A crisis in hotel and tourism leadership
by Robert MacLellan for Barbados Free Press
This is the right time to seriously rethink the role and priorities of the most important trade association in the Caribbean – one which impacts half of all employment in the region – the Caribbean Hotel and Tourism Association.
The position of CEO of the organization has been vacant for some months, with a new appointment announcement expected shortly, and the election of a new President is due in July. The Caribbean Hotel and Tourism Investment Conference – scheduled by the CHTA for May this year – was cancelled, following less than successful events in the previous three years. All of this is taking place while much of the Caribbean’s mid market and budget hotel sector is still in a state of financial crisis, with stagnant room rates and rapidly rising costs, and when new resort projects find funding virtually impossible from banks in the region.
Let me first quote from two passages on the CHTA”s web site…
“CHTA’s Mission Statement.
Our mission is to facilitate the full potential of the Caribbean hotel and tourism industry by serving member needs and building partnerships in a sociably responsible and sustainable manner.”
CHTA first began in 1959 as a committee of the Caribbean Tourist Association – a public / private sector organization created to promote and market the region – IN RESPONSE TO A SPECIFIC HOTEL LOBBY. CHTA was very much market-focused during its genesis – airlines controlled access, wholesalers controlled traffic and payments, and hotel reps controlled communication with travel agents, while the hotels themselves WERE NOT PROTECTED. Our main concern back then was for the HOTEL SECTOR TO REGAIN SOME MEASURE OF CONTROL and address these issues as one.” (My capital letters.)
Most Caribbean hoteliers would say that little has changed in the market situation, as outlined in the previous paragraph, except that the Online Travel Agencies (Expedia, Travelocity, et al) have added to the downward pressure on room rates. Average rates for mid market and budget hotels have not yet recovered in real terms in the five years since the 2008 world financial crisis. In the meantime, hotels’ energy and food costs have increased dramatically and today’s vast fleet of cost efficient mega cruise ships represents direct competition.
Arguably, to effectively represent the hotel and resort sector under today’s Caribbean market conditions, when 63% of the world’s cruise fleet is in the region between December and March, the most important criterion to recognize is the differentiation between the “stay- over visitor” and the cruise ship passenger. The former makes the greatest contribution to the Caribbean’s tourism economy, as the stay-over visitor requires accommodation in a hotel, resort, villa, condo, vacation club, timeshare property or – in the case of marinas – a berth for the yacht. The stay-over visitor supports those businesses and investors which have made a significant long term financial commitment in a fixed asset in the Caribbean. In contrast, the cruise ship passenger travels on a ship which is generally only here for the high season, when the local hotels – hopefully – have their profitable months, and nowadays 82% of the average cruise ship passenger’s DISCRETIONARY spend is on board.