Hi everyone
I've been thinking/dreaming of opening a hostel in my hometown Quebec City (Canada) for a bit now, but did not really act on it besides reading this awesome site & forum. Back in the days, there were only 2 hostels, but in the past year or two, 2 more have opened.
I'm wondering if there is any way to figure out if there's room for one more. What I can tell you is
- The city is fairly touristy and economy is good. Lots of development and good things going on (festivals and such)
- The "best" one is a huge HI hostel and I know that's not the cup of tea of everyone. The other 3 are smaller ones, like I'd like to open, and are getting mixed reviews on hostelworld/hostelbookers
- On the other hand, i think backpacking/hostels are maybe less popular in Canada then let's say Europe, so maybe our small market in the city is already saturated ?
I'd be glad to explore any advice you guys might have.
Cheers !
-Pat
11 years
Rule of a thumb. 1 hostel per 100,000 people. So Quebec City (Canada) can have 5 maybe 6 of hostels. As soon as this number grows - your city becomes choking point and saturated.
Be sure that all of these hostels now in existence in your city have a profitable business. You have couple of years more to join in on the table, and after that - goodbye papa Joe.
11 years
As long as the rents and assorted costs are manageable I think a hostel in Quebec City would be quite possible. In my experience hostels fail more often due to high costs and related unrealistic occupancy projections than just lack of customers. If you are looking at 80% occupancy say to break even then the margins are too tight. If you can get by on 50% occupancy then it getting more realistic,
11 years
Backpacking is less popular in North America than it is in Europe, but I would imagine that Quebec City gets a fair amount of tourism. Your future competition isn't likely to let you check out their books, but they might be willing to tell you if business is booming or if they're barely scraping by. As a non-profit, I think HI has to publish their financial figures as part of the public record, so you might actually be able to look at their books. You could also talk to the hostels in your feeder cities to see how many of their guests come from or go to Quebec City to get an idea of how popular the city is with travelers.
If there aren't enough backpackers, are there other niche markets that you could attract to your hostel? Maybe a particular sport or hobby that's popular in your area. You could partner up with a local club and create an event to draw other enthusiasts to the city and make your hostel the gathering point.
11 years
thanks guys for giving your opinion. I'm trying to find some stats about tourism in the region and I was able to find some, although anything remotely close to backpackers or hostels is pretty much outdated.
I'm also starting to look up costs and everything, and this won't be easy because I don't have a lot of cash and properties/rent is expensive around here these days. But i'm trying to put together some numbers and see how viable it could be. And yes, a 50% occupancy rate was part of my calculations. I'll also check with my local business development center as i'm sure they can help in finding financing and that kind of us.
And Brian, thanks for the idea of contacting hostels from out of town to see if they would share some numbers. If I pursue this dream further, I think that's definitely something I should do.
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