HOTELIERS ARE REPORTING a disappointing start to the summer season.
The latest Irish Hotels Federation (IHF) quarterly barometer shows that hotels and guesthouses in regional tourism areas are seeing a disappointing start to the season, with increased business in urban areas “masking poorer performance across the rest of the country”.
On a national basis, 55 per cent of hoteliers are seeing some increase in business compared with this time last year. Dublin, Cork and Galway are all seeing increased activity around business and event tourism.
But outside the main urban areas, the anticipated upturn in tourism has failed to materialise, the IHF said. It reports that occupancy levels are lagging in many seasonal hotels and resorts, particularly along the west coast.
When asked about the outlook for their business over the next twelve months, 50 per cent of hoteliers said they are optimistic, compared to 64 per cent of them saying this last summer.
The Government’s decision to keep the 9 per cent tourism VAT rate “is providing a vital lifeline for many businesses in the sector” said the IHF.
Nine out of ten (93 per cent) hoteliers say the measure will continue to have a positive impact on business into 2013 . Meanwhile, 50 per cent say they are likely to take on additional staff over the next year as a direct result of it.
Tim Fenn, Chief Executive of the IHF, said that, despite an actual decline in visitor numbers for the first five months of the year, hoteliers had been optimistic for an upturn in business this summer but this has not materialised outside the large cities.
Performance has been patchy at best and we’re now expecting business levels to be flat in many parts of the country which is severely disappointing given the very low visitor base we’re working off at 30 per cent less than the peak in 2007.
He added that half of the measure is “getting our marketing message right and giving holidaymakers new reasons to visit Ireland”.
Where have visitors from overseas been coming from? The IHF says of the respondents:
- Island of Ireland: 46 per cent are seeing an increase in business from the island of Ireland (26 per cent see no change; 28 per cent see a decrease)
- Britain: 44 per cent are seeing an increase in business from Britain (37 per cent see no change; 19 per cent see a decrease)
- US: 44 per cent are seeing an increase from the US (34 per cent saw no change; 22 per cent see a decrease)
- Germany: 32 per cent are seeing an increase in business levels from Germany, (51 per cent see no change; 18 per cent see a decrease)
- France: 20 per cent are seeing an increase in business from France (61 per cent see no change while 19 per cent see a decrease).
Hotels and guesthouse owners identified local authority rates as the most pressing issue affecting their business, followed by utility costs (electricity and gas), wage costs, excess capacity, weakened consumer confidence and limited availability of credit.
One hundred per cent of hoteliers said that the proposed statutory sick-pay scheme would increase the cost of doing business while 91 per cent said it would negatively impact on levels of employment in their business.
Meanwhile, 90 per cent said it would result in “greater levels of abuse of sick leave” by employees.
The Government proposals to reintroduce the Joint Labour Committee system would hinder hoteliers’ ability to take on new staff, 88 per cent said.
When it comes to banking, 39 per cent said they experienced difficulties accessing normal credit facilities from their banks during the last year.