Hey Dave, first of all can I say 'A warm welcome' to the global village [as in Hostel Management as I call it], been on here myself since the early days and yes you are correct, its a great place to gather info, see what its really like in the hostel world as a hostel owner or even a traveller to share experiences and indeed as a hostel owner help each other so you can get back up easier should you trip n fall! There a few good guys [long term peeps] that you can rely on their info such as Rucksack Brian but to name a few.
Dave I don't like to say I know everything though I am the creator and CEO of ESS Global [ESS Universal on here] that is truly global and I have been in this industry in some sort of fashion since 1989 and still stay at hostels globally to keep up with changing trends. OK reading through your write up I am both excited for you and a bit concerned! Lets start at the beginning:
I am in the process of researching the viability of opening a hostel. It will be my first foray into the hostel world and hospitality in general - Dave, whats the old saying? A man who fails to plan, plans to fail so its good that you are doing research! I am sure you have stayed in many hostels or hotels and what I have to say is reviews are everything! Treat the guests how you would like to be treated and especially with SAFETY & SECURITY! We all know that location, location, location is extremely important in the hostel/hotel business; where is your proposed hostel? In a western country or somewhere where civil unrest is likely? This will tell you what kind of manager you will probably get. There is one thing for certain, he or she is not going to love your hostel as much as you unless the manager is your mother, father or grandmother! Is your proposed manager/ess a traveller that might want to suddenly pick up and leave one day? Are you in a position to up and be there very quickly? This is the worrying part in my opinion.
Is the possibility of turning a profit, not necessarily a large one, whilst employing management to take care of things day to day a pipe dream? Be under no illusion, a hostel no matter where it is is expensive to run if run legally and properly, from staff to change and wash sheets to irradicating bed bugs if an infestation occurs and costly insurances, it all adds up, however if financed, managed and directed correctly it is doeable which brings me back to location, location, location. You need to be with a reputable booking engine such as hostelbookers.com to stand any chance of growth though in my opinion having an idependant GOOD content website is equally important! If a guest books directly from your website you can save the 6% booking fee they charge you or whatever it is. Local marketing is also beneficial, school trips to your area, schools book in students, sometimes up to 20 at a time! What's the name of that hostel in East London we supplied with bunk beds???? Ah Venture Hostels, Ade has up to 25 students from France stay at his place monthly! So search ideas of how to subsidise your normal overseas travellers.
For now I will leave the glory details until a later date or you can find my blogs on here which are helpful such as the law [especially in the west] regarding fire exit requirements like minimum 700mm gap between bunk beds as a fire escape pathway or mattresses have to be fire retardant to BS7177 [paying guests] or things like that blah blah but I do think your venture sounds great, exciting, yes I would do it! Just keep doing your research and tread water carefully and good luck mate and hope this helps some!