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Opening Hostel in Canada

Start a Hostel

bob roberts started this discussion 17 years 7 months ago

Hi guys;

some questions about starting a hostel in canada:

1) Any recommondations on what city to start with?
2) Is there still a market for new hostels in the 3 cities of Vancouver, Montreal, and Toronto?
3) Any other places out there that could use another hostel?
4) Is managing/owning a hostel as profitible as it seems?
5) Will I have to keep my day job, or is it possible to make a very solid living just from 1 hostel with capacity of 35 to 50 people?

Thanks for the feedback

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Josh Hostels

17 years

1) Any recommondations on what city to start with?

You could try looking at what hostels already exist by searching hostelz.com.

2) Is there still a market for new hostels in the 3 cities of Vancouver, Montreal, and Toronto?

I would check hostelz.com to see how many hostels there already are and where they are located. Are there places in the city that would attract backpackers that don't have a hostel nearby? I have a feeling that unless a city is really oversaturated with hostels that it is possible to succeed just by doing a great job with customer service, fun atmosphere and good marketing.

3) Any other places out there that could use another hostel?

Tim made a good list here.

4) Is managing/owning a hostel as profitible as it seems?

I think that they can be very profitable, but I've only worked in larger hostels.

5) Will I have to keep my day job, or is it possible to make a very solid living just from 1 hostel with capacity of 35 to 50 people?

I would use a spreadsheet to project income. I've attached a simple spreadsheet to this post as an example. The spreadsheet is locked except for the blue cells. Enter your number of beds in the blue cells and the spreadsheet will update the simple projections for you. The percentages at the bottom are for average occupancy.

The attached file called hostel_projection_spreadsheet.xls.zip is an Excel spreadsheet. The other one is in OpenOffice format. To view the spreadsheet on Windows, download the file then right-click on it and unzip/uncompress it.

You can also make extra income through Internet, tours, car rental vouchers, etc.

Have you seen the article about starting a hostel at backpackers.ca?

EDIT: If the zipped spreadsheets below don't work, you can click the following link to download the uncompressed Excel-format spreadsheet:
http://www.hostelmanagement.com/files/hostel_projection_spreadsheet.xls

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gordo

17 years

1) depends on what sort of hostel you're looking at. some canadian cities (vancouver especially) have the benefit of dual seasons - winter for skiers/boarders and summer for everywhere else. some smaller cities centered around certain attractions may be far more seasonal - some places only open for the ski season and still do excellent business, others only in summer. dont forget that a closed hostel isnt making any money, but nor is it spending any.

2) canada still has a long way to go in terms of developing a backpacking culture - as opposed to australia or europe for example. i doubt any city in north america has reached saturation point yet. backpacking is a growing industry (or flashpacking is anyway) with the growth in budget airlines and ease of international travel.

3) loads of places. eastern europe and the balkans are where im looking.

4) its like any business.

5) that could be tricky. most of the smaller hostels ive stayed in, the owner was also the operator. depending on your initial start up costs, you could probably run it 'hands off' at that size, but when you're starting out, id have thought youd want to have a fair degree of control over it. i know i do.

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Tim

17 years

How about Windsor, Ontario?

There is only one hostel in the Detroit/Windsor metro area (which only barely qualifies as a hostel). A proper backpackers' hostel would do well there.

You would market it as a Detroit-Windsor hostel and not a Windsor hostel. Few international travellers know where Windsor is but most people have heard of Detroit and Windsor is as convenient a location for a hostel as anywhere in the Detroit metro area. There is quite a bit to see in Detroit and its music and automotive heritage is enough to attract many travellers. http://en.wikipedia.org/wiki/Tourism_in_metropolitan_Detroit

Detroit may not offer as much as other North American cities but it has some sights that a lot of people want to see and a lot more travellers would visit if there was a proper hostel; but most travellers would feel more comfortable staying in Windsor on the Canadian side rather than downtown Detroit. Windsor is perceived as safer than Detroit and the US's high minimum drinking age makes a hostel in Windsor more attractive to travellers than a hostel on the US side of the border, yet frequent buses under the tunnel make it practical to stay in Windsor when visiting Detroit.

Another advantage of a hostel in Windsor is that being the only real hostel in the Detroit area means that virtually every guidebook will include your hostel. Being included in a guidebook isn't such a sure thing if there are 20 other hostels in town.

If I were going to start a hostel in Canada, Windsor would be my first choice. Montreal would be my second choice.

As far as size is concerned. Anything between 40 and 60 beds is small enough for one person to manage but big enough to make money. If I were doing it I would start something with closer to 60 beds.

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Josh Hostels

17 years

A Detroit-Windsor hostel a great idea... Very good advice...

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talkeetnahostel

17 years

What about one of the national parks areas, such as Banff or Jasper? Starting out with a small hostel would help you see how much you like running your own hostel. Also, I think they are more fun!

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paddybackpacker

17 years

I'm looking to set up a hostel in Ireland, in Bunratty, close to Shannon airport. I really don't know where to start. Whether to buy a house and renovate it or to build a new hostel to scratch...

Also, i really wanted to have a look at the spreadsheets you posted above, but i can't seem to open them, even tried downloading and unzipping, but it doesn't work...i was wondering could you help me with this?

I'll be setting my hostel up in quite a rural area, there are bus connections and we have the famous Bunratty Castle here, so that will attract visitors. I hope to have a small, comfortable hostel that really welcomes people and somewhere they won't want to leave! But, i'm worried that i won't be able to keep it sustainable during the winter months, when tourist numbers are a lot lower...

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talkeetnahostel

17 years

My hostel is a house turned hostel, and people love it!! Everyone feels right at home, and many people end up staying longer because of how comfortable they feel....so buying a house is a great Idea!!

Also, it is hard when you have slow winter months. I am closed from October to early April, so have to make all my money in a short time. But that is the way it goes. One thing I do to help out is to rent the hostel as somewhat of a communial house in the winter...each room rented long term. I can keep one bunkroom opened as a hostel rental, or rent the whole place. You just have to find people who are opened to living in a hostel atmosphear, not makeing them selfs too much at home (in other parts of the house than their room).

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Josh Hostels

17 years

Also, i really wanted to have a look at the spreadsheets you posted above, but i can't seem to open them, even tried downloading and unzipping, but it doesn't work...i was wondering could you help me with this?

Click here to download the spreadsheet in Excel format. You will need to unzip it first. If that doesn't work, let me know and I will email you an uncompressed version.

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kat1976

17 years

For some reason I cant open the attached files.
I would reallly like more information on financial planning and writing up a business plan.:)

1) Any recommondations on what city to start with?

You could try looking at what hostels already exist by searching hostelz.com.

2) Is there still a market for new hostels in the 3 cities of Vancouver, Montreal, and Toronto?

I would check hostelz.com to see how many hostels there already are and where they are located. Are there places in the city that would attract backpackers that don't have a hostel nearby? I have a feeling that unless a city is really oversaturated with hostels that it is possible to succeed just by doing a great job with customer service, fun atmosphere and good marketing.

3) Any other places out there that could use another hostel?

Tim made a good list here.

4) Is managing/owning a hostel as profitible as it seems?

I think that they can be very profitable, but I've only worked in larger hostels.

5) Will I have to keep my day job, or is it possible to make a very solid living just from 1 hostel with capacity of 35 to 50 people?

I would use a spreadsheet to project income. I've attached a simple spreadsheet to this post as an example. The spreadsheet is locked except for the blue cells. Enter your number of beds in the blue cells and the spreadsheet will update the simple projections for you. The percentages at the bottom are for average occupancy.

The attached file called hostel_projection_spreadsheet.xls.zip is an Excel spreadsheet. The other one is in OpenOffice format. To view the spreadsheet on Windows, download the file then right-click on it and unzip/uncompress it.

You can also make extra income through Internet, tours, car rental vouchers, etc.

Have you seen the article about starting a hostel at backpackers.ca?

Report

Josh Hostels

17 years

For some reason I cant open the attached files.

They are .zip files that need to be uncompressed before they can be opened. Did you try right-clicking on them and choosing "Extract"? If that doesn't work let me know and I'll email them to you.

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