Depending on your location, you will have to think about how you will decorate your glamping experience and what heating or cooling will be required. Do you need to install a water tank or solar power? Will you need to build a path/road for easy access for your guests? And don’t forget things like waste management and sewage, which are additional costs to consider when starting your glamping business.
The cost of glamping tents can vary from $10,000 -$30,000 AUD for the higher grade models whereas domes will go for $50,000 – $90,000 depending on the amenities.
One of the most important steps in setting up your glamping project is the development of your glamping business plan. This plan will also help you to get finance as the lender will want to see what his expected return on investment will be. On top of that, you will need to be able to show a detailed plan on how you are thinking of earning back the loan.
There are a few ways of getting your glamping business financed. You will sometimes need to look at multiple options, or even combine them.
Get a loan
The most common way to get financed is to go to your bank and ask for a loan.
This option is often the cheapest, as interest rates are the lowest in comparison to different kind of loans. Discuss the different types of loans with your banker. You might be able to put in a mortgage iIf you purchased land), apply for a secured loan (guaranteed against something you already own) or go for several small unsecured loans (usually the easiest to get, but with the highest interest rates).
Get help from a financial advisor
Your bank might not have all of the options available. Therefore it’s smart to talk to someone who can help you compare all of your options. Accommodation Finance Australia is a specialist funder to the hotel & accommodation sector. Contact leigh@cashflowit.com.au, he will be able to assist you.
Get help from private investors
Money sometimes can be found closer than you think. Ask around with friends and family and present them with your business proposal. With low-interest rates on personal saving accounts, people tend to look into financing good ideas in order to make money. You could agree on an interest rate for the loan, or a share of the equity. Or maybe they would even like to be involved as equal partners. Please note, this option does involve having to be completely honest with your partners. You don’t want to lose any friendships over it.
If you are looking for other private investors, make sure to ask around! Maybe there are partners around you that could benefit from you bringing guests to town.
Look for crowdfunding
The newest form of financing glamping accommodation (and only legal in Australia since 2018) is crowdfunding. How does equity crowdfunding work for your glamping business? It would involve giving equity away to multiple “mini” investors. The advantage of this type of funding is that you have a lot of random people interested in your business and automatically becoming ambassadors. Reward crowdfunding is another option in which you ‘reward’ mini investors not with a share of equity but with a “free annual booking”. Last but not least, there’s also Dept crowdfunding. Multiple crowdfunders will lend you the money with interest on the loan, just like a bank loan. How to find these crowdfunders?
Lease via Lodges Australia
From May 2024, Lodges Australia is in a position to offer long-term lease options with purchase possibilities at the end of the term. Lease times vary from maximum two years for the interior and six years for the basic lodge construction. Lease can include transportation and build-up costs. Lease payments only start on the day of arrival of your Crossover Lodges at your doorstep.
Don’t forget to check government grants
Bringing tourism and people to your town creates a lot of jobs for the community, and therefore your local council may be interested to hear about your plans! Every year, both state and federal governments have several different grants available for starting businesses.
A good place to start looking is: https://australiangrants.org/tourism-grants/ and:
https://www.tourism.australia.com/en/events-and-tools/industry-resources/resources-for-industry/federal-government-support-for-tourism-businesses.html
Due to COVID19, currently, the state government of South Australia and WA have implemented funds that might apply to you:
https://tourism.sa.gov.au/support/tourism-industry-development-fund
https://www.tourism.wa.gov.au/Industry-support/Funding-assistance/Pages/WA-Tourism-Recovery-Program.aspx#/
Once your finance is approved, you can go ahead and continue in setting up your glamping business journey! It can sometimes take up to 6 months for tents to be designed, ordered, delivered and installed, so often your glamping accommodation supplier can offer you a delay in payment.
At Lodges Australia we require a 50% deposit upfront, and the other 50% after your glamping tent is installed.
If you would like to discuss any quotes, financing options or are ready to go ahead and start planning your glamping business – contact us now.
