The most important standard all motel owners should understand is the Australian Consumer Law and Fair Trading Act Under Consumer laws, accommodation providers must provide service that is carried out with due care and skill and in a timely and appropriate fashion.
Motel operators should clearly outline their policies for cancellations and cooling off periods, and make sure they're in accordance with the Australian Consumer Law. In some states, motel operators are further bound to the following standards:.
As a motel owner, you must also make sure your business follows national anti-discrimination acts that protect citizens from unfair treatment because of gender, race, disability, and more. Such acts make it unlawful to show discrimination when employing staff and providing goods, services, facilities and accommodation. Make sure you're up-to-date with the most recent acts.
They include:. You can find the details of these acts on the Australian Human Rights Commission website.
Since you'll be operating a place of business where people trustingly store their possessions and stay for the night, you're publicly liable for both your guests and their property. For this reason, comprehensive insurance is hugely important for a motel business. You'll want to insure your premises and accompanying assets.
But it's also a good idea to get additional insurance to cover paying guests and their property, so you're protected should anything adverse happen. Don't forget that you're also responsible for your staff if anything should happen to them. You may want workers compensation insurance for them, as well as income protection for yourself. When you buy a motel, you may buy a leasehold title.
Motel leases generally last at least 25 to 30 years. For this length of time, you are typically considered something like the owner of the property. You'll be responsible for any OHS hazards, but the landlord usually pays for structural faults.
Everybody loves a holiday, and with a motel, you can play an important role in make it the vacation to remember for every one of your guests. But you can't do this without understanding and incorporating your rights, responsibilities and duties into your business plan.
It's worthwhile to do your research now so that you're not left behind once you enter the accommodation industry. To learn more about all the things you may need to know about running a motel business, join the Accommodation Association of Australia.
Perth Mandurah Fremantle More. Motels turn excellent profits, which is why banks are happy to finance them. Just like when you invest in shares, you become a silent partner.
The income is passive and based on your share of the ownership structure. If you decide that buying or investing in a motel is right for you, the last factor you should consider is the location.
While coastal destinations will attract the tourist flock, inland motels still have great potential for generating big returns. Whichever option you choose, the team here at Accommodation Business Brokers can help.
With an impressive motel portfolio throughout Australia, we have investment options to suit all requirements. To discuss your motel investment desires, or to advertise with us, get in touch. Whether buying or selling, fill out the form below to get in touch with one of our accommodation business brokers. Sell with us Sold Listings. About Us Meet the Team. To make a proper assessment of the financial position of the motel business you will need:.
The accounts offer an insight into how the business is being operated. Some expenses are not necessarily strictly related to the business, but rather a personal benefit or discretionary. It pays to examine the following:.
In doing this you will have a good view on how the business runs, day to day, and be alerted to matters that need further investigation. Invariably a critique of the accounts and profitability leads to an assessment of value for money. All this begs the question; how much should you as the buyer pay for what is being earned?
There are some equations to be done to determine a fair range, though it is not the scope of this article to deal with appraising motels for value. However a buyer should seek advice from professionals who work in the motel industry and whose job it is to know motel business values.
You should look at the wider market too when making deliberations on an offer working from an informed position. Lastly a key part of all motel businesses is the lease, the commercial relationship with your landlord. Ask for a copy of the lease early on if you are interested in the particular motel business.
Read the lease and understand it. The principles of respective obligations under a motel lease are that the landlord looks after the exterior and the tenant looks after the interior of the premises. Remember that your landlord will be familiar with every aspect of the lease, as this is the instrument that is used determine rent income and protect the investment in the property.
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