Avoid tourism price hikes, warns expert
Fin24

Avoid tourism price hikes, warns expert

2013-09-13 07:21

Cape Town - South Africa is on the cusp of a major tourism boom, but it will only materialise if local tourism businesses can resist the temptation to put up their prices as the number of tourists continues to climb.

This is according to Anton Roelofse, regional general manager of Business Partners, a financier to small and medium enterprises (SMEs).

Roelofse sees several factors combining to create a “perfect spring” for one of the country’s most important job-creating sectors.

The most dramatic contributor being the fall of the rand - by as much as 25% over the past 20 months or so - which has once again made South Africa a sought-after affordable tourism destination.
 
He said that although the weak rand causes widespread pain throughout the economy, tourism is one of the sectors that benefits from it.

“Combined with other factors such as the emergence of Europe and the US from hard times, the awakening of a fast-growing African middle class to the pleasures of tourism and the lingering afterglow of the 2010 World Cup, the weak rand could usher in an unprecedented tourism boom,” he said.
 
Roelofse warned, however, that it will be short-lived if South African tourism businesses fail to learn from the last boom in the mid-2000s, which could have lasted longer if local operators had not priced South Africa out of the market.
 
“The local tourism industry has learnt an enormous amount since then,” said Roelofse, who advocates a high-volume, affordable-price approach and increased service levels as the only way to ensure that the whole sector experiences growth.
   
He said that with restraint and long-term strategy, South Africa has the chance to cement its reputation as an affordable, exciting tourism destination.

This, in turn, is good news for South Africa’s efforts to boost entrepreneurship, because the tourism industry is in many ways ideally suited for SMEs.
 
“The tourism sector is not very capital-intensive as it requires the type of personal attention that owners and managers excel at, and it offers a diverse range of opportunities, including accommodation, restaurants, tour operating, shuttle services and adventure tourism," he said.
 
The fact that the number of domestic tourists has remained unchanged highlights to him that South African citizens are keen to travel, but that they do not want to pay exorbitant prices.
 
About 87.6% of the 2.5 million visitors to SA in the first quarter of 2013 reported no negative experience in South Africa.

About 52% described locals as hospitable and friendly, up from 43% in the first quarter of 2012.

A similar increase was seen in positive answers to the question asked about local service levels. About 41.8% described service as good, up from 32.6% a year earlier.

The number of visitors describing South Africa as a value-for-money destination increased by 25% over the same period.

Business Partners' figures reveal that, apart from tourism being ideal for job creation, it also lends itself to economic empowerment.

The figures also show that no fewer than half of Business Partners’ tourism-business clients are female and a third of these clients fall within the BBBEE category.

“There is a large amount of under-utilised tourism infrastructure, such as accommodation capacity, as a result of the last boom and the World Cup hype," he said.

"The recession has shaken out marginal operators and those that remain have emerged stronger, wiser and ready for growth.”

- Fin24

Comments
  • Charles Thompson - 2013-09-13 09:57

    Reading, what can euphemistically only be called claptrap, spouted by so called experts from the Minister of tourism on down the totem pole really make my blood boil! I shall suppress my desire to wax lyrical about the compounded idiocies and be as succinct as possible about the most salient issues: 1) A debate has been raging across provincial borders over the last month as to why tourism in KZN in particular, to a lesser degree in the Western Cape and SA in general has stalled. That is despite the flaunted numbers. 2) Notably, the powers-that-be have been conspicuous by their absence in this debate. 3) South Africa is NOT a low price leader. We, the SMME sector offer a world class service at internationally competitive rates. I for one, travel extensively throughout Europe and know this for a fact. 4) I exclude from my comments the large, international hotel chains as they are a law unto themselves. 5) Reliable, timeous and relevant statistics are rare and often biased. TKZN does some of the most scientifically reputable work but unfortunately the results is never analysed nor placed in context. As a management information tool it as all the others leave much to be desired. 6) Reports a without exception biased to a political agenda. One is reminded of the old soviet 5-year plans and the spectacularly positive results reported - until the entire system came crashing down! 7)Tourism is run by beauraucrats. 8) The small business sector is ignored in planning

  • Airport B'nb - 2013-09-13 10:21

    My prices have remained the same for the past four years.

  • Thelma Pluke - 2013-09-13 14:39

    Greed has taken over. We locals cannot afford to buy what our visitors buy. Fleamarkets are the pits. They charge you more for a 2nd-hand item than you would for a new item in a store. It irks me that we SA's can't enjoy our own country as everything is way too expensive.

  • Graham Michael - 2013-09-13 18:11

    We already far to expensive,for locals to experience the beauty of this country ,all good we get the people from overseas here to boost the economy ,what about us poor South africans wanting to explore the beauty

      Nikita Jones - 2013-09-13 23:08

      Graham I agree, it is very unfortunate, short sighted and unfair. But camping is maybe an option?

  • Jinxie - 2013-09-15 08:19

    Cheaper for our family to go overseas than holiday here! Tourist prices for South Africans - ridiculous!

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