ivostudios
I didn't know where to post this thread, I am hoping here is good.I am doing a business plan for college, I eventually plan on making Bali a place where I will open up some form of business. My wife is from Jakarta, so we should be able to get through any red tape and be able to use her families business knowledge to acquire property, make everything legal, etc...However, I need some information:-What are your occupancy rates on average throughout the year?-Do your rates affect the occupancy rate?-What are your business costs? (advertising, staffing[maid,security,gardener], maintenance)-What special perks do you offer? (spa, cook, transportation, surf lessons)Here is some information I have gathered to use for an assessment.6 bed & 6 bath 300sqm modern villa on 500sqm land in Seminyak leases for $70,000 per year.Let's say I were to operate with a nightly rate of: $1095 (low season for 46 weeks) $1350 (Mid-peak for 3 weeks)$1785 (High-Peak for 3 weeks)Giving me a total of:$417,835 at 100% occupancy. -$70k yearly rent and generously taking another 50% off for maintenance, staffing and advertising = $173,917.$292,484 at 70% " " " " " " " = $111,242.$208,917 at 50% " " =$69,458.(Note: I am only taking the total of $417,835 and adjusting the occupancy rate from that, not actually adjusting each rates bracket)I am not sure if I would commit my $70,000 investment, but with these numbers it's a huge return on my investment. I have been trying to research this info for a few weeks now. Am I on the right track? Is this realistic?I would really appreciate any insight you could provide me and whether or not I have realistic information in my possession.Ma kasih!Kory
spicyayam
I can tell you now you will never get 100% occupancy. Even if you have the best place in Bali, there will be times when you vacancies between bookings. Guests will have dates they want to book and will look for a place that is vacant when they want rather than when your place is available.I would probably set the price on a per person basis, after say 2 people. That is what I have seen how most villas operate. Electricity is a big expense. I would break the expenses down further. There are probably a lot more expenses than you haven't even thought about - taxes, license.High season would probably run longer June/July/August - Dec/Jan. You could earn additional income from tours, transport, food. I am not sure if I would commit my $70,000 investment, but with these numbers it's a huge return on my investment. I have been trying to research this info for a few weeks now. Am I on the right track? Is this realistic?[/QUOTE]Your numbers are a "best case" scenario and I am sure you know life doesn't work like that. I wonder if you could find a good villa for rent for just 1 year. If the owner could make more money renting it out on a nightly or evening rate why wouldn't they do it themselves. You have a lot more competition now and you also need a place to live and you need to cover your own living expenses.
balibule
How will you advertise? There are so many villas in Bali you will need good marketing. You could offer your villa through a villa agency but they will take commission of course. Is the villa you are looking at renting already operational (website - repeat guests - online reviews) or would it be starting from zero?
gilbert de jong
I didn't know where to post this thread, I am hoping here is good.I am doing a business plan for college, I eventually plan on making Bali a place where I will open up some form of business. My wife is from Jakarta, so we should be able to get through any red tape and be able to use her families business knowledge to acquire property, make everything legal, etc...However, I need some information:-What are your occupancy rates on average throughout the year?-Do your rates affect the occupancy rate?-What are your business costs? (advertising, staffing[maid,security,gardener], maintenance)-What special perks do you offer? (spa, cook, transportation, surf lessons)Here is some information I have gathered to use for an assessment.6 bed & 6 bath 300sqm modern villa on 500sqm land in Seminyak leases for $70,000 per year.Let's say I were to operate with a nightly rate of: $1095 (low season for 46 weeks) $1350 (Mid-peak for 3 weeks)$1785 (High-Peak for 3 weeks)Giving me a total of:$417,835 at 100% occupancy. -$70k yearly rent and generously taking another 50% off for maintenance, staffing and advertising = $173,917.$292,484 at 70% " " " " " " " = $111,242.$208,917 at 50% " " =$69,458.(Note: I am only taking the total of $417,835 and adjusting the occupancy rate from that, not actually adjusting each rates bracket)I am not sure if I would commit my $70,000 investment, but with these numbers it's a huge return on my investment. I have been trying to research this info for a few weeks now. Am I on the right track? Is this realistic?I would really appreciate any insight you could provide me and whether or not I have realistic information in my possession.Ma kasih!Kory[/QUOTE]I'll keep it short and simple, imho totally unrealistic
SamD
Here's an nteresting article for you:[url=http://bali-news-views.blogspot.com.au/2012/08/oversupply-causes-hotels-to-suffer-low.html]Bali News & Views: Oversupply causes hotels to suffer low occupancy rates[/url]And here is your competition:[url=http://baliluxuryvillarentals.com/]Bali Luxury Villas Bali Real Estate Bali Homes Bali Land Sales Rentals Lease Let[/url]They appear to be offering villa accommodation for $99 per couple per night. Your rates are $365, low season. Your expectations are way too high. If I was marking your college assignment, you'd get a C-
balibule
They appear to be offering villa accommodation for $99 per couple per night. Your rates are $365, low season. Your expectations are way too high. If I was marking your college assignment, you'd get a C-[/QUOTE]$99 is for one bedroom (1 couple) and $365 is for a 6-bedroom villa. I think you just earned a C- as well.
SamD
$99 is for one bedroom (1 couple) and $365 is for a 6-bedroom villa. I think you just earned a C- as well.[/QUOTE]Hmmm.... not quite. $1095 per night, not $365. But my maths was wrong if you work on 6 couples in the Villa at one time (wife-swapping party?). It should be $182.50 per couple/night, not $365. So I'll give myself a B.
balibule
Hmmm.... not quite. $1095 per night, not $365. But my maths was wrong if you work on 6 couples in the Villa at one time (wife-swapping party?). It should be $182.50 per couple/night, not $365. So I'll give myself a B.[/QUOTE]Ok, I didn't look back to the original thread. Yes, 1,095 / 6br is $182.5 per bedroom per night.
ibis69
Just throwing it out their,,Its all about "Marketing" isn't it,,if we had a side by side comparison to choose from a $365?? Villa and a normal hotel stay where just a room might be $190 for a couple we would obviously go the better.(Cheaper.) Option BUT we still have large droves of people staying in the run of the Mill hotel/motel rooms paying what I would call expensive $200 a night for a couple ?? Its how the Individual person targets or Obtains/Markets to their customers??? My point : The majority of people are getting more and more savvy in their accommodation purchases BUT we will ALWAYS have people going to travel agents/booking themselves into $190 a Night rooms in average accommodation???? Correct? So IVOstudios might have wildly Optimistic vacancy rates and figures to teh right target market he could hope to have decent profits with decent vacancy rates.?
