13 years
Since the association became a limited company the members and executive (board) have a lot less influence than the CEO and management.
Does "limited company" mean a "for profit" company that pays taxes?
Scottish Hostel Might Close
Hostel Trends and News
Fight to avert youth hostel ‘disaster’
http://www.thesouthernreporter.co.uk/news/local-headlines/fight_to_avert_youth_hostel_disaster_1_1930891
THE closure of the region’s largest youth hostel – the 80-berth Priorwood House in Melrose – would be a “disaster for the central Borders”, it was claimed this week.
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13 years
No, It is still a charitable organization, but it is not run as it used to be as a the members and managemnt having liability. In the UK it's called a company limited by guarantee. Info can be found here. Basically most charities and member based organizations are going down this route as it limits the liability of the directors or committee people in case of financial problems. There are no shares in this type of company however. Theoretically it shouldn't make a lot of difference, but other things I've been involved with have found it harder to operate in the same way they used to (i.e. like a club) once they have become a CLBG
12 years
Melrose and Kirk Yetholm went on the open market this week. More information and my take on it at http://www.yhagroup.org.uk/archives/border-hostels-on-the-market
12 years
Is it that the hostels aren't profitable, or that they are selling them to raise cash to renovate larger city hostels?
I believe there is a bit of truth in both the responses to this. Basically SYHA has become focused on property management rather than its mission... to get folk (especially young folk) hostelling. The city hostels and a few select rural ones are profitable... the rest lose money and are subsidised by the city hostels. The money raised from sales (including, I heard, the magnificent Loch Lomond Hostel though I can't find any proof of it online) is at least partly ploughed back into doing up difficult to maintain old properties. Granted, the central administrative costs must also be large and a huge drain.
In order to turn things around it would be great to see them focus on their mission and ditch a lot of the property management and overhead. Why not do like they do in Norway where (to the best of my knowledge) the national association owns two hostels with the other 70 odd being fully independent owner-managed hostels that are part of the network for mainly marketing purposes.
Is there anyone out there in Scandinavia who can tell us a bit more about how that model works?
12 years
The city hostels and a few select rural ones are profitable... the rest lose money and are subsidised by the city hostels.
I have to say I disagree with this. They do have a couple of genuinely unprofitable hostels - which they don't own, so can't sell, but the rest make money. It's just that they don't make enough compared to the value of the building, so it makes economic sense to sell them to keep the association afloat. Unfortunately this is not a long term solution, as you'll run out of capital assets to sell pretty soon. A number of "unprofitable" hostels which were sold have since opened as independents, so they must be able to make money for someone. Also if you look at how many millions they put into Edinburgh, I couldn't see that subsidizing anyone for a few years yet, if ever.
The Australian hostel association is basically a franchise model, outside the capital cities and maybe one or two others they are pretty much all independents. I'd imagine that the SYHA will be in this situation in a decade or so. I think that is the way the management want it to go. With the level of top heavy bureaucracy it's probably the only way that makes sense.
12 years
I have to say I disagree with this...They do have a couple of genuinely unprofitable hostels... - which they don't own, so can't sell, but the rest make money. It's just that they don't make enough compared to the value of the building, so it makes economic sense to sell them to keep the association afloat. .
You probably know more about the moeny they make than me. But do they really make a genuine profit i.e. including a fair share of the central office overhead? If they are almost all profitable then they wouldn't need to sell the buildings to keep the association afloat.
I'm off to start another thread to see if we can tempt anyone in Scandinavia, Australia or elsewhere to tell us how it works there exactly... it would be great to have a model under which hostels SYHA and independent could work together under to promote hostelling in Scotland.
12 years
No, for sure, they are not profitable enough, but that indicates the level of overheads that they have to subsidise beyond their own operating costs. I wouldn't say I really know that much about it. I would be honest and say that a lot I say is based on opinion. But it is hard to get a clear picture of where the share of costs go.
Aren't the SYHA already operating a large affiliate network? I count about 25 yellow triangles on their map, which would be about half as many as red official triangles. Their marketing does seem to be fragmented however. From some of the stuff I've seen affiliates aren't included on all promotional materials - perhaps they have to pay extra for that. To be honest I'm not sure that the goals of independent operators would usually intersect with the goals of the SYHA.
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