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Making up my financial plan

Start a Hostel

Sam De Raes started this discussion 5 years 8 months ago

Hi all

After months of doing nothing about my dream, I finally picked up where I left and I'm trying to write my entire concept out in a business plan.
The hardest part ofcourse being the financial plan.
Atm I'm trying to make an estimate of revenue, with the amount of people I want to host (+/- 40) at a price of 30$ (breakfast included).
Ofcourse I should be modest with the 'fullness' of my hotel.
Is it okay to make an estimate on a half-filled hostel?

So to say that I will have (all year long) 20 guests per night?
Or is even that too much already?

Thanks in advance

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KatL

5 years

Hi Sam- Excellent news you are opening a hostel. Where are you opening your hostel?
Some areas will have travellers coming through on a regular basis, like New York City or London. While other areas will be more of the "boom and bust" scenario, like my little town of Akaroa, New Zealand.
Your break even analysis will have a few different scenarios: either more guests paying a lower rate: 30 guests paying $20 per night, or less guests paying a higher rate (20 guests paying $30). Can you cut back on expenses? What does your water usage look like in the summer versus the winter?

The initial paperwork is the most daunting part of the whole process.

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molislagers

5 years

Hi Sam,

Where are you planning on setting up a hostel? I see you're my 'neighbour'. If you are 'in the neighbourhood' we could maybe talk and share experiences. I'm at the same level/phase namely (market)research & set up financial plan.

Let me know if you are interested.

Greetz Maartje

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todd@unionprope...

5 years

I am in the midst of evaluationg the viability of starting up a hostel. While I have many questions, my top ones include: Is there an ideal size or a minum number of beds to help insure success? Are there resources I can access that provide framework of a thourough budget? Are ther management groups to run the day to day operations or do most find a local person or couple?

Any insights would be greatly appreciated

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molislagers

5 years

todd, i have the same questions, so maybe an idea to start this as a new topic?

Maartje

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todd@unionprope...

5 years

If that would help then great. How do we go about that? Were my questions to broad?On the budgeting front, making assumptions on a number of beds and rack rates is fairly straight forward, it's making sure we have not overlooked certain expense line items. Would love to avoid mistakes.

On the management side, knowing that the culture is so important are their experiences management teams out there or do we take a grass roots approach and hire local

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DarrenOverby

5 years

Here's a video response for Sam and Todd:

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samderaes

5 years

Wow Darren!
Thanks so much.
The video and audio is very clear and your explanation aswell.
I would say that this is the perfect way for explaining the more complicated stuff.

I'd love to have a chat with you someday because every day I have more and more questions.

Thanks again!

Sam

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Tim-BananaDesk

5 years

Hey guys,

Great info in your video Darren. I think it's very clear and I agree with all your points. I actually published an article recently that goes fairly in depth on the topic of financial modelling for Hostels (with a free Excel template too) that I think will help get you started. Check it out in the link below and let me know if you have any questions!

https://bananadesk.com/blog/financial-model-hostel

-Tim

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Rucksack Brian

5 years

Thanks Tim! That's really helpful. A lot of people ask for this kind of spreadsheet to help them get started. This one is nice and simple. Thanks for putting this together and for sharing it with everyone!

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Tim-BananaDesk

5 years

Awesome, great to hear! I'm thinking about doing some follow-up posts helping hostel owners answer some other questions in that "financial modelling" space as well.

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