Planning for Your Short-Term Rental Business

Lets dive into the business planning side of your short-term rental and maybe just find some inspiration!

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The idea of planning may conjure visions of a swarm of consultants producing a shiny brochure that never goes very far. Or it may be more personal - you’ve crossed the line into seeking to have more structure across your life through goals.. Maybe you are just thinking about the year ahead and using this natural pause as we step fully into the new year to reflect on your short-term rental business and what you’ve achieved and would like to achieve.

Having had discussions with friends recently on this idea of planning, I wanted to bring this to you and your short-term rental business. See, planning is critical in our businesses - whether you own a single short-term rental, are simply interested in owning one, or own/manage several; craving out time to be strategic and set goals means that we can anticipate shifts in our market and have a framework for answering questions like - should I sell? Should I hold? What activities should I be engaging in to get the most return on my investment?

Planning is Focus in Action, Achievement in Motion

Here’s something a mentor told me many years ago, early in my career; the world is LITTERED with great ideas. And in fact, that’s more true today with access to information - it screams at us from our phones! All the things we should do/buy/implement in order to achieve “The Thing”.

Planning is a framework to contextualize our decisions and activities in order to achieve our ultimate goal(s) - not the ones marketers and social media tell us we should achieve.

While planning has long been part of my professional life - as an executive in Healthcare with a degree in Organizational Management and Leadership it was a foundational activity, I find it helpful in all aspects of my life - including planning for each STR.

So I’m going to share with you what's working for me and how I implement planning in my short-term rental business.

Knowing our Purpose is the Foundation for Every Decision

It all starts with a Vision - a vision we probably had when we acquired our property, but that may refine over time. I primarily like to purchase STR as a long-term hold for the best ROI; cash flow in the short-term and appreciation in the long term.

While it may seem like a “no brainer”, this isn’t a step to skip - write it down and spend time evaluating to ensure your purpose hasn’t - or shouldn’t, change. I have a hefty lifestyle component to my acquisition strategy; for some that's not a consideration in the least. Regardless, revisiting this routinely is important in planning for context. It may be we find our purpose has changed - maybe now’s the time to sell, based on changing market, or that our interests have shifted to grow and lean into the business or we have a tax problem and STR is a great solution.

For context, the purpose of your business ties to an overarching life plan; for me, STR offers a way to hit financial independence sooner than trading my time for money in a 9-5 job in a way that leverages my creativity and provides a business my family can participate in.

Performance Data Makes our Planning Meaningful

We can’t plan without information; and making goals without clarity about where we currently are isn’t helpful. Without data, we don’t know what we need to plan for or where we might be going. So let’s look at our performance - not just in the short term but for the duration, year-over-year, and in the context of our market.

But performance isn’t just financial - while ADR and occupancy are important, so are things like reviews - again, stepping back to assess the big picture what feedback we are getting, operational efficiency, and vendor performance even. Perhaps most importantly, are you content with how you spend your time and effort related to the business?

Possibilities

We don’t operate in a silo - there are factors in our market and in our businesses that we should consider as we evaluate our 2024 plan. Regulatory is always one to look at, market growth, changing guest expectations, evolving technology - all of these things are necessary to really consider as we assess our business and plan for the year ahead.

A Plan that Works

I’m a 90-day sprinter; I may - and do, set annual goals but the reality is those are more like intentions - my goals are attached to 90 day planning cycles because too many things change for me to feel like annual goals are achievable. That’s me; however you want to do it, the key elements are not just to plan, but to make plans that are achievable, measurable, realistic, and aligned with your purpose.

So let’s unpack that. I may have a “big” goal to increase revenue by a percentage or to increase the percentage of direct bookings I take over the year. My 90-day goals might look like quarter 1 - SEO my direct booking page, quarter 2 - Establish a more consistent social media presence driving traffic, quarter 3 might be seeking opportunities to promote my property in other ways to grow my audience and quarter 4 could be amping up messaging to existing guests to get them on my email list (or implementing something like StayFi)

The key to achieving goals is to be able to actually achieve them - with proof that we did. That means ensuring our goals ticks several boxes;

Execution: The Secret Sauce to Success

A plan without action is worthless; and frankly, often the hardest part. I personally find that having structure and rhythm are key to execution - meaning, I schedule, track, and imbed action into routines. I hold myself accountable, and provide structure to re-evaluate if a plan isn’t working. This is WHY I do 90-day planning cycles - I can catch myself if I’m not executing on par with the plan and adjust.

Usually, it’s because I didn’t chunk a goal down far enough - I’m biting off more than can be done in the time I have available. That social media strategy? Needs research, a mentor, and a plan. Research might be one month, a plan might be another which will have its own “execution” plan embedded.

The key to execution is “automating” self - having a schedule of reviewing, assessing and adjusting. My planning is annual > quarterly > monthly > weekly - with a clear path of connection from my annual intention setting to my quarterly goal setting to my monthly activities to my weekly planning session and finally, my day to day execution.

For my rental properties, I may not have activities every day but I have a routine that includes executing on specific actions I’ve committed to; some are just part of my business routines and others are specific for goal achievement.

Managing Distraction

I find the biggest challenge as an entrepreneur is distraction. I have to guard against it all the time, or I’ll bite off more than I can chew - and wind up with half starts and no finishes, like my kids cleaning their rooms and playing with the toys they unearth in the process.

Planning is a huge way I guard against distraction, but it does require a high level of awareness as well as routines which facilitate my asking myself how I’m spending my time, like my weekly reflections and forward planning.

Another way I guard against it is that I keep a running list - an “Ideas” list (I use Trello for my brain, so that’s where I keep it). So if something comes up that I think would be good to execute - I don’t jump in right away. I evaluate it in context of my current goals and commitments and assess if it really makes sense.

That new software that will solve all my problems in two hours is unlikely to actually do that - and the implementation time will be far more disruptive than I imagined. So I have to have a way to capture those ideas and keep them - because they may in fact be great, but then I have a routine whereby I evaluate ideas that might be great.

The final way I guard against distraction is I batch my time. While I don’t find following a set schedule useful - too many variables can throw that off, I have set days/weeks when I do specific functions. So every third week of the month I plan out and schedule my social media for my properties for a month.. If during the month I see something that would make a good post, unless I am doing one of my ad hoc posts, I’ll toss it on my Trello Board for when I’m doing my social media content.

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I can’t possibility give you my full planning process here, but hopefully this is enough to inspire you to consider your own! I have not always been successful, but with trial and error I finally landed on a process that works for me - I wish you joy in identifying your own, and tweaking it if you are already there!

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Looking for Inspiration? I’ve got some great ideas for Goals for your Short-term Rental business!

Reduce Operational Costs by 5%

Negotiate with vendors for better rates: Leverage your business volume to secure more favorable terms with suppliers.
Invest in energy-efficient appliances: Reduce long-term utility costs by upgrading to energy-efficient models.
Regularly review service subscriptions: Ensure you're not paying for services you don't need or could get cheaper elsewhere.

Increase Revenue by 10%

Implement dynamic pricing models: Use software to adjust prices based on demand, season, and local events.
Explore upselling opportunities: Offer additional services like airport transfers, local tours, or premium amenities.
Engage past guests with special offers: Encourage repeat bookings with discounts or special packages.
Consider adding third-party damage insurance like Waivo - you can add an upcharge on the fee charged to guests at the same time you - and the guest, get peace of mind with the best damage insurance in the case of damage - at a lower price with higher coverage that the platforms. You can learn more about what I do HERE.

Decrease my hours spent on my business to less than 3 hours a week/average

Do a time study - we need data to actually know what we might change!
Streamline communication with guests: Use templates and FAQs to reduce time spent on inquiries.
Outsource guest communication: Consider a virtual assistant or a guest communication service.
Regularly review and refine processes: Keep looking for efficiency gains in all aspects of your operations.

Increase my percentage of direct bookings

Leverage guest reviews: Encourage guests to share their experiences on your direct booking platform.
Offer a loyalty program: Reward repeat guests to encourage direct bookings.
Improve your website's SEO: Ensure your site ranks well in search engines for relevant keywords.

Get my conversion rate up to 1.5%

A/B test your listings: Experiment with different descriptions, titles, and photos to see what performs best.
Enhance guest experience: Offer amenities that stand out in your market and promote them well
Collect and analyze guest feedback: Use insights to continuously improve your offering.
Invest in learning more about how to effectively market your property - The CEO Host’s Optimizer Course may be just the ticket for you!

Have a robust email list

Offer valuable content: Provide travel tips, local guides, or exclusive deals to encourage sign-ups.
Use social media to grow your list: Run campaigns on social platforms to capture email addresses.
Partner with local businesses: Exchange promotional efforts to tap into each other’s customer base.
Build out a CRM (customer relationship management system) for managing your email list

Be Tax Ready - Without Stress, for Next Year

Implement a digital record-keeping system: Use accounting software to organize receipts and track expenses throughout the year.
Schedule quarterly tax reviews: Regularly check in with a tax professional to stay on track and avoid surprises
Educate yourself on relevant tax deductions: Stay informed about tax breaks specific to STR businesses to maximize savings - grab my related blog HERE

Hire the kids into your business (Learn more HERE)

Personal Development

Attend Industry Conferences or Webinars: Stay updated with the latest trends and network with peers.
Invest in a Mentor or Coach: Gain insights and guidance specific to growing your STR business - check out my Concierge Coaching Program and Lets Chat!
Read Industry-Related Books: Continuously educate yourself about hospitality, marketing, and real estate investment (looking for inspiration? I’ve got a whole page of “Mentors from Afar” - books, podcasts, people to lean into)

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Looking for some help? I offer 20 minute calls - no strings, to help you answer your trickiest questions. Some folks go on to work with me - sure (hey, I have to make a living) but some folks just need 20 minutes and I'm happy to connect and learn from you, with you, and help you too. Book a time HERE.

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Hey Boss! I'm Kate, owner/founder of The CEO Host. If you are interested in taking a leap into short-term rentals - or have some questions about your existing business, my goal - passion, and career, is to help YOU succeed. I've coached hundreds of folks getting started or looking to optimize, analyzed more deals (and duds) than I could count, completed thousands of hours of education and training, attended conferences... So don't be shy. A good CEO knows to bring in expert help - and that's what I'm here for! Lets HOP ON A CALL and chat!

Read Industry-Related Books: Continuously educate yourself about hospitality, marketing, and real estate investment (looking for inspiration? I’ve got a whole page of “Mentors from Afar” - books, podcasts, people to lean into)

Categories: : planning