The bed & breakfast launch plan
Every step from deciding to opening, in the order it happens, shaped to your situation, with your own numbers beside it. About 43 steps in 8 phases, 19 of them specific to a bed & breakfast. Free to read; ticking steps off and putting in your own numbers come with membership.
The plan43 steps
- 01Not started0/6Fold
Decide with the numbersa week or two
Before a dollar is spent. Most expensive mistakes happen here, and this phase costs nothing.
A B&B makes most of its money one way (selling room-nights with breakfast included), and the art is squeezing more and more rate out of a fixed, tiny inventory.
Typical for one unit is $150,000 to $600,000 a year; the owner keeps 30 to 42% of it before paying themselves. If that band does not cover what you need, that is the signal to pause and look again.
38% owner earnings on . Inns sold from 2021 to 2025 earned their owners a median $167,609 on $439,716 of revenue, before any .
Twelve questions about your money, time, experience and temperament, scored. Then the 5 questions this business asks of its owner, about the hours and the work. Answer both before you spend a dollar.
Rule of thumb: if you can buy a well-reviewed inn with a transferable permit, a sound building, and a seller willing to teach you the ropes, buying buys you years and a working reputation. Answer it in your situation above and the plan reshapes.
Customers, prices, rent, staff pay, what it costs to open. We filled in typical numbers; change what you know and everything on this page follows.
- 02Not started0/5Open
Plan the moneya week
What it costs to open, where the money comes from, and the cushion that keeps you alive until the business pays for itself.
A B&B is capital-heavy because you are buying a building, not a van or a storefront lease: most of the money is the house and its conversion into commercial lodging.
The itemized cost to open8 lines
- The house: $415,400 to $1,200,000From about the national median house price to the median price of a running inn
- Inspection, appraisal and closing costs: $8,300 to $60,000Typically 2 to 5% of the purchase price
- Conversion: baths, refresh, wiring and fire safety: $76,000 to $570,000En-suite baths, paint and floors, electrical, fire alarm and sprinklers
- Guest room furnishings, bedding and TVs: $29,400 to $88,200Bed, furniture, four sets of linens and a TV for each of six rooms
- Dining room, kitchen and laundry: $10,153 to $46,799Breakfast seating, commercial refrigerator, range, dishwasher and laundry pairs
- Website, photos, Wi-Fi and sign: $3,218 to $23,754Professional photos and a commission-free booking engine matter most
- Permits, insurance, supplies and legal: $6,400 to $27,800Use permit, building permits, the inn insurance package, opening supplies
- Initial working capital: $20,000 to $80,000Carry the bills and the loan payment through the first slow season
Costs start on day one; customers take months. Map the first twelve months of cash so the business does not run out of money while it is getting going.
The business has to earn your pay like any other bill. Set it in your numbers and watch the month it move.
How deals in this business are financed4 lines
- SBA 7(a) loan (Up to 25 yr with real estate · 75-85% guaranteed)The workhorse for buying an inn, including the real estate and working capital.
- Seller financing (Often 10-25% of price · 3-7 yr)Common when buying an inn.
- Commercial real-estate mortgage (Secured by the real estate)Because so much of the value is the building, a conventional or commercial mortgage on the property is a path, sometimes blended with an operating loan for the business itself.
- Conventional / 504 for the property (Long term · larger down payment)For owners with strong credit and a larger down payment, an SBA 504 or conventional commercial loan can finance the real estate at competitive long-term rates.
Most new shops pair an with 10 to 20% of your own cash. Know the monthly payment before you look at a single space.
Before you shop. A lender tells you what they would fund, what they need from you (credit, your cash in, a plan with numbers), and a pre-qualification letter makes a landlord or a seller take you seriously.
- 03Not started0/4Open
Set up the companya day or two
A day of paperwork, and it has to come before the space: a lease, a loan application and every permit are in the company’s name.
Your state’s business name search, the trademark register, and the domain, before the name is on a sign, a van, or a lease.
A , an , and the S-corporation election each change what you keep and what you are exposed to. Compare them with the numbers, confirm with a CPA and an attorney, then file with your state.
After:The is free from the IRS in minutes once the company exists. The bank account needs both. Keep business money separate from day one.
After:Pick the accounting software and connect the bank account now, so every cost of opening is captured and the numbers you later are real.
- 04Not started0/4Open
Where you will work froma week or two
A B&B is married to its location in a way few businesses are: the property and the town are the product, not just the address.
What decides it for this business: a real reason to visit (destination demand), a property with character, lodging is permitted ( & use), a long enough season, event & celebration demand.
Most cities allow a business at home with limits on signage, visitors, employees and deliveries; some HOAs and leases do not. Confirm before you print the address on anything.
A door that closes, the equipment and software the week needs, and a business address (a registered agent or mailbox) if you would rather not publish your home.
A home policy rarely covers a business. at minimum, professional liability if you advise, and the certificate clients ask for.
- 05Not started0/2Open
Get the loanfour to eight weeks
Four to eight weeks with an SBA lender, longer if the file is incomplete. Everything else waits on this, so send a complete file.
Your plan with numbers (download it as a PDF from this page), the company’s papers, the equipment quotes, your personal financial statement, and proof of the cash you put in.
The lender funds against the quotes and the insurance; the money goes to the vendors and the build.
After:
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Permits and registrationstwo to four weeks
A B&B is more regulated than a private home because you are running commercial lodging and serving food in a residential setting.
Bind the policies you had quoted before a contractor, a vehicle or a customer is in play. Keep the certificates; the landlord, the lender and the city will ask.
After:Register your or corporation and obtain a city or county operating license.
With your state, before the first taxable sale. Usually free and online; check your state.
Many cities issue a simple permit for a business run from a home; some only need the business license.
The gating item.
Serving breakfast to paying guests typically requires a food-service license and a health-department inspection of the kitchen.
A public lodging business has accessibility obligations that a private home does not, a real factor in converting an old house.
A homeowner policy will not cover paying guests or food service; commercial coverage is and often a condition of financing.
- 07Not started0/8Open
Set up to runduring the build
During the build, so the business runs from day one: the systems, the prices, the people and the routine.
The backbone: one calendar that syncs your rooms across your own site, Booking, Expedia, and Airbnb so you never double-book.
A commission-free booking widget on your own site is the single biggest lever: every direct booking is an OTA commission you keep.
Take deposits and balances by card, handle no-shows and cancellations cleanly.
A home run as lodging needs commercial coverage, not a homeowner policy: guests, food service, and the building all create liability a personal policy will...
See the price the the business needs implies, then check it against what the market pays.
Early morning: Prep and serve breakfast: the signature of the inn. Late morning: Turn the rooms (strip, clean, launder, restock) for the night’s... Afternoon: Greet arrivals personally, give the local lowdown, handle requests.
Opening, closing, the sale, the complaint, the cash. One page each. This is the manual a franchise would have sold you.
Free, and it is how most people will find you. Address, hours, photos and the menu or price list, live before opening day; then the sign, the soft opening and the first regulars.
- 08Not started0/6Open
Open and measurethe first ninety days
You own it. Now run it on the numbers.
Friends, neighbors and a short menu or list. Find the problems while the room is forgiving.
Enter the real numbers and see every cost line against the for this business.
The mortgage on the house; OTA commission on a small base; Owner (the hidden cost).
Wages are the start: , insurance, training time and the hours you stop billing. Register as an employer and carry workers’ comp before the first payday.
Growth consumes cash before it produces it. Find the rate your own cash funds before you push.
A B&B sells as two things at once: a piece of real estate and a small operating business.