How to Set Up a Glamping Business - Practical Tips and Advice
The glamping business is growing fast
The glamping business goes from strength to strength - according to Verified by 2028 the global glamping business is predicted to be worth $5.8 Bn p.a., growing at an annual rate of 13.3% from 2021 to 2028.
And customers are getting more sophisticated and demanding every year, looking for more premium experiences that combine the best of camping with the comforts of a home stay. Which is why huts, cabins and pods are now the biggest segment of the glamping market, accounting for just over 45 percent of the total stays in 2021, a number that is only set to grow as customers look for the higher level of comfort that these more permanent structures provide.
As a result, glamping can be a lucrative business. If you get the service offer right, an established, higher-end glamping businesses can deliver up to 50% earnings before tax. Most glamping businesses will typically make a little less than this, nevertheless, with a little effort and imagination they can become very successful additional revenue streams or even businesses in their own right.
So how do you go about setting up a glampsite? How much income do they generate? What are the costs? And what are the most common mistakes and pitfalls?
Land & planning permission
Obviously, you’re going to need some land to set up a glamping business. But location is key. Return business is very important for any holiday rental business, and if you’ve got the right location along with the right accommodation, you can help maximise the chances of repeat business and positive word of mouth. If you own a farm, is there a meadow, orchard or some trees you can put the glampsite in? And what about road noise? A noisy site is unlikely to get the repeat custom that you need to build a successful business. And there are practical questions too. What about the facilities, will people have to walk to them? Is there good road access? Can people drive their cars onto the site? Are there paths to stop people getting muddy. These are all things you have to consider carefully before setting up a glamping business. As we’ve mentioned, people increasingly expect a more premium experience from glamping, so it’s important to be realistic when you’re considering whether your land is right for a glamping business.
If you’re satisfied that you’ve got the right location, then planning is the next consideration. If your glamping business operates for more than 28 days a year you will need to change the land use from temporary to permanent irrespective of whether you intend to have tents, yurts, shepherd’s huts or cabins on the land. And further planning permission will also be required if you need to install permanent facilities or permanent cabins or huts.
One of the great advantages of shepherd’s huts, however, is that, unlike permanent structures, they don’t require the additional planning permission. What’s more, as a general rule they are looked on relatively favourably by local planning authorities as they are seen as being in keeping with the rural setting of many glampsites, so can be easier to get through the planning process than permanent structures.
It’s important to note, however, that planning rules are different in different areas - being in a National Parks may make it more difficult, and Scotland, for example, has different laws around planning for glamping sites, so it’s vital to speak to an expert in planning law to help you understand what you can and can’t do.
Accommodation
There’s a wide range of choices for accommodation, offering a wide range of facilities at a wide range of prices.
Of course, we’re biased when it comes to this decision, so you’ll want to do some research elsewhere to see what’s right for you, and many glampsite owners choose to have a range of different accommodation with a range of different levels of service to cater to different parts of the market, however, we believe there are several very good reasons why a shepherds hut makes a great choice for a glamping business:
They’re part of the largest and fastest growing segment of the market. People increasingly expect more from their glamping experience - wanting better facilities and a more comfortable experience.
As we’ve seen, shepherd huts don’t need additional planning unlike permanent structures like cabins.
Planning authorities have, in the past, looked favourably on shepherd huts which they see as authentic and in keeping with the rural landscape.
Shepherds huts are easy to install, and can easily be moved if you want to reconfigure or shift your glampsite.
Shepherd huts can offer a point of interest - shepherds huts dressed and fitted properly can give a glampsite an authentic rural feel, and a point of difference over more standard cabins.
Unlike more permanent structures like pods or cabins, shepherd’s huts can be resold if your plans change in the future. And there’s strong demand for shepherd huts for sale, as well made shepherd’s huts hold their value extremely well. The fact that you can get a large part of your investment back for a shepherd hut helps derisk one of the most significant investments on a glamping site.
Landscaping & facilities
The standard of glampsites rises every year, with landscaping and facilities an important part of this trend. However, you don’t have to spend a fortune to compete, some thoughtful planning and dressing can go a long way to improving the experience of your guests.
Invest in the landscape - landscaping and planting can make or break a glampsite, if you’re putting the shepherd’s hut on hard standing, is there any way you can soften the look with some quick growing plants around the border? What about some plant pots?
Think about the night time - a simple trellis or arbor with some nice night lighting can add real ambiance to a site. And what about a fire pit outside the hut?
Upgrade the facilities - they’re as much a part of the glamping experience as the inside of the hut, make sure the quality of the facilities match that of accommodation.
Add some extra attractions - what about a wooden hot tub? Or a small play area for children.
Know your limitations - if you’re not someone with a great eye for design, then hire a designer or expert to help you. An investment in the design of the site, can pay dividends later in higher prices and occupancy rates. For more on design and landscaping, read our guide to dressing a shepherd hut, by renowned designer Bee Osborn.
Marketing
The best form of marketing is word-of-mouth. A well set up, good-quality glampsite will grow in part through return customers and word-of-mouth, keeping marketing costs to a minimum. However, in the early days of a glamping business it is inevitable that you will have to use different platforms to market and promote your shepherd’s hut.
Social & Digital Media
A strong social media presence is a must these days. Make sure you have a Facebook business page and an Instagram account as a minimum. Great images are essential for a strong social media presence. It’s entirely possible to do this with a good smartphone these days, if you have the skill. If you’re not a great photographer, then pay a professional to get some key images, money invested with the right photographer will pay back many times. Social media posts take time, and you need to budget for that, but they are essential, as it’s the way many people discover and choose your site now. It’s also essential that you have a good presence on Google Maps, try to get people who have stayed to leave a review. People often search for glamping on Google Maps, and a good presence with good pictures and good reviews makes a huge difference.
Paid Digital Advertising
There’s a lot of competition for Google Adwords for glamping terms, but it is worth experimenting with ones for your local area, e.g. glamping Hereford to see if you can find ones that work.
There are of course more traditional forms of marketing and advertising, like paid ads with magazines though these can be expensive if you’re just starting out, and many customers use digital platforms as the first port of call when looking for a glampsite.
Revenues
The Return on Investment on a glamping business depends on a range of factors. Not least is the price you can charge, which is a function of your location, the level of service you provide and the season. Higher end glampsites in beautiful locations can charge up to £250 per night and more in high season, however, in more mid range glampsites you can expect to be able to charge £70 per night in low season, £90 per night in mid-season and £120 per night in high season, though again, pricing is very dependant on location, service, and a number of other factors.
A good occupancy rate is the bedrock of a successful glamping business. A mistake people often make is factoring in too high a level of occupancy in Year One. Like almost all businesses, it takes a while to spread the world and build loyalty, and these are key to success. If you get your glamping offer right, and people come back and spread the word, you can expect to get to an occupancy rate of somewhere between 60 and 70 percent by Year Three. You should plan for the first couple of years to be lower, depending again on your location and offer. This means that a glamping business should expect to turn over roughly £25,000 pounds per unit based on these average figures after three years. Assuming a reduced turnover in the first year of £15,000 and £20,000 in the second, takes the estimate of gross revenue in three years to £60,000 per unit.*
Costs
Costs fall into four main areas:
Site preparation and set up;
Cost of units & facilities;
Ongoing service costs;
Maintenance.
Site Preparation
There are a range of costs involved in set up, and these will depend on your site, so are almost impossible to estimate. However, if you have to run services to the site, that will add cost, as will landscaping, adding hard standing and dressing the site. But remember, the more you offer, and the better the site looks, the more you can charge. There may also be costs associated with planning and any other legal requirements which you need to factor in.
Costs of Units & Facilities
Again, there’s a wide variance in the cost of glamping units, from tents to permanent cabins or pods. One of the main advantages of shepherd’s huts is that they give the quality of experience of permanent structures, with the flexibility of more temporary accommodation like yurts or tents. As mentioned before, maintained shepherd huts don’t depreciate quickly, and are easy to sell if you decide to move or refocus your business. It’s also important to remember that the huts will all need ‘dressing’ so factor in for bedding, kitchen utensils and any soft furnishing needed for each unit.
Ongoing Service Costs
Energy, water and other bills are a significant cost, and need to be included. Cleaning is also a significant expense / time consideration. Many small glamp site owners do this themselves so there is no external cost, but you have to budget at least a couple of hours for the cleaning and set up of each hut between stays. On top of that there are some small costs for some consumable items - toilet roll, some wood for the woodburner, cleaning products, etc.
Maintenance
Like any building, a shepherd’s hut will need some maintenance. Exterior cladding will probably need to be repainted every 6-8 years depending on the product it’s treated with. And then there’s general interior wear and tear which you’d get with any holiday let. Again these costs should be no more than about £150 per hut per year, but should be budgeted for when building your business plan.
Management
Managing a glampsite can be a labour intensive business, and it’s important to factor in the time it takes to deal with bookings, cleaning and dealing with customers on a day-to-day basis. This shouldn’t necessarily put you off though, there are now services that will manage your glampsite for you. So if you have the land, and think would be a good for a glampsite, but don’t think you have the time to manage it, don’t worry, there are services that will, for a fee, do just that for you.
Conclusion
The glamping business is an excellent opportunity for people to generate extra income from land that may not be that otherwise productive. It’s important to understand, however, that while the sector is growing quickly, it is also maturing fast, so like any other business opportunity it’s important to go in with your eyes open. Consider what level of service you can offer and what investment that requires. With some careful planning there are ways to make the business easier to run, and a less risky proposition from the outset. At Arbor Shepherd Huts we work with a range of partners that help you figure out what the best plan is for you.
*The figures in this article are all indicative, and a number of factors will impact your turnover and profit, so it’s important that you build your own business plan with your own assumptions about revenues and costs.