One of your initial questions may be how to make the highest and best use of your investment property.
That may include income potential, contribution to the community, and eventual resale value.
The good news is that the wedding industry in the USA is bouncing back after the pandemic. According to IBISWorld, it’s worth around $58 million in 2022.
Generating a decent profit margin and ROI, is perfectly possible. However, it remains a highly competitive industry with low barriers to entry.
Brenda Bushell, co-owner of the award-winning The Treasury Venue Collection, believes firmly that a customer-focused sales approach is crucial to running a successful wedding venue business.
Below, she offers new investors expert advice based on years of first-hand experience.
Cultivate Your Venue's Unique Value Proposition
Invest in Your Wedding Venue as You Make Revenue
Optimize Your Venue Sales and Marketing System
Seize Opportunities to Upsell and Customize
Invest in the Best Venue Management System and Staff
Set Up a Reliable Network of Local Wedding Vendors
As Brenda explains, “You’re dealing with happy people who are actively engaged in the process of finding and booking a wedding venue. In other words, you’re not so much conducting a business transaction as providing an unforgettable and joyful experience.”
It’s important that your venue offers something special. Something your competitors do not. Something that helps the couple instantly envision their happy day.
Remember, your venue will have a major impact on the look and feel of their wedding, so you want to promise them an event that will be different from anything else out there.
Like any brand, your venue is more likely to stand out if it has a distinctive identity, be it chic, exotic, rustic, or cultural.
If it’s a historic building, is surrounded by lush gardens, or overlooks the water, you have a head start.
Natural advantages such as these provide a wonderful backdrop to any wedding ceremony, and deliver inspiration for your venue’s individuality.
Beyond any inherent attributes, there are plenty of other features that will help set your venue apart, including exceptional menu options, all-in-one packages, complimentary parking, and private suites where the couple can get ready.
Your starting point is the venue itself and its location.
The wedding industry is unique in that is one of the few businesses where customers truly buy with their heart and not with their head.
IS YOUR UNIQUE VALUE YOUR VERSATILITY?
Consider offering DIY and BYO opportunities so couples can customize their dream day.
This not only reduces the strain on your cashflow, but also gives you time to learn and adapt without making long-term financial commitments.
As Brenda points out, “The great thing about a wedding venue from an investor’s point of view is that it’s a completely scalable business with many repeatable deliverables, from banquet halls and DJs, to wedding cakes and sparkler fountains.”
Whether you’ve leased or purchased your property, it makes sense to use contractors to provide your deliverables in the early days. Take catering as an example. Instead of installing a fully equipped kitchen from the outset, which requires a considerable outlay, consider partnering with an outside caterer who already has a stellar reputation. When the time is right, you may decide to add catering to your revenue stream by bringing it in-house.
The same approach can be applied to almost every aspect of the business:
As bookings increase, bring more and more deliverables in-house. Focus first on those that provide the best return on investment, such as providing bar services.
With a little flair and imagination, you can create a picture-perfect backdrop for relatively little money. Pinterest abounds with ideas, from folding screens and flower-covered chuppahs to silk wall panels and arch drapes.
Bathrooms, catering spaces, and parking are just as important as the reception area, so tackle these first. If your venue allows for outdoor ceremonies, you’ll also need to prepare for a weather backup option, such as a tent.
Conversely, you can wait before installing that built-in sound system, upgrading your lighting, adding an open air balcony or indoor waterfall.
Likewise, prioritize your repair, renovation and extension projects.
Wherever you are financially, it’s always sensible to grow your business as you generate revenue.
As an investor, you already know the importance of sales and marketing. Yet many wedding venues flounder in these vital areas. They either don’t generate enough leads, or, if they do, they fail to turn those leads into bookings. Why is that?
“Well, it’s not usually due to lack of spending,” says Brenda. “Some venues spend thousands of dollars and countless hours on advertising without generating leads. Part of the problem is either not knowing the most profitable places to advertise or advertising on every platform there is in the hope that leads will offset marketing costs.”
Specify what type of couples you’re targeting so you can position your location as their dream wedding venue.
Both approaches—shooting-in-the-dark and scatter-gun—are usually the result of not having a detailed and coherent marketing plan. Time and money are limited, so it’s essential your advertising material is effective. That means choosing the right platforms and then designing ads that suit the platform, appeal to your target audience, and make you stand out from the crowd.
Many couples turn to directory sites like TheKnot.com and WeddingWire.com during the initial research phase to find vendors in their desired location.
Social media sites like Instagram and Pinterest are used by couples as a secondary "search engine."
Allocate your budget where you see the highest traffic from your ideal clientele.
And don’t overlook planners. They’re extremely influential in the couple’s decision-making process. Therefore, learn early on what it is they’re looking for, and when.
When it comes to choosing the right advertising platforms, it pays to mix it up.
Think publications, bridal shows with your ideal clients in attendance and social media.
Consider other forms of free or cheap advertising as well, such as editorial features, press releases and listings on online venue directories.
“It goes without saying that a user-friendly, visually appealing website that contains authentic testimonials and adopts best SEO practices is a must,” reminds Brenda.
One of the most important things that many wedding venues undervalue is the importance of quality photos in selling your space (along with the videos and virtual tours that you mentioned). If you don't have any events on the books, consider hiring a quality photographer to take photos of the space and stage the rooms to appeal to your ideal client.
In addition to beautiful photography, video footage and virtual tours are practically a prerequisite for sales.
These tools help couples visualize their big day in your venue.
Not only that, but they’re also shown to boost lead generation and provide excellent ROI. According to a 2020 study on video marketing, 83% of video marketers say video helps them with lead generation, and 80% say video has directly helped increase sales.
This is the only way to understand which advertising platforms are working for you, and which aren’t. Successful marketing relies on constant monitoring and timely adjustments, so ensure you have someone knowledgeable who can do this for you.
Brenda’s best advice? Hire a marketer who is experienced in the wedding industry to produce your marketing plan. Alternatively, cut your learning curve in half by using a sales and marketing education program designed purely for wedding venues.
The best will give you templates and SOPs that you can use to develop your strategy and track everything.
“Lady Castlehawke in North Carolina is a wonderful example of how using a tried and tested system can turn a business around. When it first opened as a wedding venue, the owners were really struggling to get bookings, despite its wonderful setting and unique amenities.
Popular upsells include additional time to get ready or keep the party going, specialty lighting, live entertainment, and tailor-made menus. However, don’t forget the smaller items such as upgraded linens and glassware. Small upgrades can provide significant additional revenue over time. What’s more, they’ll help you outshine the competition and give ultimate customer satisfaction.
Of course, one of the best ways to increase your profit margin and enhance your offering is to operate your own bar. Price this by consumption or by package. Want to provide a little pizazz? Recommend signature cocktails or even a mixologist who can create drinks on demand.
When it comes to making a profit, it’s tempting to assume that the bigger the wedding, the bigger the revenue. That isn’t necessarily true. The most significant impact on your bottom line comes from the extra features that you offer. Even micro-weddings can give you a very decent margin if you offer add-ons and premium services.
“The key to upselling is customization,” says Brenda. “This turns a standard wedding into a unique and memorable experience.”
According to The Knot, the average couple sets aside 30% of their overall budget for their wedding venue. Keep this in mind, be flexible, but avoid sales pressure tactics at all costs.
“Never, ever take advantage of the happy couple’s emotional state—and maybe their desire to compete with other happy couples—to rake in a few more dollars,” warns Brenda. “This will end up hurting your business. Only upsell if you see a natural opportunity and it makes sense for the couple.”
Whatever features you offer, make sure they are tailored to the couple’s vision and budget.
Once you start making bookings, it’s paramount that you manage them effectively. That means investing in the best venue management system you can afford. There are several out there, so take your time in comparing them. Make sure they include at least the following:
“Providing an exceptional service can only be done using exceptional people, so make sure they know the industry inside out, have excellent interpersonal and organizational skills, and can handle sudden changes,” says Brenda. “They should also have bags of energy. The wedding industry is exciting and romantic, but it’s also hectic and demanding.”
You may want to hire temporary staff until you’ve got a steady stream of bookings. If so, find them from a reputable agency. Once your business is established, you can consider taking on employees. The advantage of permanent staff is that they’ll be focused entirely on your venue, and you won’t have to continually break in new people.
The experience your staff provides will heavily impact your venue reviews. Work with your team leaders to create systems that provide consistently excellent experiences for your customers.
Billing and invoicing
When it comes to staff, you want professionals, especially for key positions such as venue coordinator, maître d’, head chef, and marketing manager.
Taking time to train permanent and temporary staff on best practices and your venue’s signature style is well worth the effort.
To minimize business risk, assess them like you would any other business partner before you enter into an agreement. Meet them face-to-face, ask for client referrals, check out their experience, and ensure they have the capacity to meet your needs.
Finding the right wedding vendors involves a certain amount of trial and error in the early days.
Wherever possible, use local vendors (tap into your business community for recommendations).
Local doesn’t guarantee excellence, but it does help you build a really strong network. Neighboring businesses tend to support each other, and there will be times when you need flexibility or last-minute additions.
“Knowing you can count on your vendors to help you out of a tight spot is invaluable,” says Brenda. “It’s impossible to run a successful venue without a network of reliable local wedding professionals.”
When you do find dependable wedding vendors, go out of your way to keep them. Pay promptly, maintain clear and regular communication lines, and give reasonable lead times. And don’t forget to promote them whenever possible (on your website, on social media, word of mouth, testimonials, etc.).
It sets the tone for a good, close relationship.
They may even repay the compliment.
If you’re prepared to cultivate a unique value proposition, reinvest profits as the business grows, target sales and marketing efforts effectively, work with professionals, and offer add-on and premium services, you’ll be more than pleased with your return on investment.
The wedding industry may be highly competitive, but
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