Travel and tourism business performance improves in last quarter of 2011

(Image: SA Tourism)

The TBCSA FNB Tourism Business Index is an initiative of the Tourism Business Council of South Africa (TBCSA), sponsored by First National Bank (FNB) and compiled by Grant Thornton. The index provides a national indication of the current and future performance, across the various businesses operating within the South African travel and tourism sector.

Chief executive officer for the TBCSA, Mmatšatši Marobe says the positive results are encouraging: "Considering that the index had been on a steady decline since the start of 2011, it is encouraging to see that we have ended the year on a more positive note and we hope that this is a trend that will continue in 2012, despite the on-going economic hurdles".

In this edition of the TBI, both sub-indices (accommodation and other tourism business sectors) performed better than was anticipated, with the results of the accommodation sector showing a near return to normal operating levels. However expected business performance is still a modest 82.2 for the first quarter of 2012. "The surge in domestic leisure business over the festive season and the recent hosting of COP17 have provided a much needed boost to business performance in quarter four of 2011, but the index also indicates that industry still has a realistic view of the challenges that lie ahead" explained Gillian Saunders, Head of Advisory Services at Grant Thornton.

Different cycles in business

Pieter de Bruin, head of Industry Sales at FNB says, "The latest result of the TBI again shows that there are always different cycles in business, such is the importance of South Africa being an events destination and having a healthy domestic tourism market. We trust that this may be the first sign of the industry making the turn into positive territory".

"When we launched the TBI project in 2010, one of the key objectives was to develop a business tool which would produce relevant information that will assist us to map out a clear picture of general 'health' our industry says Marobe. "At this point the index is showing positive signs of progress; however it also highlights the important role that the domestic and regional markets can play in boosting tourism trade."

In conclusion, Marobe urged the private sector to "go a little further" in catering for the domestic and regional markets, by actively engaging these markets and developing suitable packages which still offer value for money. "At this point, renewed focus on these markets might just be industry's solution for sustaining growth in the long-term" she said.

Download the TBI report. The next TBI report will be published in April 2012.

Notes

TBI
The Tourism Business Index (TBI) is an overall indicator of the "health" of businesses trading in the tourism sector. This is a business tool that can assist particularly independent and small businesses to understand their operating environment, while large businesses are able to use the index to interact with their various stakeholders.

TBCSA
Tourism Business Council of South Africa (TBCSA) is a member-based organisation, made up of Tourism Associations as well as leading businesses operating in the Travel and Tourism sector. The Council seeks to ensure that the industry is unified and speaks with one voice when engaging relevant stakeholders on macro-economic issues affecting the sector.

Sector associations affiliated to the TBCSA are as follows:

1. AHI - Afrikaanse Handelsinstituut
2. AASA - Airlines Association of Southern Africa
3. ASATA - Association of South African Travel Agents
4. FEDHASA - Federated Hospitality Association of South Africa
5. MTA - Medical Tourism Association
6. NAA -SA - National Accommodation Association of South Africa
7. NOW - National Off-Road Working Group
8. RASA - Restaurant Association of South Africa
9. SAACI - Southern African Association of the Conference Industry
10. SABOA - Southern African Bus Operators' Association
11. SATSA - Southern African Tourism Services Association
12. SAVRALA - Southern African Vehicle Rental Association
13. SAYTC - South African Youth Travel Council
14. VOASA - Vacation Ownership Association of South Africa

FNB
FNB is a division of First Rand Bank Limited. An Authorised Financial Services Provider

FNB is the oldest Bank in South Africa, and can be traced to the Eastern Province Bank formed in Grahamstown in 1838. A landmark development in FNB's history took place in 1998 when the financial services interests of Rand Merchant Bank Holdings and Anglo American were merged to form FirstRand Limited. FNB trades as a division of First Rand Bank Limited. In June 1999, the banking interests of FirstRand formally merged into a single entity to form First Rand Bank. FNB, WesBank and RMB now trade as divisions of FirstRand Bank.

Grant Thornton
Grant Thornton South Africa is a member firm of Grant Thornton International Ltd (Grant Thornton International). The firm has been operating since 1920 and provides a comprehensive range of services, including assurance, tax and specialist business advice to dynamic organisations - listed companies, large privately held businesses and private equity backed organisations.
The company employs approximately 900 people in South Africa with 79 partners and directors. Grant Thornton has a national presence with offices in the major commercial centres being Cape Town, Durban, East London, Johannesburg, Nelspruit, Pretoria and Port Elizabeth. South Africa is also a major force in the sub-Saharan Africa network, with member firms in Botswana, Guinea, Kenya, Mauritius, Mozambique, Namibia, Uganda, Zambia and Zimbabwe.