14 years
You can wonderfully run a 22-bed hostel without staff (except yourself). If you want staff, you´ll need more beds - or a hostel in a country where staff is much cheaper than that.
Budget feasibility
Start a Hostel
1.) I want to be strictly a owner/manager of the hostel, since my current hourly wage is 4-5 times minimum wage. Is this a reasonable wage for a hostel this size? I plan on working at the hostel full time for the first few months until I fully understand the business. How much work (or expected weekly hours) would be required by myself if I wanted to operate the hostel this way?
2.) I expect the major expenses to be the (A) mortgage (projected around $2,000), (B) employees probably being paid minimum wage which is currently at $8.50/hour x 16 hours/day = $136/day or $4,136/month (as you can see, I am not sure about how many hours are required), and (C) water/power/gas/cable internet which I project $690/month.
So, 22 beds at $22/night and an average 75% occupancy rate would be $11,040/month - $6,826 monthly overhead = $4,214 monthly profit.
Does this look like an accurate financial portrayal of the way things would work out? I realize this does not include incidentals.
- Comments
14 years
Most of the staff at my hostel works in trade for a free place to stay. I ask for 20 hours a week of work, to stay for free, and a two month commitment. Most stay for at least 6 months.
I also agree that with a small number of beds, that the hostel can be run completely on your own, maybe a housekeeper would help. We have 54 beds, and only one employee on at a time, which includes the manager, who works the M-F day shift. There are moments when things can be a bit hectic, however we are very upfront about being a very laid-back hostel with an easy going staff, so during those hectic moments the guests are usually very patient.
You should also really have a look at your projected occupancy rates. You'll be better off from the beginning in my opinion if you are bearish about your occupancy. It will take some time before you can get your occupancy rates up, and you don't want to be blowing money on payroll if you don't have the guests to make those employees worthwhile.
13 years
How many employees do you have at a time though? How many hours per shift? With an 8 hour shift you will need 3 employees per day to have a 24 hour coverage at the front desk. Then you have to account for days off, cleaning time etc. I am assuming you will need a minimum of 4 employees on staff. You also mention that the manager works M-F day shift - is this person a full time employee on a salary? How do you handle cleaning? Do you have a separate housekeeper or one of the exchange employees cleans while the manager is covering the front desk?
Thanks
Apgon
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