where would you start a hostel?

[DullM]

Hi, I'm thinking of starting a hostel in China and it'll best to cater for both western and Chinese tourists.

I've done some basic research on several places. Could anyone suggest more locations for me?

Beijing, Shanghai, Hong Kong - great and always have HUGE flow of tourists, but you gotta like the city life and have a lot of money to smash. (minimum ~ RMB 3-5 million )

Chengdu - One of the most competitive markets which are also home to some best hostels in Asia. Its close proximity to neighbouring tourist spots makes Chengdu a feasible base for many tourists to extend their stay there. Also one of two major entrances to Tibet.

Yangshuo - the town is nothing comparable to Lijiang but its karst landscape makes it a very good place for outdoor activities. You can go swimming (in the summer), rock climbing, biking, kayaking, camp fire, camping, some cheap nightlife and visiting a farmland. Many people easily spend 1-2 weeks, some even longer. Westerners make up around 8-10% of the total tourists, comparing to 1-2% in all other cities, making yangshuo the easiest place to speak English and meet other backpackers. A lot of hostels there but usually small sized with 10+ rooms only.

Xi'an - One of the major place to visit for western tourists for the terracotta. The city is big but polluted. Two very best (possibly top 10 in the world, based on the ranking from the hostelworld) and highly competitive hostels are there.

Sanya - Along with Yangshuo, Sanya is also a place for people to spend their leftover days in their visa. A newly developed city that does nothing other than tourism. Many expats are mid-aged to retired. Many Russians. For tourists who are planning to go to Thailand or the Philipines, beaches in Sanya doesn't seem to appeal. But the good thing is that hostels aren't competitive. They're either at a bad location, or broken and obsolete.

[fanglu]

I would focus on considering smaller places popular with backpackers. They are probably your main customer base.

[Lu]

I would look for a place with tourist/backpacker appeal but not many hostels yet. Places like Beijing or Yangshuo are already very well provided with hostels, I imagine competition would be rather stiff. I'm not very well travelled in China, but if you are, try to think of the places you loved that didn't have a hostel with all its amenities yet. That would be a good place, in my opinion.

[DullM]

@Lu,

I was also researching on some places that has very few hostels but appeal to tourists. China seems to have really a lot of those places and do you have some locations to recommend?

These places I looked at include Jiuzhaigou (Sichuan), Tiger leaping Gorges (Yunnan) or Longsheng (rice terrace field in Guilin). They have very few hostels and a lot of tourists. The drawback is that many of tourists are from the packaged tour, have a very extensive low season (half year) and most people only stay there for 1-2 days, making it difficult to help them meet each other and maintain the atmosphere.

@fanglu,

that's what I'll spend a lot of time on searching first. In these places, I've tried to find out some "smaller places" (compared to Hong Kong, Shanghai and Beijing) with many BAD hostels.

Many BAD hostels may suggest that there's really a lot of tourists. And many bad hostels suggest that only some easy and humble improvements are needed to draw enough customers to draw profit. This has happened in Yangshuo since 2008. Before that, there were around 1-2 youth hostels which now looked like "Jiaodaisuo" (motels for peasant-workers). Then a new hostel, which improved slightly, started the business there and it was an instant success. And a year later, another new wave of better hostels came and took a big slice of the cake.

I'm looking for another "yangshuo".....

[anonymoose]

Be aware that over the last few years, budget hotels have been popping up across China, and charge, on average, about 100 RMB per night. The quality is quite good, although not all of them cater to foreigners. These companies seem to be chains which are relatively still in their infancy, and are expanding quickly across China. This may have implications for the profitability of this industry in the future.

[jiminchina]

I would try somewhere where there is not so much competition. Last time I went Kashgar could have done with some better accomodation options for backpackers.

But then its probably only half the year season there, but you could hang around in Thailand reasearching other hostels during that time of the year ;)

Not sure how the political situation is though, but I guess it should be ok for a foreigner to open a business there now.

[abcdefg]

I'm not really a backpacker, but when I went to Luoping 罗平 (Yunnan) earlier this year I was struck with the difficulty in finding decent accomodations.

[rob07]

I remember Jiuzhaigou was a real pain to get to. Compared to, say, Zhangjiajie which is right on a train line. Relatively inaccessible places are probably going to have more package tour type travellers.

[DullM]

@anonymoose, many chained budget hotels seem to cater to business travelers. For them, a comfortable bed with a clean private toilet is more important than having an in-house bar and characters (vibes). I think there's still a lot of people who love to stay in a less institutional, more relaxing, more funny place. Around a decade ago when the concept "youth hostel" started to bloom in China, it was nothing but a cheap bed for the youth and a big dorm, but the standard is catching up so quickly. Several cities in China have already established some of the best hostels, but many of them seem to have enough vacancy for new players to come...

@rob07, thanks for the tips. When i'm looking for a place, i will look at the transportation network to see if it's easy for backpackers to go alone...

@abcdefg, I didn't know about Luoping before and the landscape is stunning! (google image link) I will take a look on it further!

@jiminchina, Kashgar is home to many East-turk separatists and the politics can be a big issue. I think i will avoid it...

[Tianjin42]

It might be worth considering Chengde in Hebei.

It is a big tourist spot being the location of the huge mountain resort for Kangxi and co, as well as the Eight Outlying Temples. When I was there, we hired bikes and made our way around the temples as well as spending a day in避暑山庄.

We met a lot of Non-Chinese travellers, booked into a few of the poor cheap local hotels. All had looked for hostels before making do with one the dank local venues. There was not one hostel (and the city wasn’t listed on hostelworld etc). It is just over 4 hours from Beijing (though one or two buses use the new express way cutting the journey time somewhat).

You’d have a good long busy season but I imagine winter might be quite sparse. Having said this, the city itself is not small so perhaps people still be around. Most travellers stay for two nights and there are huge numbers of Chinese visitors but also significant non-Chinese numbers.

It struck me as a good place to start up a hostel when I visited hence my answer. Welcome to PM me should you require.

[DullM]

Thanks Tianjin, i was looking into the detail of chengde in the past two days since you mentioned it. I didn't realize that it's listed as a cultural heritage of the UN. We're planning to go to Qingdiao within two months to take a look on it and i'll sure go to chengde at the time too. Thanks for your suggestion!