What To Know About Getting Your Accommodation Business Graded

Updated on 13 September 2018

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Everything You Need To Know About Getting Your Accommodation Business Graded
A grading plaque’s star. (PICTURE: DAGBREEK WEBSITE)

With over 10 million foreign visitors reported to have come into South Africa in 2016 and predictions by PwC that the country’s hotel industry is set for steady growth in the next five years – it’s evident that there are opportunities for tourist accommodations to increase their occupancy rates and income.

To help accommodation businesses including hotels, BnBs, guest houses, lodges, caravan, camping and conferencing venues to distinguish themselves, the Tourism Grading Council of South Africa (TGCSA), a quality assurance body, wants these types of businesses to get themselves graded.

The grading of establishments is done by TGCSA, which forms part of South African Tourism. Qualified grading assessors make their assessments based on a number of factors including amenities and facilities available, food, beverages and location, among others. The establishment is then given stars (one to five) corresponding with the quality of their facilities and services. They also receive a TGCSA Star insignia to display in their establishments.

The benefits

While getting graded is not a requirement, it is recommended by TGCSA because of the competitive advantage it can offer businesses.

Establishments that get graded stand to benefit more than ungraded ones, says Darryl Erasmus, chief quality assurance officer at TGCSA.

“[The] research we’ve done in the past shows graded establishments are a lot more likely to be profitable because the business and owners are a lot more structured in their approach,” says Erasmus.

We answer some of the biggest questions about the grading process and outline how tourism SMEs stand to benefit.

What is grading?

Grading refers to the assessment of your tourism SME. Accommodation businesses are rated according to the star method. The stars range from 1 to 5; 1 being entry-level, affordable with basic options and 5 for luxury options which are more service-focused and guest-focused.

Is it a requirement to get my establishment graded?

No, getting graded is not a requirement, but it is recommended by TGCSA for tourism establishments.

Where can you get your business graded?

Only TGCSA accredited grading assessors, based all over South Africa, can conduct assessments.

What is the process?

All establishments have to complete the following steps:

  • Identify your establishment – look through the grading criteria and determine which of the nine categories your establishment falls within (hotel, bed and breakfast, guest house, etc.)
  • Grade yourself – From one star to five stars, decide which star level you think you belong to.
  • Complete an online application and choose an assessor – Fill in all your details and select a preferred assessor close to your establishment. You will also have to pay for the assessment before an assessor pays you a visit.
  • Grading submissions take place – Your assessor submits the recommended star grade and his motivation behind it to the monthly Awards Committee meeting for approval.
  • If approved by the committee,  you’ll receive a full report on your grading assessment and will become a member of TGCSA.
  • Receive a certificate and star grading plaque – which must be displayed in the reception area.

What are the benefits of getting graded?

Graded tourism SMEs are placed on a benefit structure called the basket of benefits, which includes benefits relevant to small to medium enterprises.

The TGCSA provides the following:

  • Discounted legal advice – they provide free tax advice to all graded businesses this time of the year if they experience challenges with their tax returns.
  • Recruitment services – graded SMEs are provided with the services of a registered recruitment company that assists with recruiting staff with discounted fees.
  • Procurement – SMEs receive procurement discounts on items like bedding, linens, furniture etc. TGCSA does this on behalf of small tourism businesses.
  • Training and mentorship – TGCSA provides training and mentoring to graded tourism SMEs staff to help them maintain or improve their star grading level. Training programmes include waiter, general hospitality and housekeeping training and more.
  • Free access to markets – TGCSA provide a market place which enables the entrepreneur to promote their products and services to large databases of clients at no cost.
  • Marketing services – the TGCSA helps businesses market themselves by providing listings on both the TGCSA and South African Tourism websites.

See also: Find out if your business needs a trade licence

How long is the star grading valid for?

Once you receive your star, it’s valid for one year upon which you will again be assessed by a TGCSA assessor.

What are the cost?

Membership fees for 1 April 2017 to 31 March 2018 range from R2 160 to R12 994, depending on the type and size of your establishment. A joining fee of R207 is also required.

*All information courtesy of the Tourism Grading Council of South Africa (TGCSA).

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