In early 2004, Australian expats Michael and Max were traveling through Vietnam. During their visit, they noticed that the hostel experience they were so accustomed to at home wasn’t available. They decided that they could bring their vision of what a hostel could be to Vietnam. The idea was simple, “Let’s make a place where we’d want to stay” – a space that was welcoming, safe, comfortable, and social.
In December 2004 they founded Vietnam Backpacker Hostels (VBH) after converting a former diplomat’s house into Vietnam’s first and only international-style backpackers’ hostel. Today, they have multiple hostels in Vietnam, and their vision resonates with travelers from all over the globe.
The team at Vietnam Backpackers Hostels works hard to create great experiences both inside and outside their hostels. From spectacular boat trips to multi-day adventure tours, they go above and beyond to ensure a fantastic experience.
In 2015 and 2016, Vietnam Backpacker Hostels experienced rapid growth; growth that their existing property management system (PMS) was unable to handle and would have required new servers and high upfront subscription fees. The capital allocation for the new properties was already substantial. After extensive market research, they found that Cloudbeds could not only provide the functionality they needed, it also would also be less expensive than their existing solution. Plus, because the software is cloud-based, it would allow them to continue to grow without costly surprises.
As James notes, their internal back-end process has evolved over the years. Like so many other hostels, they started out with a big book, a ruler, a few hundred pencils, and a big eraser. Today, they have an integrated back-end system that is a bit more complex including Cloudbeds, Junction6, WordPress, and Xero. Vietnam Backpackers relies on Cloudbeds’ comprehensive reporting to run their business. Cloudbeds reporting allows them to track both day-to-day operations and performance metrics; everything from balancing cash drawers and directing housekeeping, to ADR, RevPAR, channel production and beyond.
By adding their own mobile friendly booking engine and vastly improving the booking experience on their website, VBH was able to significantly increase direct bookings. This means paying less commission, which directly impacted their bottom line. With everything in sync, they could make better business decisions to drive revenue.
Before Cloudbeds, several employees spent their days manually entering Hostelworld bookings into their PMS. Cloudbeds’ channel manager eliminated the need for manual entry and today, these employees spend their time interacting with prospective guests on their website’s live chat. Technology now handles manual tasks giving their employees time that they can spend helping the hostel grow.
With more data and reporting, Cloudbeds enabled VBH to optimize their rates – which helped convert high occupancy rates into higher margins. Even at a time where competition was becoming fierce (supply nearly doubled in six months) they were able to continue to enjoy stellar occupancy levels and achieve a consistently higher bed rate than before.