Which Amenities Should Vacation Rental Owners Invest In?

It’s normal for any vacation rental to need time to develop—it’s a living organism, so to speak, that must adjust to the demands of the market. Additionally, managing a rental can be daunting for newbie owners, as they must assess the amenities of their competitors’ properties and then evaluate what they can reasonably afford.

With that being said, I often get asked by vacation rental managers which amenities can help drive maximum profit (by way of increased rates), regardless of the owners’ duration in business.

Our friends at Tripping.com, the world’s largest search engine for vacation rentals, provided us data taken from ten cities in the U.S. to get a better understanding of this question. In general, a hot tub and killer outdoor space, conducive of al fresco dining, add the most value per night (per room).

Tripping Graph 1

Why These Amenities?

“Kitchen” in this data set refers to access to a private kitchen, which logically, is a huge selling point. Travelers often choose to book a vacation rental instead of a hotel to have kitchen access. It’s a mandatory feature and often the focal point in the most successful rentals.

kitchen-island

In addition to a kitchen, which allows guests to prepare and share food without having to eat at a restaurant, guests look for space and amenities that help them relax leisurely- something that outdoor space, pools, and hot tubs all do.

A Closer Look at These 10 Cities

vacation-rental-value-add

If we look at the ten cities independently, we see that the amenities contribute to a different value add, depending on the location. For example, we see that a hot tub is a great investment in Miami Beach and New York City but not in Chicago.

Although a pool on average drives the lowest increase, it provides the highest value increase when compared to the other four amenities, in Chicago and Los Angeles.

Which Amenity is the Best?

I think this data is a great gage, but ultimately, owners need to understand what will drive connection (between your guests in your home, to your home, and to the location), comfort, and enhance the overall experience you offer your guests.

If you are outside of these ten cities, research what your competitors offer in your local market then determine if your findings fit into your “brand”. Instead of choosing an amenity because it seems like a cool idea, think of such additions as an investment that should support your overall business strategy to get the highest return.

I’m also a fan of leaning on the hotel industry—they obviously have a bigger research budget so research amenities at those targeting your guest demographic in your city. Borrow the information as you see fit and can afford.

Lastly, don’t underestimate good ‘ol common sense. In addition to considering your guests’ needs, it is important to consider the weather and also the logistcs and costs associated with maintaining these amenities.

5 Tips On Prepping For The Spring Rush

A long busy season can cause wear and tear on a vacation rental and its supplies. With the end of the winter season nearing for some and the spring hustle looming for others, this is a great place to start to get your home dialed for the next round:

1. Freshin’ Up Your Linens

I’m a bit of a freak with linens. It’s these details that can make a great stay exceptional! One of the biggest differentiating factors is giving your guests the best night sleep they’ve had since forever… it will keep them coming back, for sure. As such, make sure your sheets, pillows, towels and mattresses are refreshing and in great shape. After the busy season or a few weeks before the new season (giving myself time to make adjustments), I tend to stay at my vacation homes for a weekend to get a true feel of things and replace linens at the first sign of wear and tear. It’s also a great time to change your linens for a more seasonally appropriate option; LL Bean flannels to something with light, natural fibers allowing for circulation during the summer.

2. Double Down on a Deep Clean

In larger vacation rentals, it can be hard to do any variation of deep cleaning during the busy season, so put this at the top of your end-of-season list to keep your home in great shape. Clean out junk drawers and the closets; it’s amazing at how much stuff people leave behind. Pull out appliances and large furniture, scrub baseboards and walls and make a list of what needs the attention of handyman, before it could become a bigger problem (leaks, wiggling porch stairs, and so on).

Again pay attention to the details; rewash everything from the silver wear to crockery. Wash out all the cupboards, drawers and the refrigerator in the process. Guests notice the difference.

3. Stock Up On Complimentary Items

I leave an array of complimentary goodies for my guests. Spices, coffee, crackers and other local luxuries are nice touches, but even in small individual packages, they can go stale. Always check them between seasons (or more frequently, if possible).

4. Replace Utility items

Make sure these items are in working order and that there are additional replacements. Lightbulbs (and the working condition of lamps) tend to be overlooked as well as batteries. Think of all the flashlights, smoke detectors, remotes and electronic key entry systems that are battery operated. All are essential to the flawless functioning of your home.

5. Update Your Welcome Information

This includes your house book, local magazines, and the travel brochures you provide. Make sure they are current, seasonally relevant and in good shape (no one likes coffee stained or crinkled materials!). Many guests rely on such things, so be generous with your stash and thoughtful of the activities for your location.

This post was written by Kris Getzie

Kris Getzie Hospitality Consultant

5 Reasons To Love Being A Vacation Rental Host

5 Reasons To Love Being A Vacation Rental Host was written for Tripping by Volo.

1. Giving Money to the Local Economy

There are many studies that prove buying from independent and locally owned businesses have a compound effect on the communities in which they exist and their tax base.

The reason is that a substantially larger portion of your money spent is then used to make additional purchases from other local businesses, service providers and farmers (which will also reduce the environmental impact!).

Even if you aren’t a full-time resident where your vacation rental is, when setting up your business, think local and buy local when you can. It will enhance your business by way of a stronger and more attractive community.

2.Supporting the Preservation of Beautiful Locations

Cities that make efforts to preserve historic structures tend to be pedestrian/environmentally friendly (because of the time of their design), sustainable, and hold a high esthetic and economic value as they are places people want to live, invest in, and travel to.

They evoke a connection and are just good for your soul.

St. Augustine, FL, for example, was founded in 1565 and has structures dating back to the 1600’s- it’s considered one of the oldest cities in America. In 1999, Florida’s Department of Transportation deemed that one of America’s most unique bridges here was structurally unsound. An easy fix was to tear the bridge down but leaders and preservationists put forth a $77 million dollar effort to save the bridge as historic structures are a core value to residents and huge draw for tourists. Kudos, St. Augustine.

If you are looking for a new vacation rental, I wholeheartedly suggest buying historic or in a city that prioritizes tax funds to preservation and its natural resources.

3.Unique Experiences

“When people go on vacation they generally seek out destinations that offer them the sense of being someplace, not just anyplace.” Richard Moe, President, National Historic Preservation Trust.

Tourists want to feel local, albeit for a temporary amount of time.

One-of-a-kind vacation rental homes and service providers are what make locations distinctive and full of character. Small businesses (and your home!) have the ability to choose products that create a special experience, based on your own interests and needs of your guests; not on a national sales plan.

One of the best reasons to be a vacation rental host.

4.Local History

History is what grounds us and helps us better understand the world. So, seduce your guests with your town’s dynamic past! You don’t need a museum quality history presentation; opt for historic pictures throughout, blurbs of the famous (or scandalous) patrons of your home or street, and a sense of its story.

5.You Have a Profound Impact On Guests’ Lives

Think about it, most people are overworked and disconnected. They are just trying to make it through the chaos of life with one week of vacation being the yearly opportunity to check-out.

This business can provide additional income and eventually more life flexibility for owners. For guests, it provides a spectacular opportunity to connect with a location and those most important in your life.

The most successful owners are invested and truly care about creating an authentic experience, something unobtainable at a hotel chain (only you can show people around your home and town, your way).

This post was written by Kris Getzie

Kris Getzie Hospitality Consultant

Reducing Your Vacation Rental Minimum Night Stay

This post was written for Tripping by Volo.

Years ago I read a great quote, “Your career is long and the business world is small. Always act with integrity. Never take the last dollar off the table.” – Joanna Shields (President of Bebo.com at the time) quoting her father.

I fell in love with that quote. Unfortunately, in the business world most of us become too competitive, obsessed with short-term performance, or succumb to the pressure of kicking off a new business to be cognizant of such advice.

When applying this to vacation rentals, minimum stay requirements come to mind.

Long Term vs. Short-Term Stays?

Seen as a strategy itself, minimum requirements reflect seasonality and what the competition is doing. Take a Martha’s Vineyard cottage in the summer, for example. Most require a seven-night minimum stay, which is on-par with guest needs. However, if your property is new, has lackluster occupancy, or is just outside the prime location, you might consider dropping your minimum stay requirement (among other branding exercises) down to five nights to capture those who just cannot swing a full week vacation: a secondary market.

During the shoulder or off-seasons (assuming your vacation home is still accessible) you might even consider dropping the requirement further, especially for short holiday weekends like Dr. Martin Luther King Jr. or Presidents holiday which can generate more profit than other days.

Keep the Guest in Mind – But Be Smart

For me, building a financially healthy business is a top priority. But so is the human side of the business. Really, it is the reason I’m here: to help vacation rental owners and guests connect to life again.

My minimum stay requirements are general guidelines to maximize my profits.

If someone is asking for a reduced stay, I find out why… are they not able to afford the full stay, are they short on time or just the wrong guest?

I’ve had people ask for reduced stays because they couldn’t swing the costs for a full week. Skiing with a family of four (plus food, gear, lift tickets and so on) is expensive! In such cases, I consider the overall demand for the requested dates, my gut feeling about the person and their intentions.

Meanwhile, of course, I’m considering my ability to negotiate without creating the perception that my home is a commodity.

In my experience, those guests I have flexibility with become very loyal… which actually decreases the cost of future bookings by way of repeat visits. My point of this post is to have clear strategies in place based on your knowledge of your market. But be prepared to bend when it makes sense.

Nothing is Ever Black and White

The goal for any vacation rental strategy (i.e., minimum stay requirements, pricing or market position) is so that you don’t leave any money on the table. In a way, it’s taking that last dollar by encouraging guests to pay an optimal rate and stay an optimal duration based on seasonality.

But, like most things in life, nothing is black and white.

The quote continues, “You can always do a slightly better deal, but that incremental dollar or windfall is not worth creating an imbalance that affects the relationship. You have to have the intuition to know when to say, ‘I’m going to make sure that we walk away feeling like we’ve both done well.'”

This post was written by Kris Getzie

Kris Getzie Hospitality Consultant

Insider’s Guide to Buying Vacation Rentals

This blog was written for Tripping.com by Volo.

The process of purchasing a home is the biggest step to starting your vacation rental business. It is also the most daunting. That being said, I’ve partnered with one of Sotheby’s top agents to help answer frequently asked questions for those potential investors.

Nancy Tallman sells vacation properties in my hometown Park City, UT so I’m very well acquainted with her strategies and work. In fact, she helped me find my first rental in Park City. Being that she is based locally, local examples will be used, but the principles apply anywhere.

First things first, any good agent will want a clear understanding of your goals. So when a client tells Nancy they are interested in purchasing a vacation rental property, she asks a lot of questions to ensure no stone is left unturned and that the client finds the best home for their situation.

Regardless of the your personal goals, all successful vacation rental properties share these same characteristics.

1. Best location.

We’ve previously covered tips for choosing the best location, which focused on local elements; local landscape, the surroundings, and understanding if nearby businesses and homes are complimentary to your intended experience.

Nancy actually helped me navigate some of these topics (i.e. the water main situation at my Park City rental), so I knew she’d have additional input on choosing the best location:

Best, like beauty, is in the eye of the beholder, so again, it’s important for the agent to understand your goals. Do you plan to spend any time in the rental property? Is this a property you hope to live in one day? If the answer is “yes” to either or both of these questions, then your lifestyle and personal taste come into consideration.

If the property is going to be rented 100% of the time, then you are looking at a pure economic decision. Economic decisions are always a dance between the price and income the property is expected to generate.

From experience, the exact location may not be the strongest indicator of return on investment. For example, the rental differential on a ski in/ski out property may not be sufficient to justify the higher purchase price. An older condominium project with a low price and HOA dues could have hidden costs if there is deferred maintenance and planned owner assessments.

Take time to understand your intent (and financial needs) for the vacation home, so your chosen real estate strategist can better work for you.

2. Expected Appreciation

In Park City, just like in any other town, the location will drive the appreciation. Appreciation is based on supply and demand. There is always going to be a limited supply of properties in walking distance to Historic Main Street, the ski slopes, and other amenities. There is also strong demand for new construction, which has seen strong appreciation even when located further from amenities.

The “average” annual appreciation in the USA is about 3%. In hot neighborhoods, we have seen 10-20% annual appreciation in the past couple of years. For some investors, cash on cash return is more important than appreciation. It depends on your individual goals.

3. Positive Economic Signals

As a property investor, you should look at unemployment, job creation, population migration, economic stability, housing prices and rental yields when deciding where to buy. An unfortunate negative example of the above factors moving in the wrong direction is Atlantic City, New Jersey, where casinos are closing and people are losing jobs.

On the other hand, Park City for example, has all of these factors moving in the right direction. Park City is just 30 minutes from Salt Lake City, which has one of the strongest economies in the USA, and is one of Park City’s major feeder markets for resort real estate. Vail Resorts recently took over two of Park City’s three ski resorts and has promised to make a “significant” capital investment in both resorts this year. The Sundance Film Festival also inked a long-term agreement with Park City, which means we can expect the world famous film festival to continue to draw vacationers to Park City for years to come.

Driving maximum profit starts with a detailed understanding of your home’s location as well as the economy, as we described in planning for vacation rental success. Ideally, it is best to purchase an investment property when the economic indicators first turn in the right direction to purchase before prices have been driven upwards.

4.Reasonable Vacation Rental Costs

Costs can vary significantly from home to home or condo. It’s easy to detail fixed costs, such as the mortgage, property taxes, HOA dues and utilities as the previous owner can typically provide records for the past year(s). However, the cost of maintaining and managing the vacation property will vary; if the property is part of an HOA, some or all of the utilities and maintenance may be covered.

The costs unique to owning a vacation rental can be more difficult to figure out. They may include marketing, furnishing, property management, listing site subscriptions and website development costs.

It’s really important to have your real estate strategist help you determine the property specific costs. A good agent has worked with many types of properties and buyers and can easily dig into the details (HOA logistics, for example). After all, you don’t know what you don’t know so it can be hard to ask!

5.Expected Profits

The expected income and expenses of owning a property will determine the profit. For some clients, spending Christmas with their family in their vacation property will be more important than the income they are giving up.

Even a property with a negative cash flow can be profitable when considering tax savings for depreciation and the property’s appreciation. On the other hand, if cash flow is important, vacation rental properties have the potential to generate tremendous income relative to their cost if they are managed like a business with a high level of customer care and an outstanding presentation.

This post was written by Kris Getzie

Kris Getzie Hospitality Consultant

Planning For Vacation Rental Success

This blog was written for Tripping.com by Volo.

Many first-time vacation rental owners come to me about six months into their venture, stressed that they aren’t on track for their only two goals: 100% occupancy and $50k+ in booking revenue.

While developing goals during your venture is good, I can’t stress how important it is to create a strategic map before you purchase your new home. If you can’t afford risk, you can’t afford having unrealistic performance expectations and you certainly can’t afford to make things up as you go along.

So what is a strategic plan? It’s a set of goals and framework that guides your decisions with an end vision in mind. You will constantly make decisions; like dealing with short-term guest complaints to long-term property additions. The plan prevents you from drifting, or worse, copying everything your competitors are doing.

Where Is Your Vacation Rental Business?

Vacation rental success starts with knowing exactly where you are with a detailed understanding of your home, the market, and industry. Start by researching a series of questions:

Your Vacation Home

  • How does it compare to other similar vacation rentals?
  • Do I have an intimate understanding of all aspects of the home, BEFORE closing?
  • Does it need to be renovated? If so, how much will this cost?
  • What are my setup costs (furnishing, linens, listing site fees and so on)?
  • Who are my customers? Can I divide them into key segments?

Your Vacation Rental Market

  • Do I have a lot of competitors, or only a few?
  • Is overall demand increasing or decreasing?
  • What are the barriers to entry?
  • What drives the market? Price, quality or both?

The Vacation Rental Industry

  • Key trends: Are vacation rentals being squeezed out?
  • How are guest needs and habits changing?
  • What is the general economic outlook?

These few questions aren’t comprehensive but are often overwhelming to newbies as research isn’t everyone’s favorite thing (hence my job as a consultant). But please do put in a valiant effort to understand your current situation as the effectiveness of future decisions depend on the accuracy of these answers.

Once your information is gathered, it’s time to interpret it with a good old fashioned SWOT analysis (taking you back to college, Strengths, Weaknesses, Opportunities and Threats). Understanding your strengths and weaknesses essentially helps you answer “where am I?” based primarily on facts, rather than opinions, which is ineffective.

Where Do You Want To Go?

The purpose of a strategic plan is to make you more goal-oriented, so you will need to define your goals next. Many owners stop at the desire to achieve “excellence” or 100% occupancy.

Be more specific when answering “Where do I want to go?”, so you can begin to work backwards with a clear path. Put it in words. Literally, just start writing down your thoughts as they come and organize it later. Hotels, or any business for that matter, often have their goals framed up in vision and mission statements.

They can be a powerful driving force; the vision describes where you want to be and the mission how you will operate while you get there, inclusive of your homes unique and authentic culture/experience. You don’t even have to create formal statements, just create memorable phrases that are realistic, challenging and then actually use them.

How Will You Get There?

Any goal, vision or mission is pointless unless you can make it happen (where most newbies become overwhelmed).

Your strategy will generally define the route you will take. For example, one goal might be to achieve a 40% repeat customer base within your first three year’s operating. Your strategy would then involve actionable steps to get there; understanding guest expectations for your experience, how you will exceed said expectations to drive retention, and how you will measure their satisfaction, for example.

Whatever goals and corresponding strategies you come up with, it’s important to realize you will probably not get there within three months. This plan, preferably created BEFORE you buy the home so you start with eyes wide open, breaks it down into small manageable pieces that can be tweaked as the market and your business develops.

No amount of knowledge (even if you come from the hotel industry) or hard work can compensate for a lack of direction. Effort and excellence are not the same thing. After you’ve dialed your plan, make sure you check back in to measure your progress!

This post was written by Kris Getzie

Kris Getzie Hospitality Consultant

How Far Should You Go For Your Guests?

This post was written by Volo for Tripping.com

In the hospitality industry we often talk about the importance of helping guests. Really, helping anyone inclined to inquire about your home, or with questions on your area.

The justification to do so is usually two-fold. First, it feels good to give knowing you probably just made their vacation the most memorable they’ve ever had. Also your kindness will not be forgotten, creating a repeat and high referral guest base.

I’ve had friends probe me on my varied ways of giving. “You just sent that guest to another house! They were ready to book with YOU!” Or, “Why spend a lot of money on gifts? The house is already great.”

For me, it’s about making sure someone’s vacation is perfect. It brings a little bit of light to people and gives them a well-deserved break from working long hours. I’m appreciative that they trust me and my home for their vacation, giving me the freedom to pursue my own independent work. Helping is the least I can do for them.

The Importance of Give and Take With Your Guests

Being probed prompted me to do a little bit more research on the impacts of giving, to which, I stumbled upon Give and Take, by Adam Grant. It’s an incredibly interesting book, grounded in research of why giving (i.e. helping) can have a more significant impact on our personal and professional success than taking or matching.

Giving, taking or matching are “reciprocity styles,” or way we relate to each other. Givers tend to have a relating style that is more concerned about creating value for others, than claiming value for oneself. Takers, on the other hand, seek value for themselves (in sometimes an insincere way- by pretending to be a giver) and matchers (most of us) desire equal giving and taking.

Through his many examples, Adam aims to prove that not only do givers perform the worst (compared to matchers and takers), but that givers also tend to outperform them to a higher degree, consistently. I tend to have a great disdain for labels, but I challenged myself to read this book with an open mind and to understand how my tendencies, according to his behavioral indicators, may impact my future growth in hospitality. I also didn’t read this book unquestioningly; “givers are great, therefore I will always give to my guests.” That would be silly.

Guests are not always right, and should not be given into, especially if there are malicious and disrespectful actions towards you or your staff.

I’m especially protective of my teams and have asked guests to pack their bags immediately. Of course, I help said guests by suggesting vacant places to rent, and offer a refund, but what matters more is that my team knows I have their back; it builds trust in me, our business, and the stretch goals we may place upon them.

Like me, many of you also move between giving, taking and matching in life and in your hospitality career. This book provided stories, research, and insights that were very interesting and applicable to our work as vacation rental owners and prove how giving (i.e. genuinely helping) can exponentially grow you and your business.

This post was written by Kris Getzie

Kris Getzie Hospitality Consultant

Your Vacation Rental Name Can Impact Search

This post was written by Volo for Tripping.com

With over five million vacation rentals around the globe, and only three seconds to capture the attention of potential guests, the importance of creating a dialed brand is critical. A brand should quickly and clearly define the experience or product, with the actual name being very much central. For example:

Apple: Think Different

De Beers: A Diamond is Forever

Nike: Just Do It

There are a lot of great blog posts online providing clear tutorials on naming your vacation rental business and the subsequent impact on bookings. In short, a name should be memorable, unique and representative of what you offer. It should be easy to connect with.

“Coral House”, for example, is much more appealing than “5 bedroom, 5 bath Caribbean beachfront rental”.

Recent property branding and naming exercises got me thinking about some words of wisdom from a particular client. He built a fortune (billions) creating and branding products for his many diverse companies and also happens to own $500M+ in vacation rental real estate globally.

He’s absurdly brilliant, humble, and arguably “the most interesting man in the world”. So naturally I asked him how he does it. His reply was to simply consider everything. Everything? Okay.

He’s not joking. He’s created success by paying attention to (and researching) consumers idiosyncratic habits and desires throughout the product purchasing and consuming cycle. Every behavior, from holding, smelling and sipping a beverage, for example, to every word and punctuation on a label. Everything matters.


Consider Property Type When Naming Your Vacation Rental

Heeding his advice when devising clever vacation rental names, I started considering the importance of the property “type”. Often used in the actual property name, types can range from a loft, castle, to cabin. Are these just catchy naming additions or can one be strategically used increase your bookings by way of more search yields? According to Tripping.com’s data, I’d say so.

chart1

Villa is remarkably the most searched property type. By definition, a Villa is a large and luxurious country home, particularly in Europe, but the term is often used for beach homes as well which may account for the large volume difference.

Of course, just because villa is the most searched property type doesn’t mean you should call your home one when it is clearly a mobile home. Your business name needs to be an honest representation of what you offer.

When we look at more data, however, it does make sense to tweak the type, when fitting. For example, you should brand a mountain property simply as a “cabin” instead of “log cabin” or “mountain home” to yield more views.

chart2

Perhaps the most difficult feats for owners, particularly those dependent on listing sites, is to be reasonably ranked in search results. Putting aside premium packages and featured listings, property type could be the biggest factor in helping owners overcome the ‘searchability’ barrier.

From here, you just need to ensure the rest of your listing ad is dialed (and on-brand) to drive conversion!

This post was written by Kris Getzie

Kris Getzie Hospitality Consultant

Three Vital Tips to Protect Your Vacation Rental Profits

This post was written by Volo for Tripping.com

Now that you’ve opened your vacation home, hired your help and are maximizing occupancy, it’s important to know how to protect your vacation rental profits.

Having managed $100M+ businesses at one point in life, I can tell you that the backbone of fiscal control is managing information. Unfortunately, clear bookkeeping is the easiest for newbies to overlook, which can really hurt your chances of managing (and controlling) the business. Quickbooks, a must-have for any vacation rental business, makes it easy to record every transaction, and even create budgets, so you won’t be open to inaccurate data, waste, and poor decision-making. But above and beyond Quickbooks, follow these three steps to help protect your assets and increase your vacation rental profits.

1. Budget to Protect Vacation Rental Profits

The single best method to increase your bottom line is by way of a thoughtful budget. In corporate settings, it’s not uncommon to pad the budget to give room for error. A good leadership team, or you in this case, should flesh out the padding so you see the actual state and potential of your business.

To do so, create your budget line by line. Take each line back to zero; don’t apply a factor (inflation or otherwise) to last year’s figures, however tempting. As by doing such, you are accepting inefficiencies of the prior year(s).

A Practical Example

Let’s use “Guest Supplies” as an example budget line. To create this, you investigate every item that goes into this category. Let’s just say there’s one item, shampoo, for the sake of this example.

First understand your operating standard. Will you provide fresh shampoo bottles daily, or just one (per shower) upon arrival to get your guests started? If you operate a luxury home and adhere to the standard of providing fresh shampoo bottles daily, examine the size and cost per bottle. Does it make sense to reduce the size of the bottle, and thus the cost, while maintaining your level of service?

Assuming you move forward with the existing bottles of shampoo, simply multiply the cost with the number of forecasted nights booked and the number of showers in your home.

Now that you have an idea of what the shampoo costs should be, compare it to the previous year. Is there a large difference? This exercise will probably make you reconsider how your goods are bought, stored, and controlled.

2. Be Smart About Your Vacation Rental Inventory

Never buy too much at once, keeping your stocks as low as possible. Not only does this preserve interest-bearing cash, but your inventory is much easier to control.

If your supplier offers you a 20% discount to buy 100 cases of shampoo bottles at the start of your season, for one or two properties, proceed carefully. Shampoo sitting in a closet will not earn you any money and they will be hard to keep an eye on. Your kids might decide to give them out to friends, or your cleaning staff might feel the need to pocket a few every visit.

If your stocks are low (and delivered “just in time”), it’s much easier to recognize when items have gone astray and subsequently take action to protect your profits.

3. Liquidity is Crucial to Your Vacation Rental Business

Remember the 2009 recession? In case you’ve forgotten, in the prosperous years prior to the recession, people and companies freely spent all of their income to acquire more, and not necessarily pay off, existing debt and assets.

In terms of vacation rentals, I knew many owners who bought into the temptation of rising property values and used all of their equity to purchase additional vacation rentals. Bookings were used to pay mortgages, not to build savings or pay off the existing debt. They over-leveraged themselves. My point? Cash is king. You can have all the illiquid assets in the world, but if you don’t have cash when your credit and/or bookings decrease (the economy is cyclical), you won’t be able to buy groceries, let alone keep your investments.

If you are achieving high occupancy and are ready to expand, go for it! But pay attention to your bank balance and I suggest not tapping into more than 50% of the value of your existing home(s). This may be conservative… but at least it will always be your home.

This post was written by Kris Getzie

Kris Getzie Hospitality Consultant

Can Vacation Rentals and Hotels Work Together?

This post was written by Volo for Tripping.

Lately I’ve been hearing buzz about hotel brands entering the vacation rental market. Vacation rental owners and hoteliers alike understand that we have an attractive market; but leaders in both industries are often quick to point out the stark differences and disregard each other as competitors.

I’ve personally seen and achieved a lot of success in business through aberrant partnerships and I often ponder how such a partnership might benefit our growing industry. Take Target’s designer collaborations, for example (with the likes of Nieman Marcus and Jason Wu). Each collaborator understands what the other partner offers, how they are different, and how they can benefit each other. The goal is not to become the other.

Vacation rentals are distinguished by their unique brands and authentic experiences. What they lack is industry-wide guest service standards and independent brand awareness.

Even with great efforts to overcome these challenges by industry stalwarts, it is impossible for every owner/manager to create a brand presence that precedes them, as hotels do, simply due to the marketing expenses and execution time. It is particularly hard for new vacation rental owners. Often working families, they don’t have time to read every new post on LinkedIn and follow vacation rental blogs, let alone build and manage an independent website to build their brand.

But they do have a vision. Most have created a high quality experience with amazing guest service and are taking one step at a time towards running their business as a full-time career.

One Way Vacation Rentals and Hotels Could Partner

A recent trend I’ve been noticing across a host of different vacation rental sites is the use of stamps of approval. A stamp of approval can certainly add some credibility but do guests really know what these mean and how it may add to the vacation rental standard and experience?

Guests know hotel brands and their standards (by way of millions spent each year in advertising), the biggest area of uncertainty for vacation rentals guests.

According to Oracle, 86% of customers will pay more for a better experience. If newbies (or vacation rentals in general) were able to get a “brand stamp of approval” from a relevant boutique hotel, would they see an increase in conversion, retention, and rates based on the perception of a more dialed experience?

At the same time could hotels also benefit by driving much needed patronage to their ancillary revenue centers (restaurants, spas, shops and activity spots) through recommendations from partnered vacation home owner(s)?

There are many logistics not addressed herein. Hotels, for one, would need to understand that vacation homes are independently run and a source of ancillary revenue. Independent homes would have to meet and adhere to select standards set by the hotel (that would not diminish their uniqueness, of course).

Is this topic off in left field or reasonable enough to test the possibilities? I’d love to hear your thoughts!

This post was written by Kris Getzie

Kris Getzie Hospitality Consultant