8 Hard Lessons Learned from my B&B in Ecuador


I know, I know.

It’s about time I talk about the first business idea that comes to the mind of many foreigners when buying property in Ecuador.

Start a Bed and Breakfast.

I know the business quite well, in fact, I have a B&B in Guayaquil.

Here are 8 lessons I’ve learned the hard way about this business in Ecuador so you don’t have to: 

8. Location.  Often in this business your success or failure is dependent on this first very important decision.  Where to buy.  I recommend buying property you’d like to turn into a B&B in a destination with a nice constant flow, or demand, of travelers.  Don’t try to get too far off the beaten path in an unknown location, or risk withering away on the vine.  People visit locations, not B&B’s, remember that.

7. Location within the location.  Often, your only significant advantage over your competition will be your location within your town.  The closer you are to where your clients want to be, for instance, the beach… the better.

6. Get an accountant involved early.  Unless you plan on selling exclusively to foreigners it is next to impossible to run a cash business in Ecuador these days.  Over the last few years the local IRS (SRI) has really tightened up and for the first time local businesses feel the need to pay their taxes.  When buying from you, most in Ecuador will ask for an official receipt (factura) with your local tax ID number on it (RUC) so they can legally write the expense off their taxes.  A good accountant can manage your tax payments and social security payments of your employees.

5. Have lots of rooms.  Your rooms are your products, they are your money makers.  The B&B business is a very hands-on, long-hours business which requires at least 2 employees (one day and one night shift), and it’s simply not worth it if you don’t have at least 7 rooms with private baths to rent it… trust me on this one!

4. Target the high-end.  I know it’s tempting to be the cheapest option in your area and ego-satisfying to see your place fill up.  But trust me, I’ve tried it, that’s not the crowd you want in your place.  The low-end, bargain basement dwellers are the most demanding and troublesome bunch of all.  If you target at least a slightly-higher-end crowd you can make the same money, probably a lot more, with only a quarter of the effort and your place won’t deteriorate nearly as fast.

3. Buy, don’t rent.  In order to keep your place a higher-end locale, you’ll need to invest in constant improvements, why invest sometimes thousands in ultimately someone else’s property?  Nuff said.

2. Sell extras.  Remember why people choose to stay in hotels instead of other types of accommodations.  Often, for the extra services.  Sell them and you can increase your bottom line.  Everything from laundry service to drinks to even meals and more if you can swing it.

1. Install cameras.  Why invest thousands in a business so your employees can walk away with all the profits?  Don’t laugh, I’ve seen it happen.  Think about it, what will prevent your employees (if you aren’t around) from receiving a guest, cleaning the room and pocketing the payment?  In Ecuador, like most of Latin America where many folks have to scrape just to get by, although normally honest, many won’t hesitate to skim a few bucks if they think they could easily get away with it.  You need a solid system in place with survellance cameras you can check via the internet whenever you like.

As my valued Insider subscriber, let me invite you to a coffee at my B&B in Guayaquil, if you reserve this week for a stay of 2 nights or more receive 1 free van ticket from Guayaquil to Cuenca (1 per room booked).  We are 1 short block, 2 minutes by foot, from the main departure point.

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