Now, the recent pandemic crisis is dwindling in most parts of the world and the economy of many countries is coming back to normal. So if you are thinking of how to start a hostel business for tourists and travelers, you have just got yourself an excellent business idea.
Presently, more and more people are encouraged to travel on their own, especially young and adults, and these people are regularly looking for a way to cut costs with accommodations. Therefore, coming up with a creative and attractive hostel business idea is a great decision for people who want to get their feet into the tourism business.
So in this post, we have provided some useful tips to help you get started with your hostel business.
Useful Tips for Starting a Hostel Business
Write a Business Plan
This should be the first thing to do when starting a hostel business – write a detailed business plan. Every business needs a plan that clearly highlights the assumptions and strategy to be implemented in the business. So you definitely will need a business plan for your hostel business idea too. This may not be a super plan that will take too long with several assumptions.
Whether you are buying the hostel from another operator or you are going to be doing it from the scratch, a business plan is essential. It will help you get prepared for future challenges and also help you attract investors and partners.
Some things that should feature in your hostel business plan are:
- Your mission
- Vision
- Initial costs
- Hostel description
- Competition analysis
- Funding source
- Marketing strategy
Choose the Location Wisely
The location you choose for your hostel business is essential for the success of the business. Make sure your hostel is located close to your target audience. If you are targeting tourists, then it should be located in a central place or a place with some tourist attractions.
Your Rooms
When it comes to providing hostel accommodation for tourists, the common room provision are single, double, or shared rooms. These are within the concept of a tourism enterprise.
Additionally, you can offer:
- Locker service: this will allow your clients to keep their valuables which will translate into peace of mind.
- Internet: preferably wireless, this will give you an advantage in terms of attention because today, the Internet has become a fundamental tool in the daily lives of many travelers.
- Kitchen or restaurant service: most travelers who stay in hostels are budget-conscious, so accommodation without a kitchen is an unlikely option, so you can offer this alternative. But if it doesn’t fit your plans, you can also offer the restaurant service at more favorable prices.
Understand the Basic Legal Requirements
A hostel is a commercial establishment and therefore is governed by rules that must be met for it to continue in operation. So when thinking of how to implement your hostel business idea, don’t forget to run on the good side of the law. Among the most common are:
- Norms regarding land use and related regulations issued by the competent entity of your locality.
- Health, environmental, and safety concepts.
- Copyright and complementary rules.
- Valid commercial license.
- Cancellation of taxes derived from commercial activity.
- Registration with the competent authority on tourism in your region
Carry Out a Comprehensive Competition Analysis
Get to know what competition looks like in the area you are planning to set up your hostel business. Are there any hostels around? Do tourists find that area conducive to stay? How intense is the competition there? What are your competitors doing to attract customers to themselves? All these will help you come up with a solid work plan to make headway in the business.
It is also what will point you in the right direction about making your hostel unique and stand out from the crowd.
Customize the Atmosphere and Make It Unique
Make sure that both the bathrooms and the rooms have some kind of special decoration, which turns your hostel into a cozy place and gives it its own stamp. Remember that in addition to serving as accommodation, a hostel is a meeting point for your visitors to exchange experiences, so it is important that you have meeting areas.
Hostel Business Idea; Some More Factors to Consider
- Control of expenses: define which are your fixed expenses (rent, services, and taxes) and variables (endowment, staff). Defining how much it costs to keep your hostel open will allow you to calculate what your income should be so that you can stay operational. Also, keep in mind what will be the times of less activity and what contingency plans you will have to apply in order to keep expenses at the margin.
- Research: there are currently many websites that specialize in the topic of hostels, providing valuable information to tourists and travelers. And when tourists find any hostel satisfying on their platforms, they leave great reviews based on their experience. Research such sites and get your business on them.
- Customer service: a well-attended customer today will represent good recommendations for the future, so it is important that you emphasize this point.
- Promotion: try to have a presence in the most important social networks and register on pages and sites about hostels so that you start to build a reputation in the middle.
