“Because tourism is a highly competitive and ever-changing sector, businesses that keep ahead of industry developments will reap the rewards,” adds Kara, as she unpacks some of the latest tourism trends:
• Currency fluctuations: the vulnerability of the rand against the US dollar will boost tourism in the country as foreign visitors seek to take advantage of the weak currency. As a result, we are bound to see an improvement in tourism numbers and an increase in per capita spend. In addition, the weak rand will make it less feasible for South Africans to travel abroad. Thus, many consumers may opt to travel locally, thereby increasing domestic tourism and stimulating the local economy.
• Outbreak of the Zika virus: while the outbreak of the Zika virus has had a negative impact on the tourism industry in South America, it has had a positive spin-off for the South African tourism market as tourists redirect to South Africa as an alternative long haul destination.
• Drought and water shortages: the current drought that is escalating food-price inflation will have severe consequences for the hospitality industry as food costs are one of its biggest challenges. Businesses should therefore proactively find ways to manage and keep food costs under control.
• Legislation: while legislative amendments are often beyond the control of businesses, policies and regulations usually have a severe impact on the long-term growth and sustainability of the industry.
• Hiking of rates: should be carefully considered as this affects the performance of the industry as a whole, especially for over-geared businesses.
Consequently, businesses in this sector should be prepared to take advantage of the vast opportunities presented by local and international developments.
