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June 26, 2012 / by Carolyn Neville

The Economics of Travel and Hospitality

There are many things in life that I do not understand, but specifically relating to my core industry, here are just two for starters:

  1. How is it possible that a family can go on holiday to Thailand for a week, and that week’s holiday is cheaper than having a week-long holiday in Knysna? I do not understand the economics. My son has just spent R20 000 on a holiday to Zanzibar at a resort on one of the little islands – my brother who lives in New Zealand is taking his family for a week long holiday to Fiji – for the equivalent of R3 000 per person. Both of these options include flights, accommodation and two meals a day….why is it like this? Is food that much more expensive in Africa? Are salaries that much higher in this part of the world? Are owners of properties more greedy for profit here?

So, I am not an economist but I guess this happens because of the so-called economies of scale and volume. Hard to fight this one in the market place, but we need to ensure that when travellers are spending such large sums of money, that they are getting good value for this. The value will not come just from the quality of the room or the food, but the value will come from the “service heart”. Here in Africa, we were once famous for our hospitality – if you came to a village, they would kill the chicken for you to eat (even if it was the last chicken!) – but nowadays, I don’t see too much “killing of the chicken” – service has become depersonalised, ‘one size fits all’ and frankly not very friendly, hospitable or memorable.

  1. The next thing I do not understand is how we have staff working in our restaurants and hotels that are so poorly trained and have such low knowledge bases. For example, last week I was doing some training and an ‘experienced’ restaurant supervisor told the group that you can tell if a wine is full bodied by the shape of the wine bottle; on another occasion a barman of some fifteen years told me that the ciders he had in stock were Brutal Fruit, Smirnoff Spin and Monster. How is it possible that our staff are so appallingly ignorant of the basics?

This issue is a little more understandable – I believe that it is primarily due to lack of exposure in most cases. The average waiter in South Africa does not drink wine – so how is this person supposed to understand the basics of wine, let alone all the subtleties? Most staff in our hotels and restaurants have never slept in a hotel as a guest, nor have they eaten out – it is a whole new world out there for them with lots of things to learn and internalise. Added to this, training is often seriously lacking in our hotels and restaurants, so staff just ‘pick things up as they go along’ – often copying other people who are poorly trained. And so the cycle continues.

Somehow, these two areas seem related – if we can improve the level of knowledge of basic skills for our staff, then perhaps we shall be better able to compete in the marketplace. I guess it is a chicken and egg type of situation – what comes first? I recommend starting with improving the product knowledge and basic skills levels of our staff.