I think of a hotel's business plan the way an architect thinks about blueprints. You do not throw a stack of LEGO blocks together and hope they hold up.
A written plan is still the best communication tool a hotel has for employees, lenders and investors. It equips a potential buyer with what they need to acquire and run the business profitably, and it arms your own team with the competitive advantages worth exploiting.
We are heading into the final quarter of 2026 and most operators are still building next year's budget off last year's numbers. In my experience, the more meaningful approach is to analyze the market itself, not just your own trend line. What follows is the market intelligence and revenue engine of the plan; the budget and labor side is its own conversation. Here are the 10 steps I walk owners and operators through this time of year whether they're opening a new hotel or building a 2027 plan from an existing one.
1. Review your STR trend report and competitive set data as your baseline. Then build an unconstrained demand forecast: how many rooms you could sell on a given date if inventory were unlimited. That number, not last year's calendar, is what should be driving the plan.
2. Use the unconstrained demand forecast. It shows you where you can raise rate or drop discounts, and which dates need a push instead. It also keeps revenue management and marketing working from the same plan rather than two different ones.
3. Comb competitors' websites and sales collateral and start a real competitive intelligence file. John Nolan calls this process “elicitation” in his book "Confidential: Uncover Your Competitors' Top Business Secrets Legally and Quickly," and it's worth taking seriously rather than treating it as an afterthought.
4. Meet with GMs and marketing teams at your primary and secondary competitors, and tour the properties — not to discuss rates or pricing strategy, obviously. The real payoff shows up on a sold-out night: a relationship like that means the overflow goes to the hotel on your corner instead of across town. If you're a franchise, run a market review with your franchise marketing manager and get their national media schedule.
5. Build the 2027 sales and marketing budget from real market data; don’t assume last year’s growth carries forward. Pull your CoStar report, review your central reservation database and website, and get involved with your tourism authority or Chamber of Commerce. Qualify the companies and individuals worth adding to your mailing list. Business journals are a good source, too.
6. Pitch your property as a feature story. Draft press releases for the year ahead and check with your franchise's segment specialists on promotional opportunities.
7. Update your website if your brand allows it or if you're independent for both traditional SEO and the agentic AI tools that are starting to book travel on a guest's behalf. That means structured data, accurate real-time pricing and availability feeds, and property details an AI agent can actually parse, not just a page built for a person scrolling through photos.
8. Keep producing ‘can't-resist’ content. Advertising has given way to publishing, and social media rewards real conversation with your fans and prospects more than it rewards ads. Content marketing is the new advertising.
9. Build a permission-based email program — one your audience opts into — and invest in blogs, social media, newsletters, webinars and video. It cuts into what you'd otherwise spend on paid media, and it matters even more now that agentic AI is starting to make reservations on a guest's behalf rather than a person clicking through a search result.
10. Remember what a loyal guest is worth. Treat a regular guest well and they will keep coming back on their own. That matters because acquiring a brand-new customer almost always costs more than keeping one you already have. A guest who visits once a month for a two-night, $400 stay adds up to $4,800 a year, real money that argues for investing in service and retention rather than chasing one-time bookings.
Use AI to build your business plan template. Feed it the data from these 10 steps, give it a clear point of view, and it will hand you something clean and organized fast. Ask it to write the plan itself with no direction, and you'll get something generic, closer to filler than strategy. To a strong 2027!
Robert Rauch, CHA, has been an owner-operator of hotels for several decades and is founding chairman of Brick Hospitality, owner of R. A. Rauch & Associates, Inc.
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