Individual hotels and management groups always plan for the year with an appropriate FF&E budget in mind. Depending on the year, each property would allocate funds for replacement Furniture, Fixtures & Equipment, or a full renovation.
Each year, every hotel needs to budget for replacement items, whether they need a full room of goods due to an accident, or individual pieces, like refrigerators, that require an upgrade. Hotels typically try to cover one large expense a year when they are not going through a renovation, so having a budget for these expenses is extremely important. These budgets can be presented to the design and procurement companies that let them know how to proceed with the project. For instance, the procurement team does not want to quote a refrigerator that is $800 each when the property only has $400 budgeted for each room.
It is important to sit down at the beginning of any FF&E project and have a meeting with all decision makers. This is the best time to lay out the details and expectations of the project and the budget. This is known as the project Kick-Off meeting.
After this initial meeting, the teams will get to work, putting together quotes for the customer. For new builds and renovations, it is typical to put together a model room once some of the design choices have been selected, as this is a good time for final decisions to be made once the items are in front of the key decision-makers.
For renovations, it’s typical to send one sample of the items that will be ordered. This gives the end user a chance to see the new item in their space. Sometimes, the hotel will receive these samples as a goodwill free of charge item, and other times it will be a part of the budget. In either case, the design/procurement team needs to have the budget in consideration, since they do not want to send an initial sample, knowing that at the end of the day, if the customer were to order enough of the item to complete the hotel, that it would be over budget. For example, you do not want to send a Smart TV to the customer as a sample for the model room if you already know they will not have the money in the budget to purchase Smart TVs for the entire property.
When planning your budget for the year, you also need to work on a timeline of a project.
- 12-18 months before renovation select your procurement partner(s) to begin the design process.
- Project Kick-Off meeting
- Model Room
- Begin to place orders
- 9-12 months before the renovation deadline.
- Orders to be firmed up and completed
- Deposits completed
- Confirm timeline of project
- 6-9 months before renovation completion.
- Finalize any custom pieces
- Track progress and confirm timeline
- 3-6 months before renovation completion.
- Confirm timeline
- 1-3 months before renovation completion.
- Confirm shipping schedules
- All items should be delivered a month prior to hotel opening
- Final inspection of goods delivered
Depending on the type of hotel, typical budgeting for renovations can vary. You can complete some entire rooms under $4K. However, some luxury properties can FAR exceed that price.
It is important to plan whether the property is a new opening hotel, renovation, or working on replacements, because each project requires a pre-planned budget. Sit down with your customers and start planning for 2023-2024 and beyond!