Top 10 mistakes when opening a hotel

Mar 4 12:09 2010 Maibs Print This Article

A consultant’s intention should NEVER be to keep hotel owners and investors ‘in the dark’!  A true consultant must educate advice and provide samples of good and bad practices.  A hotel consultant must also be a good teacher – not a lecturer!  We must guide and use all channels of communication to pass on knowledge to others.  We choose to write articles in a hope that it helps and inspires others. 

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After actively participating for 18 hotel openings as a manager and hotel consultant, I am somehow surprised about the fact that most independent hotel investors unintentionally – but also intentionally - make exactly the same mistakes over and over again which always turn out to be very costly!


I am writing down these “top 10” mistakes in a hope that this list might help some developers and owners.  


As we are hotel consultants, we sincerely believe that a consultant must be the most honest, transparent, straight-forward and therefore most trustworthy person close to the owners and investors.

A consultant’s intention should NEVER be to keep hotel owners and investors ‘in the dark’!  A true consultant must educate advice and provide samples of good and bad practices.  A hotel consultant must also be a good teacher – not a lecturer!  We must guide and use all channels of communication to pass on knowledge to others.  We choose to write articles in a hope that it helps and inspires others. 


Mistake No 1 - Vision and Mission.


Honestly, it is hard to understand that so many hotels and resorts open their doors without a proper written vision and mission statement.  OR, the vision and mission is most of the times not clear at all, or only clear in the mind of the owners.  On top of that, nobody communicates the vision and mission to managers and employees.  How the employees will know what is expected and understand the ‘big picture’?  As mentioned in one of our earlier articles, this silly mistake ensures that the business ends up following the habits of senior managers and owners and not the organizational vision and mission.


Mistake No 2 - Sales and Marketing? – No need now!


“I have many friends and they are well connected.  I and my relatives are well known people who are VIP.  We will all ensure that we will have many guests using the hotel and our facilities!”


Yes, don’t be shocked! - The above sayings are what I did hear from several hotel owners.  Those VIP hotel guests did come, yes, but they never paid their bills as they almost always expected to be invited since they are good friend of the owners.  The result of non-existing Sales and Marketing is very costly.


Mistake No 3 - Hiring of Departmental Managers.


Surprisingly, some new hotels and resorts do hire their Hotel Manager and Department Head Team just weeks before the opening and strongly believe that this will be fine.  After all, they are manager, expensive and should be able to get it right in a few days…… some owners think!


To my knowledge and from my experience, this is mostly done to save some hotel pre-opening costs as the needed money has been already lost during the construction process because of bad planning and ongoing adjustments to drawings and the building.


At one occasion I have seen that the whole management team for a 150 room hotel here in Thailand to be hired just 2 weeks before the opening.  The owner kindly fired the team after 2 months as in his opinion, the team was not able to implement proper systems and service standards fast enough.  Some of the best employees did resign as well, as the pressure working without a proper pre-opening was too much.  I say it again, if you don’t work professionally, your most capable employees will leave you first!


Mistake No 4 - Purchasing.


The purchasing process for equipment, utensils and amenities is all done by the owner without any hotel manager and departmental manager comments, input and specifications.  Once the manager and departmental leaders joined the hotel for the opening, there was no budget left for any additional purchases, as most of what owners choose are to serve their own preference and style, but not functional or practical to the workers and guest use.  So, the hotel or resort did end up with equipment and utensils which are not always usable, have wrong specifications, over-specs or under-specs.

Again, the owners or senior managers never stopped wondering why professional people left the company and why the quality of products and service are not up to any standard!


Mistake No 5 - Employee Restaurant and Facilities


Strangely, employees, employee facilities and welfare seem to be the least and least important thing on owners and developers minds. I know one hotel where the owner had even meetings with the employees, right after the opening, lecturing them how good the hotel will be, explaining how professional and generous the owners are as they did buy only the best qualities and products for the guests.


He said he is not stingy and use only the best and most comfortable furniture, amenities, cars, etc.  The owner also asked staff to work harder and be more committed to have a good hotel forgetting that all employees worked 2 months without a day off!   The employees listen and wondered what he is talking about while sitting on a dusty concrete floor inside a badly ventilated and non-air conditioned concrete shell of room, eating from a Styrofoam food box with plastic cutlery and without any proper uniforms and only one rest-room for 100 employees.  I am sure I don’t have to write down here what those employees did think and even say to each other about this owner after the meeting was over.


Mistake No 6 - Training


So far I found only 3 independent hotel owners and investors who actually provided proper facilities and time to have proper staff orientations and training for employees before opening the business.

Although EVERY single hotel developer said in the beginning that they fully agree and fully understand that training is very important and that they fully understand that people need to be trained before opening the hotel, the fact is that only the true professional owners did what they say. 


Most of the time, employees did not go through any orientation program or basic training. And then, on the first day of operation the managers and owners complain the staff directly that they know nothing about the hotel, that they don’t follow hotel systems, that they don’t provide good service etc.


Mistake No 7 - Human Resource


In my humble opinion, any hotel that opening / running their property without a proper HR person, HR manual and HR systems are operationally committing suicide!!!   


I have seen businesses where the majority of staff has been hired without having a written employee benefit list, written rules and regulations, written basic systems etc.  Employees have been verbally promised different benefits by different managers etc. The result was simply a disaster!

And then, once the management started to implement some standardized benefits for each level of employees and some standard rules and regulations, the Human Resource nightmares become did become reality as many employees complained that they only joined this particular hotel because of benefits verbally promised by managers. Not everyone promised the same…..



Mistake No 8 - Back of the House Design


Seldom is this area given good attention.  In most cases, back-of –house areas have been assigned based on vacant areas. I wonder so much why proper storage, proper offices with strategic locations, proper restrooms, proper walkways etc. are almost never important to developers and owners.   It is hard, and sometimes almost impossible to explain how the hospitality industry could make money from providing a good and smooth service and for this, within a rough back-of-house workflow.   It is not only the waiter and the front office staff who provide a service!  EVERYONE in the hotel provides a service and ALL Departments and employees work somehow inter-connected.


Mistake No 9 - Back of the House areas


·         Why some people believe that that staff dormitories not need proper restrooms, showers and a common room?

·         Why some people believe that employees don’t need proper food and variety of food?

·         Why some people believe that employees will not have cars and bikes which need to be parked somewhere?

·         Why some people believe that a proper Training Room is a waste of space?

·         Why some people believe that employees don’t need comfort?



Mistake No 10 - Good managers and staff are easy to find!!!!!


Those are some nice actual sentences from owners and developers to think about:

·         Spa Therapist not need training, just hire some sexy girls and let them massage the guests.

·         My gardener at my home can make up Bed’s; please consider him as Housekeeping Manager.

·         Don’t worry about Accouting and Purchasing; I have someone who works for me since 10 years and he is very good with figures. Right now he controls all my drivers in the transportation company.

·         I found a good Human Resource Manager for our 5-star hotel.  She is the wife of the local police Chief. Nobody will dare to complain.

·         My Son will be the General Manager; he just graduated and is very knowledgeable! 

·         Just go to the local market, there are 100 of local people who would be happy to work at our hotel even below minimum wage!


Mistake No 11 - Hotel Opening Support from owners or developers other companies.


Yes, many business owners forgot to focus on some if not all of the above mentioned points and now they are very nervous and scared about the operation of the hotel.   So, they ask some family members and employees from other owned businesses which are most of the time not from the hospitality and service industry, to come and help to do the following:

·         Sales and Marketing,

·         Purchasing,

·         Finance Department,

·         Human Resources,


“I, my family and staff from the factory only like to help! You should not complaint, be happy about it!”


I am sure you noticed that I did end up with a “TOP 11” and not “TOP 10” list! Who cares! J

As a matter of fact, it should be a “TOP 100” list as there are so many areas and subjects to discuss about.




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About Article Author


© Klaus R. Rauter

Managing Director

Mai-BS (Thailand) | Hotel Consultant and Training Company

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