News and views
1. Given the weight of coverage it may be unnecessary to highlight the growing impacts of COVID-19 on international and domestic tourism? The latest news being yesterday’s final collapse of Flybe, attributed in large part to the additional strain put on the company by the recent related downturn in flight bookings. Other National carriers, low cost airlines and travel companies are also weathering the self-same same headwind that now seem set to continue for some time in both UK source markets and, in all likelihood, increasingly from within the UK itself. It speculation but there is likely to be more bad news from within the aviation and travel operator sectors before normality resumes.
Government’s advisors are now suggesting that a major UK outbreak is now far more likely than not. The policy to tackle it is in essence to delay and push it back as long as possible in to a period of better weather, where the virus may be less “harmful” and NHS services are under less strain from the routinely winter pressures and therefore better able and better placed to tackle COVID-19.
In addition to reports from members on the impact on international leisure visitor numbers, we have been informed about issues for the international language schools’ market and specifically the immediate impact on the normally strong, spring European schools visit element. The ban on school trips in France earlier this week merely serves to highlight and add to an already difficult position for this important sector. Business tourism and events are also showing strain, particularly where international speakers, delegates or exhibitors are involved in activities that are planned to take place in the short to medium term.
Two growing trends are perhaps of note in the reports we have received this week; longer term, forward bookings involving international guests are now being cancelled on purely commercial grounds and much further out than was initially seen. (perhaps a balance between taking a hit on predicted revenue now v potential hit and real costs of mounting a nonviable activity later?). There are also growing signs that any immediate weakness in international tourism is now also rapidly becoming a similar or greater weakness in forward booking, cancellation enquires and the like within the domestic market. Today’s very sensible precautionary Government announcement are likely to serve to accelerate that process within the domestic market and add to the problems for both inbound international and outbound domestic markets.
Delaying onset and working to extend the length (to reduce, by spreading out the peak impact) of any UK outbreak makes perfect sense on health and other grounds. It does however represent a major planning and management headache for destination management interests, not to mention the potential major social and economic problems for businesses and for destinations as a whole.
In short, we now need to be prepared to manage the real impacts on tourism from the potential threat of CONVID-19 during an indeterminate period and be prepared to manage the additional more serious impacts of a potential extended UK outbreak, that may or may not start at any point between now and the early summer or conceivably beyond that? Lest we forget from past experience, once any potential pandemic has run its course there could be a slow, protracted period of recovery, rather than an immediate return to business as usual; especially if we are not prepared or able (resourced) to encourage a rapid bounce back.
On balance the prognosis for UK tourism isn’t good and it could be far worse if we don’t undertake some prudent local contingency planning and start marshalling post event recovery assets. We will continue work with colleagues nationally, firstly to ensure that the need for recovery resource and support for domestic, as well as international tourism, is well recognised and secondly to ensure that when the time is right, adequate national level resources are available and deployed to best effect to drive a rapid recovery.
2. Over the last few days and weeks there has been a number of interesting non COVID-19 related tourism articles, including reports about the impact of short-term lets on housing stock, alleged wide scale abuse of the London 90 day letting rules and a Which? report outlining the non-competitive practices of some online booking platforms. The latter report majors on the point that OTAs are not necessarily the source of the lowest available price which can often be realised by calling the hotels direct. How ironic would it be if increasingly customers browsed online to find the products they wanted, before then going direct to buy it for less direct from the provider themselves; a complete reversal of the damaging high street trend of look, see, feel and smell in store and then buy online for less. The report acts as a good aid memoire to the issues involved, the (undue?) power that the platforms exercise and the level and high costs to both businesses and consumers of the dependency that has been created. Articles on all these issue can be found on out “Sharing Economy and OTA” page at: https://wordpress.com/view/britishdestinations.net
3. John Lewis the stalwart of British retailing today reported a 23 % drop in profits across the group, announced the closure of 3 Waitrose stores and a 2% “partners” staff bonus the lowest since 1953 when it was zero (down from 3% in recent years). The reduction in profit in their high street, mostly major City and large town, city centre department stores or major out of town sites is an alarming 65% (including some exceptional costs).
The new Chairman intends to carry out a major review to report in September. She has promised to launch a major transformation of the business, which encompasses the need to look at ‘right sizing’ stores, ‘through a combination of new formats and new locations; repurposing and space reductions of existing stores; and closures, where necessary.’
For those struggling to understand what has gone wrong with their own High Street the John Lewis announcement is a timely reminder to us all that there is something much more profound going on than say just our ability to drive footfall to our destinations, the quality and the range of the product offer, or our promotional reach or financial clout. John Lewis department stores operates in prime City locations, with strong footfall, they major on the quality of product and service and are not shy when it comes to marketing and promotion and yet they too are feeling the strain on traditional retail. Profound problems may need profoundly different solutions? See more at:
British Destinations 