Thinking of Becoming an Innkeeper?

Is becoming an Innkeeper right for you?  Think about whether you have:

1. A business plan that includes financing prospects
2. Planning, organizational, and management skills
3. The desire to work hard, and sometimes long hours
4. Discipline and business competitiveness
5. Multitasking capability and organizational skills
6. The desire to entertain people from different parts of the country/world
7. Drive to ensure your new small business succeeds

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Avoid Paypal Reserves

If you use Paypal to charge your guests’ credit cards, you may have noticed some new reserves that Paypal is introducing to account holders.  Reserves amount to increased costs to you, the merchant, and result in delays in receiving your money.  Instant World Booking offers alternative and better methods for collecting from your guests that will not result in delays or higher costs in receiving your money.

Here is how Paypal recently described their reserves, which may amount to 20% of your credit card proceeds:

“Why was a reserve placed on my account?  Sometimes we need to temporarily set aside some money in your account to make sure that you can cover any potential reversals or chargebacks.

What are the different types of reserves?  Rolling reserve: A certain percentage of the money you receive each day is set aside and then released after a certain number of days.
Minimum reserve: The minimum that you need to keep in your account at all times. We’ll hold a percentage of each day’s payments until you reach your minimum reserve.”

Instant World Booking offers the industry’s low-cost solution for booking engines on a bed and breakfast or hotel website.  Compare with BedandBreakfast com and others.  There are no complicated reserves to contend with.  Instant World Booking also now offers IWB Payments, a convenient way to charge your guests by credit card for reservations and other services you offer.  For more information, check out IWB Payments.

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Payments Systems – Why Credit Card Processing can be so Expensive

Our analysts have been searching high and low on the internet for the types of credit card processing that bed and breakfasts use.  Services like Securepay or RezOvation are touted.  RezOvation does not actually provide credit card services, but facilitates links to external merchant processing solutions.  But why are these solution so expensive?  Read on below for the answer.

Instant World Booking ( now offers IWB Payments.  This payments system is unique among all the other providers in that it requires:

  • No merchant accounts
  • No payment gateway
  • No bank or credit applications
  • No credit card processors

In short, IWB Payments handles all the complicated and otherwise costly processing for you.  All you need to do is charge your guests with convenience and confidence.  Read more about IWB Payments here:

As for the other services, merchant and credit application fees, discount fees, address verification fees, payment gateway fees, monthly reporting fees, setup fees, monthly service fees, pci compliance fees, etc. can add up quickly.  And yes, you will be charged most if not all of these fee categories for credit card processing.  This is not to mention the complex process of handling cardholder disputes, and a chargeback fee (about $30 or more) for every disputed transaction.

With external credit card processing used by services like Securepay, RezOvation, and others these fees are billed in bits and pieces, and it can be difficult to add them all up.  This is why you may be surprised to learn that these costs in some cases can add up to 10%-15% or more of your monthly charge volume.

Here’s just one example of how credit card processing costs can add up for a bed and breakfast or inn.  Consider a simplistic example.  Let’s say a bed and breakfast charges 10 credit cards per month.  The average discount rate or their charges is 4%.  This is not the total cost of processing, of course, but just one of the cost categories mentioned above.  Now, if just one of the 10 charges for a month is disputed by the guest, the amount charged is automatically returned to the guest by the credit card processor.  However, the discount fee is NOT returned to the bed and breakfast for disputed charges.  This means the overall discount rate for the month goes from (10 transactions x 4%) / (9 successful transactions) = 4.44%.  So, the average discount rate for the month increases from 4% to 4.44%.  That’s an 11% increase.  This of course does not include the non-refundable $30 chargeback fee that the bed and breakfast will be charged for the dispute.

IWB Payments is a simple to use credit card acceptance program that may be right for your bed and breakfast or inn if you want to avoid the administrative headaches and high costs of maintaining your own merchant processing account.

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Bed and Breakfasts on the Leading Edge of Innovation and Ingenuity

As many of you know, is part of the Instant World Booking organization, which includes over 100+ brands of online marketing and booking engines.  At BedBreakfastTraveler, B&Bs are our specialty, but we also have keen insights into other lodging markets.

While it may not sound fair, some other lodging sectors consider their marketing strategies to be at the leading edge of innovation and ingenuity.  But where do bed and breakfasts figure into this?  B&Bs in North America don’t have the reputation of being cutting edge in terms of marketing or technology.  This also may not be a fair assessment, since there are many inn properties that are up-and-coming into the 21st century age of internet marketing.  But there are some important lessons that our friends and partners in North America and elsewhere can learn from their counterparts in other markets.

Many online booking services know that B&Bs are behind the curve in technology, and they may sometimes take advantage of this fact by overcharging for their services.  This is perhaps the first and greatest lesson that bed and breakfasts can learn: Don’t Overpay for online marketing services!  When it comes to online booking services, many of the availability calendars out there that cater to B&Bs are vestiges of technology platforms that are 15-20 years old. Travel industry technology has undergone a revolution since the 1980’s and B&Bs should be seeking out the best technologies available for their purposes today.

So, in short, there are 2 great lessons you can learn.  1) Don’t overpay for online marketing services, and 2) Take advantage of the latest technologies. offers some leading edge services for B&Bs that we want you to compare with your current providers.  Three areas where can enhance your bottom line are by 1) offering the lowest cost for online booking services versus all the competition, 2) setting up custom booking engines to work on your very own website (again at the lowest cost versus any competitor), and 3) offering credit card acceptance for your business without costly merchant accounts, credit checks, etc.

So, if you’re a bed and breakfast looking to try something new, and start actively improving your profit margin, contact BedBreakfastTraveler and ask how we can beat your current provider’s services.

Tip:  Don’t worry about replacing or dropping any current services you use.  Evidence consistently shows that by simply adding to the list of providers you use can improve your bottom line without dropping any other services.

Join BedBreakfastTraveler

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Return on Investment and the Lifetime Value of a Guest

We recently read with great interest the blog entries by Eric Goldreyer, the CEO of Intelligent and well-spoken, Eric speaks in one article of the Lifetime Value of a Guest. In short, this is the value a B&B earns over a lifetime by bringing in one guest. Lifetime Value of a Guest is usually multiples of the earnings on just the first reservation. The article is worth reading and has several good points to be driven home to innkeepers.

Where we stopped short in our tracks is when Eric illustrates the concept with a typical example. He uses 25% as the typical cost of a reservation. He then goes through the calcuation and reinforces that ROI (Return on Investment) is a primary consideration for bed and breakfast owners.

Please allow me to emphasize, well no … proclaim loudly, that 25% is not anywhere near a good value for B&B innkeepers to be paying for a reservation. Even when the lietime cost of acquiring a client is maybe half of this (12.6% as Eric Goldreyer goes on to explain in his article), it’s still not a bargain for the hotel.

When CEOs of online booking services announce publicly that typical costs of acquiring guests are in the 25% range, it makes us wonder where all the value is going with the high technology available today. In this particular case is a proponent of all the right concepts, as stated in their other blog entries, including “online reservations, leveraging ratings and reviews, frequent stay programs, etc.” These are all the concepts we at (Instant World Booking) have been talking about for year. Nevertheless, consider that the cost structure we are able to offer to you, the innkeeper, are roughly one-third the amount you’ll be paying as suggested by Goldreyer above.

This is why we are imploring all bed and breakfasts and small hotels to consider alternatives to their online marketing strategies. Another well-written article by Eric Goldreyer speaks of how to think about return on investment (ROI) for your online marketing spend. Read the article, then consider that (Instant World Booking) charges no fees to join the service, offers more online, search-engine-optimized content for your property, more photos, and more translated online pages than the competition. Instant World Booking also offers a fully integrated online calendar, with credit card collections, for no sign-up fee or monthly fee. In short, you have zero cost unless you have bookings. And when you do have bookings, our cost is roughly one-third the cost offered by competing services. We encourage you to sign up for a free listing at (Instant World Booking) today:

The blog articles mentioned in this article can be found at the links include in the comment below.

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Free Online Advertising and Marketing is King among Bed and Breakfasts

It never ceases to amaze me how online services continue to require hefty membership fees. The internet is the most efficient information distribution tool ever invented. In today’s lean economic environment, bed and breakfasts are seeking value in their marketing and advertising budgets. With the wide array of services available to inn managers for free, why do we continue to pay year after year those annual membership fees for services. This is the perfect time to re-evaluate our spending on those annual memberships that we sometimes blindly pay year after year.

One example I can highlight is a recent advertising email sent by PAII, the Professional Association of Innkeepers International. The email is targeted at bed and breakfast innkeepers like you, and professes how the PAII is advocating on your behalf. Specifically addressing problems the PAII sees with TripAdvisor, they indicate how some of the operations and policies of the Tripadvisor site have flaws that can cause significant financial hardship to your business. They say that this the message innkeepers all across the country have been letting PAII know loud and clear. They ask what the individual innkeeper can do to address this most critical area? After citing that PAII’s President & CEO has been tirelessly meeting and negotiating with the management team of TripAdvisor advocating for you, the rest of the email basically amounts to an advertising pitch to sell memberships in their organization at a reduced rate (for 6 months as opposed to a full annual membership).

Let me be clear that the PAII is a reputable organization which adds value to bed and breakfasts and inns in the U.S. However, know that membership in one or more of these types of organizations can cost between $100 and $300 EACH per year. When you start looking at how these memberships hit your bottom line, what you need to focus on are services “support services” that bring in business, not “support groups”. Also, beware of organizations that claim to be international, but boast a membership of predominantly North American companies.

So, as the new year approaches, look for some new opportunities to build your online footprint with some truly global services. Pay special attention to services that do not charge a membership fee. There are many such valuable services easily available. And, think about eliminating some of the more expensive annual memberships that are not really critical to the operation of your business.

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Collective Marketing for your Bed and Breakfast Inn

Collective Marketing is a new concept gaining a lot of attention these days in the online marketing and SEO (Search Engine Optimization) world. And, it’s a term that is very relevant to marketing your bed and breakfast inn or small hotel on the internet.

So what is Collective Marketing? The concept is that the more relevant websites and online services that your bed and breakfast or hotel is listed with, the more exposure and brand recognition you gain. This is true even if some of the individual sites or service yield no direct return. This is actually not a new concept per se. It is the theory of synergies in marketing, the idea that 1 + 1 equals more than 2 when it comes to advertising your small business.

As a consultant in the online marketing world for hotels, I have frequently heard lodgings question why they should keep a listing with services that don’t return any reservations, or that don’t have an immediately apparent direct benefit. The answer is quite simple. As long as a website offers free advertising, links, articles, or other mention of your hotel business, then it definitely makes sense to maintain the relationship. Even if you don’t see any direct revenue stream from the website in question, know that the exposure your property’s name receives on the internet will multiply.

How many times have I searched for a lodging on the internet only to find no more than one page listed. If you have the benefit of having your hotel’s name listed on multiple pages on different websites on the internet, consider yourself lucky. This name recognition ultimately has an influence on search engine rankings, and translates into brand recognition. When prospective guests search for your bed and breakfast on the internet and your name appears in several or more listings, there is a perceived reputation gain.

So remember, next time you consider removing your hotel from an advertising listing simply because of ROI concerns, think again. If you have a free listing on a web service like an online booking service, don’t give it up. Beyond the collective marketing advantage, online travel services are growing rapidly. In these lean economic times, you too can ride the growth that they experience.

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How Secure are your Online Bookings? How Much Deposit to Collect

How secure are online bookings these days? Everyone knows how online booking works. A small deposit is collected from the traveler at the time of booking. Our advice is that the optimal deposit amount to collect for a booking on your own website is 35%. Why 35%? Research shows that one-third of the booking amount is the best deposit level to secure bookings, ensure that bookings are not fraudulent, and ensure you do not have a loss if the guest changes their plans. Since one-third is 33.3%, and is an awkward amount to collect, our advice is that 35% is the most efficient amount. If you prefer a range, then our recommendation is 35% – 75%.

Before we get into the details about collecting deposits, let’s talk about some basics. First of all, don’t use services that require you to manually confirm bookings, contact your guests directly, and obtain deposit monies yourself. These services are still in the 20th Century. There are still quite a few of this type of reservation service that claims “instant booking”, but cannot deliver. Beyond this, if your online booking method involves a Paypal interface, know that this method still does not work for guests in many regions around the world. Also, for bed and breakfasts in North America or Europe, using a service like this is like putting a sign on your front porch saying “We’re Un-Professional Amateurs!” This is not exactly the reputation you want to develop for your website.

You certainly need a professional third party service that is able to collect more than just Visa and Mastercard. You need a service that is able to collect at least 4 major global card types. If you feature online booking on your own website, know that almost all major booking services are able to collect 5-10% deposit for your bookings. But is this enough? No. You should be collecting from 30% to 75% deposit for every booking taken on your own website. There are 2 reasons for this. One, guests who have found your website, and are interested in booking with you, are serious about staying with you. They know that if they’re paying on your website, they’re going to have some personal interaction with you, and their reputation is on the line. Fraud transactions on a hotel’s own website are infrequent. Second, since you know the guest is serious, you want to collect a reasonably high deposit to secure their booking, and eliminate any possibility of problems in the event of a cancellation or no-show. (Instant World Booking) recommends collecting either 35% or 50% as the optimal deposit for most bed & breakfasts and small hotels.

Instant World Booking is one of the only services that enables you to collect more than 10% deposit at time of booking. In fact, they can enable collection of up to 100% of your bookings at reservation time, effectively enabling you to collect credit cards right online from your own website. Instant World Booking takes this service one step further, offering full no-show and cancellation protection. With this service, you are guaranteed to receive your deposits, even in the event that a guest cancels late or does not show up.

Check out more of our controversial topics and advice at our blog. We’ll lead you to the most effective and low-cost solutions for marketing your property.

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The Most Important Business Tool for your Bed and Breakfast: Email

Want to know what’s the most important business tool you’ll use for your B&B or small hotel over the next 5 years? Email. That’s right. Well you might think you’re reading an article left over from the 1990’s. Not so. We’ve been getting a lot of comments and questions in recent months about email and it’s proper use in a small business. It’s really quite elemental, so if you don’t get it (it = email) right, you’ll kill your online busines.

One of our collaborating expert authors wrote an excellent post recently at the Instant World Booking Blog: Email Do’s and Don’ts for your Business. For bed and breakfast managers, this is required reading. But, I feel the need to add a few comments of my own.

If you have a website for your bed and breakfast or small hotel, email is the lifeline of your online business (you do have a website don’t you? If not, please get one. It’s extraordinarily cheap). The first rule of using email is that prospective guests and business partners need to be able to reach you. Don’t make excessive use of spam filters or other devices you feel are going to protect you. The basic concept of email is that you want as much contact as possible. If you’re easily annoyed by unsolicited spam, get over it. It’s a fact of life, and neither you nor I are going to solve the big problems of the internet. So, if find yourself sacrificing legitimate guest reservation requests or business solutions by erecting electric fences around your inbox (e.g., excessive spam protection tools), or threatening legal action against every sender of an unsolicited email, then you’re in the wrong business. Remember, we’re in the hospitality business, and we need to remember the old time-tested theory that out of every 10 marketing contacts, there’s one that’s going to pay for the rest.

Here’s a tip to help weed out meaningful business emails from the junk mail. On your website, use a “mailto” anchor link to publish your email address. The html for this looks something like:

<a href=” want to enquire about a reservation”></a>

This will create a link that, when clicked, will open a new email window with “I want to enquire about a reservation” pre-populated in the subject line. Of course you would replace the email address in the code above with your own. If you don’t know how to edit HTML on your website, your webmaster can do this easily for you. Then, you create a filter in your email address to automatically highlight all incoming emails with the words “I want to enquire about a reservation” in the subject, or place them in a separate folder. This is an excellent means of quickly scanning important incoming emails from the spam, and in many ways is more effective than a spam filter, which may eat many of the “I want to enquire about a reservation” emails.

This is just one example of simple tricks that can make your own email system a more powerful tool than any junk email filter. But remember also, that your business email may be used for a whole array of functions that you may not be aware of. Unless you take the time to learn about how powerful your email is, don’t get frustrated or even annoyed when you receive email you didn’t ask for. Receiving an unsolicited business email is not like receiving a prank call on your personal phone. In some cases, receiving an unwanted email can even be a positive thing, signaling that the world can actually reach you from far-flung places, and your email is working properly. So relax. If you find yourself urging to send angry responses or threaten legal action, then you’re probably in the wrong business.

I recently heard of a case in which a B&B in Virginia complained about receiving unsolicited email from an online service that they subscribed to. The B&B submitted their email for a service to communicate reservation requests to them. In the process, they failed to mark the service as a safe sender in their email system. When reservations started coming in, the B&B never received them, nor responded. Eventually the online service began sending reminders to the B&B to check their email, update their system, and various other advice. When one of these reminders finally got through, the B&B owner was insulted and tried unsubscribing the service’s emails. In this case, “unsubscribing” was not the appropriate step, since they weren’t subscribed to any mailing lists. The B&B owner contacted the online service, and claimed that they were sending accusatory emails. Accusatory? They were obviously embarrassed that they didn’t understand how to use their own email. Again … probably not in the right business.

For more tips and services for your online marketing effort, check out

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