Stupid idea?

[The Moog]

When I was away on holiday in outer Hebrides we visited this hotel which quite frankly was rubbish. It was in a beautiful place and wasn't realising its potential.

 

We talked about it and came up with this massive business plan about what we could do it etc etc. I asked SWMBO that if she had the chance of buying this versus going to Australia what would she do and in a heartbeat she said the hotel.

 

Well the world came back to normal and back to work. Apart from today I was a bit bored and looked up the hotel.. and it is only for sale!

 

Since finding out we have done nothing but talk about it. The real hurdles will be the cost and the fact that we have no previous experience running such a thing. Both of got experience of businesses but this would be a massive step

 

We are starting to plan to go to Australia so we are coming to a cross road in our lives and so the change wouldnt be as hard as other times.

 

So .. is it a good idea? or a pipe dream like a naughty holiday romance?

 

Also anyone know anything about business loans?

 

Obviously if we do go ahead, then there would be Autoshite discounts!

[ashmicro]

I don't wanto to dishearten you, but the Outer Hebrides is pretty far from nearly everywhere. In this economic climate it would be a big gamble IMHO. You should investigate thoroughly why it is currently for sale, too.

[dollywobbler]

Common sense says it's a ludicrous job that'll be back-breakingly difficult, leave you with little personal time and pretty much in the middle of nowhere.

 

On the plus side, you'd get to meet A LOT of people and customer facing work can be massively rewarding - and you get to LIVE in the Outer Hebrides!

 

It's important to try to remove the romance - we thought it'd be romantic and lovely to drive an H van to Sweden and the truth isn't that lovely when you're so hot you can't sleep and people keep banging the side of the van when you're crashed out at motorway services.

 

With our move to Wales, we're accepting that this winter is going to be horrible, because we'll have no money and won't be able to make the place nice, while Welsh weather can be pretty grim.

 

But then, nothing ventured, nothing gained! It's quite a contrast though - Australia or Outer Hebrides?

[Mr H Sceptre]

Outer Hebrides climate should mean cars rust to fuck - therefore I say go for it'

.

[The Moog]

Its actually on Skye. So joined to the main land now by a bridge. It is 30 minutes from ferry terminal.

 

It is in the middle of nowhere but next to a castle ruins and overlooks a bay where there are basking sharks and dolphins.

 

Reading the reviews on trip advisor sound like the people running dont have a clue how to do it correctly.

 

I agree it is a massive risk but being early 30's no kids no ties means that we dont have to worry as much.

 

Yes is quite a difference. I know today it is a novelty but we arent under any illusions of the hard work/no money etc.

 

This is the place http://www.duntulmcastle.co.uk/

[Rusty Pelican]

Whilst Australia sounds better , ive had a friend of mine return to blighty as it wasnt what he thought it would be

hebrides for me , peace and quite , no masses of traffic

Wether its a good buiness idea ive not got a clue ,

we would come up for a weeks stay thats for sure

EDIT ,THAT LOOKS STUNNING ,

[M'coli]

Common sense says it's a ludicrous job that'll be back-breakingly difficult, leave you with little personal time and pretty much in the middle of nowhere.

 

On the plus side, you'd get to meet A LOT of people and customer facing work can be massively rewarding - and you get to LIVE in the Outer Hebrides!

 

It's important to try to remove the romance - we thought it'd be romantic and lovely to drive an H van to Sweden and the truth isn't that lovely when you're so hot you can't sleep and people keep banging the side of the van when you're crashed out at motorway services.

 

With our move to Wales, we're accepting that this winter is going to be horrible, because we'll have no money and won't be able to make the place nice, while Welsh weather can be pretty grim.

 

But then, nothing ventured, nothing gained! It's quite a contrast though - Australia or Outer Hebrides?

Edited, now I kno it's in Trotternish: it'll still be "chust sublime" during the summer, but I'd go there for a week in January - and choose an especially shitty wet and cold week too, none of this stunningly beautiful cold and clear stuff - and ask yourself if you could manage the off-season when there's no tourist traffic.

[gearoil]

This is the place http://www.duntulmcastle.co.uk/

Yes. Do it. Or at least give it some serious thought.

[trigger]

 

That would be a good enough reason to say yes alone!.

 

There's lots of tele programs where people come in to help couples get their Hotels working better, It might pay to watch a few of these so you can see the bad sides as well as the good.

[DCLane]

Had a look;

 

It looks like it's been on the market for a while, despite 'for a quick sale' on the price.

 

Pro's: location in summer, will get Skye traffic, 27 bedrooms.

 

Con's: location in winter, you'll need staff

 

Personally, I'd go for it. But then I'm mad - and told my parents to buy a B&B hunting lodge in the Dales. Which they did, and are still there 15 years later.

[The Moog]

Well my missus is Scottish so knows about the wild side to winter

 

Looking at the details of the business, it has a pub which services the locals during the winter. It might be that you close most things and run skelton stuff except at new years etc.

 

The turnover for it was £150000 which bearing in mind it has got 27 rooms at £60 a room is pretty bad. Might be that there are some strong reasons for this e.g. location etc. But the reviews on Tripadvisor say it is run down and really bad service.

 

A couple of my mates are also a bit lost with their jobs and so when we came back from holiday we had mentioned it as a joke and they were up for moving up and working there.

 

 

I guess the difference between there and Aus is that whilst Aus we go for the lifestyle but will be doing the same jobs and have same pressures. This on the other hand is a once in a lifetime thing. Stupidly long hours, arguments, tears, immense pressure, miserable winters, midges etc but yet still sounds good.

[Cavcraft]

I'd be willing to bet the current owners bought it with every faith of making it into a profitable business and going the extra mile.

They then probably realised after a while it wasn't working out (i.e paying) and decided to sell.

 

It looks a stunning place but alas the cost of most people getting there alone (before they've paid for a weeks stay) is more than a week in a shit hotel in Spain or something.

Alas when comparing sun, drinking themselves stupid whilst their offspring play in the pool and getting tanned compared to a wet weekend there's only likely to be one winner. And I don't think it'll be Scotland sorry.

[ChinaTom]

Does look tempting, but then Oz is as well.

 

It'll be a lot of work and not all customers will be nice reasonable people.

 

You're not doing it because you have a vocation to run a hotel

You're not doing it to make a lot of dosh - you'll struggle in the early years to break even if you're taking loans to do it

You're a long way from everywhere

You'll have a great view

By the time you've done your research, your marketing and your business plan, you'll probably have gone off the idea. Seriously, do a business plan and see if you still think it's a good idea. Crack open a bottle of Excel and look at the costs of running and staffing the venture - you'll need this for the bank anyway. Think about the logistics and costs of the typical big money earners - functions, weddings and food. Do a cash-flow graph and see what overdraft you're going to need.

 

Don't mean to dishearten you either - it is a lovely idea; BUT it will be a business that ABSOLUTELY has to succeed as you will be borrowing (and using your savings) to do it. Look at it as a business only - pure and simple; as if you get your sums wrong, it will eat you alive in the first 12 months. You said it was crap - why? Looks good on the website. If the staff are shite, imagine having to sack them and find new ones that are better. How much will the "potential" cost to make this into a money maker?

 

F'ckinell - sorry about that!! I just don't want to see you both break down into tears in front of Ruth Watson for our viewing pleasure.

 

Oz sounds nice.

[Rusty Pelican]

Things to think about

Are you social party animals , if so Skye is rather quiet

Winter is bleak but then you know that already

What state is the hotel in , maintenance costs would be huge if there are structual issues , leaky roofs etc

buiness rates , how much etc

Do you think that you CAN turn it around and make a good living from it with what you know , ideas etc , catering for people who do mountaineering / love walking is one i can think of

Il think some more

[trigger]

I've just looked on google streetview at the place, It's really pretty, stunning scenery but i bet it's bleak in the winter time, still, what have you got to lose?, If it's a dream you have and it also seems like fate that it's up for sale and you really think that you can turn it around then i say go for it.

 

It's going to be challenging experience but very rewarding i'd say as well..

[trigger]

If the staff are shite, imagine having to sack them and find new ones that are better.

That's a good point, If you had to sack them is there anyone else up there looking for jobs or would the nearest town be 30 miles away which could put people of wanting to work there.

[Quintus]

Sometimes it's hard to predict whether or not a business will be successful and I'm certainly no expert on the hotel trade. Mind you, it's not difficult to tell when somebody is doing it wrong either, so if you reckon you can do a better job that the current owners why not give it a try?

 

I guess it depends on all the usual business factors - competition, publicity etc. and more than a little luck.

[whitevanman]

Running a hotel is easy............if you know how, but it can all be learned, you need to take everything into account and more, go there for a week speak to the locals, find out why it's not been working out for the folk that are selling it, decide if there is a particular market you can appeal to. be warned having staff is expensive, you have almost no idea how much you will have to pay the goverment over and above their wages ( LOTS & LOTS) I could tell you so much more if you want as I used to run several pubs and the likes, as for setting up a business with friends.......hmmmm lets just say it's not easy shall we, you all need a unified focus on the direction you are heading, then you have to take into account all the childish petty things that WILL come into play................

 

personally I'd fuck of to Australia, I loved it out there

[The Moog]

I knew I get some sensible people on here Need a few home truths I think

 

My missus is a financial controller managing £3.2 billion so cash wise she is very hot on it. My background is Marketing and Innovation so hopefully am jolly useful at that. I know that staff is the biggest cost.

 

Lots and lots of unknowns. Admittedly the state of the buildings is one that we hadn't thought of. I would imagine that we would need to do the equivalent of a survey on everything.

 

Got one friend who is a Chef and would love to have his own place so I can imagine he would be good to have on board. Another who is a snowboarder / mountain biker / all outdoors person who would be good handyman / outdoor events.

 

I guess my vision would be a good pub and restaurant with nice rooms. We would also look to develop weddings side of the business and do things like photography courses etc.

 

Very probably a totally stupid idea and come next week it has all fallen in tatters and we are back going to Aus (not a bad fall back option).

[ChinaTom]

£150k!!!????????!!!!!!!!!!!!?????????

 

Assume 75% comes from room charge, and the rest from pub/restaurant.

 

That is less than 20% occupancy. That business will need to turn over half a mill a year to satisfy the bank given that your start-up costs will be very high while you apply the "potential".

 

This'll break your heart as the small business advisor will probably recommend not doing any modifications to the hotel and just drop the price to get the occupancy up and turnover better. You'll struggle to get the funding to add the potential that you saw in it.

 

In business, romance is purchased with profits.

 

Romance + debt = divorce.

 

Oz sounds nice.

[The Moog]

LOL .. .

 

It is nice to hear some honest opinions. The £150K was in 2006 and I reckon it is even less than that now.. looking at ad looks like it has been on for a couple of years

 

Ok well plan is to phone estate agents tomorrow to see what the deal is.

 

Honestly the chances of it happening are about 1%, but thanks for the reality check

[barrett]

150k wouldn't buy you a one bedroom flat around here! How is that not a good deal??!

[ChinaTom]

I guess the "offers over" method applies up there. One of my mates is a beer distributor for this area - I'll ask him if he knows any history.

[The Moog]

The business is up for £550K but the turnover was £150K in 2006

 

ChinaTom that would be fantastic.

 

Taking a stupidly simplistic view of house prices at skye a 4 bed house is around £200K. the hotel has 2 chalets of that size on its land. Doesnt really value the goodwill of the business or the business itself as much

[whitevanman]

The business is up for £550K but the turnover was £150K in 2006

 

ChinaTom that would be fantastic.

 

Taking a stupidly simplistic view of house prices at skye a 4 bed house is around £200K. the hotel has 2 chalets of that size on its land. Doesnt really value the goodwill of the business or the business itself as much

Pubs and hotels just arn't selling at the moment, friends of mine have a pub in the village near me up for sale they would take £180k but no takers for nearly 2 years big carpark as well.

 

http://www.jimhayestateagents.com/prope ... se-td6-9jb

[eddyramrod]

I suppose I ought to comment, having sold up and scarpered abroad, although my situation is a bit different. For a start we're 20 years older! Also we didn't come over here expecting to take over (or open) a business, which is just as well. Here's a thought: how much space do you need to live in? Check out the "owner's accommodation" in the hotel. It's unlikely to amount to a three-bedroom duplex; more likely to be equivalent to a cramped bedsit. You may find you have to cook your own meals in the hotel kitchen (outside dining hours, which might be an issue if either of you needs feeding at regular times for health reasons). What goods and chattels would be moving with you? Is there space for them, or can/would you get rid before you move? Where will you house the staff you import, such as your mate the chef? Will his menu plans match yours? What do you know about wholesalers in the area? If for example the hotel currently uses Smith's Veg, is it up to the standard you want? Is there another supplier that will deliver within Smith's area? And are they any better? How will that affect your operating costs?

 

We did what you did. We stayed in a B&B and discovered it was for sale, and we pretty seriously considered the move (to Bridlington). There wasn't room for my cars (major minus!), nor was the available accommodation enough to house the things we (I) couldn't part with. Then there was the constant round of cooking, cleaning and waiting-table, in addition to the job I would have had to find to bring the income up to a viable level. Add in my claustrophobia and you can see why we didn't do it in the end. We had actually been OFFERED something similar in Blackpool a few years before, but decided against it for much the same reasons, although living in Blackpool, I could have continued in the Preston-based job I had at the time.

 

Whatever you choose to do, good luck.

[Des]

Would it be possible to go for it, and if it were to not work out, do a runner to Oz without there being repercussions?

As for learning how to run a hotel, simply watch every Fawlty Towers back to back.

[CreepingJesus]

I guess the "offers over" method applies up there.

It does, but so does a cheeky underbid. Especially if it's been on the market a while.

I see what the romance of the idea is, I'm not immune to it myself; but that's going to be a hard shift.

Being 'bike friendly' might help get a few more punters thro' the door, and it doesn't require any extra investment - just a few ads in the right places.

[Barry Cade]

I love Skye, it really is the most breathtaking place.. but having spent a christmas in Kilmaluag (just along the road) a few years back I realised that the place closes for winter..you are Miles and Miles away from anywhere up there. The nearest decent shop is in Uig, which is a good drive away, and major shopping is in Portree, a 50 mile round trip.. for some milk and fags.. You can go days without seeing anyone, and the weather can be brutal, straight off the Atlantic..although I don't believe they get that much snow.

 

Maybe if you marketed it right it would make you a living- biker hotels are very popular on Skye as has been said before- but I reckon it'd just be a living,and a hell of a lot of hard work and heartache to survive.

 

If I didn't have to make a living out of it, I'd live there in a heartbeat!

[pogweasel]

Having watched family members squander hundreds of thousands on ideas like this, seen how it can ruin marriages and lead to desperate depression, alcoholism and utter financial ruin I would advise strongly against.

 

Basically, if you love the place that much, hang in there until you have a 7-figure bank balance / assets THEN go there and look at the scenery without the hassle.