Survival of the fittest

As we reach the end of the year, many people are still struggling to survive. Statement after statement about a severe budget and a possible dilution of spending from the domestic market causes real concern. Everyone is conscious of the crisis facing this country, but a slash and burn policy is not the solution. More joined-up thinking, more utilisation of available resources, and more reform, should form part of the equation.

Businesses are continually re-evaluating their business model and adapting to an everchanging market. Anecdotally, you hear how hoteliers are now welcoming hen and stag parties from the UK, something that in the past was a definite no-no. But needs must. Before we take the high moral ground, reflect on how much business we have lost from our near neighbours and how many of them attend stags or hens in Prague or other destinations. After all, most young people who partake in such parties have disposable income and are more likely to revisit with partners and families in the future.

There was a time when groups who attended rugby internationals were viewed in the same context, but now we embrace them in events such as the Magner and Heineken Cup. The British market is of immense importance and value to Irish tourism. A recent report from the Irish Hotels Federation (IHF) states that the number of visitors from Britain has decreased by 15% since 2008, resulting in consumer spends falling by 22%. Furthermore, air travel to Ireland has been dramatically reduced by 16% with a reduction in the number of flights to Ireland by numerous airlines.

The incoming IHF CEO has set out his stall and is aware of the challenges the industry are facing. Speaking to Hotel & Restaurant Times Fenn is in no doubt that over capacity is an issue that needs a resolution. He states “Between 2000 and 2006, our market grew byabout 13%, at the same time as our capacity grew by about 34%. We wentfrom about45,000 rooms to 60,000 rooms in Ireland over that period. In 2006, occupancy rates were 64%. By the time we got to 2009, they were back at 55%. The reality is, once it goes below 60%, you get into all kinds of yield problems and the prices just collapse.”

Look at the latest price indexes in regard to room rates: we are fast becoming one of the cheapest destinations. We should build on this perception. Tourism Ireland will unveil their tourism strategy within the next month and are working to refocus tourist growth from all markets, including Britain. It is up to everyone involved to work in a cohesive, focused manner and put an end to self-serving strategies, which serve no one, except maybe egos of those concerned.

Speaking to Hotel & Restaurant Times, Andrew O Neill, reflecting on his first year as Operations Director of Choice Hotels, said: “Another change that needs reversing is the lack of Irish workers in the industry. This has impacted and maybe harmed the character and charm of our industry. Don’t get me wrong, but I think we need to get back to basics because people travel to experience Ireland and we should ensure they receive the Céad Mile Failte in all aspects of their visit”.

The opening of the Convention Centre is already showing positive signs of business potential, with over €113 million in confirmations secured thus far. This is surely set to grow. Frankie Whelehan, CEO of Choice Hotels, recently said that the turnover of the Choice Hotel’s Group will increase by 5.2% to €65million in 2010. No mean feat in such economically turbulent times.

Is their a future for tourism? I think everyone concerned will respond positively, so let’s hope that those in charge, making the decisions regarding the industry, do the right thing and encourage future growth for this jewel in our somewhat tarnished crown.

Cyril McAree

Editor