The #1 Challenge Among Hostel Owners When Running A Hostel


#1 Challenges of Hostel Owners

10,617 hostel owners were asked one question: “What’s the #1 challenge when it comes to running your hostel and why?” – A total of 279 of them answered.

In this blog post, I’m going to share with you the 49 most insightful answers. However, if you’re dying to see them all you can download my free report hereOpens in a new tab..

The report contains further charts and statistics for all the different continents.

Alrighty, let’s dive in.

#1 Challenge Among Hostel Owners

Let’s start with the worldwide results before we get to the actual answers.

Worldwide Results

Challenges Hostel Owners Survey Results

These are the top 5 challenges hostel owners encounter:

  • #1 Guest Satisfaction – 20%
  • #2 Staff – 17% 
  • #3 Competition – 13%
  • #4 Marketing – 10%
  • #5 Occupancy – 9%

Note that the results are quite different from continent to continent. If you want to go deeper, download the free report hereOpens in a new tab..

Let’s have a look at the most insightful answers for each category:

Guest Satisfaction

#1

My #1 challenge when running a hostel is…

“…meeting all the needs of our guests. The demands changed very quickly over the last few years and it’s getting more and more difficult to keep up with it while still staying low-budget.”

#2

My #1 challenge when running a hostel is…

“…managing bad reviews. It’s hard to combat them and they’re influencing our business massively.”

#3

My #1 challenge when running a hostel is…

“…satisfying all our guests with the best hospitality and facilities. The thing is, everybody thinks and feels different and there’s no cookie-cutter approach to address all of their wishes.”

#4

My #1 challenge when running a hostel is…

“…keeping up with new and higher expectations. If our end goal is guest satisfaction, then our journey begins with their expectations. When guests book a room they have certain expectations that are determined by various factors such as the images of our property that are on the web, reviews that other guests have left us, the descriptions we have, etc.

However, sometimes these expectations are so high that it’s hard to exceed them to guarantee guest satisfaction. That’s especially true when I look back at the last few years in which the expectation’s bar was raised enormously.”

Hostel Owner Survey Challenges

#5

My #1 challenge when running a hostel is…

“…maintaining an excellent level of service. Since there is no standard rule to please everyone, it’s hard to teach our staff how to do it.”

#6

My #1 challenge when running a hostel is…

“…getting our happy guests to leave a review. There are all kinds of people: The ‘bad’ ones would never forget to leave a review – on the contrary: the ‘good’ ones forget to do so all the time.”

#7

My #1 challenge when running a hostel is…

“…putting myself in the passenger’s seat and trying to figure out what they really need. The challenge is to really get the guest to ‘experience’ the quality of care we aim to give so that it goes beyond great service and becomes an experience.”

#8

My #1 challenge when running a hostel is…

“…preventing bad reviews. No matter what we do, there are always some people that had ‘wrong’ expectations about our hostel. The thing is, the unsatisfied ones go through a lot of effort to let the entire world know how they feel. On the other hand, guests that really like the place are not even bothering to write a review.”

#9

My #1 challenge when running a hostel is…

“…fulfilling all our guests’ needs. They are coming from different parts of the world, different cultures, different religions, have different levels of education, different lifestyles, etc… Meeting diverse needs is such a multi-layered task. It’s tough to be attentive to everyone.” 

Different Cultures Of Hostel Guests

#10

My #1 challenge when running a hostel is…

“…giving our guests the feeling that they have the best time of their life. While it’s quite challenging, it’s also fun.”

#11

My #1 challenge when running a hostel is…

“…increasing our online reviews. It takes forever to recover from a bad review.”

#12

My #1 challenge when running a hostel is…

“…to ensure all our guests are happy and enjoy their stay. Every guest is different and we need to find different ways to please each and every one of them when it comes to their expectations.

For example, one might be looking for fun activities whereas others might want to chill and rest, so we need to find the right balance to make them both happy at our place.”

Hostel Staff

#13

My #1 challenge when running a hostel is…

“…having a healthy relationship with the team. Our hostel relies on staff. They’re the ones in contact with guests and keep the business running. A healthy team brings happy and effective working situations. Simply put: Happy staff = happy guests.

This also affects all other areas of running a hostel. The thing is, there are always new problems popping up when dealing with the team and guests – it never ends. It’s not easy at all because everyone is from a different background and I find this is the major challenge we are facing.”

#14

My #1 challenge when running a hostel is…

“Finding the right staff. Our hostel is not for business travelers but also not for young party folks. Hence, our staff has to be a mixture between formal and casual which makes the process a bit tricky.”

#15

My #1 challenge when running a hostel is…

“…keeping up high-quality service. Our budget doesn’t allow for professional front-desk staff, so we try to coach them to provide great service. The main issue though is that they have to handle email correspondence in English and this is something we can’t really teach quickly.

Furthermore, they aren’t really knowledgeable in the areas of touristic destinations, transportation, etc., just yet. We know that it’s our task to create comprehensive guidelines for service staff to solve these issues, but it requires a huge effort time-wise that we do not have right now.”

Challenge Hostel Staff

#16

My #1 challenge when running a hostel is…

“…giving away responsibility. I find it hard to delegate and outsource tasks because I don’t like the feeling of relying solely on others. I’m totally okay with the fact that they probably don’t do the job just as good as I would for my baby, but I still prefer being 100% in control.”

#17

My #1 challenge when running a hostel is…

“…keeping great staff. I think we are doing a great job when it comes to hiring the right people. That said, the better they are the earlier they typically leave.”

#18

My #1 challenge when running a hostel is…

“…motivating our staff. It’s a vicious cycle: the lower their motivation the lower their enthusiasm when it comes to guest service and the lower the satisfaction of our guests. And unsatisfied guests lead to additional worry and stress for our staff.”

Competition

#19

My #1 challenge when running a hostel is…

“…dealing with the enormous amount of competition in our area. The tourist numbers are currently low and have been lower than expected for several months now.

There is also a myriad of new accommodations that have opened in the last 12-18 months. We haven’t had problems with it before, but now it’s getting to a point where we have to fight tooth and nail to increase our occupancy.”

#20

My #1 challenge when running a hostel is…

“…finding a way to promote our hostel without having to lower our rates. The competition is getting stronger every year and everyone’s solution seems to be lowering the price.”

#21

My #1 challenge when running a hostel is…

“…dealing with the oversupply of hostels in our area. So many new hostels have opened during the last 3-4 years. Almost every street has a hostel now. However, the number of tourists (=potential bookings) didn’t grow as much as the number of new hostels.

Some older hostels already had to close their doors and it looks like running a hostel is becoming kind of a ‘fashion-business’. Like clothes: new trends come and go. Especially because backpackers seem to prefer the new-built hostels compared to the old ones.”

#22

My #1 challenge when running a hostel is…

“…making our hostel the tourists’ best choice for staying. There are many hostels and Airbnbs that are operating these days and each has its attractions. Therefore, the challenge lies in making and keeping the hostel relevant and attractive to keep up with others.”

#23

My #1 challenge when running a hostel is…

“…increasing our occupancy rate due to the sheer amount of competitors in our area. The price war has reached a point of absurdity.”

Hostel Competition

#24

My #1 challenge when running a hostel is…

“…being unique among all the other hostels. I think you have to bring something different to the table in order to attract more tourists these days.”

#25

My #1 challenge when running a hostel is…

“…competing with bigger hostels. They have multiple income streams such as bars, tour desks, etc. so that they are able to offer lower rates while still making a decent profit!”

#26

My #1 challenge when running a hostel is…

“…competing in a market where others use “volunteers”, i.e. non-paid employees, which are illegal in the country of my hostel. When I hire people, I have to pay for them as well as for additional taxes and benefits which makes my operational overheads exceedingly higher than all of our competitors.

Yet, we are attracting the same guests and they obviously have a higher margin for marketing to get a bigger piece of the cake.”

Hostel Marketing

#27

My #1 challenge when running a hostel is…

“…marketing our hostel, since we are a poshtel. That means we are basically competing with both hotels and hostels even though we are actually something unique.”

#28

My #1 challenge when running a hostel is…

“…maintaining a healthy balance between direct bookings and bookings through online travel agencies. I noticed a huge increase in OTA bookings over the last few years and I haven’t figured out yet how to further push our direct bookings.”

#29

My #1 challenge when running a hostel is…

“…getting more guests. Our location is not a destination for travelers and there are few real attractions here.”

Occupancy

#30

My #1 challenge when running a hostel is…

“…dealing with the seasons. Many of our expenses such as wages are fixed. Hence, no matter if we are hosting just a few or literally hundreds of guests, they remain the same. That’s a real issue in the off-season when there’s no real revenue coming in on a regular basis.”

#31

My #1 challenge when running a hostel is…

“…staying profitable. In our area, we have a high season, low season and a “no season”.The latter means there are literally whole weeks without a single guest. So, the challenge we are facing is to further reduce our costs while attracting more guests and being profitable in the long run.”

Hostel Seasonality Occupancy

#32

My #1 challenge when running a hostel is…

“…improving our guests’ experience and at the same time improving our average daily rate (ADR) and occupancy rate.

The main challenge is probably the seasonality: we have few guests in the off-season at lower prices and a fully-booked hostel in the peak season when prices are high (which also leads to higher expectations due to the fact that they’re paying more…)”

Organization

#33

My #1 challenge when running a hostel is…

“…getting the work-life balance right. There is literally always something that I could be doing… 24/7. So, the challenge is to run the hostel successfully while staying sane. It’s a lot about prioritizing and effective management.”

#34

My #1 challenge when running a hostel is…

“…managing our Google calendar. It’s not just about organizing new bookings, but also about editing, extending, canceling, etc.”

#35

My #1 challenge when running a hostel is…

“…maintaining a high standard of cleanliness. The busier we are, the more we are struggling to keep up with our cleaning schedule.”

Hostel Organization Challenges

#36

My #1 challenge when running a hostel is…

“…managing our inventory. It’s tough to stay on track with all the different offline and online bookings.”

#37

My #1 challenge when running a hostel is…

“…maintaining our hostel. Due to the fact that we are indeed a 24/7/365 business, it’s hard to coordinate maintenance because we don’t want to disturb any guests during their stay. It’s especially difficult when repair work has to be done during the peak season.”

Hostel Regulations

#38

My #1 challenge when running a hostel is…

“…the fact that bureaucracy is made for large accommodation providers with hundreds of employees and large resources. Some regulations are well-meant but do not scale well to small businesses.

This means that building regulations and labor regulations which are necessary in a hotel with 100 rooms, will choke a hostel with 25 beds. I’m talking about requirements such as having a ‘designated health service provider’, elevators for wheel-chair access, uniform changing rooms, a staff eating room, etc.

Getting an exception to the rules is possible, but if you’re not allowed to stay open while the government churns through the papers (which can take months or even years) you’re broke.”

#39

My #1 challenge when running a hostel is…

“…dealing with city bureaucracy. They simply don’t acknowledge hostels and there are no zoning and licensing bylaws applicable. Thus, the city periodically tries to shut us down for ‘illegal’ operation.”

Unruly Guests

#40

My #1 challenge when running a hostel is…

“…screening our guests and the review system itself. Each guest should have a review and comment system, just like a hostel does or how it’s done on eBay, Uber, etc.

If a guest does not follow the house rules or is not considerate and respectful, we as a hostel should be able to give points and comments to our guests, the same as they give us points if they don’t like something.

In my opinion, it’s not fair that a guest can basically do whatever they want and get away with it and we have to always bring our A-game. And dare something is not to their utmost satisfaction… they’ll let everybody on the internet know about it.”

#41

My #1 challenge when running a hostel is…

“…offering a low price without affecting guests’ expectations too much. In my experience, low prices attract more problem-guests who assume the price denotes the ability to disrespect the facility. Yet, our competitors continue beating down the price.” 

Miscellaneous

#42

My #1 challenge when running a hostel is…

“…getting rid of bed bugs. We couldn’t get rid of them for weeks and we don’t know what else to do because the exterminators already came in three times.”

#43

My #1 challenge when running a hostel is…

“…dealing with [specific country] tourists. They rarely announce their time of arrival and don’t check messages on platforms on which they’ve booked their stay. Moreover, they often don’t speak English and shush other guests at 8 pm because they want to sleep. Then the next morning they are very loud. Rude, self-centered, and messy.

They never clean the toilet after themselves, they leave their hair everywhere, they love to make a flood in the bathroom while they wash their clothes, they put fully cooked meals in the shared closets used by other guests… The list is endless…”

#44

My #1 challenge when running a hostel is…

“…being able to charge for no-shows. Some of our guests use invalid credit card details that make it impossible for us to charge them in case they don’t show up.” 

#45

My #1 challenge when running a hostel is…

“…separating ‘me time’ from ‘work time’. I personally live in the hostel I run and sometimes after a hard day, I just want to relax. But guests know of my position and my volunteers – especially the new ones – always ask for help when there are special guest questions or guests ask for a recommendation. I find it very hard to have some alone time.”

Hostel Owner Work Life Balance

#46

My #1 challenge when running a hostel is…

“…bringing hostels closer together instead of fighting against each other. In my opinion, there’s plenty of room for all of us, yet it seems like we are making our life unnecessarily harder.”

#47

My #1 challenge when running a hostel is…

“…being able to balance good service with good revenue. Good service to me is a mix of competent and caring employees, great additional services to offer and providing top-notch facilities.

When a guest isn’t happy with our hostel, we refund their stay (also to avoid bad reviews): it’s quality first, revenue second. Now to the catch-22: In order to maintain our hostel and keep the service up, we also need a good revenue.”

#48

My #1 challenge when running a hostel is…

“…finding a good booking engine. We used a ‘free’ one only to find out months later that it took a commission on the guests’ side.”

49

My #1 challenge when running a hostel is…

“…dealing with situations we don’t have control over. Examples: Even if you have the perfect team that really cares about your guests, in the low season, guests will complain that there’s no atmosphere in the hostel.

Or you sell them a tour and something goes wrong – they’ll tell it’s your fault because you recommended it. The same goes for transportation, restaurants, etc.”

Read all 279 answers in my free Report! 

How To Start A Hostel - Challenge Report

Dedication:

I want to thank all participants for taking part in my survey, sharing their wisdom and being so helpful. Thank you for inspiring me. You’re the reason why this website exists.

STOP! 🤚

Before you leave: Answer this quick question and help our community.

What’s YOUR #1 challenge when it comes to running YOUR hostel and why?

Share your opinion in the comment section below!

P.S. People who read this article were also interested in the ONE THING hostel owners wish they knew before they started a hostel.

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Kevin

Kevin is the founder of TheHostelHelper and a former German engineer in his late twenties. In the middle of his grad school studies, he started a consulting business and broke several branch records within the first six months… until he finally quit this venture to pursue his passion for hostels. Kevin is known for his super black humor – yet, super black might still be an understatement. He also LOVES dogs and drinks too much coffee. When he’s not obsessing about hostel topics you’re likely to find him at the gym – where the heavy weights are.

18 thoughts on “The #1 Challenge Among Hostel Owners When Running A Hostel

  1. Hi Kevin,
    I downloaded and read your new report. Really like it!
    And the stats you added compared to the last one are really interesting.
    Keep it up!

  2. Like the article, Kevin!
    Though I disagree with your comment on the review system. Airbnb does exactly that: it enables both parties to review themselves and I think that’s just fair. Otherwise, pesky guests can always play their wildcard by saying “If you do X, I leave a bad review.”

    1. Thanks for sharing your opinion, Bruce.
      I think the main issue with such a system is that it’s too time-consuming for hostels to review all their guests.
      Quick example: If you’re operating a hostel with 100 beds and an occupancy rate of 60% and an average length of stay of 2 nights, it would mean that you’d have to review 30 guests PER DAY!
      That’s huge. Anyway, several companies are currently trying to offer such a service.
      I’m curious if it will become a standard in the future.
      – Kevin

  3. Interesting read!
    When I reflect on my challenges of running a hostel, I’d say that the chart of the worldwide results pretty much explains all of them.
    Thanks for taking the time to create the report. I really enjoyed reading it.

    1. Hi Linda,
      I’m currently working on an article on how to build systems, i.e. making yourself replaceable.
      I’ll shoot you an email as soon as it is published.
      – Kevin

  4. Super interesting. Thanks for your effort in the industry, Kevin!
    I first thoughts it’s another spam email… but that’s really cool.
    🙂

  5. Zoning + laws + regulations are and have been a problem in our area for 20 years. It seems like no one wants to acknowledge hostels… but motels, b&bs and airbnbs are fine… that sucks.

  6. I haven’t read through the full report yet, to be honest. But the conclusion is quite interesting. Thanks for your effort!

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