How to open a hostel - hostel business plan with calculations

21.09.2021

Approximate data:

Net profit - 56,525 rubles
Payback - A little more than 1 year.

This business plan, like all others in the section, contains calculations of average prices, which may differ in your case. Therefore, we recommend that you make calculations for your business individually.

Over the past few years, hostels have become popular in Russia. This is due to the inexpensive cost for an acceptable level of comfort. If you compare prices with hotels, you can say that hostels are much cheaper. In connection with the crisis, the popularity and demand for this type of mini-hotels has only increased. Therefore, aspiring entrepreneurs are increasingly wondering how to open a hostel.

We will consider a hostel business plan with calculations in a three-room rented apartment.

Market analysis

Today, there are more than 5,000 mini-hotels and hostels in Russia. Half of them are located in Moscow and St. Petersburg. In other cities, the potential for this type of business is great. About 2.6 million rubles annually on average as income (not profit!) are received by Russian hostels.

Over the past two years, the number of hostels has more than doubled, which indicates the increased attention of entrepreneurs to this type of business and demand from potential customers.

As a rule, hostels are created with a capacity of 10-30 people. Their share is more than 50% of all hostels, in some regions even more. This is due to the relatively low level of investment and high profitability. It should be noted that over the past 2-3 years, investment in this area has also increased. So, for example, in St. Petersburg this figure has more than doubled, the total amount of investments has already exceeded 500 million rubles.

Before you open your hostel, you need to analyze the situation in the hotel business market. The best way to do this is to collect data in booking systems. In addition, this information is freely available. For clarity, it is better to compile the information in the form of a table, considering each object separately.

If it is difficult to collect information yourself or there is no time, you can entrust it to freelancers.

There are several ways to open hostels:

Buying a franchise.
Opening your own business with the acquisition of premises.
Opening your own business with rental premises.

For most, the third option seems to be the most acceptable and budget option. That is what will be considered.

It is very important to assess your own level of competitiveness by familiarizing yourself with the services of other hotel companies. Competitors will be: hotels, hotels, other hostels, rented apartments (daily). A lower price will help to compete with hotels and hotels, and with other hostels and apartments - the quality of the services provided and some kind of "trick" that will make the institution memorable, recognizable.

Portrait of a potential buyer: the main consumers will be representatives of those strata of the population who have an average level of income. This, as a rule, will be tourists, traveling enthusiasts, youth. If we talk about middle-aged people, then these will be ordinary employees who do not have a conservative outlook on life. Over 65% of all students in the world visit more and more new places every year. They will be the main clients of the hostel.

SWOT analysis

Internal factors

External factors

Advantages:

1. Prospects for this type of business.

2. Constant demand for services, regardless of the situation in the country, the level of inflation, the severity of the crisis.

3. Low cost.

4. Since the main investments are made in real estate and household items, losses are reduced in case of possible failure.

5. The presence of "chips".

Opportunities:

1. A developing market segment in which investors are ready to invest their money.

2. Offering additional services (breakfasts, development of excursions, etc.).

4. Quality improvement.

5. Increasing the speed of service and provision of services.

Disadvantages:

1. Lack of double beds.

2. Lack of breakfast.

3. Lack of parking.

4. Inability to serve large events due to small capacity.

Threats:

1. Economic instability in the country.

2. High level of competition.

3. Seasonality of demand.

Opportunity Assessment

You can increase opportunities by introducing additional services, increasing their level. The increase in demand will directly depend on promotional activities.

It is necessary to take into account the seasonality of demand for hotel services.

The organization will be open 24 hours a day, seven days a week.

Organizational and legal issues:

Choice of OPF of the enterprise. When opening one hostel, it is best to stay at. With further expansion, you can think about registering a legal entity, opening an LLC. OKVED codes can be: 55.23 - activities of other places of residence. Or 55.23.5 - activities of other places for temporary residence, not included in other groups. It will depend on the maximum length of stay for clients.
Registration with the tax office, obtaining a certificate, choosing a taxation system. You can start with a choice, as it provides many advantages. One of the following objects can be chosen as the tax base: 6% of income or 15% of the difference (income-expenses). In the second case, the rate may vary depending on the region in which the business is registered.
We also recommend accepting payments from our customers by bank cards. To do this, you need to open a bank account. By the way, we wrote an article about.
If the hostel opens in an apartment or a separate room, no licenses are required.
Compliance with the requirements of sanitary standards. In this case, additional documents are not received. However, after some time, the relevant services may come and check. When finishing the premises, it is worth obtaining certificates of conformity of the materials used (in order to avoid possible problems).
Obtaining the conclusion of the fire inspection on the satisfaction of all norms and standards in the room. This document guarantees safety not only for visitors, but also for workers. It is mandatory to receive it.
Conclusion of a lease agreement.

A few more legal requirements:

The hostel cannot be located in the basement or basement.
When settling foreign citizens, migration registration must be kept.
Redevelopment will require an appeal to the Housing Inspectorate.

Leased premises: it will be a three-room apartment on the ground floor, preferably with a separate exit. It is desirable that the property has already been transferred to commercial ownership, as this procedure is not easy and lengthy.

Service Description

The actual service is the provision of a temporary place of residence. It includes:

sleeping place;
kitchen with necessary utensils (including electrical appliances, utensils);
bathroom (shower, toilet);
rest room (with TV, laptop, game console);
WiFi;
use of dryers, washing machine, iron.

Such a range of services will certainly attract more visitors to the hostel.

The order will be made through the administrator, who accepts applications by phone or via the Internet.

Drawing up a marketing plan

One of the main factors in the demand for hostel services is advertising. You should not wait for self-promotion - it will be a very long process. The following strategies must be used:

Work with educational institutions (schools, universities). Students and pupils very often go on excursions to other cities, various Olympiads. In addition, by contacting you, they will recommend this place to others. And this is a completely free bonus in the form of word of mouth. The main thing is that they like the hostel.
It is necessary to register the hostel in various social networks that are popular. It will also be useful to open your own website with feedback and contact information. Be sure to indicate the location, phone numbers. It is worth posting photos of rooms, kitchens, bathrooms and other rooms. Having good reviews can also instill confidence in the quality of services in potential customers.
Work with various schools (sports, music), clubs, teams. Talented people are often on the road.
Development of commercial offers with a system of bonuses, promotions, discounts. You can associate them with seasonality, the number of visitors, for example.
Working with travel agencies.
Registration on travel sites and applications like booking.com.
System of corporate discounts.
Distribution of leaflets.

Payment for accommodation will be made after the arrival of residents. You don't need to pay anything in advance. Checkout time is 12:00. Payment is made in cash.

The cost of one place is set at 700 rubles, as the hostel is equipped with a kitchen, a bathroom, a room with a TV, a laptop and a game console. In addition, there is an iron and a washing machine. In general, prices for this type of service vary from 350 to 1500 rubles, depending on the conditions of the hostel, city, location.

Drawing up a production plan

You need space to work. It will be a three-room apartment on the ground floor with a separate entrance. Refurbishment of the premises will be required, which will include redevelopment. The apartment will include:

kitchen (10 m 2);
bathroom (4 m 2);
toilet (4 m 2);
corridor (4 m 2);
hall (8 m 2);
closet for the administrator and consumables (5 m 2);
2 rooms (30 m2 each);

Total total area will be: 95 m 2.

The repair will include interior decoration, installation of lamps, chandeliers, complete bathroom and bathroom equipment, installation of a sink in the kitchen. The cost will be 700,000 rubles.

Important: For 12 residents there must be 1 toilet, 1 shower, 2 sinks.

The apartment will need the following furniture:

kitchen set (1pc);
dining table (1pc);
chairs (5pcs);
bunk beds (6pcs);
sofa (1pc);
bedside tables (6pcs);
cabinets (2pcs);
tables (2 pieces);
dryers (2 pieces);
armchairs (2 pieces).

You can buy furniture new or get by with a used one, buying it, for example, on Avito.

You will also need to purchase the following equipment:

fridge;
microwave oven;
stove;
TV set;
game console (preferably);
vacuum cleaner;
2 laptops (1 for administrator, 1 for residents);
washing machine;
Electric kettle.

It will not do without buying the utensils that will be required for cooking.

Cleaners clean the premises in the morning in shifts (rooms before the arrival of new residents, other premises - 2 times a day).

Administrators work around the clock in shifts. Their responsibilities include accepting applications, monitoring them, adding information about promotions, special offers, settlements with guests, their settlement, consulting.

Salary is issued 2 times a month (advance payment and salary).

People with work experience are hired. Knowledge of foreign languages among administrators is welcome, excellent computer and Internet skills are also required.

organizational plan

	1 month	2 month	3 month
IP registration	6 800 rubles
Conclusion of a lease agreement
Search for colleagues
Competition analysis (booking systems)
Advertising	10 000 rubles
Purchase of equipment	135 000 rubles
Buying furniture	102 000 rubles
Buying bedding	42 000 rubles
Buying utensils	30 000 rubles
Purchase of curtains, towels	20 000 rubles
Buying household items	6 000 rubles
Purchase of food stocks	1 000 rubles
Site creation	11 000 rubles
Purchase of a cash register	15 000 rub.
Renovation of premises	300 000 rubles
Obtaining the conclusion of firefighters
Conducting the Internet			600 r.
Equipment installation
Apartment equipment
launch
Total	679 400 rubles

The entrepreneur is engaged in the search and placement of employees, he also studies the available booking systems to assess competition. Advertising includes placement on the Internet, contracts with travel agencies.

The purchase of bedding includes mattresses, pillows, blankets, bed linen (2 sets for each bed).

Household items include stocks of shampoo, shower gel, soap, as well as items needed for cleaning the premises (including mops, rags).

Food stocks are sugar, coffee, tea.

Financial plan

Monthly income - 210,000 rubles.

Initial costs - 679,400 rubles.

Recurring costs (calculation for 30 days):

Thus, profit before tax will be: 210,000 - 143,500 = 66,500 rubles.

Taxes: 66,500 * 0.15 = 9,975 rubles.

Net profit: 56,525 rubles.

Profitability = 56,525/210,000 = 26.92%.

Payback period = 679,400/56,525 = 12.02. Therefore, the business idea will pay off in a little more than a year.

The break-even point is reached after 205 settlements per day.

Risks

Risk	Probability of occurrence	Ways to avoid	Possible threats
External
Tightening of the legislation, new norms.	Low	Solution of organizational issues	Additional expenses. Decrease in the level of profitability.
Emergencies, accidents.	Low	Insurance	Damage to property. Suspension of activities.
The growth of competition.	Medium	Building a customer base. Development of special offers. Additional services. Quality improvement.	Decrease in income. Reducing the level of profitability. Loss of some clients.
Seasonal fluctuations in demand.	high
Internal
Choosing an unfavorable location.	Medium	Conducting geomarketing research.	Fewer clients. Less income.
Low level of qualification of employees.	Medium	Hiring experienced workers. Education.	Customer dissatisfaction with the service. Reducing the number of potential buyers.
Technological risks	Medium	Timely repair of equipment. Purchase of new equipment at the expense of the depreciation fund.	Decrease in the quality of the service provided.

You can think about developing a hostel for a specific consumer. For example, athletes or musicians with the appropriate paraphernalia (gym, studio room for rehearsals).

It is very important to timely replace old or broken equipment. You can not ignore the things that are used constantly. You can't skimp on these things.

Consider offering additional services. For example, developing excursions, preparing breakfasts for guests.

Make your hostel original, unlike all the others. Maybe it will be a games room or an entertainment room. In a word, everything that will surprise and be remembered!

Of course, it is necessary to constantly maintain the cleanliness of the premises.

After the promotion of the premises, you can think about opening another point.

We also recommend watching one of the many videos about entrepreneurs who opened the hostel:

Important: Remember that you can write a business plan for your business on your own. To do this, read the articles:

Last request: We are all human and we can make mistakes, ignore something, etc. Do not judge strictly if this business plan or others in the section seem incomplete to you. If you have experience in this or that activity or you see a defect and can supplement the article, please let us know in the comments! Only in this way can we jointly make business plans more complete, detailed and relevant. Thank you for your attention!