating, plumbing and dealing with stress.

November 30, 1997|By Vincent J. Schodolski | Vincent J. Schodolski,CHICAGO TRIBUNE

Telephone Nancy Donaldson or Susan Brown to inquire about the course they teach in how to run a bed-and-breakfast and you are likely to be greeted with an ambiguous "So, you want to be an innkeeper?"

It is not that they seek to discourage. In fact, they go to great lengths to promote the joys and satisfactions of the innkeeper's life. The ambiguity is designed to instill a healthy dose of skepticism in minds that might see running a bed-and-breakfast as little more than an endless house party.

"There is a lot of romantic fantasy attached to it," said Donaldson, who opened the Old Yacht Club Inn in Santa Barbara, Calif., 17 years ago, after leaving a career as a school administrator. "Of all the people we have trained, many more have decided not to become innkeepers than have opened inns."

Four intense days

Twice a year for the past 16 years, Donaldson and Brown, with help from fellow Santa Barbara innkeepers, have run a four-day crash course that provides a mountain of information about the realities of running a B&B inn.

Whether it is information on marketing, suggestions on what kind of flatware to buy, tips on decorating, advice on advertising, a primer on plumbing, notes on how to find financing or ways to deal with the stress of the job, the course offers enough information to temper excessively romantic notions and to launch the committed into business.

"By the time they leave, they should have everything [they] need for a start-up or for buying an existing inn," said Brown, who opened the Bath Street Inn in 1981.

Throughout the years, the two have seen their labors translated into successful inns all across the country and have seen reality strike like lightning, sending some people racing for the exit.

"We had a couple who left at noon on the first day," said Brown.

"They just knew after the first morning session that it wouldn't work for them," Donaldson chimed in. "They spent the next three days on the beach."

When Donaldson and Brown began their businesses, Santa Barbara's bed-and-breakfast industry was in its infancy. In fact, the Old Yacht Club Inn was the city's first. Since then, the business here and around the country has become much more complex and sophisticated.

"We are beyond the quiet-little-place stage," said Patricia Hardy, a former innkeeper who now publishes an industry newsletter and heads the Professional Association of Innkeepers International.

However, Hardy said, there are no signs that the business has peaked. A recent survey done by PAII showed that 90 percent of guests at bed-and-breakfast inns said they would certainly return.

"People are still buying inns and renovating properties," said Hardy. "It is a stable industry."

Among the trends in the B&B business that Hardy discussed during the most recent course was a phenomenon in which inns are opened for specific markets.

Hardy noted one new inn in New Mexico that started up simply to serve people who came to the area for the excellent bird-watching. Another inn that opened its doors in Mississippi linked its business to a group giving guided tours along the Natchez Trace, the historic route running 449 miles between Natchez, Miss., and Nashville.

Another change Hardy has noted is the growing number of people operating B&Bs as sources of second incomes. "Sometimes it is a couple where the other person has a steady income," she said. "Sometimes it is an interim step until both can work the inn."

The bottom line

Much of the course deals with the bottom-line aspects of the business. Donaldson and Brown said the average start-up inn takes three to four years before reaching the break-even point.

"You have to be prepared for a period of losses," Brown said. "During the first year of operation, you will be lucky if you get half of whatever the average occupancy rates are in the area."

Inns add an average of 10 percent occupancy a year, meaning it could take up to five years before a new inn reaches the local average occupancy rates.

In addition to the initial operating costs for a new inn, there will be capital expenditures related to renovation, the purchase of furniture and other equipment as well as local, state and federal licensing fees that can add up to a great deal of money.

The costs of fixing up old properties -- the kind that most appeal to travelers looking for a quaint bed-and-breakfast -- can be considerable. Hardy said start-up costs for six-room inns are around $300,000.

Adding to these costs is the installation of equipment required to comply with the Americans With Disabilities Act. She said the law, which involves the installation of ramps, redesigned bathrooms and even elevators, covers all inns with five or more rooms.

That leads some people to consider buying an existing business.

Brown estimated operational inns in California sell for about $100,000 a room.

"That is a lot of money, but at least you avoid other start-up costs and know approximately what your income will be from the start," Brown said.

Profit margins

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