All Topics / General Property / The Taurest Dollar..

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  • Profile photo of js2js2
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    @js2
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    Has anyone Invested in a Backpackers Hostel style accommodation? For Taurests and the likes?

    Just toaching on the surface – There is two basic needs that a Taurest must secure when traveling!

    One is – To find somewhere to stay.

    And the other – Is a way to get around.

    My mind has beggun to boggle. I’m getting grand thoughts of owning a chain of Backpackers accommodations around Australia. Thinking bigger then what i can do again, of course.

    Though others may want to share the insight and look into it!!

    Why right the way around Australia? Well you need somewhere for your vans to be destinatable to. (is that’s such a word). If it’s not i just made one up :). I’m thinking of a van hire service to go along with it. What better way to do it then to have both businesses work in unison together.

    Anyone like to offer there thoughts on this?

    One down side i see, is I’d hate to have to fix broken down hippy style comvy vans half way around Australia. What would be the pro’s and con’s of doing this Investment style?

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    Profile photo of AUSPROPAUSPROP
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    I am told there are problems controlling the cash in the tills. I think a lot of backpackers are run as owner operated. I also believe it to be fairly competitive these days and the standard needs to be high.

    The trouble with hire cars is you are competing against industry specialists who are gettign their huge volume discounts on new cars i.e. fleet discounts, vs your 1960’s kombi… sounds like headaches but if you could work a solution to that it sounds interesting. Perhaps look at newer vans like Transits or something that could be under new car warranty and have a break down service.



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    Profile photo of aussierogueaussierogue
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    i reckon its a great idea. linking all the backpackers with a shuttle service. great way to keep the clients within yr system and you can get some money for the transport aswell. i reckon you would have to view the transport as an auxillary service to the accomodation. you cld buy 10 vans and have them running all the time. you cld even get one of the backpackers to drive it to the next location. insurance could be an issue but i reckon youve got a great idea.

    you could start small by offering this in one state. ie 7 backpackers in victoria. all linked with shuttles. clients pay an upfront fee if they wish and legs are redeamable within a 3 month time frame (a bit like the old eurail).
    worth thinking about – you cld also pitch the idea to a van company or even a backpackers network.

    good idea!

    Profile photo of thecrestthecrest
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    Hi Jaffasoft
    You have an acorn there.
    The cash can be controlled by leasing out all the hostels.
    You don’t want to be bothered with vehicle breakdowns.
    Backpackers who want vehicles, always have the problem of selling them when they leave Australia.
    Perhaps you can sell vehicles to inbound backpackers with a buyback scheme. They have to buy the vehicle and prepay for a book of accommodation vouchers to your hostels. You buy the vehicle back at an agreed lower price, less costs for damage or urgent repairs. Where else would they stay ? Possibly a win-win.
    cheers
    thecrest

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    Profile photo of aussierogueaussierogue
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    good suggestion the crest – im in!! send me the business plan!

    Profile photo of wilandelwilandel
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    Hi Jaffasoft,

    The idea has some merit, however I’d have somebody good managing it! I’d be concerned about druggo’s burning the place down, or drunks often getting into a fight causing damage.

    I don’t want to put a dampner on your idea, but we use many seasonal casual workers on our asparagus farm, and lots of them are backpackers on holidays. Most are great people, however, they are often broke the day after they are paid. They either “score” on payday (if you know what I mean), or live at the pub after work hours….

    A good idea would be to provide a shuttle service to working farms, (go to centrelink and enquire about the “Harvest Trail of Australia)”, to provide work for the backpackers. i.e. citrus in Mildura, Asparagus in Kooweerup, etc.. This leads to a win/win deal. The backpackers pay you for the delivery service, and they earn money and pay you first instead of last!

    Farmers and the Gov’t will go along with it, (you may be able to even get some sort of Gov’t grant if you are smart about it, because there is a cronic shortage of seasonal casual workers in Australia. The Gov’t only charges 13% tax to harvest workers, however it is still difficult to find good reliable workers.

    Good luck,

    Del

    Profile photo of calvin_thirty4calvin_thirty4
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    Jaffasoft Posted – 29/09/2004 : 12:35:45


    Has anyone Invested in a Backpackers Hostel style accommodation? For Taurests and the likes?

    Well that’s an excellent idea. Here in WA there is a group called Easyrider Backpacker Tours and they basically operate a touris transportation service up and down the WA coast for Backpackers. This could be another spin off of the above ideas.

    I don’t have their contact details handy, but when I do I’ll be certain to PM them to you so that you can pick their brains, should you chose to develop this idea! Perhpas you can start in WA – hey, I know a Bus Contracting company over here that will, evenually, look into building a website for their business……..[blush2]

    Cheers

    [email protected]

    Profile photo of js2js2
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    Sorry this is a bit of a long post!!

    And sorry I haven’t been able to reply, I’m all over the place, really busy.

    In this place I’m in. The rental backpacker accommodation is 65% and the some are saying the maximun their having is 90%, vaccancy that is!

    So thiers the problem! Because thier is an unemployment rate of 12% you can rent the rooms tempararily for the people with not much money, the helpless and the not so well off. During the time when thier is not as many back packers around end march for a two three months, when thier at a minimun. ( but i’m only guessing that’s the problem, I think if you market it you can make it profitable easily) an average house can have 16 beds at 20 a day, that’s $208 a day at 65% vacancy.

    But also, but the key in all this is the marketing. Thier is so many things that you can do to market a Backpackers accommodation. Though i actaully prefur to call it a “Guest House” with good genuine country style hospitality but in near and around the city limits hussle and bussle.
    I could go on for ages, but I will just put in some piont form.

    ` Run workers out to the workers fruit picking farms dayly and nite.
    As already suggested and a good idea.
    ` Manually campain outside of the bus shelters, the bus stops (just the same as how i have been picked up for Backpackers) train stations and anywhere, where thier is taurests or backpackers travelling into the area. You need to approach them and give them a ride and a bit of support.
    `Offer deals (in house) free feeds, coke machines, airconditioned rooms, food for lunches for the workers. Taurests for the beach to run them to the beach. I’m a qualified Chef so I can do the food.
    `And then you could have other things like washing machines, Internet use, coke machine.

    Thier is harder rules to backpacker accommodation because of the Childers backpacker murders and the fire. That we so easily have forgotten from a while ago! A big Queenslander is suitable. With it already lifted so that you don’t need legal requirements meet. Thier is grounds and the market to do this and it would deppend on how it is managed. I could manage it and know I would thrive in this sort of situation.

    For example the other day I seen a Lovely queenslander and was only $250 thousand.

    Does anyone like dealing with council. I don’t like dealing with council. You want to find out with the council of all the if’s and but’s and do the council side of it. And I can sign a contract with you to run and manage the place (we can organise a contract with something!) probably for twelve months. I can do all the administration and the organising ‘On Site’ and the marketing. In this time it could get settled and the run of the place ‘in place’ then maybee i can be replaced with a trained person or somebody thats wants to be a resident for free and runs the place?

    Profile photo of garrytasgarrytas
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    Hi
    Just wondering what a TAUREST is?
    Is it a resting place for Bulls

    [thumbsup2]

    Regards
    Garrytas

    [email protected] Always have cashflow positive Tasmanian commercial properties
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    Profile photo of ANUBISANUBIS
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    I think they are people born in May who like to travel [biggrin]

    Profile photo of js2js2
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    Just wondering what a TAUREST is?
    Is it a resting place for Bulls

    I think so that’s the way i feel sometimes!

    I am actaully a Taurus I was born in the star sign Taurus. Maybee that’s the reason why I go “Bull” steam ahead , i mean ‘full’ steam ahead.

    But seriously this could be a go here, i feel that I can thrive in this enviroment.

    I just priced a van, it’s $1500 it goes, it’s a bit ruff but I could get them out there :).

    Profile photo of JunkersJunkers
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    Hi Jaffasoft,
    I really don’t want to rain on your parade, but your idea has been done to death in the backpacker industry already. I would suggest having a look at TNT Magazine, The Word, Backpackers guide to Australia, Zinc magazine, Travel Australia etc, and you will find that there are already many chains of backpacker hostels right throughout the country. It is an incredibly competitive industry out there (I know as I own a backpacker tour company) so you’ve already got your YHA’s, Base Backpackers, Koala’s Resorts etc, and the biggest players of them all, Oz Experience, Greyhound Buses and Adventure Tours which really have the transport side of ferrying tourists around all sown up. Of the backpacker campervan providers, there’s ‘Wicked’ vans, Britz, NQ, Maui, Koala’s and many miore based in Sydney that cater for the backpacker who buys a piece of junk then sells it back to the original seller at a cheaper buyback price. In the 5 years I’ve been in the industry, I’ve seen many new start ups come and go, including the biggest backpacker travel agency in Australia going under owing millions to backpacker suppliers. Backpackers are a lot more sophisticated these days than they ever were, and because of the extremely high standard of hostels these days (many are like hotels) you’d really have to have your marketing and business plan well and truly researched before you put any money into it. Just because it’s cheap accommodation doesn’t mean you’ll get droves lining up at your door to take up your offer. More likely you’ll get a lower standard of tenant, which possibly means higher maintenance bills when they trash the joint after a big night at the pub. Smaller backpackers in regional towns employ backpackers to run the place, so proper management would be an important issue. I don’t know where you are from, but our tours cover every state except WA and tasmania, and we use hostels all the time.
    My advice is, research it very, very carefully before you start buyinghouses to accommodate backpackers. Also remember, the travellers bible is the Lonely Planet, and many backpackers will go to places listed in there ahead of other places that have people spruking for business at train stations etc. I don’t know whether it’s illegal, but i don’t think you can spruik for business at the airport – you run the risk of being clobbered by the taxi drivers, shuttle bus drivers and every other Tom, Dick and Harry operating out of there.
    Like any good business, get your business plan and marketing plan researched first before you do anything.
    That’s my 2 cents worth….hope it’s of some help.
    Cheers,
    Junkers

    Profile photo of summersummer
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    From my backpacking days it was almost garunteed that the backpacker running the place would still money from the till and then move on. So owner ocupied would be better. Also backpackers theses days are really 5 star with pools and all the mod cons.

    Profile photo of js2js2
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    Junker, excellent advice. Thanks , some things to think about in there. Always when you get to the bottom of it , there is problems.

    Yeah obviously it is a problem that people might steal, from the til ( I thought of that!). I don’t know a way to keep them fool proof and honest?

    Profile photo of JunkersJunkers
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    No problems with the advice – more than happy to help! And it doesn’t mean that your idea is a bad one, just that you may have to think a little outside of the square to be able to make a profit in the competitive industry that is the backpacking industry. Backpackers are notoriously tight with their money, but a total contradiction as well – they’ll try to screw you to pay bugger all for their nightly accommodation, and then go and spend $200 at the pub on a night out. Hostel prices range from $15 up to $25 a night – depending on what season it is (low season on the east coast is June, July, August) They’ll also expect free or very cheap internet, meals and sometimes transfers – depending on where you are located. The biggest problem in the backpacker industry is that because there have been so many players in the game, to acctract business they’ve cut corners, given lots of freebies etc to get marketshare. So it’s something to be aware of before you get involved.

    As for the stealing from the till, the best way to manage it is not to let your hostel be run by the backpackers themselves, some smaller backpackers rely on the backpackers – they may have run out of money, so they stayin the one place for a month or two and work for room and board and a little pocket money, until they save enough to move on to the next town. that’s where you’ll run into trouble, you would need to make sure the person you employ to run the hostel is trustworthy. Just like any employer, we all have to make sure that our employees are trustworthy with money that comes through their hands.
    Hope this helps and good luck.
    Cheers,
    Junkers

    Profile photo of js2js2
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    Just thought I would reply to this, almost three months after I made the initial thread!

    I have noticed a recent renovation development of an older style existing building, that is going ahead as an equally large backpacker accommodation as the town is used off (esp in the main street!). But not large buy any standards of the city and some of the other touristy places!
    Some stats in the area show that in 2003 there were some 350,000 visitors staying an average of 5 days in the town and in 2004 some 475,000 visitors staying an average of 7 days. And this year expected to rise again. And it is of my opinion that it will certainly, and steadily grow.
    This kind of development is good for me, because.
    1). It re-confirms that it could be done (and this is also a larger style backpackers accommodation).
    2). Says to me that this still could be done with a very smaller type of accommodation, guest house type backpacker accommodation, with has less risk.
    3). Makes me keener to find a money partner. So that I can try and get something started tomorrow!!

    Jaffasoft

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    Profile photo of crjcrj
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    Jaffasoft,

    Your figures are suggesting in 2003 1,400,000 bed nights (5 days, 4 nights) and in 2004 2,850,000 bed nights (7 days, 6 nights). This works out to be the equivalent of 3835 fully occupied single beds in 2003 and 7808 fully occupied single beds in 2004 (or if all couples 1917.5 (someone always misses out) and 3904 double beds in 2003 and 2004).

    I’d be cautious and recheck your figures as what your figures are saying is that in 2004 there was not only a 35% increase in visitors but all the visitors stayed 50% longer on average.

    I don’t know what happened in your area in 2004 but this is phenomenal.

    Your area might be booming and tourist accommodation might be a good investment but on this basis any property investment used by tourists – Laundromats, cafes etc etc would be likely to be a good investment.

    Why don’t you look at the census figures for 2001 and 1996 which the local council or library probably has and see what the numbers of nonlocals on census night was.

    I’ve had two experiences of living in tourist oriented areas.

    In one – a Murray River town the population went up several fold between Melbourne Cup Day and the end of January. Obviously these people were staying for longer periods so if your area is like that the demographics being attracted might be families not backpackers

    In the second – on the Newell Highway where I was also involved in tourism committees, the average stay was 1.1 nights

    If your area has high numbers over a short period, in the off season there are going to be people undercutting prices, so you are really going to have to make your profit in the busy time.

    Tourism might be growing in your area, but it is also the industry most areas of Australia are looking at for growth so there will be a lot of competition

    Good luck

    Profile photo of JunkersJunkers
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    HI Jaffasoft,
    Of those figures you just quoted for the number of visitors to the region, how many of those are backpackers?? Do you know the dollar figure that those travellers are spending on average in the town??
    And, if I may be so bold as to ask….which area are you looking at?? I know investors are incredibly antsy about revealing where it is they’re investing, but I’ve had it up to the eyeballs with backpackers, so have absolutely no intention of EVER stealing your idea!!
    The reason I ask is again, I know the backpacker industry very well and know where it is the backpackers want to go to. You don’t have to tell if you don’t want to.
    Cheers,
    Junkers

    Profile photo of RavtownRavtown
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    Hello All,

    just read this post with interest. Personally I’m all for the laundromat, hands off approach.

    But the thread bought to mind an idea I had when I first went to Maggie Island off Townsville.

    Essentially, back packers are not all the get drunk fall down type, many just aren’t full on party people and then there are those that just want to take a bit of a break from the full on back pack experience every now and again. The island is the ideal place to have a little bit of a chill but as yet there is very little reasonable accommodation that allows you to have some quiet space free from the smell of last nights alcohol and what ever else.

    Also you get a lot of Australian people, couples, familes, whatever that would like to overnight in clean simple affordable accommodation, so they can take their time to enjoy the island (one day is a little too short)

    On the island we seem to have big packpacker party central places, flash new appartments, holiday home rentals (bit harder to access)

    Longwinded I am, but essentially I think there is room on maggie for a backpacker retreat so to speak.

    I guess it would be a lifestyle business tho. as the capital required to set it up would be significant, island prices being what they are.

    idea is no good to me, so others are welcome

    Profile photo of calvin_thirty4calvin_thirty4
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    originally posted by Ravtown:
    Essentially, back packers are not all the get drunk fall down type, many just aren’t full on party people and then there are those that just want to take a bit of a break from the full on back pack experience every now and again. The island is the ideal place to have a little bit of a chill but as yet there is very little reasonable accommodation that allows you to have some quiet space free from the smell of last nights alcohol and what ever else.

    This sounds like a great idea. In the Pilbara we have a similar set up called Eco Beach Resort. It sounds as if that is what you are saying, an eco friendly ‘Time-out’ holiday destination! Might pay to do some research on Eco Beach Resort, if it could be applied in the Eastern States where there are three states close together – you might find yourself fully booked all year round!

    Food for thought, anyway.

    Cheers

    [email protected]

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