Opening a bed and breakfast intended to receive foreign tourists is a promising investment choice. However, the accounting management of the activity is necessary to reveal the seasonal aspect of the costs and the earnings according to the number of reservations. Then finalize your business plan to remedy a lack of capital or a financial loss.
Keeping a chart of accounts means that you remain in control of the financial situation of your business
The creation of a gite and bed and breakfast to welcome holidaymakers is a promising investment choice. It constitutes an appreciable contribution of income, especially when the residence is located in the heart of a tourist site of quality. However, keeping a simplified accounting and a business plan is a prudent act. The objective is to have an accurate picture of the various cost elements for a rational management of the activity. At the same time, the accounting must take into account the seasonal nature of tourist arrivals and turnover, which must be compared with the fixed costs of the establishment. It is necessary to be sure that the project is worth the effort and investment, taking into account the amount of the projected profit. Finally, the business plan is intended to review the financial expenses required to open the B&B. It leads to a search for financing, if it turns out that there is not enough capital to start the activity.
The first step is to evaluate the investment expenses required to set up the B&B :
- The building, including the acquisition value of the property plus notary fees
- The furnishings : bedding, living room furniture, kitchen utensils, dishes, gas and electricity installations…
- Intangible assets : image and communication expenses, internet ads, business cards…
- Exceptional expenses : membership in the local tourist office, labeling fees, real estate guarantee fees…
These are fixed expenses that you will have to assume as soon as the accommodation is created and that will remain stable, whatever the evolution of tourist numbers. For example, as far as the cost of the accommodation is concerned, you will have to pay the bank loans as well as the tax deductions (housing tax, property tax…).
Once you have determined the cost of the initial investment, you will have to estimate the operating expenses related to the daily operations of the accommodation
- Water, air conditioning and lighting costs
- Food expenses for breakfast for visitors
- Depreciation expenses: repairs required to refurbish the facility