Hello my YouTube friends its richard founder of short-term rental university
and Airbnb super host on today's video we're gonna talk about a place where I
think a lot of people are losing money and since we as hosts are here to being
profit let's just cut it out look I recognize that what I'm about to say is
gonna be controversial and a lot of people are gonna have comments so go
ahead and comment I want to hear what you want to say and let's get into this
debate that's the whole point of learning I want to hear about different
people's opinions and I think we all benefit from it and here's the
controversial thing what I'm realizing when I look at the Facebook group and I
speak to people in the meetups is we don't really understand what hospitality
means we confuse hospitality with like generosity and that's okay occasionally
but that doesn't have to be something that we do every single time because at
the end of the day we're running a business here and the way that a
business succeeds in the long run is by being profitable and just as a reminder
I think we all know this but like profitability comes from your revenue
how much you make on Airbnb per night the number of nights minus your expenses
and the expense component is something that we don't spend a lot of time on
just realize that these expenses are the chips and the snacks and the crackers
that you go and get it's the spending more money on a certain type of coffee
and I'm a certain type of beer and leaving wine out it's on spending more
than you need to on toilet paper sheets towels whatever right like there is a
bare minimum that we need to do and then we have to be above that so we're not at
like that you know bare minimum level we're all
super oh so we're above that but above here let's calculate the return on
investment is that really good worthwhile investment from your business
so let me show you what I'm talking about so let me go ahead and draw this
here we're gonna call this the STR you satisfaction quotient how do you like
that Charles all right cool so look here's a basic line and it's gonna be
like the the bare minimum expectation based on what they've read in the
reviews and how much you're paying and like that's the bare minimum value now
anything below that we're gonna go ahead and put that in read that gets people
really angry like you can't be down there that's just a fail alright so you
want to be at that black line or better now we don't want to just be at that
black line we as super hosts we actually want to be
on top of that line we want to be ahead of that line right we want to delight
our guests and so that's this line here okay I think that that's a really good
place to be in terms of getting five-star reviews and making people
happy and delighting them and so on and so forth and the way you can achieve
that is actually through caring and hospitality that is like free so you can
put a handwritten no you can use a chalkboard you can have a map you can
engage them to do certain things you can leave like magazines that you have you
can have a guide that tells them where to go there's all sorts of things that
you can introduce your guests to that don't actually cost any money and you
can even do things that are inexpensive and meaningful so if you want to have
you know one or two snacks or something like that or I don't know microbrew beer
or anything like it's okay to spend a little bit of money but what I'm seeing
a lot in the Facebook group and in the meetups are people that are just
spending an awful lot of money above that line like going way overboard
spending way too much money on on basic necessities from you know maybe paper
towels or toilet paper or that and I must have 600 count sheets and I iron
everything and at the end of the day people don't really notice they may
appreciate it they may think it's super great but it's not gonna influence their
buy decision you don't want to be there right they're not going to influence
their buy decision it may not influence the night knightly rate like you're not
gonna get any more money for it and it may not even influence your five-star
review so like there's no point in doing it by doing all of that by spending all
that money and your time right like going to get to specialty cheese and the
wine and so on not only spending time and money but you're not getting any
reward and so like the thing that you want to try and do is be in that sweet
spot here in the green above the bare minimum substantially doing things that
delight your guests and make them happy and make them want to come back and
write about your stuff in your review spending a modest amount of money
keeping the eyes on the expenses and avoid everything above that because at
the end of the day we're all running a business here and we just can't waste
money unnecessarily it's just not a good idea and it's
sustainable and so while it sounds really great and you feel like you're
doing all this wonderful things for your guests you may not be doing the best
thing for yourself and to do really right by your guests you need to be in
business for a long period of time to delight hundreds if not thousands of
guests over a significant period of time so the green is the sweet spot all right
so I'm clearly not that good at that but I wanted to try and illustrate it I hope
it made some sense when we did that like at the meetups people's eyes literally
lit up and here's the point we're in this to be profitable many of us want to
expand on to you know our second or third properties and the best way to do
that is by keeping an eye on our expenses especially if you charge a low
nightly rate like if you're at $100 or below those expenses are critical to
your success and I see a lot of people spending unnecessarily to outfit like
there are air B&B properties the way that they like to live and you don't
need to do that right so like if you like a twenty dollar bottle of Pinot
Noir you don't need to do that if you like 600 thread-count sheets in your
place you don't need to outfit your Airbnb rentals like that you need to
think about what you do to exceed the bare minimum significantly but not like
go overboard spending money and throwing money at this stuff does not translate
into hospitality into five-star reviews or even into appreciation what really
improves your ratings and your five-star reviews and stuff like that is knowing
your guests making sure that they're comfortable exceeding their expectations
and you can do that without throwing a lot of money out the door so I hope you
found that helpful one thing I'd encourage you to do is like leave a
comment tell us where you changed something and you saved a lot of money
you reduced your expenses and therefore you made more profit and it could be
anything I installed a thermostat that was on a timer and so I spent less money
on utilities I I don't know you know stop putting out the wine and guess what
my reviews didn't change I did something that I no longer do and now it's better
give us the ideas because we all grow from one another
in the meantime I want to encourage you to please go ahead and subscribe to the
channel if you haven't I want you to come over to the Facebook group we've
got a lot of great stuff going on in that community and I really appreciate
your time energy thanks so very much happy hosting
I'll see you soon