Searching for a general startup budget. Your thoughts...

Reading more into various threads, it looks like I forgot to factor in the cost of insurance. I'm sure insurance costs vary from place to place. This is a subject with which I am totally unfamiliar. Would anyone care to elaborate on the finer points of insurance/zoning/and other legal matters? For instance, are hostels considered residential or commercial properties?; is there a price range that you might reasonably expect to pay for insurance while in the planning process? (budget); etc.

hostels are generally considered commercial properties - though more than a few operate in grey areas. though in some countries, theres no such thing has a hostel from a legal point of view - only hotels and B&Bs (greece jumps to mind). how that actually effects the running of the business, im not 100% sure.

as far as your costs go, they seem pretty similar to what ive come up with except for the property costs and renovation, but that obviously depends on what sort of model youre looking at for a hostel. personally, id be looking at putting a bar in - which obviously jacks the costs up considerably.

one i worked at in melbourne was spending $50,000 a month on rent and theyd put down $1 million in renovations... on the ground floor. not even the whole building - not sure how much the whole thing cost, as they purchased it 1/2 way through the fit out off another hostel company (nomads bought it from xbase, if anyones interested)

I found the Web site for the American Chambers of Commerce Abroad -- not sure if that is of use:
http://www.uschamber.com/international/directory/default

EscapeArtist.com has articles on doing business abroad. There aren't any in this list for Thailand, but there might be simliar articles on other parts of the site:
http://www.escapeartist.com/Articles/Articles_21.html

Looked up Thailand because that is a specific country that you mentioned.

Possible resources for Thailand:
http://www.sunbeltasia.com/
http://www.bahtsold.com/
http://www.thaivisa.com/ (large forum)
http://www.thailandguru.com/
http://www.thailandguru.com/thailand-company-setup-registration.html (how to setup company in Thailand)
http://www.thaiwebsites.com/ (directory, including business resources)

Two friends and I are looking to get into running a hostel somewhere abroad like Latin America or Asia (most likely Thailand). This won't happen for sometime so we are trying to find out as much information as possible early in order to limit likely future mistakes and pains.

Just by browsing this site for an hour I threw together a rough idea of startup cost. I'm sure it's no where close to actual, so I would like to collect the thoughts of veteran owners/prospectors. Please include in your response an initial reaction to this post, any amendments you can think of, and perhaps ways to apply/or direct our aspirations.

Thank you!

Visiting location “vacation” : $9,000 (assuming $3000/per person)
Buying Property: $300,000
Renovations: $35,000
Startup*: $20,000
Lawyer/Legal/business plan: $2000 (just a guess)
Marketing: Variable**
Buffer: $20,000***
Total: $386,000 / 3 =$128,667

*Includes beds (sturdy metal framed to avoid bed bugs. Look into army surplus bunks), also linens, pillows, phones, computer(s) (may consider one for resident internet access), networking (find someone to set up a good solid network), things that make life good for guests like decoration, common area, small bar/kitchen (just a few well thought out purchases can go a long way here), washer/dryer, iron/board, lamps, alarm clocks, etc

**Large internet marketing sites like hostelworld.com generally take 10% of each booking which can be substantial. We should make this decision early depending on what kind of place we have to work with. It’s also very possible to advertise ourselves based on keywords on search engines. Either way, expect to pay either monthly or by booking.

***This buffer assumes no guests for one month which includes $10,000 at most in mortgage, $1,000 in utilities, $2,000 for two employees, and $7,000 in unforeseen expenses

Just few comments: I think you would be more mobile if you could either rent or get a mortgage on the property... even if you have 300k for the building, there will be more than 35k renovations or 7k as unforeseen expenses, and I guess you can get some good mortgage rates nowadays. As my opinion the best investment is when you always have enough cash-flow and can cover any costs may occur. The hostel should have enough incomes to cover the mortgage anyway, if not, then you can forget it. Also plan some amortisation on the furniture or utilities, as running a hostel is merely different than having your own apartment: Let's say you have a hostel for 50 people... It means there will be 50 people having a shower every day (or having two showers in such tropical weather... :( ), which not only affects the water bill, but the plumming, the pipes, the tiles, etc. You can easily plan to reconstruct your bathrooms every third year. ;)

About bedbugs: Unfortunately metal beds don't have the mysterious power to stop them. :( Bed bugs can be as thin as a credit card, therefore they can hide even in such unimaginable places as flooring, light-switches, even in the cracks of the walls or ceiling!!! The only way to stop them is by proper fumigation methods and quarantine the affected areas. There are some articles in this forum under the pest control section (if you are lazy enough to find it, the url is here ;) Pest Control

Otherwise the metal beds usually squeak and bounce every time you move on the bed, so will defo wake up the other person...