Tourism

The Downturn in Backpacker Tourists. Last week's Fiji Islands Backpacker Association conference in Nadi heard president Error Fifer  attribute the backpacker downturn since 2007 to the "removal of Fiji as a free stopover by Air New Zealand on their round-the-world tickets, the slowly developing international financial crisis, increase in bed capacity, competitive airlines operating in NZ and Australia offering a choice of low airfares, negative comments by overseas media, and the inability to adequately market our product overseas and many of us, and not fully utilising the internet as a marketing tool". [Map:  Pink shows backpacker accommodation. Click and zoom (Crtl +) to enlarge.]

This followed the sharp upturn from 2004-06 due to "increased arrivals, the expansion of Awesome Adventures, the consolidation of FEEJEE Experience locally, political stability, the start of operations by Virgin Blue and industry activity during those years."Tourism Fiji has indicated its willingness to meet a unified Association on all marketing initiatives.

Another speaker at the conference, Dr Jeff Jarvis from Monash University's Tourism Research Unit told participants Fiji was facing tougher competition with other tourist destinations, most especially Australia (where Working Holiday Makers visas allowed tourists to earn up to $15,000 working in vineyards), New Zealand, and the Asian destinations -- Bali, Thailand and Vietnam -- that offer multiple country visits options. Limited awareness of Fiji in the market was also a reason for its perception as an expensive destination.  Fiji could piggyback on the Austalian WHM visas if it could maximise its advantage of airline links.

Growing Food for Tourists. Across the island, in Suva, Fiji Islands Hotel and Tourism Association president Dixon Seeto told a media workshop that 80% of food used by the tourism industry is now produced locally. The industry uses $500 million worth of imported food and beverages a year. The Ministry of Agriculture has been helping farmers to produce enough to meet the demand of the hotel industry, and hoteliers have been encouraged to prpeare menus using local produce.

Just an Idea. I wonder what the economics would be of a "multiple country visit" tourist airline route from Sydney to Auckland, Rarotonga, Niue, Samoa, Fiji, Auckland and back to Sydney, with tourists being able to stop off at two or more destinations? Two trips a week in both directions? With Christchurch alternating with Auckland?  Something like the old days when the Union Steamship cargo/passenger ships Tofua and the Matua linked Auckland/Christchurch, with Tonga, Samoa and Fiji.  That's when villagers poled bananas for export down the Rewa on bamboo rafts.

Comments

Tourism risks said…
Never mind the backpacker resorts, the entire tourism industry in Fiji is on the ropes and anyone in these columns who says otherwise is an idiot. Dixon Seeto was stating the bleeding obvious this week when he said that much of tourism was discounting by up to 50 per cent. Five nights for the price of three, and a hefty discount on top, is the norm even at prestige properties like the Outrigger. Sure, the planes are full but they're relatively low income earners out for a cheap time and stories abound of visitors arriving at resorts with not only their own liquor but sometimes their own food. Tourism isn't just about bums on seats but the margins operators rely on to make a profit. I've just come back from the Coral Coast and the anecdotal evidence on the ground is worse. There's a real sense of foreboding as bank overdrafts blow out and operators are forced to delay not just capital investment but basic maintenance and repairs. As Seeto acknowledged, many are relying on day to day cash flow to get by and any disaster now, either natural or political, will push many of them over the edge. Many people I spoke to pointed the finger at Australia and NZ, saying their travel advisories weren't helping the situation and they were failing to see some of the benefits of dictatorship, like a renewed sense of order and accountability. But they're also unhappy with the regime for tending to inflame the situation and want a more disciplined approach when it comes to the nation's PR. One of the biggest fears is the welfare of Air Pacific, facing a deluge of competition on the Australian route from V Australia and Jetstar. From a passenger viewpoint, Air Pacific's 747s are aging and the airline just can't match the in-flight experience on V Australia's new 777s when it comes to entertainment in particular. Everyone in Fiji remembers what happened in 2000, when the airlines deserted the country after the Speight coup and Air Pacific was our only lifeline. If it's ever driven out of business, that'll be the time when apprehension turns to outright fear. Fiji was lucky to have a guy like the much loved John Campbell at the controls of Air Pacific in recent years. His replacement, Dave Pflieger, is an American expert in low-cost operators. His job will be to keep Air Pacific flying at any cost so expect things like free airline meals and unprofitable routes to be a thing of the past. We need to pray he gets it right.
Memories said…
Croz, I can tell you what the economics of your proposal would be. Certain bankruptcy for whoever was mad enough to take up your idea. You used to be able to island hop with Air New Zealand until comparatively recently ( the 80s) by starting in Tahiti, flying to the Cooks, then Fiji, then Auckland, then Sydney all for the same price as a direct LA/Sydney flight. But they couldn't make a go of it then and they certainly can't now when the expectation of cheap fares means high load factors are critical. Island hopping has given way to point to point travel from the US, Australia and NZ. And that also reflects the limited time most people have nowadays to holiday and their dependence on cheap packages. It's only an airline like Air Calin that can hop between Noumea, Nadi and Wallis Island and only then with French Government subsidy. There's not even a direct flight anymore between Nadi and Papeete. In the glory days, at various times, Qantas, Air New Zealand, UTA and Air Calin all covered that route. It's all gone the way of the Matua and Tofua, the romance of Pacific travel living on only in the fading memories of qase levu like you and I. But, boy, weren't those were the days?
snoopy said…
@ Tourism Risks

I think the comment from you below summarises how you like to debate

"anyone in these columns who says otherwise is an idiot"

There are many generlisation that you use about low income tourists etc that i have seen before. The facts as usual is that the number of tourists visiting fiji is reaching record numbers. Yields which have been poor are improving.

Airfares to Fij i will be permanently lower thanks to the low cost airlines and the end of the Qantas/Air Pac monopoly from Australia.

Agree with the next writer that we definetly need Air Pac in Fiji and i hope most Fijian continue to support them. they will need to learn to reduce costs and compete with V Australia and Jetstar
Ostrich hunt said…
This is not a debate, Snoopy, but my reporting of what I found on the ground in Fiji last week. And, yes, you're one of the people I was referring to. So yields are up are they? Who the hell are you talking to? Why not do yourself a favour, go to Expedia.com and plug in some accommodation options for Fiji. Then do the maths. Of course, people are flocking to Fiji. It's cheaper than holidaying at home. But that doesn't mean the industry is in good shape. Dixon Seeto said so publicly last week. But perhaps in your opinion, he doesn't know what he's talking about either.
Croz Walsh said…
I'm sure there are real concerns for the tourist industry but they are not limited to Fiji. Read this in the SMH http://www.smh.com.au/travel/battle-of-the-beaches-20100429-tu8y.html

The SMH notes political uncertainty as one cause (not helped by damaging travel advisories in Aust and NZ and poor media coverage) but, unlike Government critics, it notes other more important reasons.
Proud fijian said…
@ Tourism risk ".. relatively low income earners out for a cheap time and stories abound of visitors arriving at resorts with not only their own liquor but sometimes their own food"

Stories are stories we need stats. I have had look at the Fiji statistics in summary.

Spending of tourists at hotels hasn't changed much at hotels from and including 2006 to 2008.

2006 $1213/person for food and alcohol
2007 $1099/person
2008 $1200/person

Haven't got the figures for 2009 but wouldn't expect it to be any different statistically.

Also interesting to note that the hotel room capacity has increased by 40% from 2005 to 2008 and only 33% in the 10 years from 1995 to 2005.

So the current push with discounts etc. in my opinion is due to hoteliers pushing to occupy rooms as due to an oversupply. Look at what's happened in Denarau for example.

There should be some sort of government control on building of hotels. There should be a control what number of rooms are required etc and resource consents should not be given willy nilly.

In my opinion there may have been an excessive approval of hotels being built over the last 4 years resulting in an oversupply of hotel room. This has pushed down prices as competition is ferocious resulting in my opinion the current status of reduced profit margins.

The reduced profit margins can be carried by large overseas coorporations but probably not local small hotel owners and backpackers.

I wonder because of the tremendous growth in hotel room numbers from 2005 onwards whether the Qarase Government had anything to do with it.

What is the process of consents for building of hotels in Fiji? Can anyone answer that question?
Cheaper than chips said…
Proud Fijian, I'll bet you a case of Vonu Lager that the food spend figures for 2009/10 are less than in previous years. Take the Outrigger for example. They have a $F99 a day food deal at the moment that covers breakfast lunch and dinner. That's just over $A50 a day per person for three full meals in a five star hotel. I can't see much of a profit margin in that, can you? And this is on top of reduced room rates and five nights for the price of three. Great for the tourists, disastrous for the industry. And when a five star hotel is giving away this kind of thing, it naturally has a flow on affect to the cheaper operators. Why stay somewhere cheap when five star joints are cheap anyway? Believe me, the bars too are only crowded during happy hour. Of course, it's the smaller operators who are suffering the most. But my point is that tourism is not the saviour of the Fiji economy some people think it is.

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