I am an inbound tour operator and have been reading various takes on our industry, which is very important to South Africa and, understandably, I cannot listen to all the current nonsense going around about the state of our industry. It’s easy to be negative but some simple facts need to be identified, thus I guess I decided to answer my own questions which we are all entitled to do.
1. Is the world economy in the state of chaos? To be honest that is the underlying problem of tourism at the moment. Some emerging markets can help but it will not supplement the traditional markets that have delivered numbers that have supported us in the past and what we all need.
2. Is this a hangover from World Cup? Without a doubt the perception was that we were very expensive to travel to for the World Cup and if you look at it, most countries that hosted previous World Cup or Olympic events have had the same problem (some destinations took two years to recover). This is exacerbated by our current exchange rate.
3. Do we compete on a world stage with our competitors? Without a doubt, but many destinations offer better value for money at present. You will see even our fellow African countries that have a dollar-dominated currency performing well. Our industry was to a certain extent built on currency weakness.
4. Do politicians and tourism boards give an honest opinion about the industry? I am afraid not as they would not get the increased budgets from parliament and additional money for tourist boards if the truth was told. Unless we all believe the stats that are provide by government.
5. Has there been a sufficient increase in flights to South Africa to justify all the increased inventory since World Cup? I guess this question does not even need to be answered as we all know it is a big NO! As we know there are slots available for additional flights but these have not been taken up. Our open sky policy is still an enigma.
6. Do hotels need to discount their rate? If you are standing empty what must you do? Tour operators are suffering as much as hotels and thus we cannot prescribe to hotels what their policy should be to fill their rooms if we cannot deliver. The question should be rather whether discounting is working as I don’t see airlines doing it to the same extent. Thus all discounting is happening with accommodation suppliers and there is no joint venture with the airline industry to work together? The occupancy levels are still low. Airlines are not flying at full occupancy and are not discounting while everyone else is.
7. Who should be responsible for coordinating a holistic approach to bringing airlines and the accommodation industry together? Well I believe government should play a more active role in this process. A vast amount of money is spent on positioning the destination without a more practical issue on how to get people here in numbers at a fair flight cost. If you look at most holidays at present, flight prices are now the main ticket item to South Africa (taxes are nearly the same price as the basic flight ticket).
8. Are we a value for money destination? Without a doubt but our single biggest edge over the last few years was the currency which has now disappeared and the differential on accommodation, food, wine, activities etc. is now small. Our quality is still exceptional high and I don’t believe anybody returns from South Africa feeling that have been short changed.
9. Should we start to panic? Unless you are in government it’s not required as it’s winter. If you are a hotelier or tour operator looking at all our forward bookings I believe a serious introspection of our business models may be required. There are certain markets that can assist but the our main trading partners such as the United Kingdom will take at least 18 months to recover. We thus have to look at alternative markets to survive and that is a reality. These however do take time to develop to become volume producers to the destination.
10. What needs to be done? If I had the answers life would be simple but I believe some short ‘shock’ treatment needs to be done to create interest in our destination quickly to dispel the notion that we are an expensive destination unless we are intent on following a high-value, low-impact tourism policy such as Botswana. South Africa needs travellers in numbers to sustain its industry. We need specific short term campaigns to promote the destination with airlines and service providers getting together to generate the interest that is required. All stakeholders have no choice but to work on this sooner rather than later.
Craig van Rooyen
Director
Tour d’Afrique
Do you agree with Craig van Rooyen’s views on the state of the inbound industry? Let us know by adding your comments below.
