According to the EBITDA formula, the profitability of a business class hotel is 20-30%. Average payback period is 4–5 years. Hostels and motels pay off much faster.
The hotel business in Russia in 2021 is well developed and has a high level of competition. According to Rosstat, there are almost 22 thousand hotels in the country, most of them are concentrated in large cities, in resorts and in the venues of the last World Cup.
This does not mean that the hotel industry is oversaturated. According to experts, in the coming years, tourism is expected to develop actively in the Crimea and Krasnodar Territory. Inexpensive roadside motels will be in demand in almost any city where important highways and transport hubs pass. And budget hostels are just beginning to develop and have great potential. Today we will look at the features of the hotel business and the algorithm that will allow you to open your own hotel from scratch.
Let's consider the most relevant hotel formats for Russia.
Which format should you choose? First, it depends on the size of the investment. Guest houses, motels and hostels will require relatively small amounts and pay off faster, but large hotels will be a serious test for the budget. Secondly, it is necessary to take into account the specifics of the region. It hardly makes sense to build a large hotel in a small mountain village - the guesthouse format will fit perfectly here. In general, business hotels and large hotels are best built in cities with a population of one million or more.
As with any business, the hospitality business begins with a thorough analysis of the market in your city. For these purposes, you need to use the services of financial analysts and marketers. They will assess risks, analyze the state of affairs of competitors, potential and prices. Further, based on the findings, you can draw up a business plan with individual calculations.
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