Living the dream

Written by ProfitGuide Staff
Part 3: A place like home

Laurie Mackechnie was working in human resources for a company in London, Ont., when she got that old feeling: time to move on again. “I start to get stagnant, I guess,” says Mackechnie, 32. “I tend to stay in one career for no more than five to eight years.” She and her husband, Todd Finnie, 36, a sales rep, had talked for a long time about opening a bed and breakfast. Why not now? They began looking at properties and only a few months later, in April 2003, threw open the doors to their new business, The Organ Factory Bed and Breakfast. As the name suggests, it’s located in the former family home of organ factory owners and there’s a Victorian-era organ factory on the grounds. Located in St. Joseph, Ont., the B&B has three guest rooms and a private second-floor suite for Laurie and Todd. Guests can enjoy their breakfast on a deck out back while gazing over a stone-edged pond and perennial gardens.

During the week, when Todd’s on the road with his sales job, Laurie presides over the property, preparing blueberry-stuffed French toast and poached eggs, cleaning rooms, answering phone calls and e-mail queries, and greeting guests. Come Saturday, she and Todd work side by side. Slowly but surely, they’re advancing through an ambitious 10-year plan for the property, which includes adding more guest rooms as well as a gift shop.

When their story is told that way, Laurie and Todd’s transformation into business owners sounds effortless. In reality, getting the B&B into shape was, and continues to be, hard work.

First, there was the choice of location. To be successful, a bed and breakfast has to be surrounded by popular tourist attractions. Seems like a no-brainer, but according to Richard Taylor, co-author with his wife Monica of Start & Run a Profitable Bed & Breakfast (Self-Counsel Press), trying to do business where only tumbleweeds roam is one of the biggest mistakes of novice B&B operators. “We know people who bought places along some concession road and they’re starving,” he says.

Having read the Taylors’ book, Laurie and Todd were well aware that location is crucial to success. Their original impulse was to set up in Stratford, Ont., home of a famous theatre festival, or nearby St. Jacobs, Ont., known for its Mennonite quilts, antiques and farmers’ market. Both areas seemed like good choices on paper, but when the couple looked closer, they found that the bylaws weren’t exactly welcoming to new B&B operations. In St. Jacobs, for example, “you aren’t allowed to open a bed and breakfast unless it isn’t in an agricultural zone, is 150 metres from any other house and 23 metres from the centre of the road,” Laurie reports. “It was impossible.”

Laurie and Todd were disappointed, but they had learned an important lesson that any aspiring B&B owner should heed: before you buy any property, no matter how charming, ask the municipal office whether a B&B operation is permitted there. Skip this step and you could be stuck paying the mortgage on a house that will never bring in any revenue.

With a little more research, Laurie and Todd found the perfect place in St. Joseph, close to a summer-stock theatre company, antique shopping and a provincial park — all of which provided that much-needed draw for overnight guests. The property was already being used as a B&B, so they had no huge renovations to undertake, just painting and redecorating. Best of all, the area’s bylaws were relaxed. “It’s pretty much as simple as ensuring you have enough parking for each of your guests,” Laurie says.

Once they had purchased the property, the hard work began. “We shopped for probably two months solid on the weekends, picking up linens and towels and pillows and furniture. I’m a shopper and I was pretty tired of shopping by the end of it,” she recalls. “We also did a lot of eating breakfast for dinner, testing different recipes.” And they signed up for a seminar on how to run a B&B.

Anyone who’s thinking about opening a B&B should look into taking a similar course. If you do nothing else, read the Taylors’ book or talk to a B&B operator. The experience can be an eye-opener. “I don’t think most people realize how labor-intensive running a B&B is,” says Lynn Hainstock, owner and operator of Vancouver’s Penny Farthing Inn. Her own hostelry has been operating for 14 years and has been featured in Fodor’s and Frommer’s travel guides, but she still has to work hard at it. When she teaches continuing education classes through the Vancouver School Board on the realities of operating a B&B, she is forced to shatter many of her students’ illusions. “A lot of people in the course think they can run a B&B and still be on the tennis court by 11 o’clock. My guests don’t get up from the breakfast table until noon sometimes! So out of the 30 people who do the course, by the time I’ve finished with them, usually three or five will actually follow through.”

The ones who succeed have realistic expectations about how much money they can make, especially in the first couple of years, when cash is usually tight. Mackechnie and Finnie, who charge $75 to $165 a night, reckon they’re on target to take in $30,000 to $35,000 before expenses during the coming year. That figure should swell as they add more guest rooms.

What’s the peak of B&B ambition? Well, larger operators in major centres can gross well over $100,000 a year, but how much of that is profit depends upon how hands-on you’re willing to be. If you do all of your own cleaning, cooking and bookkeeping, you can net around $100 for each night you’re able to rent a room at $125, estimates Richard Taylor, the B&B author. But hiring employees to do the dirty work for you will quickly shrink your profit margin.

The upside is that your cost of living is minimal. “You’re not living free,” Hainstock says, “but you’re living very cheaply because a lot of stuff is covered by the B&B.” And running a B&B allows you to live in a bigger, better or just plain different abode than you would working a nine-to-five office gig. “I’ve had people tell me, ‘I’ve always wanted horses, couldn’t afford them, didn’t come from that sort of family,’ ” Hainstock says. “Well, you can buy a ranch in the Cariboo, put some horses on it and run a bunk and breakfast. It allows you to create a dream.”

Originally appeared on PROFITguide.com