Starting a Bed and Breakfast

This document is intended to provide an understanding of potential license, permit or registration requirements when considering the establishment of a bed and breakfast in Québec. This Info-Guide has been prepared by the Info entrepreneurs service from information provided by the Canada Business Service Centres and contains a series of possible steps and issues to consider in carrying out your project. While most of your questions will be answered in this document, it is not intended to be exhaustive. Further information can be obtained by contacting Info entreprises at 514 496-4636, Ressources Entreprises at 418 649-4636 or across the province at 1-800-322-4636.

TABLE OF CONTENTS

1. Industry overview
2. Managing your operation
    2.1   Insurance
    2.2   Marketing / Advertising
    2.3   Accommodations rating program
    2.4   Accounting / Bookkeeping
    2.5   Selecting professional services
    2.6   Furnishings and equipment
    2.7   Setting up a pay system
3. Licenses, permits, certificates and regulations
    3.1   Licences
    3.2   Permits
    3.3   Certificates
    3.4   Regulations
4. Associations / Organizations
5. Resources
    5.1   Statistics
    5.2   Related Web Sites

BASICS TO GETTING STARTED

Before proceeding, reference should be made to the  Info-Guide – Business Start-Up for information on the steps involved in establishing a new business.

Starting a business can be a rewarding undertaking, but it comes with its challenges. Before starting a business in Québec, it is wise to do your research. You should also make sure you are suited for entrepreneurship, and understand that significant effort may be required. As such, you should thoroughly enjoy the field you are getting into, and you must believe in your product or service as it may consume much of your time, especially in the start-up phase. There are many issues to consider such as regulations, financing, taxation, managing the business, advertising, and much more. For further information, consult the document Venture Checklists.

1.  INDUSTRY OVERVIEW

This Canadian industry comprises establishments primarily engaged in providing short-term lodging in facilities known as bed and breakfast homes. These establishments provide guest rooms in private homes or in small buildings converted for this use, and they often possess a unique or historic character. Bed and breakfast homes are characterized by a highly personalized service, and the inclusion, in the room rate, of a full breakfast served by the owner or owner-supervised staff.

Questions to ask when starting a bed and breakfast:

• Is your home located in a desirable setting?
• What makes your home unique or attractive to prospective guests?
• Will the structure of your home have to be altered to function well for you, your family and your guests?
• Will additional furnishings be needed?
• Will you have the time, money, and skills to accomplish what is needed?
• Are you and your family emotionally prepared to have strangers stay in your house?
• Have you consulted professionals with expertise related to the bed and breakfast industry?
• Do you like being with people; do you have good hosting, conversational and listening skills?
• Do you enjoy maintaining a neat and clean home?
• Are you well-organized (for example, to maintain reservation schedules and prepare breakfast) and do you understand the basics of managing, accounting and bookkeeping?
• Have you done your research (i.e. analyzed the demand for your services; identified your competitors and established what will set you apart from them; determined how you will advertise)?
• Do you have realistic expectations? (Do not expect big profits...these are not get-rich-quick operations.)

Choosing your location
Choosing the right location for your business is important. A location will depend on the needs of your business, where your customers and competitors are, and such things as taxes, zoning restrictions, noise and the environment. For most businesses, an appropriate location is critical. For further information, consult the document Store Location - "Little Things" Mean a Lot.

2.  MANAGING YOUR OPERATION

Business Plan for Small Service Firms
This publication is designed to help an owner-manager in drawing up a business plan. For further information, consult the document  Business Plan for Small Service Firms.

2.1  Insurance

Insurance needs for businesses vary greatly. It is best to choose an insurance agent or broker familiar with your size of business and, in particular, an agent familiar with your type of operation. If you don't have an insurance agent, it could be a wise decision to ask other business owners in your area to recommend one.

The following is intended to remind you not to overlook the complex areas of business insurance. It is best, however, to discuss your specific requirements with an insurance agent. Adequate insurance coverage, particularly in the area of liability is a must.

Basic insurance:

• fire insurance (extended coverage on buildings and contents);
• liability insurance (depending on type of business);
• burglary protection (theft coverage);
• dishonesty insurance (covers thefts by employees).

Important: It is your responsibility to contact your insurer and advise them of your intention to provide bed and breakfast for paying guests. Failure to do so could result in the voidance of your homeowners' policy. Request written confirmation that you have proper coverage.

2.2  Marketing / Advertising

Word-of-mouth advertising and good public relations are often the best ways of promoting a bed and breakfast. A satisfied customer is good advertising. Brochures are often used in bed and breakfast operations. Networking, including an open-house day for the various tourism operators of your area is also a good way to promote your establishment; they may be asked for accommodation referrals by tourists.

Advertising on the Internet is also highly recommended. If you cannot afford your own Web site, there are companies, and sometimes tourism departments, who, for a fee, may host a Web page for you. Shop around to make sure you find one which attracts a lot of traffic; this will maximize your exposure.

For other cost-effective advertising, consult your provincial/territorial government or tourism association; they may be aware of cooperative advertising or promotions opportunities. A refferal in an area's tourism guide could lead tourists to your location. In some regions, highway signage may be an option.

No matter how you choose to market your business, it is wise to track how your guests found or heard of your establishment - this may help determine your future advertising strategies.

For more information regarding advertising and marketing, see the following documents:

• Signs and Your Business
• Plan Your Advertising Budget
• Advertising Do's and Don'ts
• Ways to Promote Your Product or Service
• Marketing Plan Outline

Guide to Market Research
Successful businesses have extensive knowledge about their customers and their competitors. Acquiring accurate and specific information about your customers and competitors is a critical first step in market investigation and development of a marketing plan. The success of companies, new or existing, depends on the precise evaluation of the market and on the development of an effective business plan. The market influences and directs all the aspects of the activities of the company and will contribute to the success or to the bankruptcy of this one.

In developing a market plan, your primary functions are to understand the needs and desires of your customer, select or develop a product or service that will meet customer needs, develop promotional material that will make the customer aware and ensure product or service delivery. For further information, consult the document Guide to Market Research and Analysis

2.3  Accommodations rating program

An Accommodations Rating Program is defined as "the rating of like accommodations based on the basics of cleanliness, comfort and safety, as well as the extent and quality of facilities and amenities." Participating properties are inspected and rated to ensure they meet consumer expectations. Ratings are based on extent and quality of facilities, services and amenities. The higher the star rating, the more extensive are the facilities, guest services and amenities. (Note: The majority of lodging properties are in the 2 to 3 star range; there are only a handful of 5-star properties in all of Canada.)

Examples of classified accommodation directories include, but are not limited to:

Quebec accommodation directory - Tourisme Québec
This directory offers information on 5,000-odd establishments listed and classified by the Corporation de l'industrie touristique du Quebec (CITQ). Operators may inquire on how to proceed to have their establishments classified. For further information, see the document http://www.citq.qc.ca/publication/repertoire.asp and for consult the directory visit the Web site at: http://www.bonjourquebec.com/anglais/hebergement/index.html
.
Guide « Gîtes et Auberges du Passant au Québec » (Bed & Breakfasts and Country Inns) - Fédération des Agricotours du Québec
Each year the Fédération produces a guide, which is published by Guide de voyage ULYSSES inc. You may submit a request for accreditation. For further information, call 514 252-3138 or visit the Web site at http://www.inns-bb.com/

2.4  Accounting / Bookkeeping

A good record keeping system should be simple to use, easy to understand, reliable, accurate, consistent and designed to provide information on a timely basis.

The legal requirement concerning financial records specify only that they be a permanent, accurate and complete record of your daily income and expenses. There are many types of record books and bookkeeping systems available; for example:

• double entry bookkeeping;
• commercial bookkeeping systems;
• one-write systems;
• computerized systems;
• single entry bookkeeping.

2.5  Selecting professional services

The use of professional services is essential to the success of a small business. Professionals can provide knowledge and expertise in the areas where you may have little. They can round out your management team to ensure your business is operating efficiently. As an entrepreneur, there are four main areas of professional services with which you may consult: lawyer, insurance broker, accountant and banker.

Dealing With Your Banker and Other Lenders
For tips and pointers on dealing with your bank, see the document  Dealing With Your Banker & Other Lenders. Lenders

2.6  Furnishings and Equipment

When furnishing a bed and breakfast, here are some items to consider:

Bedrooms

• Each guest room should have a double, queen or twin bed(s), bedside tables, dresser or writing table or combination, mirror, easy chair(s), desk chair, bedside rug, window screens and coverings, closet, smoke detector, wastebasket, locking door and a posted rate card;
• Invest in good quality mattresses; and
• Consider extras such as a clock radio, full-length mirror, luggage racks or local newspaper.

Linen

• For each bed, have one bedspread and throw blanket and two each of: blankets, sheets, pillow cases and allergy-free pillows; and
• If you send laundry out, have at least three times the amount of linen in use.

Bathrooms

• Will you have shared or private bathrooms;
  for each person, provide a bath towel, hand towel, face cloth, wrapped soaps and drinking glass (paper cups in shared bathrooms);
• Install towel racks and good lighting near bathroom mirror;
• Remove or lock away all personal belongings, medicines, cleaning solutions, toxic or hazardous substances; and
• Put a name plate on the outside of a locking door.

Lighting

• Install wall outlets and lights near beds, mirrors, desks and chairs.

  Flooring

• Ensure floors can withstand traffic;
• Uuse penetrating seals on wood floors and opt for inlaid instead of printed vinyl;
• Use rug underlays to prevent skidding; and
• Choose thick and heavy scatter mats so that they lie flat.

Used Equipment

• Consider buying used equipment as a cost-saving measure. Sources of used equipment could be a bed & breakfast that is closing or dealers in second-hand equipment. The drawback to this approach is that, often, there are no guarantees with the purchase.

Leasing Equipment

• Another alternative is to lease equipment to help keep start-up costs down.

2.7  Setting up a pay system

Pay administration is a management tool that enables you to control personnel cost, increase employee morale, and reduce workforce turnover.

Commission des normes du travail
Useful information on minimum wages, payment, tips, leaves,... For further information, call 514 873-7061, 1-800-265-1414, or visit the Web site at: http://www.cnt.gouv.qc.ca/en/index.asp

Tax measures respecting tips - Ministère du Revenu du Québec
A tip paid directly or indirectly by a customer to an employee belongs to the latter and is considered income. As such, it must be included in the employee's annual income tax return. For further information, visit the Web site at: http://www.formulaire.gouv.qc.ca/cgi/affiche_doc.cgi?dossier=5136&table=0&  (In French Only)

3.  LICENSES, PERMITS, CERTIFICATE AND REGULATIONS

One area of rules and regulations that all new businesses must comply with is that of licenses, permits and regulations. When creating a company, the entrepreneur must contact the municipality involved, along with the provincial/territorial and federal governments.

Each municipal government has the authority to issue its own business licenses within its jurisdiction. Since there is no uniformity throughout the country regarding municipal licenses for businesses, you should consult with the appropriate local officials to determine whether your business will be affected by local regulations and licensing requirements. Businesses (including home-based businesses) must also meet the zoning by-laws that control property uses in their municipalities.

Examples of licenses, permits, certificate and regulations that could apply to you when starting your bed and breakfast may include, but are not limited to:

3.1 Licenses

Municipal business license
You must inform your municipality of your desire to open a bed & breakfast and check whether its location is zoned for such a business. Since regulations vary from one municipality to another, it is important to find out about, among other things, the alteration or construction permit, the occupancy certificate, municipal taxes, signs and terraces. For the location and telephone number of City Hall in your municipality, consult the Quebec municipality directory published by the ministère des Affaires municipales et des Régions. For further information, visit the Web site at: http://www.mamr.gouv.qc.ca/repertoire_mun/repertoire/repertoi.asp (In French Only)

Music license
A license is required to perform music in a public setting. To find out whether you need a license, consult the Society of Composers, Authors and Music Publishers of Canada. Tariff rates exist for, among others, background music. For further information, call 514 844-8377, 1-800-797-6226 or visit the Web site at http://www.socan.ca/jsp/en/music_users/do_you_need_licence.jsp

Liquor licence
Duties and taxes on alcoholic beverages - Ministère du Revenu du Québec
Alcoholic beverages are taxed according to the location where they are consumed. For alcoholic beverages sold for consumption in an establishment, a specific and a general duty must be paid when selling the drinks in addition to the QST and GST. The cost of the license is $30.00. For further information, visit the Web site at: http://www.formulaire.gouv.qc.ca/cgi/affiche_doc.cgi?dossier=4030&table=0& (In French Only)

3.2 Permits

Bed & Breakfats permit
Obtaining a bed and breakfast classification certificate - Ministère du Tourisme
To obtain a certificate (permit) you must submit a request to Tourisme Québec to open a file. Once you obtain an establishment classification from the Corporation de l'industrie touristique du Quebec (CITQ), you must post it in plain view. This certificate costs $190 plus $4 per accommodation unit. The CITQ has been assigned to inspect and classify these establishments.  For further information, call 418 643-2230, 1-800-463-5009 or visit the Web site at: http://www.formulaire.gouv.qc.ca/cgi/affiche_doc.cgi?dossier=4070&table=0 (In French Only)

Permit required for food preparation - Ministère de l'Agriculture, des Pêcheries et de l'Alimentation (MAPAQ)
A food preparation permit is valid for a period of 12 months. The types of permits and rates vary according to the category. For further information, visit the Web site at: http://www.formulaire.gouv.qc.ca/cgi/affiche_doc.cgi?dossier=239&table=0&  (In French Only)

Liquor permit
Liquor permit: categories - Régie des alcools, des courses et des jeux (RACJ)
A list of the liquor permit categories available: restaurant sales or restaurant service. For further information, call 514 873-3577, 418 643-7667, 1-800-363-0320, or visit the Web site at: http://www.formulaire.gouv.qc.ca/cgi/affiche_doc.cgi?dossier=7286&table=0& (In French Only)

Liquor permit: permit delivery, authorization - Régie des alcools, des courses et des jeux (RACJ)
An application fee must be paid at the time of application. If the Régie grants the permit, the holder must also pay an annual permit fee billed by the Régie. For further information, visit the Web site at
http://www.formulaire.gouv.qc.ca/cgi/affiche_doc.cgi?query=&dossier=2703&table=4&tableOrg=0 (In French Only)

Vendor permit
Sole proprietorship: striking off/revocation of striking off - Registraire des entreprises (REQ)
Striking off a sole proprietorship means putting an end to its activities (its existence) by removing its registration from the REQ register of sole proprietorships, companies and legal persons. The sale may be the closure of the company or the operation of another business or the acquisition of a new one. For further information, call 418 380-2130, 1-800-463-6210 or visit the Web site at: http://www.formulaire.gouv.qc.ca/cgi/affiche_doc.cgi?dossier=8415&table=0& (In French Only)

Building permit
Declaration of construction work: public buildings - Régie du bâtiment du Québec (RBQ)
The target clientele is contractors and builder-owners. The following work must be declared: foundation, erection, renovation, alteration and demolition. The declaration must be sent no later than the 20th day of the month following the start of work. For further information, call 514 873-0976, or 1-800-361-0761, or visit the Web site at: http://www.formulaire.gouv.qc.ca/cgi/affiche_doc.cgi?dossier=4253&table=0& (In French Only)

3.3 Certificate

Registration of a business and collection of the QST and GST - Ministère du Revenu du Québec
Anyone who makes a taxable or tax-free sale or rental as part of a commercial activity in Quebec, including the taxable sale of goods and services must register. For further information, visit the Web site at: http://www.formulaire.gouv.qc.ca/cgi/affiche_doc.cgi?dossier=4031&table=0&  (In French Only)

3.4  Regulations

Tourist Establishments Act - Tourisme Québec
The operator must obtain a classification certificate from Tourisme Québec.
For further information, visit the Web site at: http://www2.publicationsduquebec.gouv.qc.ca/dynamicSearch/telecharge.php?type=2&file=/E_14_2/E14_2.html (In French Only)

Tax on lodging - Revenu Québec
The tax on lodging finances the Fonds de partenariat touristique (tourism partnership fund) with a view to supporting and promoting Québec's tourist industry. The tax is $2 per overnight stay or 3% of the rental price of the unit, depending on the tourism region concerned. It must be collected each time a tourist accommodation unit is rented, for more than six hours per day. For further information, visit the Web site at: http://www.revenu.gouv.qc.ca/eng/entreprise/taxes/hebergement/info.asp 

Food Products Act and the Food and Drug Regulations
There are currently many regulations concerning hygiene and cleanliness standards in restaurants: temperatures, locations and facilities, operations, meat, fish and dairy products. In Quebec, with the exception of the City of Montreal, the Food Inspection Support Branch of the ministère de l'Agriculture, Pêcheries et Alimentation Québec (MAPAQ) is responsible for inspecting food prepared and sold in establishments and the cleanliness of their premises. For further information, visit the Web site at: http://www.mapaq.gouv.qc.ca/Fr/Restauration  (In French Only) or http://applicatif.ville.montreal.qc.ca/framville.asp?url=http://services.ville.montreal.qc.ca/aliments/fr/accualif.htm (Montreal) (In French Only)

Fire prevention by-law - Ministère des Affaires municipales et des Régions
This by-law concerns smoke detectors and other equipment, heating and cooking equipment and stoves, pipes and chimneys. For further information, visittheWebsiteat: http://www.formulaire.gouv.qc.ca/cgi/affiche_doc.cgi?dossier=7239&table= 0 & (In French Only)

Competition Act - Competition Bureau
The Competition Bureau is responsible for administration and enforcement of the Act. Its role is to promote and maintain fair competition. For further information, consult the document  Competition Act - Misleading Advertising and Deceptive Marketing Practices or visit the Web site at: http://www.competitionbureau.gc.ca/internet/index.cfm?lg=e

On- or off-premise signage regulations - Transport Québec
For further information, call 514 873-7781, 418 643-1911, or visit the Web sites at: http://www.mtq.gouv.qc.ca/en/index.asp

A number of laws must be considered. The following is a list of examples:

• Act respecting Offences Relating to Alcoholic Beverages;
• Act respecting Occupational Health and Safety;
• Act respecting Labour Standards;
• Section of the Quebec Taxation Act concerning tip-workers;
• Personal Information Protection and Electronic Documents Act.

4.  ASSOCIATIONS / ORGANIZATIONS

There are many bed and breakfast associations. Although it is not necessary to join one of them, there can be advantages in becoming a member in these industry associations. In general, these associations will:

• promote bed and breakfasts as an accommodation choice;
• promote and exchange marketing and promotional ideas among members;
• promote and encourage cooperation on vacancy referrals among members;
• establish and encourage high standards of quality and professionalism;
• represent and advocate on behalf of members.

Examples of associations and organizations include, but are not limited to:

Bed & Breakfasts Canada
For further information, visit the Web site at: http://www.bbcanada.com

Association provinciale des gîtes touristiques du Québec (APGTQ)
For further information, call 418 522-6354 or visit the Web site at:
http://www.bbcanada.com/associations/bbbonjourquebec/bienvenue.html (In French Only)

Association des gîtes du Saguenay-Lac-Saint-Jean
For further information, call 418 543-8751 or visit the Web site at: http://www.agitessaglac.com/agites (In French Only)

Les gîtes touristiques de Granby, Bromont et région
For further information, visit the Web site at: http://www.gitescanada.com/associations/bromontgranby (In French only)

Magog-Orford Bed & Breakfast Association
For further information, visit the Web site at:
http://www.gitescanada.com/associations/magog/english.cfm

Outaouais B&B Association
For further information, visit the Web site at:
http://www.gitescanada.com/associations/outaouais/

Conseil québécois des ressources humaines en tourisme (CCRHT):  Quebec
The Conseil is a group of Quebec tourism organizations. This partners' forum seeks to help define human resources development strategies to enhance professionalism in the tourism industry and thereby fuel its growth in Quebec and competitiveness on the global scene. For further information, call 450 651-1099, or visit the Web site at: http://www.cqrht.qc.ca/ (In French Only)

Corporation de l'industrie touristique au Québec (CITQ)
The CITQ mission is to manage the process of classifying tourist establishments with a view to enhancing their quality. For further information, call 514 499-0550, 1-866-499-0550 or visit the Web site at http://www.citq.qc.ca/

5.  RESOURCES

Additional resources which may help bed and breakfast owners include, but are not limited to:

5.1 Statistics

Canadian Tourism Commission
The Industry Resources section provides you with additional tourism statistics and figures, as well as images and logos for inclusion in marketing materials. Additionally, you can create and maintain contact groups of interest and link to tourism business resources. For further information, visit the Web site at: http://www.canadatourisme.com/ctx/app/en/ca/resource.do

Le Bulletin touristique du Québec - Ministère du Tourisme
This monthly information newsletter provides statistics on U.S. and foreign tourists visiting Quebec as well as information on the level of activity recorded by tourism-related sectors such as hotel occupancy by region and traffic at Centre Infotouristes. For further information, visit the Web site at
http://www.tourisme.gouv.qc.ca/mto/publications/statistiques/index.html (In French Only)

E-Commerce Overview: Tourism Accommodation Sector - Industry Canada
This site will inform you about how firms in Canada's tourism accommodation sector are using the Internet and e-commerce to improve their business processes. For further information, visit the Web site at: http://strategis.ic.gc.ca/epic/internet/indsib-tour.nsf/en/h_qq00109e.html

5.2  Related Web Sites

Directories - Ministère du Tourisme
This section of the Web site provides access to directories compiled by Tourisme Québec and other organizations such as product and services leaders and industry associations.  For further information, visit the Web site at: http://www.tourisme.gouv.qc.ca/mto/repertoires/index.html (In French Only)

Information, documentation, booking- Tourisme Québec
Québec government official tourist site. For further information, visit the Web site at: http://www.tourisme.gouv.qc.ca/qc-fr/accueil.html (In French only)

Discover many other documents, tools and interesting links perterning to the "Start-Up cluster" in the Tool Box, What You Must Know and Links of Interest sections of our Website.

• Info-Guide – Not-for-Profit Organisation (NPO)
• Info-Guide – Cooperatives
• Financing a Business
• Social Economy – Financing and Technical Resources
• Info-Guide - Aboriginal Entrepreneurs
• Info-Guide – Women Entrepreneurs
• Info-Guide – Innovation / R&D;
• Info-Guide – Employment and Training
• Info-Guide – Permits and Licences Required for Certain Types of Businesses
• Info-Guide – Multimedia, Culture and Communications
• Info-Guide – Import
• Info-Guide – Business Start-Up
• Info-Guide – Export
• Info-Guide – Young Entrepreneurs
• Info-Guide – eBusiness
• Starting a Convenience Store

DISCLAIMER
Information contained in this document is of a general nature only and is not intended to constitute advice for any specific fact situation. Users concerned about the reliability of the information should consult directly with the source, or seek legal counsel.

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