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Currently, 53% of local tourism businesses are not considering permanent closure, although 69% have applied temporary closure
This is according to the Tourism Industry Survey of South Africa: COVID-19’ conducted by the Department of Tourism in collaboration with the Tourism Business Council of South Africa and the World Bank’s International Finance Corporation.
The survey – conducted in April and surveying around 1 600 respondents across the travel and tourism sector – highlighted that a number of tourism and travel businesses have put a variety of measures in place to help mitigate against the impacts on their business.
The most commonly applied measures are temporary closure (69%), supporting deferment of bookings instead of cancellation (60%), and significant downscaling (58%).
A total of 54% of respondents have awarded refunds, affecting revenues, and 51% have cancelled planned investments or upgrades, which will have consequences for other areas of the economy.
On the more positive side, only 28% have lowered prices, 25% have already borrowed capital, and 17% are investing in upskilling staff.
Here’s a snapshot of the impact on the various sub-sectors:
The accommodation sub-sector has issued the most refunds at 64% and lowered prices the most at 36%. It is also the sub-segment with the most temporary closures at 82% compared with all firms at 69%.
Activity and experience providers have seen the largest amount of permanent closures at 4%, with a further 24% considering it.
Community-based enterprises have implemented proportionately the fewest measures across the board, and they are also the lowest in terms of temporary closures (at only 38%), possibly reflecting their lower market dependence and debt exposure. At 13% they have borrowed the least capital.
Conservancies, reserves or enterprises in protected areas are the largest sub-sector to have borrowed at 36% and are the largest group to have cancelled planned upgrades at 77%.
The MICE sector has most strongly supported deferment instead of cancellation at 73% and invested the most in upskilling staff at 38%.
Just 20% of tour operators have borrowed capital (compared with all firms at 25%), and 35% are considering it.
Transport is proportionately the largest sub-sector to have downscaled (66% of the sub-sector) and lowered prices, at 36%.
Source: tourismupdate.co.za
