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In a recent meeting, the tourism stakeholders in the country have set an ambitious 8-million foreign visitor arrivals annually starting 2016.  A report by Business Mirror said that in a consultation, organized by the tourism committee of the Philippine Chamber of Commerce and Industry (PCCI), stakeholders agreed that the target was “achievable.” 

Although the tourism industry is confident of meeting this target, the Philippine Tourism Authority has earlier said the lack of hotels in the country’s prime destinations has hampered the  industry’s growth.
These factors make the hotel and resort business a profitable and exciting opportunity. According to industry estimates, one in 10 entrepreneurs is looking at opening a hotel or investing in one, driving growth in the hotel business.

However, the fact that the hotel and resort business may just be where the money is should not be reason enough to get into this industry. “The hotel business is not for everybody. Just like in food; not just because one knows how to enjoy good food makes one a good restaurateur,”  said Merril Yu, Y&S 1847 Hotel Investment and Development chief executive officer, at the press briefing for  the First Philippine Hotel Investment Conference, which will be held on August 20 at the SMX Convention Center, Mall of Asia Complex in Pasay City.
 

Yu cited five questions to assess one’s readiness in getting into the hotel and resort business:

1.Why would I want to do it?

“You should ask yourself if you want to put up a hotel just because your ego says so, or do you want to profit from it, or just because it’s what everyone is getting into?” Yu said. The hotel business requires huge capital and those who invest in one must be serious in doing business.

2. Where will my hotel rise?
 
Just like in any other business venture, the hotel’s location must be a primary consideration. Location will determine the hotel’s concept, structure and design.  “Do I have the location or will I still be looking for a location?” Yu said, adding that the hotel business is very much about location.
 
3. Who are the people traveling to the hotel site now?
 
“What will your market be? Does the area have a market already or are you going to make a market for yourself?” Yu said. Other hotels cater to the market that already exists while some hotels create their own. A business hotel caters to the traveling businessman while a resort hotel targets guests who are seeking rest and recreation.

4. Will my hotel cater to the people going to the area?
 
“The question seems similar to number three, but this one should show whether the hotel design and concept will be coherent to the market in the area,” Yu said.

 A hotel may cater to various markets, depending on the season or day of the week.  For example,  Makati City is dotted with businessmen’s  hotels that also target weekend visitors. An aspiring hotelier  should ensure that his hotel's design will appeal to various clients.
 
5. Do I have the money, resources, and conviction to stay?
 
“Running a hotel is not easy, maintaining one is not cheap either. The hotel business is not for those who want to earn immediately. It is  capital-intensive with a long payback period,” Yu said, adding that the return of investment for a small hotel usually takes between four years and six years.